Commentary

Sports TV Rights Climbing: What Will Stop It? Hardball

High-priced sports TV content continues be a remedy -- and a concern.

Consider that media-rights revenue for the top 17 highest-grossing sports leagues is set to reach $96.3 billion per year by 2035 -- four times 2015 levels, according to

Rethink TV.

So one wonders to what end -- in terms of profitability for what remains of live, linear TV as well as those profitably fledging premium streamers owned by those same companies that have linear TV network groups.

This isn’t much of a concern for Amazon Prime Video, Netflix and Apple TV+ -- companies and operations that have lots of cash flow and profits allowing them to spend and experiment.

Near term, we can only expect those digital-first companies will continue to put pressure on the likes of Disney+, Paramount+, Peacock, Max and others that are close to just posting slight profitability earning periods.

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But even then somewhere along the lines those digital-first companies with money losing sports content might look to make adjustments.

That said, might something give in the meantime?

Perhaps we can look to Major League Baseball for answers -- not only the league and teams struggling to reinvent what somewhat greedy local teams got themselves into when demanding high carriage fees by regional sports networks (RSNs).

The RSNs in turn need to pass that on to cable and satellite operators, which in turn look to pass on pricey $20- to $25-a-month subscription RSN fees to consumers.

RSNs are particularly reliant on baseball for way more programming hours than other sports. Each team plays a 162 game schedule with additional playoff games. That’s a lot of content. NBA and NHL teams each have an 82 game season schedule.

Factoring into MLB’s predicament are high $100 million-plus player salaries that force teams to charge high pricing to be carried by RSNs.

MLB is exposed to the higher levels of potential RSNs revenue declines versus other sports. The league doesn't have huge national TV media rights deals that the NBA and NFL have.

That means MLB teams are much more dependent than the NBA or NHL on RSNs. and why MLB is much more a “local” TV/media sport, according to analysts.

Although MLB has been moving slowly to take over more RSN business and operations, it is still dependent on these legacy TV distributors and network owners for the bulk of its media revenues.

But with all cord-cutting continuing to hurt the traditional pay TV businesses, it’s tougher to get them to play ball.

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