What Does Bankruptcy of Bally Sports' Parent Company Mean for the Twins?

[Cody Christie]

The Twins are entering the final year of their current television contract, but Bally Sports' parent company recently filed for bankruptcy. What does this mean for the Twins and their fans?

Image courtesy of Jeffrey Becker-USA TODAY Sports

Diamond Sports, the parent company of Bally Sports North, filed for Chapter 11 bankruptcy protection earlier this week. In a statement, they said the regional sports channels would continue to operate, but that might not paint the complete picture of fans' ability to watch games this season. There are long-term ramifications that will impact the way viewers consume sports on television. 

What's the Problem?
Diamond Sports purchased the regional sports networks at a time when customers continue to cord-cut and search for streaming options. With fewer viewers, there is a decrease in revenue from ad sales and cable contracts. Baseball has relied on regional sports networks for decades, but fans aren't paying for traditional cable packages. Some teams lose money annually, which doesn't help Diamond stay profitable. 

According to the New York Post, Diamond plans to reject the contracts of four teams that cost more to operate than they bring in with cable contracts and ads. Luckily, the Twins aren't among the four teams operating in the red. Currently, the Cincinnati Reds, Cleveland Guardians, San Diego Padres, and Arizona Diamondbacks are the teams most likely to have their contracts rejected due to bankruptcy proceedings. The Padres lose the most money at $20 million annually. 

Plans have yet to be finalized about how to deal with MLB's archaic blackout restrictions. Currently, out-of-market games can be streamed on the MLB.TV app, but that doesn't help local markets. MLB is losing exposure with cable companies not carrying games and fewer fans attending games.

What's the Solution?
Major League Baseball has known for quite some time that Diamond Sports was in financial trouble. Last month, the company missed an interest payment of nearly $140 million to creditors. MLB jumped into action and hired former regional sports network executives, so they could take over broadcasting duties if necessary. MLB did try to acquire the rights to all 14 regional sports networks, but Diamond turned down the offer. 

MLB plans to take over the local broadcasts of the teams being dropped by Diamond and stream games for free in those markets. They will try negotiating with other cable companies for lower contracts, but there is no guarantee that another company will be available on short notice. MLB plans to offer a streaming service for around $15 per month if a deal is reached. Eventually, this time of overarching streaming service is baseball's best bet to help the game to grow in a cord-cutting culture. 

How will Bally Sports' bankruptcy impact the Twins?
Diamond plans to continue broadcasting games for teams earning them a profit, so there will likely be little change to how fans consume games in 2023. At TwinsFest, Dave St. Peter told fans that the issues with Diamond are "not a risk to short-term production and distribution of Bally's broadcasts." The Twins' deal with BSN ends following the upcoming season, so many eyes across baseball will be on the Twins and how they proceed before the 2024 season. 

Minnesota's current contract is for 12 years and $480 million, which pays the club around $40 million annually. For comparison, the Padres signed a 20-year deal in 2012 with average annual payments in the $50-75 million range. Historically, the Twin Cities has fewer people utilizing cable services, resulting in smaller television deals for the Twins. Minnesota is the only current MLB negotiating with Bally Sports, which can be a commitment for a decade or longer. If BSN isn't an option, the Twins can look to other regional sports networks like Comcast or AT&T. 

In the next decade, MLB viewership will continue to evolve, and this is one of the first steps in the process. For 2023, Twins fans should be able to continue to watch on Bally Sports North, with MLB providing backup services if BSN fails to meet its contract. 

How do you plan to watch Twins games this season? Will the Twins find a different network for 2024? Leave a COMMENT and start the discussion. 

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[HerbieFan]

Blackout rules for mlb.tv might not be THE stupidest thing in professional sports but it's right up there.  Let's see....your sport is losing popularity.  So....let's make it HARDER for fans to see their team play.  Genius.

[Bodie]

And the fact that you can't stream local radio broadcasts of games at all..

How can my favorite sport and entertainment keep making not just the wrong decisions to improve its popularity, but be 180 degrees off time after time?

And don't get me started on 9pm starts for team USA in the WBC...

[chpettit19]

9 minutes ago, Bodie said:

And the fact that you can't stream local radio broadcasts of games at all..

How can my favorite sport and entertainment keep making not just the wrong decisions to improve its popularity, but be 180 degrees off time after time?

And don't get me started on 9pm starts for team USA in the WBC...

MLB doesn't have the radio broadcasts for free, but for $30 a year you can stream every major league game radio broadcast with no blackout restrictions. That subscription also gets you video streaming of minor league games. I'm not defending MLB cuz they've been awful at promoting the game and making it possible to watch local teams, but they do alright with the radio broadcast streaming. Not to mention iHeart radio is free and you could stream the radio broadcast through that easily.

