Re: MLB Advanced Media & The Future of Broadcast Rights
Originally Posted by Unassisted
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.
"No matter how good you are, you're going to lose one-third of your games. No matter how bad you are you're going to win one-third of your games. It's the other third that makes the difference." ~Tommy Lasorda