A reported move by Amazon to take over the streaming portion of Diamond Sports Group’s business is among several recent key developments in the bankruptcy case involving the regional sports telecaster.
That could mean Cardinals and Blues games eventually would be streamed via Amazon Prime Video instead of on Bally Sports Midwest’s service.
Diamond is the TV and video streaming distributor for dozens of teams across Major League Baseball, the National Hockey League and the National Basketball Association, and those games are shown on outlets branded as Bally Sports. But Diamond has come under financial distress in recent years as consumers have been moving away in droves from the cable TV bundle, the core of its business model, to streaming. Diamond said in a financial filing last year that its debt was $8.67 billion.
Bally Sports Midwest — the local spoke on the Diamond wheel that produces Cardinals, Blues and Ƶ University basketball telecasts — lost $13.8 million this year through September, according to a filing in the ongoing Diamond bankruptcy proceedings in a federal courthouse in Houston. That’s after BSM showed a profit of $2.5 million last year.
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The reported this week that Amazon has been in discussions with Diamond to purchase its streaming arm, with Diamond continuing to operate its pay-TV (cable, satellite, etc.) business.
But Diamond currently has the rights to directly sell those streaming productions to consumers with only five of its 11 MLB teams. The Cardinals are not one of the five; for them and the others, viewers must have a subscription to a pay-TV service that carries Bally Sports to access streaming. A vastly larger deal would have to be struck in order for Amazon to be able to carry those contests, and MLB has indicated a strong desire to control those rights.
Also in the past week, reported that an agreement had been reached for Diamond to pay in full all but two of the MLB teams (the Texas Rangers and the Celveland Guardians) it has under contract for the coming season. The Cardinals are among the clubs it said would receive full pay. The next hearing on the matter in the bankruptcy court is set for Jan. 10.
The Cardinals are in the midst of a 15-year, $1.1 billion deal that runs through 2032 for BSM to show their games, with the bulk of that total still owed. They are due to be paid roughly $73 million for next season.
Recent maneuvering in the bankruptcy case seems to indicate that if the plan is approved, there would be no interruption of coverage on the Diamond outlets other than possibly for the Rangers and/or Guardians in the 2024 season after two teams were left to fend for themselves last summer.
MLB does not want a repeat of that and had been pushing the court for a resolution regarding next season by Dec. 31. But recent mediation was termed “constructive” and “productive,” and the judge called the parties’ agreement to not have the next hearing until Jan. 10 an attempt to have “peace in the land.” A Diamond attorney said the conversations were attempting to have “peace break out in the valley.”
Some thought Diamond may shut down after the next baseball season, but that might not be the case. Sports Business Journal said this week that “an arrangement with Amazon would obviously change the calculus. Nothing in Diamond’s plan would prevent it from reaching new deals with its now-current partners, and having Amazon as an investor and distributor would presumably make those deals more appealing.”
A Diamond attorney flatly said in bankruptcy court last week: “We are not winding down the business and liquidating.”
Meanwhile, Diamond has reached an agreement with the NHL to keep televising all 11 of the league’s teams that is under its umbrella, including the Blues, for the entire current season. There had been some concern that the plug could be pulled before that. Under terms of the deal, which still must be approved by the bankruptcy court, the league will take over local rights for next season. This is similar to an agreement Diamond made last month with the NBA for the 15 teams in that league it televises.
So if all goes well, there would be no change to how Ƶ sports fans watch their teams play through the end of the 2024 Cardinals season.