Diamond Sports Group, the corporation which operates the Bally Sports regional networks responsible for nearly half MLB’s local broadcasting deals, has informed the Padres it won’t make its scheduled payment to the club. John Ourand of the Sports Business Journal was first to report the news. Diamond had initially missed a payment a couple weeks ago and had until today to make up the debt if it wished to keep its broadcasting rights.
By declining to do so, Diamond forfeits in-market broadcasting for Friars’ games. Beginning tomorrow, the rights will revert to Major League Baseball. Both Ourand and Alden González of ESPN report that the league will stream Padres’ games in-market on MLB.TV (free of blackout restrictions) at no cost through Sunday. Thereafter, González reports, they’ll be available in-market on MLB.TV for either $19.99 per month or $74.99 for the rest of the season. In addition to the blackout-free streaming options, MLB is expected to make the games available on various non-Bally cable platforms.
Diamond filed for bankruptcy in mid-March, calling into question its long-term ability to honor any of its broadcasting deals. The company had held onto all of its contracts thus far — it missed a payment to the Reds but salvaged the deal by upholding its commitment during the grace period a few weeks later — making the Padres’ deal the first to fall through.
The Padres’ contract with Diamond runs through 2032, according to Ourand. It’s a $1.2 billion deal which Diamond asserts has proven unprofitable. It will let it lapse as a result; in a statement to Sports Business Journal, the company said “the economics of the Padres’ contract were not aligned with market realities” and excoriated MLB for what it called the league’s “continued refusal to negotiate direct-to-consumer (DTC) streaming rights for all teams in our portfolio despite our proposal to pay every team in full in exchange for those rights.”
Padres’ CEO Erik Greupner provided González with a statement as well. “The Padres are excited to be the first team to partner with Major League Baseball to offer a direct-to-consumer streaming option through MLB.TV without blackouts while preserving our in-market distribution through traditional cable and satellite television providers,” it read in part. “Our fans will now have unprecedented access to Padres games through both digital and traditional platforms throughout San Diego and beyond.”
According to both González and Jeff Sanders of the Union-Tribune, San Diego’s on-air broadcasting staff will remain in place. It’s not yet clear whether the pregame or postgame staff might be affected by the shakeup. What is apparent is that access for fans in the San Diego area will be greatly expanded with Bally forfeiting its unilateral in-market broadcasting rights.
To this point, the Padres are the only team for which that is the case. They’re not likely to be the last, however. Diamond’s ongoing bankruptcy case is set for a pivotal hearing tomorrow. Diamond has been paying the Guardians, Reds, Twins, Rangers and D-Backs at lower than contracted rates since filing bankruptcy.
Those clubs are pushing for payment of the overdue rights fees or the severing of those contracts; Diamond has argued for the court to restructure the deals to more closely align with their current market values in light of rampant cord-cutting that has devalued the cable market in recent years. Evan Grant of the Dallas Morning News and Paul Hoynes of Cleveland.com each write that league officials aren’t anticipating an official ruling from the court during or directly following tomorrow’s appearance; nevertheless, tomorrow’s hearing sets the stage for a key ruling down the line. In the interim, Diamond will maintain its slate of non-Padres contracts.
Yes!!!! Hahaha Yes!!!!
Twins are a Bally station, which mlb has already set deadlines for… so ya can’t say all of em (I really, really hope).
Diamond needs to just give up.
Blackout deals are also ridiculous. A fan has to pay $150 a month to a cable provider for 3 hrs of programming 162 days a year. So dumb, someone would pay to watch commercials for shows.
More people might like cable if you could watch every property owned by all the companies without on demand with out commercials. Oh it’s called streaming and you can do that for $75 with a click of a button to cancel if you don’t like something (cable takes about an 8 hour phone call along with uncancellations and hidden fees)
The funny thing is that you still need to pay a broadband provider for internet service which usually ends up being your local cable provider or Fios. That runs close to $100/mo. Then you add the $75 streaming package on top of that and you are at $175/mo now with less channels than cable used to provide you. They get you no matter which direction you go.
Ok, but is anyone really going to be paying for internet service they didn’t already have? It’s not like that’s an additional cost for anyone.
