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SBD/January 17, 2014/Media
MLB Reportedly Approves Revenue-Sharing Plan For Dodgers' New RSN
Published January 17, 2014
GOLD RUSH, OR FOOL'S GOLD? SPORTS ON EARTH's Jack Moore wrote the past three years "have been the perfect time to strike and renegotiate a huge windfall" for an MLB franchise. The multi-billion dollar TV deals negotiated by the Dodgers, Angels, Rangers and now Phillies "have all occurred" since '10. But the "big question ... is when this bubble will burst." If teams like the Astros and Padres "are already having issues getting cable providers to pay carriage fees, what will the market look like in five years when the Brewers, Royals, Pirates and Cardinals can finally renegotiate their TV deals?" This "sounds like a question the fan who only cares about results on the field can ignore, but massive competitive balance implications rest on its answer." In leagues like MLB, "where players have free agency, studies have shown nothing -- not a salary cap , not player drafts -- leads to more competitive balance than more revenue sharing." While MLB's revenue-sharing program "will throw some of the new TV money down to the smaller market, late-negotiating clubs, it might not be enough to offset the growing gap in gross rights fee revenue and the non-shared money coming from club-owned equity stakes" (SPORTSONEARTH.com, 1/16).