Almost a year after NBC Sports Group reached an agreement to renew a rights deal with the Washington Capitals and Washington Wizards, the two sides have gone from handshake mode to signatures. The ownership of the two teams, Monumental Sports & Entertainment will receive a 33%equity stake in Comcast SportsNet Mid-Atlantic, the regional sports network that airs their games. In addition, Sports Business Daily’s John Ourand notes that NBC will get a minority stake in an over the top channel that will be developed by Monumental.
Overall, the teams get a huge bump in rights fees from NBC Sports Network. The Caps will receive $28 million annually, up from $13 million and the Wizards will get $35 million a year, up from $17 million. The contract will run through the 2031-32 seasons.
As part of the deal, an over the top platform will be developed by the two parties, however, neither the Caps nor the Wizards will be part of it. Instead, the OTT channel will carry Arena Football and WNBA games from the teams under the Monumental umbrella. The OTT platform will be a subscription-based channel.
Monumental owner Ted Leonsis had considered keeping the Caps and Wizards rights in-house and launching his own regional sports channel, which could have included the AFL, WNBA and an NBA D-League teams. However, Leonsis said putting those teams on an OTT channel was better as they would not bring mass audiences to the RSN.
So this deal will provide not just rights fees to Leonsis and Monumental, but also subscription income from the OTT channel. With both sides getting equity stakes in the other’s companies, it’s an innovative deal that both NBC Sports Group and Monumental view as having long-term benefits.