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Caveat Emperor
11-01-2012, 11:35 AM
http://www.buzzfeed.com/jackstuef/inside-the-major-league-baseball-tech-startup-that


Glass walls abound in the four sprawling fours of offices, housed in New York Cityís Chelsea Market, the site of a former Nabisco factory in Manhattan. Banks of cubicles with an army of twentysomething video editors and game loggers prepare highlights and information for MLBís Web properties and apps. A huge, unnecessary metal dome sitting in the middle of one floor seems to serve as a conference room. Despite the baseball artwork on the walls and the company softball trophies in the reception area, thereís no mistaking it: This isnít a sports company. This is a tech company.

This is a good read on MLBAM -- which, if you aren't familiar, does a lot more than just baseball. MLBAM took in an estimated $500m in revenue last year alone (a pot that is shared equally by all 30 teams), and they're constantly looking to expand what they offer.

dougdirt
11-01-2012, 12:13 PM
MLBAM is the absolute best at what they do. Without question. They are also incredibly fan friendly.

MartyFan
11-01-2012, 12:21 PM
Great article that really articulates where new media is going and how quickly it is all happening. :thumbup:

westofyou
11-01-2012, 12:22 PM
Can't be happening.

The game is dying! :p

Reds Fanatic
11-01-2012, 12:28 PM
MLBAM does really great work. MLBAM's MLB AT Bat app is I think the best app ever developed. It is so far and away above anything any other professional sports league has.

As good as the work they do is the only thing that holds them back is MLB still using the old blackout rules. For a league that can be forward thinking in the things MLBAM develops it is shame that some things like blackout rules as so stuck in the past.

Caveat Emperor
11-01-2012, 12:32 PM
Can't be happening.

The game is dying! :p

There's a very real argument to be made that the game is in better position to be succeed long-term, financially, than any other sports league on the planet.

Unassisted
11-01-2012, 12:38 PM
IMO, the writer willfully ignores the most ominous issue, due to wishful thinking. The entrenched presence of those hugely lucrative, long-term deals with RSNs are what is going to prevent MLB.TV from moving beyond blackouts and distributing games to all comers via streaming. The very reason those deals are lucrative is because of the per-subscriber revenue stream from cable and satellite subscribers within the teams' territories. It's money that is baked into what you pay for "basic cable" or the "base package" with your satellite provider. It's money that is paid by everyone from diehard fans to grandmas who only subscribe to cable to watch "The Barefoot Contessa" and hipsters who only got cable for "Mad Men," "Game of Thrones" and "Breaking Bad." That revenue stream won't simply disappear because fans and cord cutters dislike it intensely. There's too much money involved.

Readers will come away from this read thinking that a future free of blackouts is right around the corner when it isn't. It isn't at all. Those 20-year deals with RSNs are like a pair of shackles, anchoring the team to 2 decades of blackouts.

Brutus
11-01-2012, 01:14 PM
IMO, the writer willfully ignores the most ominous issue, due to wishful thinking. The entrenched presence of those hugely lucrative, long-term deals with RSNs are what is going to prevent MLB.TV from moving beyond blackouts and distributing games to all comers via streaming. The very reason those deals are lucrative is because of the per-subscriber revenue stream from cable and satellite subscribers within the teams' territories. It's money that is baked into what you pay for "basic cable" or the "base package" with your satellite provider. It's money that is paid by everyone from diehard fans to grandmas who only subscribe to cable to watch "The Barefoot Contessa" and hipsters who only got cable for "Mad Men," "Game of Thrones" and "Breaking Bad." That revenue stream won't simply disappear because fans and cord cutters dislike it intensely. There's too much money involved.

Readers will come away from this read thinking that a future free of blackouts is right around the corner when it isn't. It isn't at all. Those 20-year deals with RSNs are like a pair of shackles, anchoring the team to 2 decades of blackouts.

