Diamond Sports Group Bankruptcy Throws Wrench Into MLB RSN Viewership Trends

For the past two seasons, determining the overall viewership trends on the regional sports networks that support Major League Baseball has been chaotic due to the ongoing Diamond Sports Group (DSG) bankruptcy.

In March of 2023, DSG, which runs the Bally Sports branded facility of regional sports networks, filed for Chapter 1 bankruptcy. Supporting half of the teams in MLB at the time, and impacting teams in the NBA and NHL, the move has thrown the entire RSN bubble into disarray. In the midst of last season, two DSG clubs were dropped – the San Diago Padres and Arizona Diamondbacks – followed by the Colorado Rockies leaving AT&T Sportsnet Rocky Mountain. All three were switched over to MLB providing production and working out their own carriage deals.

As of now, Diamond Sports Group still carries 12 teams across the Bally Sports branded RSNs: the Atlanta Braves, Cincinnati Reds, Cleveland Guardians, Detroit Tigers, Kansas City Royals, Los Angeles Angels, Miami Marlins, Milwaukee Brewers, Minnesota Twins, St. Louis Cardinals, Tampa Bay Rays and Texas Rangers.

In May, Comcast dropped the Bally Sports regional sports networks after failing to a new contract, rendering a massive hole in MLB’s local viewership numbers. While MLB was trending upwards, since the carriage dispute between Comcast and DSG, the MLB RSNs are down 6% year-over-year compared to the same point last season. That number could improve. In a status conference in court on Wednesday, Diamond said they had made “substantial progress” with Comcast, opening the door to games making their way back onto the major distributor.

Craig Sloan, who recently was made CEO of Playfly, a full-service, integrated sports marketing and media company that acquired Home Team Sports, Impression Sports and Entertainment and Fox Sports College Properties, three major arms of FOX Sports in 2021, said that the MLB regional sports network model was holding up as expected prior to the DSG/Comcast dispute saying at the top level, sports are exceptionally consistent on television like an annuity.

“When you look at MLB, or NBA or the NHL in general, the portfolio delivers,” Sloan said in an interview with me for Forbes. “In aggregate, somebody’s going be up and somebody going to be down. The only variance traditionally that our insights team sees is that we’ll see numbers go a little bit above our average impression delivery across the country when large market teams are winning and if small markets winning we see the numbers go a little bit below the median, but in general, for the last10-15 plus years, it’s been very consistent.”

While the Comcast issue looms large over MLB’s total numbers, there have been some promising signs from several clubs.

In the Philadelphia designated market area (DMA), the red-hot Phillies are pulling a 6.83 TVHH rating which equates to over 217,000 TV Households, up +46% over the same number of games last season.

The Baltimore Orioles, who have been starved for a winning team for years, are seeing dividends on MASN. In the Baltimore DMA, their TV Household rating has jumped to a 4.91 average meaning the O’s deliver over 57,000 TV Households every single game. That’s a sizeable +28% increase over the same number of games from last season.

The Cleveland Guardians are seeing a +7% increase over last season at the same time with an average 4.24 TV Household rating in the Cleveland DMA which translates to over 65,000 TV Households every game.

Other teams outpacing 2023 YOY in their respective DMAs are the Dodgers, Royals, Brewers, and Pirates.

While linear television numbers for the RSNs are up in the air with the Comcast dispute, streaming continues to gain traction as subscribers move away from traditional television. Average unique viewers are up 10% while average consumption is up 20% year over year.

According to Sloan, advertiser interest in MLB remains exceptionally strong given the large inventory of games and how the season plays out in the summer. While they have pulled back some in recent years, the insurance company channel is back on the rise. For the auto sector, it’s on an OEM to OEM basis based on new car launches but continues to be strong for MLB. The biggest ad growth channel is the gaming industry. While MLB caps the number of ads for sports betting companies is a highly competitive ad space that has grown quickly as a key advertiser. Other staples continue to be the fast-food industry, cellular carriers, and other technology companies. One key shift has been around entertainment as streaming companies continue to grow.

“The demise of entertainment viewership on traditional television broadcasts has opened the door for the likes of Amazon Prime and others,” said Sloan of streamers that are advertising with Major League Baseball.

A key question is what the future holds for the RSN model in the near term. MLB Commissioner Rob Manfred has said that getting all club local media rights under one umbrella, is similar to what the NFL has done to share revenues equally amongst the clubs. The ability to get all 30 clubs under this model seems a long shot. Clubs that have equity in RSNs that are performing well, are unlikely to see the value in joining the model. Big market brands such as the Yankees, Red Sox, Dodgers, and Astros would likely fall into the category.

At the same time, ESPN has the option to opt out of their national broadcast deal with MLB in 2025. While some have concluded that ESPN will negotiate down, conversation has also surfaced of the Worldwide Leader looking to potentially grab some MLB local media rights should they become available to bolster their new direct-to-consumer streaming service set to begin next year. If so, media revenue streams from ESPN could potentially stay at their current levels or increase depending on the amount of inventory that was obtained. Diamond Sports Group Bankruptcy Throws Wrench Into MLB Regional Sports Network Viewership Trends