Diamond Sports Group will not broadcast San Diego Padres games after Tuesday, and the media company will not pay the rights fee before the Tuesday night deadline. Here’s what you need to know:
- Diamond Sports said in a statement to the athletic that it “decided not to provide additional funds to the San Diego RSN that would allow it to make royalty payments to the San Diego Padres during the grace period.” The company said it continues to broadcast team games under its contracts.
- Bally Sports San Diego, the San Diego RSN and broadcaster of Padres games, is not part of Diamond’s bankruptcy filing, as it is a joint venture between the Padres and Diamond Sports. Therefore, Diamond cannot argue against it in bankruptcy court and there are no bankruptcy law protections that can overcome a late payment.
- Diamond Sports’ late payment means media rights revert to the Padres, with MLB producing the team’s game in Miami on Wednesday. The league was notified at 5 p.m. ET Tuesday that the payment would not go through, and MLB had staff on hand to handle the game should it occur.
- MLB doesn’t guarantee that the Padres (or any team that ends up in a similar situation) will make up the lost money, but the league and other teams will back teams like the Padres who don’t get paid, sources reported on the plans. said the athletic.
How can fans watch Padres games in the future?
MLB will stream Padres games on the MLB TV app for free through Sunday. After that, fans will have to pay $19.99 per month or $74.99 for the rest of the season. MLB has also struck local media deals with Spectrum, Cox, Fubo, AT&T UVerse and others.
The Padres announcers are team employees, so they should remain the same. The league announced that the Padres’ primary television announcers Don Orsillo, Mark Grant and Bob Scanlan will remain on duty, while radio team 97.3 The Fan will also continue with Jesse Agler and Tony Gwynn Jr. announcing games from the cabin.
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How to watch the Padres after the departure of Diamond Sports
Whats Next?
It is perhaps a coincidence that this news comes on the eve of Wednesday’s mega-hearing in bankruptcy court where Diamond will argue that it should pay four teams less than the contracted rate due to changing economic conditions. And perhaps it’s no coincidence, as Diamond’s lawyers will almost certainly use the Padres as proof that RSN’s contracts are too rich.
Diamond stopped paying the Texas Rangers, Cleveland Guardians, Minnesota Twins and Arizona Diamondbacks (the bankruptcy judge ordered Diamond last month to pay half of what he owed until default). Wednesday’s hearing will be a duel over the value of baseball teams as media content and Diamond can underscore his claim that cord-cutting has eviscerated old economic paradigms with his decision to walk away from one of MLB’s most intriguing teams. . — Kaplan
What this means for the Padres, MLB
The Padres broadcaster is a joint venture with the team and Diamond and is therefore not bankrupt. As a result, Diamond couldn’t simply cut the Padres’ fee and rely on the automatic stay that applies to all contracts in bankruptcy. One source, who has advised some of the creditors, believes Diamond is sending a message to MLB with the move, as if to mock how much the Padres are losing. This source texted: “The question we need to ask ourselves is, ‘What is MLB doing?’ I mean they cost the Padres a ton of money with no clear way to replace them.
“I hope MLB tries to launch a new RSN, but it’s impossible to imagine that they’ll get (anywhere) close to the roughly $50-60 million per year they (were) getting from Bally’s. It will probably be half of that and maybe even on a sporting level.”
That said, MLB controls the digital rights to the Padres, the feature that Diamond has negotiated unsuccessfully for the past several years. Now MLB can sell all media platforms to the Padres, a small step toward their goal of a local/national cross-platform viewing option. — Kaplan
what are they saying
“While DSG has significant liquidity and has been paying royalties to teams, the economics of the Padres’ contract were not aligned with market realities,” Diamond Sports said in a statement. “MLB has forced us by its continued refusal to trade direct-to-consumer (DTC) broadcast rights for all teams in our portfolio despite our proposal to pay each team in full in exchange for those rights. We continue to broadcast team games under our contracts.”
background
Commissioner Rob Manfred said multiple times this spring that MLB has been preparing for the possibility that it might need to broadcast games and that the league could finally handle it.
“We have taken those preparation efforts very seriously,” Manfred said in February.
“We know we can produce games in case Ballys isn’t streaming. We know we can put those games together with MLB.tv digitally. And we’re in the process of trying to reach agreements that will put us in a position to make those games available within the cable package as well. From a fan’s perspective, while it may not be the channel that’s your traditional RSN, if you think about it from a reach perspective, games being available digitally in the marketplace is something that fans have been yelling for years.” . — Drellich
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(Photo: Denis Poroy/Getty)