I can’t speak for others but Optimum on Long Island is phenomenal. As Dorothy posted, you still need Internet. My employer pays that portion of my bill but by bundling, both my employer and I pay less than if we separated things. Add in as a Sox fan, I stream the MLB package for no additional charge as a T-Mobile customer. When the discount ends I call and speak to the retention department and work out another discount. My total bill got lowered $55 three weeks ago and my WiFi went from 200 speed to 1gig. My total bill including four tvs, Internet and home phone is $202 a month (taxes included) and my employer pays $105 of that. Not everyone has a work at home situation but at least with Optimum, they are negotiable.
That assumes that is the only reason you have internet. If you divide the cost of the internet expense amongst work-from-home, gaming, internet TV, and any other uses it is not nearly that bad and you don’t have deal with cable companies which is a huge plus in its own right.
You pay $100 per month for internet? Why? I pay T-mobile $35 per month and get 350 mbps. Even if you don’t have their phone service its only $50 per month.
Streaming isn’t just $75
Funny that the Padres are happy to see the deal expire. And now I suppose fans can see the games easier
Actually they are screwing the fans. I have a MLB.tv subscription and pay $150. They just blacked out my subscription in the San Diego market and are making us pay an extra $20 a month or $75 for the rest of the year on top of that.
That’s total BS.
That’s not true
If you are in the San Diego market, the Padres were already blacked out. No clue what the hell you are lying for, and that isn’t even what the announcement means, if you already have it you’re fine.
If you are in market, you were already blacked out on MLB.TV. All local teams are blacked out on MLB.TV. I live in Texas and can’t watch the Rangers or the Astros live. I can however go back an hour-and-a-half after the game ends once it has been archived and watch the game.
You will have to pay a $20 fee extra to watch in-market games now that this is happening, which is cheaper than the situation before. For example if I want to watch Rangers games, I’d have to have cable to get Bally on top of what I already pay for MLB.TV. I would/will happily pay an extra $20 to watch in-market games on MLB.TV.
I live in Texas and like you cannot watch live Rangers or Astros on MLB.tv. I see zero reason to pay for that. I just personally do not enjoy watching them after they are over. Plus, if they play a night game on the west coast the earliest you can watch it is after midnight. I just use free third party sites. Have for years. I would pay if they got rid of the blackouts, which are stupid.
The deal did not “expire”, the rights reverted to the Padres when Diamond Sports missed a rights payment.
And how is this “screwing the fans”? Major League Baseball faced the prospect of a member club with big-name stars not being seen on local TV in its home town. Props to MLB for stepping in when it did.
Right on, now I can watch in the market or out of the market. So when I’m in Trader Joe’s and Sprouts or in the parking lot, I can follow my Friars…whohoo!
So stoked! True fans have needed this forever… and new fans will pop up as a result. All San Diego fans are in a win/win situation; I hope this spreads to all fanbases. Cheers!
So what does this do to the Padres themselves and the revenue it generated to pay all them contracts?
Ownership has lots of cash.
They should be able to figure out fairly quick what their share of the pie from MLB will look like. Also, there are a couple expiring deals upcoming.
Maybe one or two trades happen if the team continues to underperform through the deadline, but, there’s lots of baseball left.
But you have to feel bad for San Diego a little bit. The owner finally went way above and beyond this offseason trying to build a winner. A lot of their big contracts were signed based on the “guaranteed” $1.2B long term cable deal they signed with Bally. Now they are back to square one with MLB (Manfred) running the show. It will be very interesting to learn how much less they will make under this new deal and how it affects overall spending on the team going forward.
MLB doesn’t own the Padres broadcast rights and Manfred will not be in charge. The Padres own their broadcast rights and owned 20% of the Bally Sports San Diego station.
From what they are saying on sports radio here, they have already negotiated deals with all the carriers that carried Bally Sports previously plus YouTubeTV.
MLB.com and MLB.tv will stream Padres games through June 4th when the carriers are expected to be able to dedicate a channel to them.
After that Padres fans around the country will be able to buy a one team package on MLB.tv to stream games for $19.99.
The TV deals they have already negotiated and streaming on MLB.tv increases the Padres TV household penetration from “approximately 1.130 million homes to approximately 3.264 million homes”. The 2.131 million more TV households they can now reach makes the Padres broadcasts more valuable to advertisers. The Padres get 100% of that advertising revenue and a portion of the money for single team packages on MLB.tv, not just the $60 million they were getting on their deal with DSG.
