Diamond Sports Group will not broadcast San Diego Padres games after Tuesday, as the media company is expected to miss paying its rights fee by the Tuesday night deadline. Here’s what you need to know:
- Diamond Sports said in a statement the athlete that it “has decided not to provide San Diego RSN with additional funding that would enable it to pay the rights to the San Diego Padres during the grace period.” The company said it was continuing to broadcast matches for teams under its contracts.
- Bally Sports San Diego – San Diego RSN and broadcaster of Padres games – is not part of the Diamond bankruptcy filing because it is a joint venture between the Padres and Diamond Sports. Therefore, Diamond cannot pay against it in the bankruptcy court and there are no bankruptcy law protections that can overcome a missed payment.
- A missed payment by Diamond Sports means media rights are expected to revert to the Padres, as MLB is expected to produce the team’s game in Miami on Wednesday. The league was notified at 5 p.m. ET Tuesday that the payment would not come, and MLB had people in place to be able to handle the game should that happen.
- MLB can’t guarantee that the Padres (or any team that ends up in a similar situation) will make up for lost money, but the league and other teams will support teams like the Padres that don’t receive payments, the sources briefed on the plans tell. the athlete.
How can fans watch Padres games in the future?
MLB will stream Padres games on the MLB TV app for free through Sunday, according to sources familiar with the plans. After that, fans will have to pay $19.99 a month or $74.99 for the rest of the season. MLB also has local media deals with Spectrum, Cox, Fubo, AT&T UVerse and others, which the league plans to announce on Tuesday.
Padres announcers are employed by the team, those sources said, so they should stay the same. It is said that much of the crew will also remain the same.
What then?
Perhaps coincidentally, this news will surface on the eve of Wednesday’s massive hearing in bankruptcy court where Diamond will say it must pay four spreads less than the contracted price due to changing economic conditions. And it’s probably no coincidence that Diamond’s lawyers would almost certainly use the Padres as evidence that the RSN contracts are very rich.
Diamond has stopped paying the Texas Rangers, Cleveland Guardians, Minnesota Twins and Arizona Diamondbacks (a bankruptcy judge last month ordered Diamond to pay half of what he owes until he rules). Wednesday’s hearing will be a duel over the value of baseball teams as media content, and Diamond can confirm his claim that the cut-of-the-cord uprooted old economic models with his decision to walk away from one of the most interesting teams in MLB. – Kaplan
What does this mean for the Padres, MLB
The Padres broadcaster is a joint venture with the team and the Diamond Corporation and is therefore not in bankruptcy. As a result, the Diamond could not afford to cut Padres fees and rely on the automatic stay that applies to all contracts subject to bankruptcy. One source, who has advised some creditors, believes Diamond is sending a message to MLB with the move, as if he was teasing them about how much the Padres lost. This source texted: “The question to ask is, ‘What does MLB do? I mean, they just cost the Padres a bunch of money with no clear way of substitution.
“I would expect MLB to try to launch a new RSN but it’s impossible to fathom that they’re going to get (anywhere) near about $50-60 million a year (they were) getting from Bally. It’s probably half of that and maybe even on a sporting level.”
However, MLB controls the Padres’ digital rights, an advantage Diamond has negotiated unsuccessfully for the past several years. Now MLB can sell all of the Padres’ media platforms, one small step toward its goal of a multi-platform viewing option locally/nationally. – Kaplan
what are they saying
“While DSG has significant liquidity and has made rights payments to teams, the economics of the Padres contract were not aligned with market realities,” Diamond Sports said in a statement. “MLB has forced our hand by its consistent refusal to negotiate direct-to-consumer (DTC) rights for all teams in our portfolio despite our proposal that each team be paid in full for those rights. We are continuing to broadcast matches to teams under our contracts.”
background story
Commissioner Rob Manfred said several times this spring that MLB was preparing for the possibility that it would need to broadcast games, and that the league would eventually be able to handle it.
“We took these preparation efforts really seriously,” Manfred said in February.
“We know we can produce the games if the Ballys aren’t airing. We know we can put those games alongside MLB.tv digitally. And we’re in the process of trying to put in place arrangements that will put us in a position to make those games available on the cable package as well. From a fan standpoint, while no channel might be your traditional RSN, if you think about it from an access perspective, having games digitally available on the market is something fans have been crying out for for years.” – Drillish
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