Three months ago, the New York Post reported that MLB, the NBA, and the NHL “may orchestrate a buyout” of the Bally Sports RSNs, owned by Sinclair subsidiary Diamond Sports.
On Sunday, the Post reported that those talks were “faltering” after the company’s latest earnings call, which contained concerning information about increases in subscriber churn to the RSNs.
The article then goes on to presume bankruptcy is in the works for Diamond, and that carriage deals with teams “will likely be rejected” in court, eventually replaced by streaming deals with tech companies.
That means Diamond’s slew of unprofitable broadcasting contracts will likely be rejected — and its decades-old, cable-TV-based business model will go out the window as deals are cut to stream lives games online, sources said. MLB could potentially step in as a temporary platform next year, but the streaming rights are expected to eventually end up with Big Tech companies like Apple, Amazon and Facebook, sources said.
Diamond strongly denied the possibility of carriage deals being rejected.
Paul Caminiti, a spokesman for Diamond Sports Group, said, “The idea of rejecting MLB contracts is unequivocally false. DSG is committed to enhancing and strengthening our relationships with the MLB, NBA and NHL by fulfilling our contractual obligations and acquiring more rights.” He declined to comment about a potential bankruptcy.
This summer, Sinclair hired investment banks in the lead-up to a possible sale of the Bally Sports RSNs. That article from the Sports Business Journal mentioned that “in Chapter 11, Diamond will be allowed to continue showing games without making payments to teams — even during a long restructuring that takes 18 months,” which is seemingly a direct contradiction of both the “temporary platform” and the rejection of contracts mentioned in the Post article.
Whatever ends up happening with the Bally Sports RSNs, there are not many paths that end positively for all involved.