Warner Bros. Discovery is getting out of the RSN business, and they’re not wasting any time in doing so.
Per the Sports Business Journal, the company has set a March 31st deadline with teams to take their rights back. Ten teams air on one Root Sports RSN (which is majority owned by the Mariners) and three AT&T SportsNet RSNs.
The company, which operates three AT&T SportsNet-branded channels in Denver, Houston and Pittsburgh and has a minority stake in the Root Sports channel in Seattle, has told teams that they have until March 31 to reach an agreement to take their rights back. If the RSNs can’t reach deals with the teams, the channels eventually plan to move forward with a Chapter 7 liquidation filing.
The three AT&T SportsNet RSNs are Pittsburgh (Penguins, Pirates), Rocky Mountain (Golden Knights, Jazz, Rockies), and Southwest (Astros, Rockets), while Root Sports Northwest airs the Blazers, Kraken, and Mariners.
The Wall Street Journal reports that in a letter sent to the teams, AT&T SportsNet President Patrick Crumb said that “the business will not have sufficient cash to pay the upcoming rights fees” and WBD “will not fund our shortfalls.”
WBD doesn’t seem to be seeking much in return, per the Journal.
The letter proposes that AT&T SportsNet transfer ownership of the networks and programming rights to the teams for no purchase price consideration beyond a release by the teams of any future claims against the networks.
SBJ reports that WBD would “allow the teams to use the same production staff and equipment to continue producing the games” if agreements are reached.
Last week, it was reported that three MLB teams airing on the RSNs were shorted rights payments. Three years ago, AT&T opted to keep the RSNs after receiving below expectations offers on the open market.