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Fuse lit: MASN goes to court to keep from having to pay the Nats more money for TV rights

Aug 7, 2014, 2:30 PM EDT

MLB Commissioner Bud Selig speaks during a news conference in New York

Last week the Hollywood Reporter got inside the ongoing Washington Nationals-Baltimore Orioles-MASN dispute over the dividing up of rights fees. The big takeaway there was that everyone was preparing to go nuclear, abandon negotiations and run to the courthouse. And that Bud Selig was warning everyone involved NOT to take this to court because, well, baseball just doesn’t want that. He said in a letter to the clubs that he would level “the most severe sanctions” against them if they do.

Well, get ready to level, Bud, because MASN has gone to court in New York and obtained an injunction against a Major League Baseball arbitration which ruled in favor of the Nationals on the fee dispute. Basically: a court order to prevent the Orioles, the Nationals and MASN from having to comply with it. You can read all of the documents filed and the court order below. The upshot of the arguments, for those who do not wish to read: MASN is asking that the arbitration be set aside due to a conflict of interest. The argument includes the following claims:

  • The same lawyers represented the Nationals, Major League Baseball and the clubs of the three owners who comprised the arbitration panel;
  • “The three arbitrators, MLB and the Commissioner of Baseball, all had a direct and significant pecuniary interest in the outcome of the arbitration.”
  • The authority set up to determine the amount of money the Nats were supposed to get from MASN “exceeded its authority by intentionally refusing to use its established methodology to determine the fair market value of the telecast rights fees as mandated . . .”

Worth noting that there are many levels of conflict of interest here. For all intents and purposes, MASN is the Orioles in this case. The Orioles are the majority shareholders in MASN, they have the same lawyers and, in not paying a lot more money to the Nationals, the same general interests. To the court they are a separate party, to be sure. But I wonder if Bud Selig and Major League Baseball feel obligated to view them that way. Because, either way, the same bad purpose (in MLB’s eyes) is being obtained: the undermining of its arbitration and taking an internal dispute out into the open.

Whether the court is willing or able to untangle all of these many layers of conflict is unclear. It is worth rememberng, however, as we learned in the A-Rod/Biogenesis case, that courts are extremely reluctant to overturn arbitration rulings, so this may all ultimately be an exercise in posturing and delay.

But that’s the legal stuff. The practical aspect of all of this is that, at essence, MASN and the Orioles do not want to pay the Nationals what the Nats and what Major League Baseball, per its arbitration, think their broadcast rights are worth. Or, it should be noted, they may not be able to. You see, per the agreement between the parties, (a) the Nationals are to get market rates for their broadcasts; and (b) the Orioles are to get increases in their payout that match the Nats’ increases. In this market, however, that would probably bankrupt MASN. So no amount of negotiation under the terms of the agreement is likely to solve the problem. It may be an utterly untenable agreement.

So, while this is somewhat amusing from the point of view of baseball’s failed efforts to negotiate a settlement in private between the parties, the parties may now be in an impossible situation. Maybe the court steps in, but it’s hard to see the court wading in to this matter beyond the preliminary way in which it already has. One other possibility is that a third party could step in. As in, the Nats buying their way out of the MASN deal entirely and going out on its own with a separate broadcaster. Which, for their part, MASN and the Orioles probably don’t want, as they make money off of Nats broadcasts and don’t want the competition. But as of now, I see no other way out of it.

For now, though, it’s in the court’s hands. Here are the documents it’s working with right now, including the court order and MASN’s petition to set aside the arbitration ruling:

Order

Petition

Mem

  1. umrguy42 - Aug 7, 2014 at 2:32 PM

    “The most severe sanctions” – he’s gonna bury ‘em buy putting them on the A’s relocation committee?

    • umrguy42 - Aug 7, 2014 at 3:33 PM

      *by putting them…

      EDIT FUNCTION!

      • slappymcknucklepunch - Aug 7, 2014 at 3:38 PM

        Don’t worry, we got it.

