Tuesday, the company that runs the Bally sports net TV channels filed for bankruptcy. Here's why that might end blackouts of local sports streaming.
Regional Sports Networks, or ""RSNs"" are TV channels that broadcast games for local teams in a market. So, for example in Detroit, the RSN has Tigers baseball, Pistons basketball and Red Wings hockey. NFL uses national broadcasters instead of RSNs.
Regional Sports Networks are usually available on the local cable TV system but they aren't always available on streaming TV services like YouTube TV or Fubo, because of fights over carriage fees. And the big sticking point is those RSNs block their local games from being used in "league packages" like NHL on ESPN+ or NBA League Pass. So, for example, if you subscribe to MLB.TV, to "get all the games" and you live in Detroit, you will get all the games except for the Tigers, who play in Detroit. For that, you're expected to pay for cable and watch the Tigers on Bally Sports Net there.
That might be ending.
How Did We Get Here?
Quick catch up. The largest collection of RSNs used to be called Fox Sports Net. When Fox sold large parts of itself to Dinsey, it technically sold the regional Fox Sports Net channels (not the national ones). But regulators were worried about Disney owning those and ESPN, so forced Disney to sell them. Sinclair Broadcast Grup, whcich operates local TV channels and radio stations, bought Fox’s Regional Sports Nets.
Sinclair had to pick a new name, so it sold the right to Bally Casino and called the RSNs Bally Sports Net. Sinclair grouped them together in a subsidiary called Diamond Sports Group.
You the viewer only noticed that the name changed to Bally and maybe that it disappeared from YouTube TV or some such service because of fights over carriage fees.
Executive Maneuvers
What you may not have followed, is some executive moves. Two people are key to understanding this and they both used to work in RSNs.
The first person to focus on is David Preschlack. He was once president of Comcast's RSNs. In May, he joined the Diamond Sports Group's board of directors. In September Diamond looked into a sale but couldn’t find a buyer or didn’t find an offer it liked. But it kept losing money, because sports rights are expensive, streaming was undermining cable, and streamign TV services didn’t want to pay big fees. In fact some cable suystems like Dish didn’t want to pay big fees. Sinclair needed to be protected from this risk and creditors wanted a plan. So in December, Diamond Sports Group's board voted to block Sinclair from having any input into its day-to-day operations and the company's creditors named Preschlack as CEO.
OK. Now to the second person to focus on. Billy Chambers was once an executive at Fox Sports Net, both before and after the sale to Sinclair. On February 1st, Chambers started work as EVP/Local Media for Major League Baseball. Except MLB doesn't have any local broadcasts. They all come from RSNs. So why did they do that?
The Plan All Along?
Sports Business Journal thinks Chambers job is to prepare the way for MLB to get its local rights back. In fact at a February owners meeting, Baseball Commissioner Rob Manfred said that if Bally ran into trouble, MLB would be willing to step in and "make games available not only within the traditional cable bundle but on the digital side, as well." MLB handling digital local broadcasts? That would be Chambers job.
The plan is coming together
Tuesday Diamond Sports Group filed for chapter 11 bankruptcy. It will further separate itself from Sinclair Broadcast Group to become an independent entity. That will make it easier to sell or carve up without hurting Sinclair. MLB could buy Diamond, then work with the NHL and NBA (and other sports) to divvy up those parts fo the business. Or Diamond could just sell its baseball rights to MLB. Either way, if MLB got their local broadcast rights back from Bally, which has the majority of them, it would make it easier to negotiate the remaining baseball rights which are held by a few channels owned by Comcast and Warner Brothers Discovery.
That would let MLB do what Major League Soccer has done and stream local games in local markets without blackouts. Which, you know, could lead to MLB's streaming package being attractive to Apple. But also maybe to ESPN for ESPN+ which already has done this with the NHL, minus local broadcasts. MLB will have options.
And fans will complain that they can’t get their local games the same way they used to. Until they get used to it.
But whatever happens, RSNs are going to disappear from cable soon, putting another nail in the linear cable coffin.