You're missing something too, though. There is a consensus in the industry that eventually we'll wind up with a la carte programming. Once that happens, the leverage RSNs have will be diminished a bit and arguably the contracts with RSNs might suffer. If a la carte programming happens, it will especially make sense to bundle the product together online because right now TV networks profit by forcing bundles on cable operators, and in turn are able to pay more for rights fees. There is a point when consumers will stop paying for cable packages once it gets too bloated. Once that happens, there will be a big push in the industry to ditch the current model. Some have even speculated congress and the FCC will get involved and legislate it. Who knows... but it will happen at some point.

dougdirt
11-01-2012, 01:19 PM
You're missing something too, though. There is a consensus in the industry that eventually we'll wind up with a la carte programming. Once that happens, the leverage RSNs have will be diminished a bit and arguably the contracts with RSNs might suffer. If a la carte programming happens, it will especially make sense to bundle the product together online because right now TV networks profit by forcing bundles on cable operators, and in turn are able to pay more for rights fees. There is a point when consumers will stop paying for cable packages once it gets too bloated. Once that happens, there will be a big push in the industry to ditch the current model. Some have even speculated congress and the FCC will get involved and legislate it. Who knows... but it will happen at some point.

Sports is literally the only reason I have cable right now. Between Netflix, Hulu Plus, Computers that can be hooked up to an antenna and record local TV, Amazon Prime, Youtube, Vimeo and a few other places, I could easily get by Cable if I weren't locked into sports. If I didn't live in the Cincinnati area, I probably wouldn't have cable because I would just buy MLB.tv and package it with some of the above options for my programming needs. For the non-sports fan, they can truly get away from cable pretty easily and still get HD programming directly onto their TV.

_Sir_Charles_
11-01-2012, 04:18 PM
Thanks CE. That was a good read. Really makes me curious what the Reds TV deal is going to bring in. Could be monsterous.

dougdirt
11-01-2012, 06:25 PM
Thanks CE. That was a good read. Really makes me curious what the Reds TV deal is going to bring in. Could be monsterous.

Doubtful. The Reds tv market is quite small. I am sure it will be quite stronger than their current one, but it will still be small among baseball.

_Sir_Charles_
11-01-2012, 06:37 PM
Doubtful. The Reds tv market is quite small. I am sure it will be quite stronger than their current one, but it will still be small among baseball.

From what I've seen, their market isn't small. There was a color-coded map posted here a while back and the Reds area was surprisingly large.

dougdirt
11-01-2012, 06:38 PM
From what I've seen, their market isn't small. There was a color-coded map posted here a while back and the Reds area was surprisingly large.

The area may be large, but the population numbers aren't.

_Sir_Charles_
11-01-2012, 06:49 PM
The area may be large, but the population numbers aren't.

Actually, they are. The problem is that the area has multiple teams fighting for the same viewers. If we consistently put a better product on the field, the Reds could take back Columbus, Indianapolis, etc from other teams. I'm clearly no expert in the field but seeing the areas and populations...and then seeing what the Padres recently got for example, I'm optimistic.

dougdirt
11-01-2012, 06:51 PM
Actually, they are. The problem is that the area has multiple teams fighting for the same viewers. If we consistently put a better product on the field, the Reds could take back Columbus, Indianapolis, etc from other teams. I'm clearly no expert in the field but seeing the areas and populations...and then seeing what the Padres recently got for example, I'm optimistic.

I don't see much of a premium being paid for the "well, if they can pick up a majority of the fans in cities 2 hours away.....", but maybe I am wrong.

MikeThierry
11-01-2012, 06:52 PM
Sports is literally the only reason I have cable right now. Between Netflix, Hulu Plus, Computers that can be hooked up to an antenna and record local TV, Amazon Prime, Youtube, Vimeo and a few other places, I could easily get by Cable if I weren't locked into sports. If I didn't live in the Cincinnati area, I probably wouldn't have cable because I would just buy MLB.tv and package it with some of the above options for my programming needs. For the non-sports fan, they can truly get away from cable pretty easily and still get HD programming directly onto their TV.

Agree with doug here. In fact, I've streamlined my cable deals because I really don't watch anything else on TV besides sports and AMC (Walking Dead and Breaking Bad are a win). Since TLC no longer allows you to lean anything anymore and the History Channel is nothing more than Aliens and pawn stars, my TV habbits have changed drastically over the years.