[LewFordLives]

AT&T Sportsnet was part of the Warner-Discovery merger. They've already said they are getting out of the RSN business.   The old model is all but dead.

[AmesFan]

My TMobile cellular plan is providing MLB TV as a perk to use their service. They did the same last year, also. Living in Iowa, I’m subject to blackouts, but I have a VPN (virtual private network) to get around that issue. 

[Joey Self]

I have the Extra Inning package, so I get 26 of the 30 teams--I'm blacked out of Houston, St. Louis, Kansas City and Texas (even though I'm over 4 hours from the closest stadium)--unless one of those 4 are playing one of the 26.   I can, however, see the blackout games an hour and a half after they end.  So, to see those 14 KC games and the 15-17 with the others, I will either wait and see them the next morning or go to https://mlb66.ir/simulator to watch them live on my laptop. 

 

I don't get about 1/5 of what I pay for with Extra Innings because of the blackout rules, but I can't make myself go to the bootleg site full time.  At least not yet. 

[TaterTot]

Would the twins possibly starting their own network be an option? I believe they tried that sometime in the early 2000s.

[roger]

Gonna be interesting.  I guess we will have to wait and see.  Or not.

[Loosey]

Has anyone actually ever tried to ask MLB for their written consent to broadcast the game?  Maybe they just say “go ahead”.  

But seriously, $40M a year in the grand scheme of things isn’t that much. Honestly in the world of steaming YouTube should try to get a contract for every team currently with Bally’s.  I know grandma and grandpa will be confused how to watch a game but I think the handful of games they produce are pretty good. If they get rights to every game I think they could invest in more interactive type of content.  With that sort stuff they could add in stadium type stuff when you have the you tube app on your phone and your at the game.  I think Ballys going bankrupt could offer MLB the chance to really change the way a game is broadcast.  MLB has a chance to be ahead of the curve in the way a baseball game is aired.  One idea that current play by play guys would hate, is let people use YouTube’s stream and individuals broadcast the game on their own YouTube channel.  Imagine TwinsDaily having their own writers calling a game.  It would sort of be like Manning cast, but anyone could do it!  Covid showed us you don’t HAVE to be at the game to call it.  

[Richmond Dude]

Does anybody know the status of the BSN contracts with the Wild and Timberwolves?  That would have to play into this in terms of making their own network work.

[dxpavelka]

It means that the 150 games a year we've been able to watch for free for the last few decades will no longer be free.  OK, maybe they haven't been free.  They've been factored into our cable cost.  But at the end of the day they WILL end up costing you MORE.  Which MIGHT be fine.  The majority of folks who will read this have spent decades begging for the team to spend more.  Here's our opportunity to contribute more so they CAN spend more.  We should all be ecstatic.

 

[Riverbrian]

How many customers? 

How much do they spend? 

If a business doesn't have many customers... they must get them to spend more.

If customers are not willing to spend more.. then you need more customers,

Major league baseball chose to limit customers and they did so they could extract more money from those limited customers. 

The very nature of a blackout is a restriction. It's saying... you can't watch. They said... I'll take the money and agree to restrictions that limit the cumulative audience and now that revenue stream is at risk and they don't have the cume necessary to replace the revenue. 

Baseball should have been chasing cume all along. Consumers are spending less time (and money) with the product and that less time must be replaced by more people to compensate for it. They are on the cusp of demographically aging out.

We are watching the much needed overdue transition. Baseball is trying to figure out how to reach more consumers. Baseball needs to be everywhere the people are. It needs to repair the damage done 

 This could be painful for us old folks but baseball needs a larger audience. They always have. 

[adjacent]

Well, in the end as always, we will end up spending more, and quite a bit more. Right now, nothing is free, we pay for the cable subscription. But in that way we get all the sports. In a couple of years, we will have to have a subscription to watch baseball, another to watch hockey, another for basketball, another for soccer, and so on. So, business models continue to evolve to squeeze every penny out of us.

[jmlease1]

8 hours ago, Richmond Dude said:

Does anybody know the status of the BSN contracts with the Wild and Timberwolves?  That would have to play into this in terms of making their own network work.

The Wild & Wolves are an important part of this equation; having pro baseball, basketball, and hockey all on the same network made it more attractive to cable and satellite systems and positioned it to command a better rate. if that splits off? That influences streaming as well. Much easier to sell a streaming service that bring all three sports to the table than just one.

[Twodogs]

4 hours ago, TaterTot said:

Would the twins possibly starting their own network be an option? I believe they tried that sometime in the early 2000s.

Victory sports one.  The Twins and Carl Pohlad started it.  They were trying to copy the YES network, (Yankees).  The cable and satellite companies denied them in their packages because they were trying to charge too much.  It soon folded.  

