A major development in MLB’s media future likely hinges on Diamond Sports Group’s fate in bankruptcy court.
In February, Commissioner Rob Manfred said he hoped to launch a national streaming package to market in 2025 with about half of the league’s teams. Achieving this would be a huge deal. Not because it would make a lot of money upfront, or any money. Streaming is often a losing business.
Its importance would rather be within reach. A domestic package would be one of the easiest ways for fans to watch any team included.
But if Diamond and its regional sports networks under the Bally brand manage to emerge from bankruptcy, it will be basically impossible for MLB to launch even a semi-national program as early as next season.
The 2025 calendar may have always been aggressive, but it has a logical origin. MLB would have a dozen teams in need of a new broadcast partner if Diamond disappeared. If Diamond now survives bankruptcy — and that seems increasingly likely — MLB won’t have enough control over teams’ rights to launch a viable product.
Manfred said in February that he would need at least 14 clubs to get started, a figure that could still fall short of sales. But if Diamond were still in business, he’d probably only have nine at most.
There are the three teams whose games MLB itself is producing this season: the Arizona Diamondbacks, the Colorado Rockies and the San Diego Padres.
Then there are three teams whose games are not produced by the league but were released by Warner Bros. Discovery last year: the Houston Astros, Pittsburgh Pirates and Seattle Mariners.
The Cleveland Guardians, Minnesota Twins and Texas Rangers bring the total to nine; this trio is carried by Diamond this year but on one-year contracts, which makes them free agents at the end of the season.
Diamond has a June court date to confirm an Amazon-backed bankruptcy exit plan. If it’s taken down, MLB could have as many as nine additional teams to work with.
But that just doesn’t seem likely. Diamond’s bankruptcy process is entering an advanced phase.
“On something like this, where it appears that most of the major players are parties to a restructuring support agreement…I would say it’s heading toward confirmation,” said lawyer Brian Davidoff, president of the group of bankruptcy of the Greenberg Glusker firm in Los Angeles.
Does this mean MLB is fighting Diamond in court? Not necessarily, and maybe not at all. Team owners generally like the regional sports network model because it usually comes with a long-term commitment and a lot of money. The league won’t mind if Diamond can continue paying his teams for years to come.
But here’s the problem: In court, MLB was very skeptical of Diamond’s ability to do just that.
Comcast stopped broadcasting Diamond channels Tuesday as part of a carriage dispute, leaving fans subscribing to Comcast’s Xfinity service without Diamond broadcasts while the sides fight.
The dispute is driven by the question of what tier of service Comcast offers Diamond RSNs on and how quickly tier changes are made. Teams and leagues want their games to be part of the core service rather than a premium add-on.
“I always thought that in these carriage negotiations, Comcast was going to be the most difficult,” said media consultant Patrick Crakes, who runs an eponymous consulting firm. “They are committed to moving RSNs…to the digital levels.”
Presumably, Comcast and Diamond will eventually reach an agreement. Diamond recently entered into long-term deals with two other major distributors, Charter and DirecTV. One of the key questions facing Judge Chris Lopez in federal bankruptcy court in Houston will be whether the terms of these agreements match Diamond’s projections and overall plan.
Even though MLB doubts Diamond’s long-term viability, Crakes said Diamond’s survival is in baseball’s best interest.
“Given the economic difficulties of standalone streaming, it’s pretty obvious that these regional sports networks need to survive and that distributors want them, and that they are the best way for teams to profit from the local rights paid to them, even if that means no growth, or even in some cases, decline today or likely in the near future,” Crakes said. “And baseball’s behavior says it.”
(Photo: Casey Sykes/Getty Images)