Jan 23, 2013, 12:52 PM EDT
We talk a lot about the skyrocketing TV deals baseball teams are getting from cable operators these days. One wonders, though, whether or not we’re witnessing a bubble that’s going to soon burst. If it does, we may look at the Dodgers’ new TV deal as the beginning of the end.
The Dodgers TV deal with Time Warner is reported to be upwards of $8 billion. To pay for that, Time Warner is going to charge other carriers (Direct TV, Dish Network, other cable systems) $4 or $5 per subscriber for the right to carry the new Los Angeles Dodgers network they’re operating, with those costs passed on to the other carriers’ customers. This is how all sports TV rights deals go. It’s just way bigger with the Dodgers and Time Warner.
Many — probably most — of the customers who are seeing their cable bill go up are not Dodgers fans. They just want to watch Nick Jr. or History Channel or BBC America or any number of other channels. But, because you can’t (for the most part anyway) pick and choose which channels you get, the non-sports watchers are helping subsidize the sports watchers. Again, this is how it always works, but this time the rate hikes in question are going to be quite large.
Joe Flint and Bill Shaikin of the L.A. Times write about this today, and they talk to one former TV executive who thinks that such a pattern is unsustainable:
But non-sports fans and pay TV companies are increasingly frustrated at having to pick up the tab for big sports deals. There have been calls to sell sports channels “a la carte,” or separately from other programming.
The Dodger agreement with Time Warner Cable may be a tipping point.
“That is the solution everyone should be looking at seriously,” said Derek Chang, a former senior executive at satellite broadcaster DirecTV. Such a move, he added, may be the only way to lower the cost of TV sports. “Ultimately the market for fees would then reset.”
All it takes is a political groundswell — and someone talking about how we should think of the children who just want to watch “Spongebob” is a great way to get that going — for Congress to wade in and either begin legislating or begin threatening to legislate with respect to cable TV in such a way that a la carte pricing becomes available. If it does, companies in Time Warner’s position won’t be able to demand across-the-board rights fees like they are now and, in turn, they won’t be able to offer sports teams like the Dodgers the billions of dollars in rights fees like they’re currently doing.
If that bubble bursts, down with it comes the TV money. Then down go the franchise values, which are escalating due to the TV money sports teams are attracting. If team values go down, team payrolls will eventually come down too. No aspect of baseball finances would be untouched by it.
Will it happen? I don’t know. And if it does, I don’t know when. But I also know that no bubble in history has ever failed to burst, and that when they do burst, the bubbles tend to take down just about everyone.
Jul 25, 2014, 2:20 PM EDT
Issues caused by pre-existing injuries could lead to more disagreements, such as the one between Brady Aiken and the Astros that was played out on a public stage.
Jul 25, 2014, 1:13 PM EDT
At age 41 he’s at risk to break down, but Colon has a 2.98 ERA in his last 12 starts with a 62/14 K/BB ratio and .217 opponents’ batting average in 85 innings.
Jul 25, 2014, 1:01 PM EDT
Greg Maddux was a magician on the mound, and now he’s going to the Hall of Fame, writes Joe Posnanski.
Jul 25, 2014, 12:57 PM EDT
[but watch that bat-flippin', buddy]
Jul 25, 2014, 11:51 AM EDT
Rollins also has the ability to block any potential trade, so even if contending teams think having him locked into place for 2015 adds to their interest level it may be a moot point.
Jul 25, 2014, 11:33 AM EDT
They are obviously deserving of induction, but their induction also serves some political ends too.
Jul 25, 2014, 11:19 AM EDT
Greg Maddux looked like a guy who should be riding a Metra commuter train to his 9-to-5 job in the Loop, maybe sneaking out later to catch a Cubs game and have a few beers at Wrigley Field.
Jul 25, 2014, 11:03 AM EDT
OK, we’ll just accept that you have not at least talked about taking one of the few options you have regarding Howard, Ruben.
Jul 25, 2014, 10:47 AM EDT
Kyle Gibson has had an up-and-down first full season for the Twins and now he may wind up on the disabled list with a back injury.
Jul 25, 2014, 10:38 AM EDT
He’s a double threat: bad and expensive.
Jul 25, 2014, 10:15 AM EDT
After a huge spring training that won him the Mariners’ starting shortstop job Brad Miller has struggled mightily, hitting .205 with a .599 OPS and 74/25 K/BB ratio in 86 games.
Jul 25, 2014, 9:57 AM EDT
Injuries are mounting for the first place Giants.
Jul 25, 2014, 9:34 AM EDT
A great, great ballplayer seems to be in denial about his career being over.
Jul 25, 2014, 8:55 AM EDT
With Joakim Soria watching from the sidelines, the Tigers embattled closer shuts down one of the best offenses in baseball.
Jul 25, 2014, 7:17 AM EDT
Ryan Raburn is gonna be buying Corey Kluber steaks for the foreseeable future.
Jul 25, 2014, 6:47 AM EDT
It was a day of blowouts and fine pitching performances.
Jul 24, 2014, 11:19 PM EDT
The Yankees are reportedly considering a reunion with right-hander Ian Kennedy.
Jul 24, 2014, 11:18 PM EDT
Jonathan Papelbon was booed by Phillies fans this afternoon, but it didn’t bother him. In fact, he says bring it on.
Jul 24, 2014, 10:20 PM EDT
Chad Qualls quietly owns a 1.78 ERA this season. The Astros are reluctant to deal him.
Jul 24, 2014, 9:25 PM EDT
Astros left-hander Dallas Keuchel tossed a baseball to a heckler during today’s game against the Athletics. And the ball contained a clever message.
- How’d he do that? Magician Maddux fooled hitters all the way to Hall 5
- And That Happened: Thursday’s scores and highlights 45
- MLBPA files grievance against Astros in regard to draft pick situation 35
- The eyes have it: Thomas’ greatness built on patience 14
- Expert’s Corner: How to troll fans of all 30 teams 193
- Mariners re-acquire Kendrys Morales from Twins for Stephen Pryor 22
- A’s designate $10 million reliever Jim Johnson for assignment 35
- Everything you need to know about next week’s trade deadline 35
- Expert’s Corner: How to troll fans of all 30 teams (193)
- Verducci: baseball should think about an “illegal defense” rule to combat shifts (162)
- Yankees acquire Chase Headley from Padres (108)
- Who is the next Face of Baseball? (97)
- David Ortiz passes Carl Yastrzemski on the all-time home run list — is he a Hall of Famer? (92)