[IndyTwinsFan]

While I fully agree with all that's been said here thus far and sympathize with those being affected, being an "out of market" viewer appears to insulate me from many of the concerns raised here, for the 2023 season,  at least.  I switched off the MLB Extra Innings on DirecTV package beginning this year in favor streaming on MLB.com.  Still affected by the archaic blackout rules, but that part (supposedly) won't change at all under the streaming package I purchased. 

I also fully agree that the outdated manner in which MLB sees that its team's games are broadcast needs to change significantly.  However, I don't have a good solution to offer regarding the most efficient and practical way to deal with it.

[Lauriee23]

I switched to YouTube TV when it did carry the RSNs. After 2020, I watch wherever I could find the game (Fox, FS1, ESPN, Apple+, YouTube), and I have MLB.tv (as a STH and t-mobile customer). As a partial plan STH, I get to maybe 30-35 games/season in person.  For all the rest, if I really want to see a game I'll go to a bar, or try to do a self imposed media blackout until I can watch on MLB.tv (annoying and inconvenient). I listen to the radio broadcast most of the time, though.  MLB is losing fans and viewers and def not attracting new ones with this nonsense. They can't afford to do that for the long term health of the game.

[heresthething]

1 hour ago, jmlease1 said:

The Wild & Wolves are an important part of this equation; having pro baseball, basketball, and hockey all on the same network made it more attractive to cable and satellite systems and positioned it to command a better rate. if that splits off? That influences streaming as well. Much easier to sell a streaming service that bring all three sports to the table than just one.

The impact to the cable companies revenue could be high if they can't find a way to bundle it in like they do today.  If I'm a cable company exec I would try to find anyway I can to offer MLB.com as an add on service or bundle it into a package tier so i don't give my subscriber base any more reasons to cut the cord.  And the teams win in this scenario too because it makes it easier to watch.  Yes it's not difficult to click an app and stream it but  there is a very large demographic of older consumers who will not want to deal with it and just want to go to channel xx and watch their Twins.

[beckmt]

Just remember (and it is interesting for the legal beagles), Manfred has said if Bally rejects one contract, MLB will attempt to terminate all. Given the anti-trust status that MLB now has, it should be interesting. Long term either areas or teams will set up their own RSN's or everything will be streaming.  This will also affect the cable companies as they will lose many subscribers without the local sports on the cable.  Since I don't know the ad revenue numbers maybe some combination of streaming and local TV is where it ends up  Then you have the major issue of the cord cutters, and people who use VPN's to gain access. 

[Whitey333]

Interesting comments from everyone.    I'm not smart enough I guess to have any answers.  All I know is after cutting the very expensive cable, we went to streaming to watch Twins.  We switched 3 times in streaming to try and watch the Twins.  Each of the services dropping the Twins due to costs etc.    Now I've been unable to watch the Twins at home.  This is the third year of this.  Twins said they were working on a solution.  Yet this is the third year with very limited coverage and nothing was done.  All I know is I used to pay my cable or streaming billeach month mostly for local sports.  Now I can't, for three seasons.  Does anyone really care? I guess not.

[NotAboutWinning]

I'm a bit confused by those who say they can't watch the Twins. A subscription to MLB.tv is about $20/month for the season. I can watch literally any MLB game (and MiLB this year) on PC, tablet, phone, cast to a TV or on a smart TV app. The Twins games are available 2 hours after they finish (or in real time if you want to mess with a VPN). I think it is a decent deal. Will be even better if the blackouts go away once Diamond is completely defunct.

[silverslugger]

I've been an avid Twins fan since the 70's and am soon to be 58 years old.  I haven't lived in Minnesota since childhood, 1979 to be exact.  I've been to many games at the Met, the Dome, and Target Field.  None recently.  I've avidly listened to radio broadcasts for years, attempting to tune into WCCO or more local radio, when possible, here in Iowa.  I started watching many games a year back when FSN became available on DirecTV.  Eventually, DirecTV was charging me $160 a month and I finally said, "forget it" and cut the satellite cord in favor of Hulu for $60 a month.  Of course FSN became Bally and Bally don't play ball with Hulu.  Well, here I am in Iowa blacked out from the Twins/Brewers/Cubs/White Sox/Royals these past several years and no way to watch on TV.  Guess what I ain't doing.  I ain't going to no stinking games at Target Field because I'm fed up with MLB's archaic rules.

Here's what else I have to say.  I've been a teacher in high schools since 1990.  In those 33 years I've watched as teenagers have become less and less enamored with sports in general and baseball specifically.  It used to be that students talked about the World Series or their favorite team.  Now, none of them talk about it, at all!  They do still talk once in a while about the NBA or the NFL.  I currently work in an urban school in Des Moines and, by far, the sport of choice is...Soccer!  

MLB has a huge problem on it's hands that will "come of age" over the next 20 years because almost nobody below the age of 30 cares, at all!  Good luck finding revenue.

