Diamond Sports, Bally Sports, RSN and Leagues

[JB]

This is an absolutely fascinating story for those that follow media, tv and sports leagues.
A few weeks ago, a judge approved mediators to negotiate with creditors in the bankruptcy case of Diamond Sports Group. Which most sports fans know as Bally Sports.
This leads to many problems as NHL, MLB and NBA have many teams tied to these channels.

The story gets much weirder and more interesting though. Diamon Sports now has until the 30th of this month to come up with a reorganization plan for what amounts to nearly 8 billion in debt.

Yet Diamond Sports, which is a subsidiary of Sinclair Broadcast Group, blames the parent company for the problem explaining that their crazy management fees (about 100 million annually) is part of the huge problem, but worse, they accuse Sinclair of causing Diamond to transfer more than 1.5 billion in cash to benefit the parent company. Which began the spiral of these issues.

This is a bigger story than just two huge companies battling it out or a large broadcast company going under. Diamond has already lost some MLB teams. MLB scrambled and got a backup plan in place. MLB says they are prepared and added some talent to their local media branch to take over if this were to just shut down.

Disney, Apple and Amazon apparently are all in the mix of wanting streaming rights of the local teams, but will not be picking up the debt Diamond has on the books. Or so we think. The NBA (shocker), is in the tough spot, because according to some sources, are completely behind on preparation and if the networks were to go dark, would not have a plan in place to broadcast.

The RSN market has been vastly criticized for its faults, but no other solutions have been brought to the forefront and while the NFL and even MLS have gone around this issue, MLB and NBA are still tied to them for the time being.

A suit has been filed it looks like from Diamond Sports against their parent company, which would I believe stave off any further damage, but the time table may not work out. We could end up in a situation where the NBA season kicks off and fans miss a large amount of games depending on region.

 

[TRyan]

This is such an absolute mess.....

 

[MGoBlue]

Interesting problem. NHL is on ESPN+ so no impact for me personally but I hope for those that follow MLB, NBA etc that alternatives are found soon.

 

[JB]

Interesting problem. NHL is on ESPN+ so no impact for me personally but I hope for those that follow MLB, NBA etc that alternatives are found soon.

I might be wrong, but I believe ESPN+ only gets out of market games, so those in market would be impacted on that league as well.

 

[JW Smoove]

Sinclair, ugh. I know that John Oliver is satire, but he does some in depth digging into his main topic each week. Sinclair is a bane on broadcasting and news.

 

[MGoBlue]

I might be wrong, but I believe ESPN+ only gets out of market games, so those in market would be impacted on that league as well.

That could be, but for me, the Red Wings are out of market here in SC so I’m good!

 

[JB]

That could be, but for me, the Red Wings are out of market here in SC so I’m good!

Right. What I am saying in this mess is it is a lot bigger than just not seeing games. These TV deals are how teams get paid, how players get paid, etc. A complete and utter failure in this can lead to catastrophic changes if broadcasts are not paid for or seen.

 

[JDax]

This is a mess for the MLB & NBA.

 

[JW Smoove]

Right. What I am saying in this mess is it is a lot bigger than just not seeing games. These TV deals are how teams get paid, how players get paid, etc. A complete and utter failure in this can lead to catastrophic changes if broadcasts are not paid for or seen.

MASN owned by the orioles had the rights to the nationals. It’s also a mess. And had been in litigation for 10 years or so!? I think it’s a huge impediment to selling the nationals. And the money that’s been held up during all this could easily buy a couple decent free agents.

yea regional is where the teams get a lot of cash. I wonder more about cord cutting, and regionals who may not be ready for those situations.

 

[JB]

yea regional is where the teams get a lot of cash. I wonder more about cord cutting, and regionals who may not be ready for those situations.

Bally Regionals are on multiple cord cutting platforms including Fubo and Directv Stream. They also have their own stand alone service for subscription.

 

[Daluteh]

Just reading this makes it sound messy. I don't follow many live sports (soccer / golf excluded) but for those that do or those companies or whatever it's going to be a dumpster fire it sounds like.

 

[JB]

Sinclair, ugh. I know that John Oliver is satire, but he does some in depth digging into his main topic each week. Sinclair is a bane on broadcasting and news.

Of course he did. He is employed by a competitor who owns the other suite of RSNs. Typical with his reporting...

 

[Scooby45]

Just hope the end fall out is it continues to push sports into subscription streaming models for most of the regular season with broadcast covering the big games.

 

[PPFour12]

The Pittsburgh sports broadcasting market has been a bit of a mess lately as well - specifically the Pirates.

AT&T Sportsnet seems to be dissolving in a lot of markets. I think it’s going to totally dissipate in Colorado, for example. Fenway Sports Group - who bizarrely owns the Penguins - bought the Pittsburgh regional AT&T Sportsnet. So, Penguins broadcasts should carry on per usual.

Of course, the Pirates are a trainwreck organization. It sounds like they have the option of going with this newly purchased AT&T Sportsnet but instead will opt to hand their broadcast rights over to the MLB. But they’d be selling their broadcast rights back at only at 80% return. And the Pirates are already a penny pinching organization.

 

[McLovin]

a reorganization plan for what amounts to nearly 8 billion in debt.

