DSG also intends to hold onto MLB rights; Plans to sell minority stakes in the YES Network, Marquee Sports Network
After months of intense uncertainty, there appears to be a bit of clarity regarding the immediate future of Diamond Sports Group’s regional-sports networks following an agreement with the NBA that will keep local broadcasts for 13 teams on Bally Sports through the end of this season. The agreement was revealed as part of a “cooperation agreement” filed Monday in the Houston bankruptcy court by DSG, which has been in Chapter 11 bankruptcy proceedings since March. The filing also provides a peek into the company’s future plans for NBA rights beyond this season, ongoing NHL and MLB rights discussions, and its minority stakes in YES Network and Marquee Sports Network.
“Our newly-signed agreements with the NBA, Comcast and our creditors reflect significant progress on Diamond’s path forward,” Diamond said in a statement. “Upon court approval, these agreements will enable Diamond to continue delivering live game broadcasts to fans throughout the 2023-24 NBA, NHL and MLB seasons. Diamond has been broadcasting NBA and NHL games and will continue to do so while the Court considers our motions, and while discussions with the NHL finalize with respect to their own new deal.”
NBA Games Stay on Bally Sports…for Now
Although there will be a reduction in rights payments for some teams under terms of the deal, local rights for all 13 NBA franchises will revert back to those teams and the league at the end of this season. This potentially sets up the league to begin negotiations for national rights, which expire after the 2024-25 season, in conjunction with its local rights.
According to Sports Business Journal‘s John Ourand, NBA teams will have the option of presenting up to 10 of their games on local broadcast stations this current season and will get back their rights from Bally Sports if Diamond can’t ink a carriage renewal deal with Charter Communications (and its 15 million pay TV homes) when the current deal expires in February.
In exchange, Diamond will receive an undisclosed reduction in its rights burden for this current season (SBJ reports this represents 16% of the teams’ previously contracted rates) that the company says will enable it to continue operating.
What About the NHL and MLB?
In addition to retaining its existing local NBA rights through the end of this season, Diamond told the court it is currently in discussions on a similar deal for the 11 NHL teams it currently has rights agreements with.
As for MLB, DSG said it intends to keep 10 of the 12 teams for which it holds rights and is currently negotiating deals for the other two. In the filing, DSG said it has “determined which MLB team agreements the debtors may retain, subject to further discussions with the applicable teams, and recently have identified these teams to MLB.”
This comes after commissioner Rob Manfred recently called out DSG, saying “there is no reason to believe that the debtors will finally figure out a path forward.” MLB took over production and distribution of the San Diego Padres’ and Arizona Diamondbacks’ broadcasts in 2023 and Manfred has indicated the league could take on similar responsibilities for many as 16 teams next year.
The Future of YES and Marquee Sports Network
Diamond’s also said it plans to sell its minority stakes in the YES Network (home to the New York Yankees, Brooklyn Nets, New York Liberty, and NYCFC) as well as the the Chicago Cubs’ Marquee Network. The proceeds from those sales will go to unsecured creditors.
“The Debtors have reached agreement on modifications to their telecast rights agreements with the NBA and are continuing those discussions with the NHL,” DSG added in the filing. “The Debtors project that these modified agreements, together with the other agreements and transactions that are part of the Cooperation Agreement, will allow the Debtors to operate profitably through the 2023–24 Seasons.”