This is a great thing for the Padres and for local Padres fans.
Padres fans in San Diego will have to purchase the $19.99 single team package from MLB.tv even if they already have the full out-of-market package.
“The new arrangement gives fans the option to watch on television or stream digitally without local blackouts”
mlb.com/padres/news/mlb-to-produce-broadcast-padre…
mlb.com/padres/schedule/programming
Cool, that’s more options not less given that it will still be available on local TV per the announcement.
Well informed PadsFans, thanks for the info!
It will go up long term. After getting their first check of the season, the Padres will miss one. Then revenue from all the outlets they have already negotiated deals with will start to kick in. They have increased their possible TV households from 1.1 million to over 3 million so TV money will not be an issue long term.
So the potential market has gone up, from what you say, by 1.9 MM. Of those who weren’t watching, how many will be willing to pay $20/month above what they are paying now for TV, to start watching? I don’t believe that it will be as high a number as you think. Some current watchers may drop due to the added cost.
Sounds like they will be able to watch it through other streaming/cable providers: we shall see but yes the for sure option we know about will be for $20s
From what those articles he linked said, if you live in their TV territory you can watch on those satellite, cable, or streaming options where Bally was available before OR if you don’t have one of those TV options you can purchase the single team IN-MARKET package due $19.99.
The Padres apparently added areas to their local broadcast that were not covered by Ballys too like Hawaii.
Sounds like the company has made poor decisions and wants MLB and/or courts to bail them out of those decisions. I can see where they are coming from trying to get MLB to do some things differently but still, it’s their own fault. Businesses need to face the consequences of their poor investment decisions (except for banks of course, and those businesses that are “too big to fail”).lol.
Exactly. Capitalists love capitalism, until they’re on the wrong end of the deal. Hence small business owners who rip the government with their hands out for PPP.
Oh, it’s you. And socialists love socialism as long as someone else is paying for their benefits. I’m a small business owner and I didn’t put out my hands for PPP.
Called it.
Now. Where are the various Pads fans that kept telling me Diamond wouldn’t forfeit the Pads rights deal because it wasn’t so underwater and that it would be one of their best performing assets?
I dunno where they are dude. . Once you are done patting yourself on the back go out and find them and report back
One of the best reply’s I’ve ever seen on here.
Bally Sports is pure booty juice yo.
Bally Sports dropping the Padres quick – but not as quick as the Padres dropping down the NL West standings
wow. hilarious.
If I understand correctly, the Padres have already negotiated deals to carry their games with Cox Cable, Directv, and Fubo with Spectrum, Dish/Sling and YouTube TV expected before the end of the week with channel numbers to be announced by Friday.
I am 3000 miles away so forgive the question. Were their games on Bally Spurts carried locally by all those sources?
Gave your post a like for “Bally Spurts”.
To answer your question, Bally Sports was carried on Cox, DirecTV, Dish Network, Spectrum, and Fubo TV in San Diego County.
.
Forgot AT&T Uverse.
Dish didn’t carry Bally Sports and won’t air the Padres now. Dish has taken a hard line against the RSN business model.
Like I said, the Padres added a few more providers. You will get a notification from Dish about what channel the Padres will be on by the end of the week.
This is not the RSN model.
Did you actually read the official announcement? Dish is NOT carrying the Padres! That is because Dish CEO Charlie Ergen has spoken out against the high cost of RSNs.
The only provider that’ll air the Padres now but didn’t before is Oceanic Spectrum in the state of Hawaii.
I saw Dish on that list they posted originally and it was mentioned all over sports radio today too. The Padres changed the graphic. The new station is not an RSN, it’s just the Padres and Dish carries other sports programming. YouTube TV is also expected to carry the games.
Now are you finished being a jerk? The information is still coming in hot and heavy about this so cut people some slack.
This is so exciting.
Enjoy not being able to watch your teams! A thing called blackouts, is MLBs favorite tool.
So it looks like MLB is setting the price for watching in-market teams at 20 bucks per month…
Fubo is only charging me $14 per month to get Bally Sports Southwest.
The first domino falls. Interesting though because the Padres deal with Bally/Diamond looks to be worth $100M+ per year. I get why Bally might have wanted out of that, but hard to think the Padres will get anything close to that from having MLB take over their local broadcast.
