Major League Baseball is considering making a move to take all local media rights nationally, following in the footsteps of the NFL. The idea is being discussed as clubs face pressure to renew terrestrial television contracts, which have been impacted by the Diamond Sports Group bankruptcy proceedings affecting roughly half of the teams. Individual streaming rights deals are also being pursued, but the crowded field of other sports properties is making it difficult to secure these agreements.
Historically, baseball has focused on local media rights with radio, cable, and satellite television being the main platforms. In contrast, the NFL centralized its broadcasts with a deal with CBS in 1962, leading to a significant increase in revenue for the league. MLB has chosen to have select exclusive agreements with FOX, ESPN, and TBS, rather than taking all media rights national.
However, taking all MLB media rights national poses unique challenges due to the design of baseball. The sport creates loyalty to brands rather than star players, with regional networks showing nearly all games and increasing fan loyalty. Additionally, MLB’s 162-game season provides a large inventory for advertisers, but it can be challenging to engage fringe fans in regular season games until they become more significant closer to the playoffs.
One major obstacle to taking all media rights national is the divide between large revenue-making clubs and small clubs within MLB. It would be difficult to convince teams like the Yankees, Dodgers, Red Sox, or Cubs to agree to the concept, as they may not benefit as much financially as they would from their own individual deals. This division could make it challenging to reach a consensus on this potentially groundbreaking change.
Another issue facing MLB is the reluctance of streaming companies to engage in long-term deals. While local media rights may not provide a solution to this problem, locking in revenues for an extended period would be challenging with potential streaming partners. The league’s current national media rights deals are set to expire in 2022, with a total value of $12 billion. However, recent deals with streaming platforms like NBC Peacock and Roku Channel have shown that retaining continuity for fans could be a challenge in the future.