Unassisted
11-01-2012, 07:05 PM
You're missing something too, though. There is a consensus in the industry that eventually we'll wind up with a la carte programming.
I've never heard that any forces within the industry, other than OTT providers like Netflix, are pushing for that. Netflix's competitors like HBO are pushing back just as hard to keep the status quo.

Considering the huge impact on revenue that eliminating blackouts and RSN basic-carriage provisions would have, I could easily picture Bud Selig testifying before Congress against a la carte delivery. Bud's signature accomplishment is the billions of dollars in revenue that now flows into MLB, mostly from media contracts. He publicly pleads ignorance about the blackout rules, But I'm certain he knows full well that RSN revenue can't be replaced in-market with OTT delivery.

Brutus
11-01-2012, 10:17 PM
I've never heard that any forces within the industry, other than OTT providers like Netflix, are pushing for that. Netflix's competitors like HBO are pushing back just as hard to keep the status quo.

Considering the huge impact on revenue that eliminating blackouts and RSN basic-carriage provisions would have, I could easily picture Bud Selig testifying before Congress against a la carte delivery. Bud's signature accomplishment is the billions of dollars in revenue that now flows into MLB, mostly from media contracts. He publicly pleads ignorance about the blackout rules, But I'm certain he knows full well that RSN revenue can't be replaced in-market with OTT delivery.

A lot of operators would love to go to a la carte programming. They're tired of Disney, Viacom and other companies shoving low-rated channels down their throats in bundles, forcing them to pay 20-50 cents per subscriber per month when very few people want to watch these secondary networks.

When Time Warner deals with Disney, it's not just paying market value for Disney, ESPN and ESPN2. It's being forced to take on ESPN Classic, ESPNU, ESPN News, Disney XD, etc. These networks bundle all of their channels and force up the rates paid through subscriber fees or else they threaten to yank all their channels off the air.

So what's happening is the rates are in turn jacked up on the consumers. Eventually, consumers will stop paying the money and everyone in the industry, to a man, knows that and admits it. When that happens, everyone expects some form of a la carte. But for now, they're trying to milk the system as long as they can before it crumbles.

Wonderful Monds
11-02-2012, 02:49 AM
Am I the only person that exists on the planet that doesn't really care about a la carte programming?

Chip R
11-02-2012, 09:25 AM
The thing I worry about, in regards to the Reds situation, is that while the games are highly rated, there is basically no other outlet to carry those games on. It's Fox Sports Ohio or nothing. I can't see the over-the-air channels carrying Reds games and pre-empting network programming. I may not understand this as well as I think since sports economics are very different than regular economics but if there's only one outlet for a product, the outlet can pretty much pay whatever they want for that product no matter what the ratings are. If there were more than one outlet, the Reds could play them off against each other.

Now I have seen ROOT SPORTS (http://www.rootsports.com/ViewArticle.dbml?DB_OEM_ID=25900&ATCLID=205126777) come into play over the past year. Right now they are in Pittsburgh, the Northwest and the Rocky Mountains. They carry Pirates, Mariners and Rockies games. Perhaps they could be used to drive up the price of the games. I suspect, by the time the Reds deal expires, they will have grown or gone out of business. Their website says they are owned by DirecTV and used to be FSN. So I don't know if they would be a competitor of Fox Sports Ohio or FSO would become ROOT. My guess it would be the latter which would put the Reds back in the same boat they were to begin with.

Brutus
11-02-2012, 05:40 PM
Am I the only person that exists on the planet that doesn't really care about a la carte programming?

You wouldn't prefer to only pay for the channels you watch?

Wonderful Monds
11-02-2012, 06:07 PM
You wouldn't prefer to only pay for the channels you watch?

They'll find a way to gouge prices either way.

dougdirt
11-02-2012, 06:10 PM
They'll find a way to gouge prices either way.

Not really. If people aren't willing to pay $X for Y channel, then Y channel is going to have to start offering its services for $X-10% (or more).

Caveat Emperor
11-02-2012, 10:38 PM
Not really. If people aren't willing to pay $X for Y channel, then Y channel is going to have to start offering its services for $X-10% (or more).

Or, more likely, they'll bundle in Channel Y "for free" with Channel X (a channel like ESPN / TBS / TNT etc.) that everyone wants and pays a lot for.

Then you end up exactly where you started.