Have to wonder what that means for the other teams in Bally’s RSN’s. Bally appears to still be paying my Tigers their full fees. That tells me Bally sees their deal with the Tigers as profitable, and also a lot less than what they were paying the Padres. But there are a few teams in the RSN’s that are not getting their full fees so they seem to be next on the block.
The one good thing that might come of this whole debacle is that more people will have a direct streaming option. With more people cutting the cord (preparing to do that myself) that is an absolute must in order to reach fans and get new ones. We have a direct streaming option in Michigan that launched last year.
FWIW, my guess is that it is just a matter of time before Bally/Diamond is no more and MLB takes over all the local broadcast.
No it’s not worth 100m a year. Believe it was a 20 year 1.1b deal. More like 50m per, escalates so the lower years were already paid.
So now that the Pads are not getting $1.2 billion, there will be the inevitable sale of the team before the big money comes due, just as I predicted all along. We have seen it happen before.
Did you just throw your shoulder out patting yourself on the back? Look up and down these message boards. You are just one of many of MLBTR’s sports prophets.
“Those who do not know history are doomed to repeat it.”
Just common sense to anyone paying attention. No need for any back patting due to that.
It also blows the large market apologists saying SD proves a small market can spend money after it comes out their local TV deal was 1.2 billion. That’s an influx of cash most local “small market” TV deals don’t provide. Exactly why Bally failed to pay them first. It’s not brain surgery, folks.
Every local TV deal in the nation is more than $40 million per year. The Padres was $50 million AAV after the previous owner was given $200 million cash upfront to buy him out. 20 years/$1 billion to the team.
The Reds are getting $50-60 million per season. nexttv.com/news/reds-ready-to-go-it-alone-sans-bal….
Twins are $40M/yr; They haven’t been paid their full rate thus far this year, and the ruling may come as early as this afternoon. Also, the Twins contract with Bally’s is up after this season (not sure of status of Wild or ‘Wolves contracts).
Then again, the Dodgers get 230 million, Yankees earn 143 million, the Angels 138 million, the Braves get 100 million, etc. by teams who don’t have to invest a lot in things like scouting and player development like two thirds of baseball because they can just go buy players.
Sadly, you do not know history or the present.
Wow! O for 4. A golden sombrero for you.
Blackout rules are B S, I live 6 hours from Baltimore/DC yet when my team plays them I can’t watch the games dues to regional blackouts. I have no access to MASN unless I want to deal with DTV and pay extra for their Sports package on top of MLB extra innings…. And now they add Peacock, Prime and Apple TV games and scr#w us more…. No thanks.
Off topic but related to Pads – noticed Iglesias is back in El Paso on minor league contract.
Opt out made the board but not the resigning.
the economics of the Padres’ contract were not aligned with market realities”
And yet you signed the contract. Why won’t it surprise me when a taxpayer bailout is incoming.
They’ll be no bailout for a failed media company. There’s plenty of them and viable options past Diamond. We’re about to see that.
The contract was signed in 2012, before the networks were sold to Disney and then the government forced them to sell to Sinclair.
The government didn’t force the sale to Sinclair/DSG.
I was wrong. When FOX was sold to Disney for $71.3 billion, they were forced to divest of the RSNs.
variety.com/2019/tv/news/sinclair-closes-purchase-…
What I find interesting is that the RSNs were valued by Murdoch at $4.1 billion in their sale to Disney, almost purchased back by Murdoch for $3.6 billion, and then sold to Sinclair for $9.6 billion.
Sinclair then created a subsidiary, DSG, and assigned the RSNs to DSG to shield themselves from liability for the $8.3 billion in loans they took out to buy the RSNs from Disney. Its almost like they knew it was a bad deal at $9.6 billion to start with.
First domino of many to fall, NFL has produced their own games for years. Cable model is dead, if MLB handles production, they can cut out the profilt-taking middleman and become more agile and attractive to broadcasters.
The NFL only has to broadcast 16 or 17 games per week. MLB’s schedule simply doesn’t fit with the NFL model.
Still, there are improvements that could be made.
Blackout rules are effing stupid. I live in Southern Arizona. So for some stupid reason, D-Back AND Padres games are blacked out.
Orsillo will have to cut back on his bronzing when the money gets tight.
