Bally Sports — the regional sports television networks that air 42 NBA, NHL, and MLB franchises — saw nearly the worst combination you can experience in 2023.
Nearly two weeks ago, Diamond Sports Group — the owner of the Bally Sports-branded channels — purposely missed a $140 million debt payment in what is almost assuredly a chance for the company to file for bankruptcy.
In return, questions have abounded about the network’s future as the home for the television rights professional sports franchises. Major League baseball has been outspoken on its backup plan, should the network shutter, preparing to continue to produce the games using MLB Network equipment. The NBA, in a somewhat surprising move, reupped its television streaming deal with the fledgling network days after Bally Sports missed its debt payment. Meanwhile, the NHL has been largely mum on what its plans would entail.
In 2023, there’s a nearly guaranteed fatal cocktail for sports television failure: technology passing you by, the entire television delivery landscape changing underneath you, a contentious relationship with one of your biggest business partners, and a massive amount of debt.
Diamond Sports Group hit the jackpot! They had all four!
Once streaming became more prevalent, it was only natural that the regional sports network model was going to collapse. And rightfully so. For long periods of time, cable subscribers didn’t really understand how the cable bundle worked. They knew they paid their bill, it went to the provider, and that was really the extent of the knowledge. A viewer didn’t really know that this portion of their bill went to channel A, this portion went to channel B, and so on.
But once that information became more readily available, a question continued popping up: Why am I paying for (insert channel here) when I never watch it? I remember a study at one point revealing that every single person in the United States who has cable or satellite TV pays $30 a year for the NBA, whether they ever watch a game or not. Talk about a bad ass business model! It’s like gym memberships on steroids.
So, streaming begins to grow, and it becomes much easier to cherry pick the content you want to pay for. And, believe it or not, it’s really easy to avoid paying for a regional sports network you don’t want to watch.
It should have been very easy for Bally Sports to pivot, and offer a streaming service, right? Wrong! MLB wasn’t interested in budging an inch, and told the network it didn’t own the digital rights, and if they’d like to purchase them, they could pony up.
In select markets, Bally Sports did just that, and created Bally Sports+. At a wholly overpriced $29.99 a month.
Streaming is attractive for consumers for virtually two reasons: it perpetuates a growing “on-demand and what I demand” world, and it’s cheap. Bally Sports+ has neither of those things. For $16, I can get every Disney movie ever made, The Simpsons, some of the most popular Star Wars content ever created, ESPN+, and the bad version of Hulu, while for $30 I can get the Cleveland Cavaliers, Cincinnati Reds, Columbus Blue Jackets, and Cleveland Guardians? Man, I can’t understand why that service isn’t more popular!
Finally, Diamond Sports Group took on massive amounts of debt to purchase the networks from The Walt Disney Company after the Justice Department declared the mouse would have to divest itself from the outlets after purchasing FOX’s entertainment assets due to a potential monopoly with ESPN.
$9.6 billion is a lot of money for even the richest of people or companies. And yet, Sinclair — the principal owner of Diamond Sports Group — took on the channels for that price. And due to all the factors listed above, so the revenue it brought in from the networks shrink and shrink over time until the situation became untenable.
It shouldn’t have been hard to see the writing on the wall. When you spend nearly $10 billion on something before you decide how you’re going to brand your acquisition, it’s pretty clear: the Bally Sports networks were destined to fail.
Garrett Searight is Barrett Media’s News Editor, which includes writing bi-weekly industry features and a weekly column. He has previously served as Program Director and Afternoon Co-Host on 93.1 The Fan in Lima, OH, and is the radio play-by-play voice of Northern Michigan University hockey. Reach out to him at Garrett@BarrettMedia.com.
