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 28, 2014, 6:32 AM EDT
The Dodgers sweep their rivals in San Francisco, the Rays complain about Big Papi and I complain about Southwest Airlines messing with my kids’ vacation.
Jul 27, 2014, 11:05 PM EDT
Ian Kennedy’s left oblique is bothering him, so he’ll miss tomorrow’s start against the Braves.
Jul 27, 2014, 10:35 PM EDT
The Padres are expected to get Jedd Gyorko back from the DL, but lose Carlos Quentin on Monday.
Jul 27, 2014, 9:40 PM EDT
Josh Harrison kept the PIrates in the mix in Sunday’s game against the Rockies by using his legs.
Jul 27, 2014, 8:45 PM EDT
Pitchers do not want to be facing Carlos Santana right now.
Jul 27, 2014, 7:50 PM EDT
Baseball’s implementation of home plate collision rules, meant to protect catchers, hasn’t gone as smoothly as expected this season. There was yet another example on Sunday afternoon in Philadelphia.
Jul 27, 2014, 6:55 PM EDT
The Rays and Red Sox have been nipping at each other throughout the season, so it was no surprise that Chris Archer took exception when David Ortiz gawked at his three-run home run.
Jul 27, 2014, 6:05 PM EDT
According to an ESPN report, the Red Sox are considering a trade that could bring Matt Kemp to Boston.
Jul 27, 2014, 5:13 PM EDT
Frank “The Big Hurt” Thomas gave a tremendous speech — reflecting on his parents and upbringing in Georgia — Sunday at the Hall of Fame induction ceremony in Cooperstown, New York …
Jul 27, 2014, 4:29 PM EDT
Via the National Baseball Hall of Fame Musuem’s official Twitter feed, here are the six new plaques that will be added to the walls in Cooperstown after Sunday’s induction ceremony …
Jul 27, 2014, 3:41 PM EDT
Rangers left-hander Derek Holland is scheduled to throw a full-effort bullpen session on Monday at Globe Life Park in Arlington, Texas. If it goes well Holland will be cleared to embark on a 30-day minor league rehab assignment later in the week.
Jul 27, 2014, 2:55 PM EDT
On this Hall of Fame induction Sunday — Greg Maddux, Frank Thomas, Tom Glavine, Tony La Russa, Bobby Cox, and Joe Torre are going in — we give you Ted Williams’ speech from 1966 …
Jul 27, 2014, 2:08 PM EDT
The Mariners acquired Kendrys Morales from the Twins on Thursday for right-handed reliever Stephen Pryor, and they’re not done trying to beef up their offense.
Jul 27, 2014, 1:25 PM EDT
Mark Appel was promoted to Double-A Corpus Christi on Saturday despite posting a 9.74 ERA and 1.92 WHIP in 44 1/3 innings at High-A Lancaster. And he was invited to Minute Maid Park in Houston on Sunday morning to throw a bullpen session in front of Astros coaches and executives. This stuff is not sitting well with some of the players on the Astros’ current major league roster.
Jul 27, 2014, 1:07 PM EDT
Jon Heyman of CBSSports.com reports that the Yankees are eyeing Twins outfielder Josh Willingham, who would require less of a committment in years and money than Alex Rios and Marlon Byrd.
Jul 27, 2014, 12:20 PM EDT
So I have three – no, wait, just thought of another one, so four – theories about the Baseball Hall of Fame’s decision to reduce the time a player can spend on the ballot from 15 years to 10. I am not opposed to this rule, by the way. I have long thought 15 years was too long for a player to be on the ballot. And I am absolutely for some changes in the Hall of Fame process …
Jul 27, 2014, 11:34 AM EDT
Jack Hannahan is finally ready to rejoin the Reds’ active roster after missing April, May, June, and most of July following offseason shoulder surgery.
Jul 27, 2014, 10:59 AM EDT
Greg Maddux, Tom Glavine, Frank Thomas, Tony La Russa, Joe Torre, and Bobby Cox make up the star-studded six-man class of players and managers that will be inducted into the National Baseball Hall of Fame on Sunday afternoon in Cooperstown, New York. Here’s a sneak peek at the intro video that will be seen before the ceremony on MLB Network …
Jul 27, 2014, 10:12 AM EDT
The Dodgers and Diamondbacks got into a few scuffles last season, and now their Triple-A affiliates are taking the feistiness to another level. Check out this brawl from Saturday evening …
Jul 27, 2014, 9:30 AM EDT
This doesn’t sound like a promising development. According to Nick Groke of the Denver Post, star shortstop Troy Tulowitzki flew to Philadelphia on Saturday afternoon to visit Dr. William Meyers about his lingering left hip injury. Meyers performed a sports hernia surgery on Tulowitzki in 2012
- And That Happened: Sunday’s scores and highlights 0
- Mariners’ interest in Matt Kemp is “very real” 22
- Astros players upset over Mark Appel’s promotion to Double-A, bullpen session in Houston 39
- Four theories about the Hall of Fame voting changes 23
- Troy Tulowitzki is visiting a sports hernia surgeon 10
- Settling the Score: Saturday’s results 29
- Giants acquire Jake Peavy from Red Sox 55
- Maximum stay on Hall of Fame ballot changed from 15 to 10 years 66
- Expert’s Corner: How to troll fans of all 30 teams (201)
- Verducci: baseball should think about an “illegal defense” rule to combat shifts (164)
- 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)