  2. timbo1986 - Aug 7, 2014 at 2:37 PM

    A-rod to Orioles

  3. tcostant - Aug 7, 2014 at 2:41 PM

    I don’t understand why MLB just doesn’t deduct the amount from the national TV contract due every team, and make the O’s come back for the money. Baseball could then forward the money to the Nationals. As noted, the arbitration process was agreed to by everyone.

    • lphboston - Aug 8, 2014 at 6:28 AM

      Not sure why you got down arrows. That sounds like a good idea.

  4. billybawl - Aug 7, 2014 at 2:43 PM

    Can we all agree that once Bud is gone, we’ll miss the endless supply of photos of him reacting to something that get inserted into blog posts every time he’s mentioned?

  5. packerken2000 - Aug 7, 2014 at 2:45 PM

    Do they have to leave just because Bud leaves? I think not.

  6. Old Gator - Aug 7, 2014 at 2:48 PM

    I understand that a large amount of money is at stake here and that the long term upshot of this could be deadly serious, damaging to baseball, and could ultimately affect Bud Slight’s legacy.

    Heee heee heee.

    • natstowngreg - Aug 7, 2014 at 9:44 PM

      Fun as it might be to contemplate, this probably won’t make much of a dent in Bud’s legacy.

      The key is in the words, “…a large amount of money is at stake here…” A big part of Bud’s legacy will be MLB’s good financial health. Providing large amounts of money over which to fight.

  7. dowhatifeellike - Aug 7, 2014 at 2:54 PM

    Considering that MASN/Angelos/Orioles are essentially the same entity, I don’t think Angelos cares how the money is moved between them. He just doesn’t want to give any of it to the Nats. Hell, he’d probably get a tax break if MASN had to operate at a loss. Just shift some of that money back over from the Orioles to keep it going.

    • randomdigits - Aug 7, 2014 at 3:10 PM

      A portion of the money paid in rights to the Nats (with an equal share paid to the O’s) is subject to revenue sharing. If MASN keeps the money it isn’t subject to revenue sharing. Earlier in the process MASN tried to increase the Nats’ stake in MASN instead of increasing the fees.

    • Old Gator - Aug 7, 2014 at 6:43 PM

      Sounds like the kind of “creative accounting” Gene Wilder recommended in The Producers, no?

  8. kopy - Aug 7, 2014 at 2:56 PM

    I think you meant “for all intensive purposes”

    /s

    • tearlw - Aug 7, 2014 at 5:30 PM

      Nope. He had it right the first time.

      From Dictionary.com: Idioms
      5. for all intents and purposes, for all practical purposes; practically speaking; virtually: The book is, to all intents and purposes, a duplication of earlier efforts.

      For all intensive purposes is a non-sense phrase.

      • [citation needed] fka COPO - Aug 7, 2014 at 7:01 PM

        See that “/s” at the end of his comment, it means he’s being sarcastic.

  9. bisonaudit - Aug 7, 2014 at 3:02 PM

    You’d think that the O’s would have some incentive to come to an agreement since they’re going to continue to own 2/3 of the network broadcasting both teams games and get paid for their broadcast rights at a rate that they wouldn’t otherwise receive.

    Similarly, the Nats would really have to be getting hosed in order to walk away from a 1/3 equity interest in the network. The ‘market value’ of the broadcast rights causing a cash flow problem for MASN is a short term issue if it’s one at all. It’ll get fixed the next time carriage fees are negotiated. The equity interests are forever.

  10. bfunk1978 - Aug 7, 2014 at 3:10 PM

    Is this where the RSN bubble bursts? Regional sports networks make me crazy because they’re the reason MLB.tv blocks in-market games streamed over the internet. I’m sure MLB isn’t cutting the RSNs in on the proceeds from the web streaming to make allowing those games to be streamed to me worthwhile. I’d pay 50% premium for MLB.tv in order to cut the cable TV cord. Baseball in my market is literally the only thing keeping me from doing that.

    • scoutsaysweitersisabust - Aug 7, 2014 at 3:35 PM

      Yea, I’m in the same boat. I haven’t watched live tv in months, with the exception of Baseball and Football. Both of witch I can stream over the internet. Only MLB.tv has that stupid black out policy.

