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.
Aug 30, 2015, 8:35 PM EDT
Tim Lincecum may have thrown his last pitch as a member of the Giants after suffering another setback in his recovery from hip and back injuries.
Aug 30, 2015, 7:45 PM EDT
David Ortiz has sole possession of 27th place on baseball’s all-time home run leaderboard.
Aug 30, 2015, 6:55 PM EDT
The Phillies added bullpen depth on Sunday, claiming Ken Roberts off waivers from the Rockies.
Aug 30, 2015, 6:05 PM EDT
Curtis Granderson was prompted to say something controversial, so he did.
Aug 30, 2015, 5:22 PM EDT
The 27-year-old missed most of July with an oblique strain and most of June with a trapezius strain.
Aug 30, 2015, 4:15 PM EDT
Royals right-hander Jeremy Guthrie is doing some fine side work in his new long relief role …
Aug 30, 2015, 3:28 PM EDT
Josh Hamilton is likely to be activated off the disabled list Tuesday, September 1 when major league rosters expand, but it sounds like he’s going to be limited to pinch-hitting duties for a while.
Aug 30, 2015, 2:34 PM EDT
Machi owns a rough 5.21 ERA in 46 2/3 total innings this season between San Francisco and Boston, but the out-of-contention Red Sox will simply roll with what’s currently working as they play out the string.
Aug 30, 2015, 1:47 PM EDT
Josh Donaldson got Sunday Funday started early in Toronto with this first-inning solo blast …
Aug 30, 2015, 1:20 PM EDT
A.J. Burnett has been out since late July with a strained flexor tendon in his right arm. There was some thought initially that the injury would be a season-ender (and thus career-ender) for the 38-year-old, but he’s beginning to make significant progress.
Aug 30, 2015, 12:43 PM EDT
Data really is beautiful.
Aug 30, 2015, 11:59 AM EDT
This is probably a case of the ‘Stros playing it safe with a young star. They do have a four-game lead in the American League West standings and Correa has been pushed hard over the last three months.
Aug 30, 2015, 11:01 AM EDT
Cardinals right-hander Lance Lynn rolled his right ankle in the eighth inning of a shutout bid Saturday against the Giants and had to be pulled from the game, but it sounds like he is going to be fine.
Aug 30, 2015, 10:24 AM EDT
Baez batted just .169/.227/.324 and racked up a whopping 95 strikeouts in 52 games last season for the Cubs, but he’s made great strides with his plate approach this year on the farm and he could slide his way into regular playing time in Chicago if he hits well out of the gate.
Aug 30, 2015, 9:40 AM EDT
Bryce Harper took some frustration out on a now-former bat of his Saturday night at Nationals Park …
Aug 30, 2015, 8:56 AM EDT
Your box scores and AP recaps from Saturday …
Aug 30, 2015, 12:03 AM EDT
A fan heckling Alex Rodriguez from the upper deck fell and died at Turner Field on Saturday night.
Aug 29, 2015, 11:05 PM EDT
The Royals will likely get Alex Gordon back when the calendar turns to September.
Aug 29, 2015, 10:10 PM EDT
Mariners manager Lloyd McClendon wants to keep Felix Hernandez fresh through the end of the season, so he’ll skip his ace’s start on Monday.
Aug 29, 2015, 9:15 PM EDT
Gavin Floyd will pitch out of the bullpen for the Indians when he is activated on Tuesday.
- Lance Lynn expects to make next scheduled start despite suffering ankle injury Saturday 2
- Cubs expected to call up Javier Baez on September 1 5
- Settling the Score: Saturday’s results 13
- A fan died at Turner Field after falling from the upper deck 53
- Mets acquire Addison Reed from the Diamondbacks 10
- Vin Scully says 2016 will be his last season of broadcasting 31
- Edwin Encarnacion slugs three home runs as Blue Jays thrash Tigers 18
- Mark Teixeira says he’s having “serious pain” when he tries to run 14
- Sarah Palin sticks up for Curt Schilling, tells ESPN to “stick to sports” (266)
- Dan Patrick: When does ESPN cut ties with Curt Schilling? (200)
- Curt Schilling taken off of Little League World Series duty for making a really bad tweet (170)
- Curt Schilling taken off of ESPN’s Sunday Night Baseball telecast this week (134)
- Phillies announcer calls Mets fans “obnoxious” (123)