[AlGoreRythm]

On 3/18/2023 at 8:30 AM, jmlease1 said:

The Wild & Wolves are an important part of this equation; having pro baseball, basketball, and hockey all on the same network made it more attractive to cable and satellite systems and positioned it to command a better rate. if that splits off? That influences streaming as well. Much easier to sell a streaming service that bring all three sports to the table than just one.

I'll buttress your point with my own experience. I'm in my mid-30's and grew up with MN sports, but I cut the cord over a decade ago.

While I grew up watching the Wild and Wolves, I no longer watch any sport other than baseball. Last season I paid roughly $200 split between the single team MLB.tv subscription and a VPN to get around the blackouts. I live in the Fargo-Moorhead area and it costs more than that to go to a single game regardless of the sport. Gas, tickets, food, potentially a place to stay depending on if friends can put us up for a night, not to mention the travel time involved, and you've got a recipe for waning interest in professional sports altogether.

A streaming option which includes all or most of the MN sports franchises is exactly the way to bolster interest from fans like myself.

The services have to meet their customers where they are, and cable is not where people my age and younger are found.

[AlGoreRythm]

2 hours ago, silverslugger said:

I currently work in an urban school in Des Moines

I literally laughed out loud when I read this phrase😂

[Rosterman]

The name of the game is still advertising for whomever does the broadcasts. Cable services are dying fast, yet people can/will only spend so much on streamning services with so many to choose from. 

I don't think the answer is MLB controlling broadcast baseball. But is antenna TV still anywhere in the mix? Can cable offer some results? Is streaming via APple or youtube or whatever the real deal necessary? How much do WE pay to watch a game, and how much can advertising generate additional income, with money going back to the teams, MLB, and shareholders?

[PopRiveter]

18 hours ago, Whitey333 said:

Interesting comments from everyone.    I'm not smart enough I guess to have any answers.  All I know is after cutting the very expensive cable, we went to streaming to watch Twins.  We switched 3 times in streaming to try and watch the Twins.  Each of the services dropping the Twins due to costs etc.    Now I've been unable to watch the Twins at home.  This is the third year of this.  Twins said they were working on a solution.  Yet this is the third year with very limited coverage and nothing was done.  All I know is I used to pay my cable or streaming billeach month mostly for local sports.  Now I can't, for three seasons.  Does anyone really care? I guess not.

I absolutely care. I’m right there with you. I hate how it is currently structured and I’ve been holding my breath so long awaiting a solution that I’ve mostly transitioned from “overly hungry for baseball” to “kinda checked out on the team.”

 I entered the cord cutting era as a diehard, lifelong Twins fan and I’m now a guy whose read 3 or 4 articles this spring and hasn’t even listened to a spring game on the radio or watched a postgame highlight.

It will be nice to come back to mlb whenever they figure it out.

[Gonzo Bob]

I'm in wait-and-see mode.  I got YouTube TV in 2018 (for the Winter Olympics) and had that up until late 2020 when they dropped Fox Sports RSNs.  Since then I've listened on the radio and watched a few games here and there when the Twins were the YouTube game-of-the week, or the MLB.TV game-of-the-day, or on Fox Saturday baseball.

I did see that FuboTV is now carrying the Bally Sports RSNs and I think I saw that DirecTV Stream has them, too.  But I don't really need/want a full channel line-up so I am waiting to see if Diamond Sports Group will acquire streaming access for the Twins and if they do, I will subscribe to that (Bally Sports Plus?).  That doesn't seem likely and I don't think it's going to be the magic solution to make DSG profitable anyway.  Maybe MLB will take back broadcast rights for all 14 teams handled by DSG and if that happens, I will subscribe to MLB.TV.

[DJL44]

On 3/18/2023 at 8:21 AM, adjacent said:

Well, in the end as always, we will end up spending more, and quite a bit more. Right now, nothing is free, we pay for the cable subscription. But in that way we get all the sports. In a couple of years, we will have to have a subscription to watch baseball, another to watch hockey, another for basketball, another for soccer, and so on. So, business models continue to evolve to squeeze every penny out of us.

Since I basically only care about baseball this is great for me.

I don't think the Twins will have any bids from cable channels for their upcoming TV rights, especially because streaming rights will not be part of the contract. I'm optimistic this means they will find an over the air broadcast partner (Channel 45?) for some games and rely on streaming for the rest.

 

[Major League Ready]

The league hiring executives from RSNs is pretty telling.  It would appear they are gearing up to take control of the broadcast product and how it is distributed.  Understanding all the financial and legal implications is a deep well.  I presume that's why the first hire was Billy Chambers.  If you are looking at different options for a "future state", you need someone like Chambers to oversee that analysis.  This is their chance to reconstruct the current model in a manner that makes it much easier to get ALL of the games no matter where you live.