    • gloccamorra - Aug 7, 2014 at 4:55 PM

      Thisn’t the first instance of the RSNs bubble bursting. Time Warner stiffed the Padres sports network for a couple years, much of Los Angeles still can’t see Dodgers games, and the Astros’ Houston network went bankrupt. The bubble won’t exactly burst, it’s looking more like it’ll be a slow motion train wreck

      • bfunk1978 - Aug 7, 2014 at 9:52 PM

        I’m all for teams getting paid for the content they produce but I this bubble needs to deflate faster. Lol

  11. hk62 - Aug 7, 2014 at 3:17 PM

    Can’t the Nat’s lawyers ask to see how money moves between MASN and the O’s? I think that’s what Bud is wanting to protect. You would think that Angelos would want the same thing. But as Craig said before, Angelos loves court…

    • bisonaudit - Aug 7, 2014 at 3:21 PM

      The Nats are a minority shareholder in MASN so they should have that information already.

  12. nvl004 - Aug 7, 2014 at 3:21 PM

    Statement case by the Orioles organization- Bud Norris

    • sophiethegreatdane - Aug 7, 2014 at 8:07 PM

      Craig would just say: “Whatever”.

  13. DJ MC - Aug 7, 2014 at 3:33 PM

    The biggest issue here comes back to a very basic, foundational point: this deal was the only thing that allowed MLB to move the Expos franchise into Washington without the Orioles going nuclear in 2005. This isn’t a situation like the Bay Area where the A’s gave up territorial control to the south bay to the Giants to help save that club and now the Giants are refusing to act in kind and the A’s have no recourse. The Orioles were specifically given this deal in exchange for their acquiescence.

    What happens if the contract is either nullified completely or upheld in a way that destroys MASN, and the Orioles get an injunction against the Nationals operating in what is their contractually-agreed territory by MLB?

    That’s pretty much the most extreme outcome, but it’s also probably the most interesting.

    • bisonaudit - Aug 7, 2014 at 3:46 PM

      That sounds like a pretty terrible outcome for the O’s. Unless they’re clearly getting the better of things in court you’d think it would make them want to settle.

      • DJ MC - Aug 7, 2014 at 4:48 PM

        If you mean terrible in terms of the loss of MASN, I agree. Which is why if that were to occur, there is always the nuclear option of going against the very right of the Nationals franchise to operate within 75 miles of the Orioles previously-established operations.

        The Orioles certainly don’t want that outcome, just like no nation that holds nuclear weapons actually wishes to use them. But that is the deterrent.

      • natstowngreg - Aug 7, 2014 at 10:05 PM

        Teams’ territorial boundaries can be changed. They need to change as teams move. Angelos’ claim to Washington would rest on the Orioles getting those rights in 1972, after the Senators left.

        However, Angelos agreed to putting a team back in Washington in 2005. So much for any territorial claims he could make to Washington.

      • natstowngreg - Aug 7, 2014 at 10:45 PM

        Correction. As someone pointed out, Angelos voted against the move. However, as an MLB franchise holder, he had to abide by the decision.

        Being Angelos, he might well have sued anyway, but he got the sweetheart TV deal to facilitate the move.

    • dowhatifeellike - Aug 7, 2014 at 4:16 PM

      I would not be too surprised if Angelos let MASN disband if it came to it. The Orioles would still come out on top; the Nationals don’t have the fanbase to get a decent TV deal on their own. That D.C. metro/DMV area is still mostly Orioles fans; O’s territory extended all the way into parts of North Carolina (where it bumped up against Atlanta’s reach) long before the Expos moved. I remember, as a kid 20 years ago, seeing that most of the televised contest winners were from Virginia.

      • jeffchadwick - Aug 7, 2014 at 4:55 PM

        Most of this statement may have been correct in 2005, but it most certainly is not in 2014. You could probably count the Orioles fans in Montgomery County, DC, and Northern Virginia (sans Manassas) on one hand at this point.

      • DJ MC - Aug 7, 2014 at 4:55 PM

        That was 20 years ago when, you know, there wasn’t a team in DC.

        Plus, if MLB is fighting so hard on the Nationals’ behalf, and has even been giving them money outright over the duration of the fight, why wouldn’t they help the Nationals get some form of network up and running as soon as possible.

