Group Created with Sketch.
Volume 22 No. 15
  • Created with Sketch.
  • Created with Sketch.
  • Created with Sketch.

MLB local streaming talks heat up

One of the most contentious sports media negotiations in recent memory — rights to stream MLB games locally — is back on the front burner.

MLB’s local streaming deals with Fox Sports and Comcast-owned NBC Sports, comprising the majority of MLB teams, ended after the 2018 season and the two network groups already are butting heads with the league over a renewal. MLB signed a three-year deal with Fox’s RSNs at the end of 2015, which set the market and helped lead to similar deals in early 2017 with Comcast RSNs, and then with the Fenway Sports Group-owned NESN and AT&T forerunner Root Sports that generally ended after this season.

Just as the original deals took years of often-arduous negotiation, renewals do not look to be straightforward, with two main snags emerging:

■ MLB wants an increase for its streaming rights fees. RSN executives are pushing back, saying that even though they paid for these streaming rights in the past, such rights typically are not carved out from other media rights packages they buy.

■ MLB wants to make its streaming deals run the same length as the various RSN linear TV deals. RSN executives say that the media landscape is so fluid that they do not want to be locked into long-term streaming deals. RSN executives complain that they don’t make money off of the current stream deals, and say they are difficult to produce, sell and market.

Formal negotiations started soon after the end of MLB’s regular season. Only three MLB teams — the Baltimore Orioles, Los Angeles Dodgers and Washington Nationals — do not have in-market streaming deals for various reasons. The negotiations are especially important given the pending sale of Fox’s RSNs, the relaunch of NBC Sports Regional Networks’ mobile app, and Fox’s negotiations to renew its deal for MLB’s national rights, including the All-Star Game and World Series.

Part of the valuation media companies, teams and private equity are placing on Fox’s 22 RSNs undoubtedly includes streaming rights. As the pay-TV industry continues to lose subscribers and media companies launch over-the-top services, streaming rights become more valuable. The original MLB in-market streaming deals were solely on an authenticated basis and required a traditional cable or satellite subscription for access. A key question going forward is whether a standalone offering might ultimately emerge.

MLB executives see the value in these rights and want to be compensated for them. RSN executives say that video streams of their MLB games are no different than their linear television feeds and believe they’ve already paid for those rights as part of their media rights deals.