MLB wants their broadcasting rights back, with the Braves being the centerpiece.
Diamond Sports Group, the company that operates Bally Sports, has been in a 18-month-long legal tiff with Major League Baseball in bankruptcy court over its restructuring plans as it desperately tries to reemerge as a viable home for live sports broadcasting via its Regional Sports Networks (RSNs).
The RSN model, as it comes to broadcasting live sports, is one that’s slowly been dying the last decade or so. More and more fans have cut cable out of their monthly budgets in favor of streaming services.
All of this can be a bit confusing for casual fans who don’t really pay attention to all the inner workings of sports broadcasting. Essentially, teams can sell their broadcasting rights to networks, or RSNs. Those RSNs then sell their channel to cable companies (Charter, Xfinity) to be included in their cable bundles. The cable companies turn around and sell those bundles to customers. The RSNs are spending an incredible amount of money to purchase the broadcasting rights from the teams and are spending an incredible amount of money on actually putting on nightly broadcasts (on-air talent, cameraman, producers, equipment, etc.), and try to recoup that money by (1) selling their networks to the cable companies; and (2) by selling advertisements on the broadcasts themselves. Theoretically, because people want to watch pro sports and are willing to pay to do so, the money flowing from those people into the cable providers, and then up to the RSNs, along with any advertising revenue, is greater than or equal to the money going out. That was the theoretical, and highly sustainable, business model.
The problem is the money coming in, well, it doesn’t really equal the money going out, at least not when you take all the finance stuff into account. The RSNs ended up getting squeezed to death on both ends: teams know that live sports are the only thing keeping these networks afloat, so they charge exorbitant amounts of money for their broadcasting rights. Meanwhile, cable companies are losing customers left and right, and can’t afford the same fees networks charge to carry their channel and are constantly trying to pay lower and lower prices — these are the carrier disputes you often see between your cable company and different networks. The carrier disputes themselves may only hasten the cord-cutting, because rather than have an uncertain lineup on a cable package a consumer pays for, they may finally just dump cable altogether.
On top of that, advertising dollars took a massive hit during COVID, as did the whole industry itself when live sports weren’t happening at all, and you can see how this model looks fraught, if not outright impossible, at this point.
Nonetheless, Diamond Sports Group thought they could make it work. They gobbled up as many team broadcasting rights as they could in 2019, acquiring 22 Regional Sports Networks from Fox Sports for roughly $10 billion. The 22 RSNs covered 42 professional sports teams (14 MLB teams, 16 NBA teams and 12 NHL teams). A year later they reached a 10-year deal with casino operator Bally’s Corporation for the naming rights for their networks, and rebranded as Bally Sports. They took on a lot of debt to get all this done — no one had that sort of cash laying around on hand, and certainly not a venture like Diamond Sports Group that was basically created to make this plan work without any other notable products.
Unfortunately for DSG, on top of making a major investment into an already-iffy business model, they also won the award for the most miserable luck along with it. Months after completing their $10 billion acquisition of 22 Regional Sports Networks, a global pandemic hit, shut down all live sports for months, and altered the industry forever. It was unlikely it was ever going to work to begin with, given the debt load that DSG took on, but COVID all but assured it was going to crash and burn. They hung on the best they could for a couple of years but unsurprisingly, in March 2023, less than four years after launching, Diamond Sports Group filed for bankruptcy, crushed by their debts and lacking the near-term revenue streams to pay them off.
And… that’s where we are now: still in bankruptcy court, with DSG desperately trying to come up with a plan that satisfies the judge and their creditors enough to allow them to restructure and emerge out the other side. There has also been a bunch of other nonsense mixed in, too: at one point, about a year ago, while in bankruptcy, DSG actually sued its parent company, Sinclair Broadcasting Co., claiming that Sinclair took $1.5 billion in management fees from DSG that hastened the path to bankruptcy. (The lawsuit ended in a settlement that had about $500 million going from Sinclair to DSG, and not the $1.5 billion claimed.)
While in bankruptcy over these last 18 months, Diamond has relinquished or lost broadcasting rights to 12 of its 14 major league teams. Earlier this month, they told the court that unless they can successfully renegotiate the contracts, they would only show Atlanta Braves games in 2025. DSG did just recently announce they have completed a negotiation with the Miami Marlins for 2025 to add to the Braves, but of course, there’s a lot of uncertainty about all of this because there doesn’t really appear to be a reorganization plan that formalizes much of this, if anything at all, and allows for a path out of bankruptcy.
The Atlanta Braves are uniquely at the center of the legal battle between MLB and DSG. MLB simply wants the broadcasting rights of all its teams back and believe since DSG has missed multiple payments to multiple teams, all contracts should be void and all broadcasting rights returned to the respective teams. DSG holds and wants to retain the rights to at least a couple of teams (Braves, Marlins) and will exhaust every legal recourse at their disposal to restructure around maintaining those rights, as well as rights to the few NBA and NHL contracts they still hold.
The Braves’ broadcasting rights are a massive asset, one of the largest assets DSG currently owns and its why, even if they lose every other MLB team, they’ll try hold onto the Braves to the bitter end. The Braves hold a monopoly over major league baseball in the Southeastern part of the United States and their incredible TV ratings reflect it. They’re also a major national brand because of all the years spent on TBS (the Superstation). It’s no surprise every inkling of a reorganization plan DSG has offered to the courts includes broadcasting Braves’ games in 2025, because if they don’t have that, they don’t have much of anything else. (DSG has not actually filed a reorganization plan in earnest; the latest messaging suggests that they’ll do so in the first half of November.)
Conversely, MLB knows without the Braves broadcasting rights, there’s very little chance DSG could devise a sound-enough restructuring plan to survive bankruptcy, and MLB would get its desired outcome of getting all of it’s team broadcasting rights back from DSG. In fact, MLB has constantly been beating this drum — every time DSG makes a side agreement to shore up its viability, MLB cries about how it’s not enough to keep the company afloat. James Bromley, a lawyer for MLB, acknowledged in court last week DSG’s plan to air Marlins and Braves games in 2025 but also offered that the league “will be fighting Diamond’s continued relationship with the Braves.”
If it seems like MLBs attitude towards DSG is adversarial (if kind of catty and ineffectual), then you would be correct. They have no interest in DSG restructuring and surviving this bankruptcy. They want the rights back, and without a real reorganization plan to sneer at, this is the best they can do right now. Last week when DSG announced they had reached a multi-year deal with FanDuel to take over naming rights of the networks from Bally, MLB sharply criticized the lack of transparency and information DSG provided about the deal. Bromley actually accused of DSG of filing motions in an “ambush fashion” and strongly argued MLB should be involved in any conversations about such things instead of learning about them in court. The judge ultimately agreed and told DSG that as long as they hold MLB broadcasting rights, that MLB is an interested party, and therefore is entitled to all the information they need regarding the deal.
This was not an isolated incident. There have been many notable heated exchanges between the two parties the last 18 months, unsurprising given the two have opposite end goals for these proceedings. We should learn relatively soon how this all is going to play out as a two-day confirmation hearing is scheduled for November 14th. This is where the judge will review DSG’s full proposals and decide if it’s a sufficient enough plan for reorganization to put forth to the creditors.
You can be certain broadcasting Atlanta Braves games on FanDuel Sports Network in 2025 will be front-and-center in that proposal.
As for where to watch Braves games in 2025 and beyond? TBD.