        Plus, without MASN there is no other realistic possibility for local broadcasts in the Baltimore area. Comcast Mid-Atlantic was pissed off royally when the Orioles dropped them to start MASN, so if anything they would be out for the rights to the Nats, which they can then broadcast to the Baltimore market. A new network would then have to build from the ground up and it would be a fight to get that channel airing outside of the immediate Baltimore metropolitan area. So all those Virginia and Carolina regions that were Orioles territory exclusively for 30 years and shared for the past decade would fall right to the Washington market.

        So the Orioles lose their network and have to build a new one while the Nats either find an established option or build their own likely with MLB assistance. They lose their market share, and maybe even find themselves unbroadcast for a period while the Nationals air all across the region.

        That’s not good for the Orioles at all.

      • voteforno6 - Aug 7, 2014 at 5:29 PM

        When you were a kid there wasn’t a team in D.C. There still are some Orioles fans in the area, but the Nats are by far the most popular team here – winning the division in 2012 had a lot to do with that. People followed the O’s back then, because they were the only game in town. That’s no longer the case.

      • voteforno6 - Aug 7, 2014 at 8:50 PM

        DJ MC –

        If MASN collapsed, I don’t think Comcast would have any qualms about picking up the Orioles again, for the right price. Corporations are soulless entities; whatever feelings the executives there may have, I’m sure they’ll gladly sign a deal if they think they can make money.

      • DJ MC - Aug 7, 2014 at 9:03 PM

        They’re a DC-based network, so they’d go for the Nats first. And I can’t imagine Washington contractually allowing CSN to buy the Orioles’ rights, too, even affording them second-class status.

    • voteforno6 - Aug 7, 2014 at 5:35 PM

      Anyone who lives in the area knows that D.C. is not Baltimore – they’re separate media markets. It’s kind of arrogant for Angelos to claim any ownership of the D.C. market, especially considering that he’s never done a thing for the area, except take their money. Also, let’s not forget that when Angelos bought the Orioles, he was informed by MLB that D.C. would be getting a team eventually.

      • DJ MC - Aug 7, 2014 at 6:28 PM

        1) Angelos doesn’t personally claim anything. The Orioles–going back to the ownership of Jerrod Hoffberger–claim DC by right of a lack of a team between 1973 and 2004, the city currently housing the team being (significantly) within the 75-mile territorial rights granted by MLB to existing franchises, and the support base built up over that 32-year period.

        2) MLB was in such a hurry to do so that it took them more than a decade. And then when they finally did, they signed away the broadcast rights of that franchise in lieu of a court battle. That doesn’t sound like an organization that had solid ground to stand on legally in this case.

      • voteforno6 - Aug 7, 2014 at 9:06 PM

        1) In ten years the Nationals have built up a larger support base in D.C. than the Orioles did in 32 years. I have to wonder how deep support was in D.C. during those three decades.

        2) Considering that MLB has an antitrust exemption, I’m not sure how solid the legal ground would be for the Orioles to sue. MLB tried to contract the Expos (at least they claimed to do so), but instead relocated them, since they weren’t being supported by Montreal, and were victimized by bad ownership (as happened to both iterations of the Senators). Where could the Expos move? Were there any bigger markets than Washington that did not have a team? It was kind of a no-brainer to move them to D.C.

        Yeah, MLB signed away the broadcast rights of the team when they relocated them. Then they sold the team. Are there any other teams that do not have the right to negotiate their television rights on the open market? I think MASN/the Orioles would be at greater risk if this dispute actually went to trial, though the discovery process would be extremely entertaining.

      • simon94022 - Aug 7, 2014 at 9:13 PM

        There is no “75 mile” rule in MLB. The MLB Constitution spells out precisely the Territory of each team. Baltimore has no rights — and never has had rights — to any part of the DC area.

    • simon94022 - Aug 7, 2014 at 8:53 PM

      This is different from the Giants/A’s situation. For better or worse, the Giants have exclusive contractual rights to operate a MLB team within a Territory that includes San Jose.

