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12 July 2006

Fox/TBS ink new national TV deal

In case you missed it in the past couple of days (I did while I was flying back to Australia - again), MLB sewed up its national broadcasting rights for the next seven years by inking deals with Fox and TBS. The actual money being doled out to MLB by the networks is actually going to be about the same if not less than the previous Fox-only contract. Let's tally up the national TV money:
  • Fox - ~$250 million per year for 7 years. Includes World Series, All Star Game, national Saturday broadcasts, and alternating ALCS and NLCS based on the year.
  • TBS - ~$150 million per year for 7 years. Includes ALDS and NLDS, and whichever LCS Fox does not pick up. Deal includes 26 Sunday afternoon games (new schedule, not the ESPN Sunday night game) per season. Atlanta Braves broadcasts will be reduced, which probably means Turner South will take over many of the Braves' games.
  • ESPN - $296 million per year for 7 more years (new deal started this season). Includes Sunday night and Wednesday night broadcasts along with certain marquee and late season matchups (usually Yankees-Red Sox). Does not include playoff games.
Combined, it comes to upwards of $700 million per year through 2013 ($5 billion total), not including money gotten from the Japanese TV deals, internet streaming through MLB Advanced Media, and various other rights fees. Still, this pales in comparison to the NFL's whopping $3.7 billion per year in national TV rights. Of course, that's comparing apples with oranges since MLB makes up the difference with tremendous amounts of locally generated revenue, including local TV rights.

The news sets the table for the upcoming CBA negotiations, which as mentioned before, are more a battle between big and small market owners than between owners and labor.

7 comments:

Jeff said...

Any idea if they tinkered with the blackout rules? I buy Extra Innings from my Directv and have been disappointed by the rules blacking out games that are not televised locally. I have come up with a solution.....but I'm not sure how long it will work. It seems stupid to negotiate deals and then shoot themselves in the foot over their fee-payer package. You would hope that they would be clever enough to negotiate exemptions for those that pay them $140.00 dollars a year for the EI package.

Marine Layer said...

This would have little to do with the blackout rules because these are nationally televised games. The only times blackouts would apply would be the exclusive Saturday afternoon telecasts and games in which there are both national and local broadcasts.

Jeff said...

That's not exactly accurate with the EI package. On Saturdays (presumably due to the contract with fox) all games before 4pm (west coast) are blacked out. That doesn't make sense to me. Why would you allow that when you negotiate TV deals? Also, why doesn't MLB excercise more control over local TV rights? Presumably the revenue from EI is divided amongst all 30 teams. What's the point of blacking out a customer who lives in Oakland from viewing a game broadcast on NESN when the game is not being broadcast locally? I will never be able to figure out the black out rules....and I have tried!!

Oh well, like I said before, I found a solution, but if it ever fails I will cancel my subscription to EI. You would think MLB would figure out how much money they are losing from this potential revenue stream and act accordingly.

jrbh said...

So what's your solution? That drives me nuts about the EI package too.

If you'd rather respond privately, my e-mail is jrbh@pacbell.net

Jeff said...

jrhb,

I sent you an email....did you get it?

Marine Layer said...

Jeff, you missed the point. These national TV deals, other than the impact of the Fox national Saturday afternoon game, have little effect on local TV schedules, blackouts, and revenue.

The structure of locally generated TV revenue is one that will be up for serious debate in the upcoming CBA negotiations. I'm not certain how the deal works with EI, but I'm guessing that the money gets split evenly among the teams. That raises a dilemma in that a subscriber may be able to get extra games without paying the specific subscriber fee for say, NESN or YES. To combat that, I understand that EI blacks out many A's games that are not covered by A's TV network's schedule. It's unfair to the guy who shells out $140, but until every MLB team has every game (home and road) broadcast, this will continue to occur. And EI does not claim that they show every game. They only claim that they'll show 60 out-of-market games per week.

No other sport has a disparate number of local games broadcast through regional and local stations/networks, so it's impractical for all of baseball's local and national revenue to be pooled and split evenly. The difference can be split, however.

Jeff said...

I see what your saying ML, and I agree. My beef is as the guy paying the $140.00 bucks. MLB is negating their own revenue stream by using archaic blackout rules. Aren't some of the fee's being paid by the subscriber going to the Yankee's who own YES network? If that's the case, then the subscriber IS paying for that portion of their broadcast. In my case, I even subscribe to the sports package which carries YES and NESN. I think we are in agreement in that MLB needs to devise rules that cover broadcasts as related to their EI package. I think the solution would be more central control of TV arrangements. I know that is next to impossible due to regional conflicts as well as the MLBPA. I just hope that Selig starts the ball rolling in regards to a firm overall policy in which the teams negotiate and that the EI customers will be cared for above all other demographics. After all, that is a revenue stream that benefits the entire organization. But realistically, I know your assessment is dead on.