We are in the midst of a transformative era when it comes to media consumption, especially when it comes to streaming rights versus traditional and cable networks. And with 25 RSNs on the market, we could see MLB make some bold changes to its broadcast model.
In a way, history is repeating itself. Almost 20 years ago several MLB teams, including the New York Yankees (with the YES Network) and Minnesota Twins (remember Victory Sports One?) launched their own cable networks in an effort to boost broadcast revenues. These networks, for the most part, didn’t work very well: while YES is still around (albeit after most of it being sold off), Victory Sports One died quickly after failing to land wide cable distribution. And since then most MLB teams have hitched their broadcast wagons to Regional Sports Networks (RSNs).
But that model may change in 2019. As part of its acquisition of many Fox assets, Disney is selling off 22 RSNs in an auction that could bring as much as $7 billion to the media giant. MLB Commissioner Rob Manfred has expressed interest in acquiring as many of these RSNs as possible. (The Yankees have expressed interest in exercising a right of first refusal on the YES Network in a deal where Amazon is a rumored investor.) By owning the RSNs, MLB would control cable rights.
“Yes, we’re interested in the regionals,” Manfred told FOX Business News. “You know, in 12 markets baseball on the Regional Sports Network is the number one programming throughout the summer. In 24 of 25 markets that we operate in, we’re the number one programming on cable. So these Regional Sport Networks are really valuable, valuable assets and we think that the combination of that traditional mode of delivery and the digital rights that we control is an opportunity for the game.”
This would be just the beginning of the changes to the MLB broadcast model. Right now, the teams are beholden to the whims of the cable system; Las Vegas isn’t served by any RSN carrying MLB games, and Atlanta Braves games aren’t shown on North Carolina cable. Instead of relying on RSNs, MLB would shift streaming rights to individual teams and diminish the importance. Want to see Braves games in Durham? Just subscribe to the Braves streaming service. There would still be an economic benefit to owning an RSN, as MLB games are top-rated events on many RSNs, but there would be a diversification in the revenue model. And teams could also sell rights to other streaming services. More streams of revenue via streaming, you could say.
“Well, I think our fans want to be able to consume the game on the platforms that they’re naturally on…that’s why we have experimented with things,” Manfred added on the FOX Business Network interview. “We had 30 games on Facebook last year. We have a relationship with Twitter. YouTube’s been very active with respect to our product. And it’s important for us to deliver games in the way that fans want to see them.”
It doesn’t sound like MLB is looking to scrap game distribution on the traditional RSN model—far from it. But by centralizing rights and giving teams to set up their own streaming services, MLB foresees a rights model with one foot in the established present while also looking toward an all-digital future where all content is streaming.
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