He’ll have to sell the tanning bed AND cut back on cookies. He’ll still be the best announcer in MLB though. =)
Except for when a pitcher throws a 100 mph fastball and Orsillo refers to it as a “hundo.” That’s rather annoying.
TV deals need to be short. It is too much of an evolving market to have a 20 year deal. It’s ridiculous. Whoever makes such an investment is probably going to regret it and fans are not going to have as many options as they should. So I’m curious to see what the future holds with all that’s going on. Technology is progressing exponentially. Business contracts shouldn’t interfere with expanding what we can do.
Reading The Athletic and saw an interesting comment. Not sure how accurate it is, but it meshes with other things I have read.
“The Padres and MLB were prepared for this because they negotiated deals with all the providers that carried Bally Sports SD plus a couple extra to carry the Padres games going foward. They had all those agreements in hand prior to DSG announcing their default.
The Padres also expanded the number of TV households that can now get the local/ in-territory games from around 1.1 million to over 3.2 million.
That does not include the number of in-market, single team MLB.tv accounts they will sell at $19.99 per month.
The Padres already recieved the 1st of four payments this season that they were to receive from DSG for their broadcasting rights. MLB will cover the 2nd payment that was due. Because of the increased TV households the Padres live broadcasts on cable, satellite, local streaming will now reach they are expecting to bring in more revenue between when the next payment would have been due in late-July and the end of the season than their joint venture with DSG would have produced.
This whole situation is a testament to Sinclair’s failure to read the market and adjust.”
Like I said, interesting.
Of course, there is the hanging question….
Just because they expanded this territory, will those people even care at all about SD baseball?
It is the Padres home market, so the answer is yes, some will. Not everyone cares now even on the TV providers that used to carry Ballys. Not everyone is into baseball.
Bloomberg reported this morning that MLB.tv had 70k subscribers in the local market to the $19.99 Padres package already, so for Padres fans this will be huge and the number of people watching will increase. Remember, those are pretty much ONLY people that don’t have cable, satellite, or live streaming TV like Fubo or YouTubeTV that have never been able to watch the games before because of blackouts of local broadcasts.
Everyone that has cable, satellite or live streaming services will still be able to watch and they will have several new providers available that they didn’t have before. This is awesome news for Padres fans and for the Padres themselves.
Best possible scenario.
For a baseball team that airs games on FM radio, a signal not received in my area, they’ve made some poor media choices.
I cannot sit in front of a screen to watch games anyway – I have a life. They should fix the radio deal, go AM and I might follow them enough to feel like watching occasionally is worth the investment.
Audacy carries all the radio broadcasts of Padres games. You can listen anywhere you have data on your phone or internet access.
I have T-Mobile for my phones and they offer for the last 4 or 5 years MLB free to watch games. I would never leave them. So I can watch the Yankees live or on delay in Houston as I live in Houston area but, don’t support the Houston Cheaters.
The beginning of the end for Black Outs!!!!! Lets Go!!!
Would be nice if MLB.TV could pay the TV providers a portion of the fee they pay the teams to release the black out restrictions on streaming while leaving the black out restrictions for those who haven’t cut the cord. might work for those companies that are feeling the hurt now that more people are cutting the cord.
I was in a weird pickle for a bit there. I was in black out territory for 4 teams at the same time. Not sure if it was a screw up or if they actually overlapped but my neighbor was the same. Seems to just be the one team now.
I’ve heard there are some cities that offer a $20 streaming package just for the local team’s MLB games, but my city is unfortunately not yet one of them.
yeah.. $20/month is a bit steep If i just wanted to watch baseball.. but then again i did pay for hulu just to watch letter kenny so.. i guess it isn’t the worst thing in the world,
I wish the Cardinals weren’t profitable for Bally.
Hopefully the Twins will be set free soon!
That’s great for Padres fans! Now please default on your payments to the Cardinals next so I can finally watch more than the rare game on TV without going back to cable or buying a ridiculous $80 / month AT&T streaming package that I wouldn’t use for anything else.
They already said the were keeping the Cardinals because it’s a profitable contract
Something is fishy with this Bally Sports purchase and subsequent bankruptcy. Sinclair is the largest local news station conglomerate in the nation. They know the regional tv business. I don’t believe they missed this bad on Bally.
They missed badly on cord cutting. They needed the millions of cable subscribers who don’t actually watch sports funding their contracts.