ESPN keeps MLB rights with $700 million/year deal

Six weeks ago we discussed here the implications of MLB negotiating new TV contracts, with up to $40 million in new national revenue going to each team as a possible outcome. Today the first domino has fallen, as Sports Business Journal’s John Ourand reports that ESPN and MLB are re-upping their deal.

The current deal calls for ESPN to pay $306 million per year ($10 million per team) to baseball for the rights to games on Sunday and Wednesday, occasional Monday nights, and immediate highlights and live look-ins on Baseball Tonight. Digital rights to select games were also added for $50 million per year. The new deal has ESPN paying $700 million per year ($23 million per team), which now includes digital and international rights along with domestic cable. The international rights piece is another coup, because it should clean up some rather disparate pieces. The “Worldwide Leader” will also get one wild-card playoff game per year as part of the deal.

Of course, this is ESPN we’re talking about, so there has to be a downside, and it’s that Bristol asked to carry more Yankees-Red Sox games (imagine that!). They got it. Now it can be written: ESPN pushed to expand their East Coast bias. Next thing you know they’ll have a Mark Sanchez-Tim Tebow reality show ready for Week 8 of the NFL season.

Remaining to negotiate are the deals for the Saturday Game of the Week (FOX), and the Sunday afternoon game (TBS). Both of those networks also have playoff series, so the stakes are just as high, even if the coverage is not as vast. NBC/Comcast wants in, and CBS is also in the running. Ourand thinks those rights will stay with their respective holders, so we’ll see about that.

As for the A’s, anything that can help the team keep players and start with a higher baseline payroll ($70-75 million), the better.

19 thoughts on “ESPN keeps MLB rights with $700 million/year deal

  1. Wow… The funny thing, I switched over to Baseball Tonight a few weeks ago because I hadn’t watched it all season. I quickly switched right back to MLB Network.

  2. Same I have not watched Baseball Tonight ever since I got the MLB Network a few years ago.

  3. To echo NSJ- it was nice seeing newballpark in another blog I love.

    @ML: I appreciate and agree somewhat with what you say here
    “As for the A’s, anything that can help the team keep players and start with a higher baseline payroll ($70-75 million), the better.”
    Except it is worth mentioning that since the revenue benefits are league-wide, there’s an inflationary aspect to this — if there’s more money in the entire system, it also makes dollars less valuable (i.e. contracts will increase in price). I expect much of this benefit to be passed along to the players, not to small market teams. Not ALL the benefit, but probably most of it.

  4. @Otter: True, but there’ll be a delay because any free agent contract agreement over this coming offseason will be based on market values established the prior.

  5. @Briggs: good luck convincing agents of that! I don’t think the adjustment period will be long. (Dodgers?)

  6. Yup. How silly of me. Trickle-down economics’ effects are totally immediate (and real).

  7. @Briggs, It’s not like they don’t know it’s coming. If you think the agents are going to ignore that, you’re mistaken.

  8. Still, the A’s will have more to spend on a proportional basis the more shared revenue exists (if they have $160 million vs. the Yankees’ $439 million, and each gets an extra $13 million, the Yankees go from having 2.74 times as much to spend to 2.61, leveling the field just a tad.

  9. Tangentially related to ML’s blog post here, the fangraphs link above, and Bill Simmons’ latest piece about the Red Sox becoming unlikeable:

    I think it would be worth discussing the idea of a team building a new ballpark, intentionally NOT raising payroll, and using the low payroll as a justification for suppressing ticket prices in the new facility.

    So, as an example, say the A’s build a new 36-38K capacity facility, but continue to have a payroll that hovers in the $60M range, and they continue to have some of the cheapest tickets in baseball…but instead of averaging 20K fans, they (hopefully) sell out every game. Let’s say they average 35K per game.

    Do some franchises follow this model already? It seems to me that many teams (all teams?) do the Florida Marlins thing – get a new stadium, payroll shoots up, and ticket prices also shoot up, and inevitably the novelty wears off and working class/middle class fans are priced out of 10 game, 20 game, and season-ticket packages.

    I think the A’s would sell out every game all season in a new ballpark if they kept their current rates, and perks like free parking Tuesdays, $2 tickets, etc. If that meant that payroll had to remain at $60-70M in order for ownership to turn a profit annually, I’d still be enthusiastic about it – I think Beane has shown he can often build a good team with that budget, and I think it would be amazing to watch a team of young, cost-controlled players play in front of a packed house all season long.

    A lot of times the star-studded free agent teams become less likeable and less watchable (Red Sox, Marlins), because of the expectations and the personalities. I think the current iteration of the A’s is about as enjoyable to watch as any team in my lifetime, and putting them in a packed new ballpark would be the best of both worlds to me, even if it meant continuing to trade them away for new cost-controlled guys once they got expensive, as the team always have in the past.

    I don’t think the financial model of running the team (avoid huge FA splurges, horde prospects, trade established cost-controlled guys before they reach free agency) necessarily should change just because they get a new park. I think the Marlins are the cautionary example of what can go wrong when you do that. The Marlins have probably already lost whatever novelty their park offered.

  10. Speaking of radio….
    Anyone know what will happen to the A’s with 95.7 and their changes?
    .
    They are carrying Sunday, Thursday and Monday night football games this year. Luckily the A’s only have day games left on Thursdays once the season starts and Sunday’s are day games also. But A’s have two Monday night games? So do the A’s get bumped to a small station no one can get?
    .
    95.7 is also making a strong push for the Warriors. The Warriors main complaint with KNBR is being second status and being pushed to 1050. So if 95.7 does get them like they want (This is why the 7-10 slot has not been filled) What happens in April when A’s and Warriors are playing at the same time. Seems like A’s get bumped since Warriors are using that as the reason to leave KNBR.
    .
    This A’s falling short of buying the station themselves could be a big problem again.

  11. I think the idea with a new stadium is that you let Beane run the team the way he normally does, but when it comes to picking between Tejada and Chavez, you can now pick both.

  12. The more money available for the A’s to make annual debt payments for Cisco Field, the better.

  13. The Raiders have a home game on 10/21, the same day as a potential ALCS Game 7.

  14. @Mike A few days back I asked the 95.7 PD on twitter who gets precedence if the A’s and MNF overlap. He replied “A’s come first.”

  15. @Briggs That’s a major problem b/c the A’s won’t have time to retarp the upper deck!

  16. I thought I replied to this, but it seems to have been lost…..
    .
    The NFL could move the game to the next day, creating a MNF doubleheader. Move the game of DET at CHI up from 5:30pm Pacific to 4:30pm/5:00pm. Then the JAX at OAK game would start at 7:30/8:00pm Pacific. Or, make it a Saturday game.
    .
    On the other hand, a more likely scenario would have MLB push the game to Monday. The NLCS is already playing that Monday. The World Series isn’t scheduled to start until Wednesday the 24th.

  17. @gojohn10 – They can convert it back in 24 hours, but if it’s after the football game they don’t really need to put the tarps back up because THEY’LL JUST BE TAKEN DOWN AGAIN FOR THE WORLD SERIES GAMES THAT START A FEW DAYS LATER!

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