Yet Diamond Sports, which is a subsidiary of Sinclair Broadcast Group, blames the parent company for the problem explaining that their crazy management fees (about 100 million annually) is part of the huge problem, but worse, they accuse Sinclair of causing Diamond to transfer more than 1.5 billion in cash to benefit the parent company. Which began the spiral of these issues.

diamond is $8 billion debt, claiming it's because they sent $1.5b up to sinclair and are paying $100m per year? it'd take 65 years to be $8 billion in debt ($8b - $1.5b = $6.5b / $100m = 65 years). i'm sure the sinclair thing put them behind the 8 (billion) ball, but seems like there's a lot more to the story than that.

 

[JB]

The Pittsburgh sports broadcasting market has been a bit of a mess lately as well - specifically the Pirates.

AT&T Sportsnet seems to be dissolving in a lot of markets. I think it’s going to totally dissipate in Colorado, for example. Fenway Sports Group - who bizarrely owns the Penguins - bought the Pittsburgh regional AT&T Sportsnet. So, Penguins broadcasts should carry on per usual.

Of course, the Pirates are a trainwreck organization. It sounds like they have the option of going with this newly purchased AT&T Sportsnet but instead will opt to hand their broadcast rights over to the MLB. But they’d be selling their broadcast rights back at only at 80% return. And the Pirates are already a penny pinching organization.

Yeah they are dissolving their RSNs.
It appears as though the best biz sports move in history was Rupert selling off the RSNs to Disney haha

diamond is $8 billion debt, claiming it's because they sent $1.5b up to sinclair and are paying $100m per year? it'd take 65 years to be $8 billion in debt ($8b - $1.5b = $6.5b / $100m = 65 years). i'm sure the sinclair thing put them behind the 8 (billion) ball, but seems like there's a lot more to the story than that.

There is definitely a lot more to the story. They are claiming that that put them behind the 8 ball and it snowballed from there.

 

[MattyD-MPLS]

If only they were a way to generate a bunch of money like selling it to streaming services that have 10 million subscribers(roughly) monthly.

With Sling, YoutubeTV and Hulu Live.

 

[Rod Dunlap]

Bally Regionals are on multiple cord cutting platforms including Fubo and Directv Stream. They also have their own stand alone service for subscription.

Yes, but I think Bally really missed the boat on not striking a deal with YouTube TV, Hulu etc. as well as offering an app (that actually works) early on.
I tried to switch to DirecTV stream and it was awful here. DTV customer service blamed my Samsung TVs for buffering issues (that were 6 years old at the time).
So when I bought a new 82" Samsung a weird thing happened... JK nothing happened it was still horrible.

We've advertised with a couple golf shows Breaking Par and Golf Life that broadcast through Ballys.
Leaving lots of shows scrambling.

 

[JB]

Yes, but I think Bally really missed the boat on not striking a deal with YouTube TV, Hulu etc. as well as offering an app (that actually works) early on.
I tried to switch to DirecTV stream and it was awful here. DTV customer service blamed my Samsung TVs for buffering issues (that were 6 years old at the time).
So when I bought a new 82" Samsung a weird thing happened... JK nothing happened it was still horrible.

We've advertised with a couple golf shows Breaking Par and Golf Life that broadcast through Ballys.
Leaving lots of shows scrambling.

D Stream has been great here in our brief move.
They may have missed the boat on Hulu and YTTV, but that isnt entirely on Diamond Sports. Disney offers virtually no RSNs and doesnt appear interested in going that route or making it a very sports friendly offering.

 

[Rod Dunlap]

D Stream has been great here in our brief move.
They may have missed the boat on Hulu and YTTV, but that isnt entirely on Diamond Sports. Disney offers virtually no RSNs and doesnt appear interested in going that route or making it a very sports friendly offering.

Interesting. I wish they were good here. I actually liked the overall set up.

I just think there are a lot of sports guys who would have purchased Bally's app with a monthly subscription.
It arrived way too late and was riddled with problems. I think they could have made a lot of $ with it.
I can't even count all of our subscriptions these days so what's one more.

 

[DataDude]

There is definitely a lot more to the story. They are claiming that that put them behind the 8 ball and it snowballed from there.

It snowballed when refinancing and revolving lines of credit ran into the current interest rate market is my guess. As Warren Buffett said "When the tide rolls out you find out who was swimming naked". It seems a lot of media companies are swimming naked with boatloads of leverage to finance growth in streaming.

 

[Davidhibler]

Wow. What a damn mess. All of my teams are out of market, but this isn't great for locals at all.

Not an NBA guy myself, but hoping they can get something worked out quick because that's a huge market.

Wow.

 

[JB]

Wow. What a damn mess. All of my teams are out of market, but this isn't great for locals at all.

Not an NBA guy myself, but hoping they can get something worked out quick because that's a huge market.

Wow.

NBA is a mess with their TV stuff.
They dropped their league pass 50% last year to get people to consider it. They are giving it away for free this year with a video game purchase and will stay at the 50% cheaper rates for those that dont play video games. They are intertwined with RSNs much like MLB and need to find a taker or they will have to handle it on their own. It is poised for a big let down.