Will Diamond Sports Bankruptcy Impact Baseball Broadcasting?

By Peter C

Local broadcasters play a crucial role in the success of Major League Baseball (MLB). Unfortunately, the new MLB season has been hampered by off-field concerns caused by the bankruptcy of Diamond Sports, America’s leading regional sports network.

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Diamond Sports, which operates 19 regional networks under the Bally Sports brand, declared bankruptcy in March. This has jeopardized the live game broadcasts of 42 major league teams, including 14 from MLB. The bankruptcy comes when baseball broadcasting is growing more complicated and contentious due to developments in the streaming and cord-cutting age.

The way people watch sports is changing, which is upending an economic model that has boosted team earnings and athlete wages for decades. Nearly a quarter of MLB team earnings come from local media, and the league’s 162-game regular season is a staple for sports channels.

Customers are leaving traditional pay-TV firms due to rising costs, which require them to pass on more than $7 per month per subscriber carriage fees to customers. Furthermore, how viewers consume content is shifting from a fixed menu to a la carte, which means those uninterested in baseball do not want to pay for games they will not see.

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To compound matters, Diamond Sports failed to pay the Arizona Diamondbacks $31 million in mid-March, and its interest payments to creditors are more alarming than dwindling audience interest. Despite these obstacles, MLB is on track to set a new revenue record of about $11 billion in 2022 across its 30 teams, mainly for sponsorship and media deals.