Cord-cutters threaten regional sports networks

In March, Diamond Sports Group, the biggest owner of regional sports networks, filed for Chapter 11 bankruptcy protection.
Alexander Hassenstein/Bongarts by means of Getty Photos

As customers reduce cable solutions in favor of streaming platforms, regional sports networks are at threat of going beneath. In the 1st quarter of 2023, an estimated two.three million Americans ditched conventional cable packages. And as a lot more Americans move toward streaming platforms, these regional cable networks are losing a lot more income.

“Marketplace” host Kai Ryssdal spoke with Ben Strauss, a sports and media reporter for The Washington Post, about how regional sports networks are fairing as a lot more Americans pass on cable, and what this could imply for sports fans about the nation.

The following is an edited transcript of their conversation.

Kai Ryssdal: For these maybe unfamiliar, what precisely are regional sports networks?

Ben Strauss: They are cable networks that for the previous 20 to 30 years have shown just about each one particular of your preferred baseball, hockey and NBA teams.

Ryssdal: And regional, as it implies, is not a national factor. It is each and every area, you know, there is a network for each and every and each area and group, suitable?

Strauss: Precisely. So, the teams in Dallas are on one particular network. In Chicago, up till lately, the Cubs and the White Sox and the Bulls and Blackhawks are on the very same network.

Ryssdal: OK. And the point of this piece, and the factor that essentially may perhaps alter sports, as we type of know it, is that these regional sports networks are going broke, fundamentally.

Strauss: Fundamentally, they are in deep problems. Basically, as persons leave cable, the charges that they had been paying to these networks that these networks, then in turn, had been paying to these teams are dropping significantly. And one particular of the top owners of these networks, a organization known as Diamond Sports, filed for bankruptcy protection earlier this year. And there are teams that have not received their rights payments, which is potentially landscape-altering for sports.

Ryssdal: So, the leagues have a vested interest in saving these regional sports networks. What are they carrying out?

Strauss: So, distinct leagues are carrying out distinct factors. Distinctive teams, in truth, are carrying out distinct factors. Baseball does not think in this organization — this Diamond Sports organization. And so, baseball would sort of like to have all these teams pull their rights back and make some sort of solution that you could see on cable that you could stream straight by itself. Most NHL and NBA teams would sort of like to see this model milked for every little thing it is worth as extended as the checks are nonetheless cashing for the subsequent couple of years. So, it is a tiny bit of a hodgepodge, and it is definitely not specific how it is going to play out.

Ryssdal: Messy sounds like a very good word right here, suitable?

Strauss: Yes, yes, you are very good at this.

Ryssdal: So appear, spare a believed for me right here for the fans, who all they want to do is watch their teams, and now mainly because streaming is up and in cable tv, and mainly because the league’s want income, and the regional sports networks are going broke, what’s a fan supposed to do?

Strauss: Effectively, so actually fascinating query about getting a sports fan for the final whilst, suitable? One particular of the factors that these networks have been so worthwhile is that all of these persons who didn’t watch sports, had been paying for them. Everyone has a cable subscription, and everybody’s paying 3, 4 or 5 even six dollars a month for that regional sports network, even if they do not watch a minute. And so, it is sort of in this á la carte model exactly where persons are leaving the cable bundle., eventually, the teams sort of have this decision, like do you want to attain a lot more persons, and do you assume about a thing on broadcast TV—which is a actually old college factor that would make the games accessible to a large quantity of persons. Diamond is fighting that. and so do you want to attain the most quantity of fans, or do you want to gather the most quantity of income by going on to a streaming service exactly where persons have to spend a lot more to come across you? And, it is sort of this balancing act.

Ryssdal: And the catch is that you cannot have them each, suitable?

Strauss: The catch is you cannot have them each. And so eventually, I would assume that sports fans are going to finish up paying a lot more for their sports.

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