A court hearing scheduled for Wednesday afternoon in Houston that had the potential to bring some clarity for Major League Baseball’s broadcast uncertainty has been postponed 10 days. The purpose for the delay is likely to buy time for an agreement that will “compel assumption or rejection of telecast rights agreements,†according to a court filing late Tuesday.
The Cardinals are not one of the clubs wondering how their games will be televised in 2024 due to its broadcast partner’s bankruptcy case. Diamond Sports expects to meet its rights fee obligations for several teams for at least 2024, and the Cardinals are in that group.
But any sweeping agreement between Diamond Sports Group, Bally Sports’ parent company, and Major League Baseball could include the Cardinals or reveal how their situation will be resolved.
Two clubs, the Cleveland Guardians and the World Series champion Texas Rangers, do not yet know how their games will be broadcast in 2024 or if they’ll receive owed rights fees. Diamond Sports, which filed for bankruptcy this past spring and cited gargantuan debt, reportedly owes the Rangers $111 million for this coming year.
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This past week, Major League Baseball held a meeting with member clubs to detail the ongoing regional sports network concerns. MLB rejected this week an offer from Amazon to take over streaming broadcasts for 11 clubs, an official with knowledge of the decision said. The Cardinals were one of those 11 teams that Amazon had interested in obtaining. The New York Post reported Amazon’s offer was “roughly $150 million.â€
Diamond owns the streaming rights to five of the 11 MLB teams with broadcast agreements. Diamond does not own the streaming rights to the Cardinals; those are partially held by the club. As part of the Cardinals’ current 15-year, $1.1 billion broadcast deal with Bally Sports Midwest, the Cardinals have an ownership stake in their broadcast partner.
Amazon’s offer would have meant a team like the Cardinals giving up their streaming rights as part of the proposed deal.
That was not palatable to MLB or many member clubs.
Major League Baseball has preferred to control those rights instead of a piecemeal agreement with a streaming power like Amazon working toward a global package of games. That would help obliterate archaic blackout rules and also ultimately be more lucrative.
The court filing Tuesday night to delay Wednesday’s hearing was also signed by counsel for the commissioner’s office, the Atlanta Braves, Milwaukee Brewers and Detroit Tigers. The other teams who have a contract with Diamond for the 2024 season are the Cardinals, Angels, Marlins, Rays, Reds and Royals.
Major League Baseball took over the broadcasts for the Padres and Diamondbacks during the 2023 season when Diamond sports stopped making payments.
MLB remains poised to do that if necessary for other teams.
During a hearing in December, an attorney for MLB, James Bromley, said there was a “framework to move forward†and that parties required time to “work through†issues. A “broad and global deal†was being discussed with MLB and the clubs, one of the lawyers told Judge Christopher M. Lopez. An attorney for the Rangers — noting the team’s recent championship run — stressed the need for urgency as spring training neared and both fans and teams needed to know how games would be telecast.
All of this is leading to the biggest question facing Major League Baseball, and that’s how games will be broadcast in 2025 and whether MLB itself can regain rights and pursue a larger broadcast structure for member clubs. Other leagues offer hints of what’s ahead. Diamond Sports Group and the NBA reached an agreement for all games through the end of the current season that included a reduction of rights-fee payments but also assured all contracts would expire at the end of the season and rights return to the clubs.
The Blues are one of 11 NHL teams with Bally Sports deals, and late last month, the NHL and Diamond Sports came to an agreement to guarantee uninterrupted broadcast of games through the conclusion of the current season. Like the NBA deal, the NHL agreed to some reduced fees, but all contracts expire at season’s end and rights revert to the clubs.
The unraveling of the RSN model comes after a decade of wild and exponential growth in broadcasts deals, all fueled by the demand for live programming. Live sports were viewed as DVR-proof and adored by advertisers. The Cardinals were among the teams to capitalize on the era with a new deal that they’re only now halfway through — they’ve yet to reach even the average payment of their 15-year deal with Bally Sports Midwest. The deals hinged on cable subscribers, some of whom paid for sports regardless of whether they watched them, just as a sliver of the cable bill was for news stations others may not have watched. The whole model has come apart with fewer cable subscribers, cord-cutting and streaming popularity.
Another contributor was anachronistic blackout policies that made it difficult for fans to see their favorite teams. Areas of Iowa were de facto baseball deserts — unable to get games from the Cardinals, Cubs, Twins and other clubs in nearby states.
“There is a lot of talk in the owners meetings about cleaning it up. Put it that way,†Cardinals president Bill DeWitt III said a year ago. “It’s a bigger issue than just us. I think these blackout areas are really problematic in baseball, and everybody knows it.â€
The Cardinals’ current broadcast deal with Bally Sports Midwest began in 2018, and the annual rights fees would escalate throughout the life of the contract. The Cardinals received all payments in 2023 after Diamond’s bankruptcy filing, and Cardinals broadcasts have been described as profitable for its partner. Based on the initial structure of their agreement described to the Post-Dispatch by some sources, the Cardinals are due an estimated $73 million in 2024. Broadcast rights revenues and ticket sales are the two leading indicators for the Cardinals’ baseball operations budget and spending on players.
Officials with the team said this offseason that the RSN uncertainty has not limited their investment in the 2024 team, though it has contributed some to the length and structure of recent contracts the team offered. An executive with the team called Diamond’s bankruptcy “a real factor†in the team’s near future.
In December, the judge hearing the case said a delay was worthwhile if it offered a true opportunity to bring “peace in the land.†The rescheduled hearing is set for Jan. 19 at the U.S. Bankruptcy Court for the Southern District of Texas in Houston.