      The Orioles’ Territory never included Washington, DC or any of its suburbs. So the Orioles no ever had the right to prevent the Nats from relocating and operating there. All the Orioles had in the DC was a broadcast right – but the MLB Constitution specifically states that those rights can be changed at any time by the Executive Committee. No veto by the affected club, and an ownership vote is not even required.

      Angelos didn’t have much of a legal claim for compensation in 2005. But MLB gave him MASN anyway, because Bud likes to keep everyone happy, and this deal cost MLB nothing — thanks to the huge windfall the other team owners got from selling the Nats to the Lerner family.

      Unfortunately the success of MASN depended on Angelos having some integrity, which he does not. If he won’t pay the Nats what he owes them for the perpetual rights to their games, then MASN should be broken up and Angelos left to rot with nothing.

      • DJ MC - Aug 7, 2014 at 9:26 PM

        The Orioles certainly did have a claim to DC through territorial rights and 35 years of no team. They built a fan- and business-base in DC, so moving a franchise into the area had a major effect on the organization. I’ve seen estimates from online sources suggesting as much as 25 percent of the Orioles business was directly lost in the move.

        So MLB was doing more than throwing a bone at a litigious owner. They were buying the right to move a franchise into the region, and they believed that cost (a very high cost, even at the time) was worth putting that club in a much better position.

  14. nvl004 - Aug 7, 2014 at 3:40 PM

    Send the Nat’s back to Montreal.

    • gloccamorra - Aug 7, 2014 at 5:07 PM

      Or send the Orioles back to St. Louis! They were the Browns until 1954, and they moved in on the Washington Senators’ territory.

      Actually, the Browns were originally the Milwaukee Brewers, but moved into the Cardinals’ territory, so they’ve done twice what the Nationals have done to them!

      Anyway, it’s the famed Northeast Corridor – there are plenty of fans to go around, and lots of TV/radio money to scoop up. I hope Bud goes medieval on them and sends stern letters to all involved!

      • tmc602014 - Aug 7, 2014 at 6:24 PM

        Thumbs up for medieval letters! All Hail the Olde English “D”

    • voteforno6 - Aug 7, 2014 at 5:31 PM

      Why? They’re doing pretty well in D.C. More likely candidates for relocation are one of the Florida teams.

      • gargamelsmentor - Aug 7, 2014 at 5:39 PM

        Voteforno6…are you sure the Nats are the most popular team “by far” in DC? You saw the game on Monday night (and the previous O’s/Nats games in DC). The stadium was 50/50 at best.

  15. voteforno6 - Aug 7, 2014 at 5:44 PM

    No, it wasn’t 50/50. The Nats had the majority of fans there at the stadium, as they did at the previous game (I was at that one). You can check the attendance figures, and you’ll see that the Nats are drawing more fans than the O’s. Or, you can just walk around in D.C. and in the suburbs (particularly in NoVa), and you’ll see a lot more people wearing Nats gear than any other team.

    • gargamelsmentor - Aug 7, 2014 at 5:55 PM

      You’ve got yourself quite a nice pair of rose-colored glasses.

      • bisonaudit - Aug 7, 2014 at 5:59 PM

        The Nats are gaining but the O’s get the same number of eye balls in Baltimore (a much smaller TV market) that the Nats do in DC and that’s not counting O’s fans watching O’s games from the DC TV market and vice versa, which would clearly favor the O’s.

    • DJ MC - Aug 7, 2014 at 6:37 PM

      The advantage is pretty small (~3,600 fans per game last season, ~2,000 per game so far in 2014), especially considering DC’s specific MSA has a population approximately double that of Baltimore.

      I watched the game at Camden Yards South on TV, and the crowd sure didn’t sound like a 50/50 split. I guess a few of the Nats fans could have been reading, though; they’re known for that.

      • voteforno6 - Aug 7, 2014 at 8:42 PM

        So, how many games do you catch at Yankees Stadium South (or Fenway Park South)?

      • DJ MC - Aug 7, 2014 at 9:00 PM

        That place was torn down September 28, 2011. But I wouldn’t expect a Nationals fan to know that. You’re too busy holding your closet door shut so all the Orioles gear you threw in there last year won’t explode out :)

      • voteforno6 - Aug 7, 2014 at 9:14 PM

        I have a lot of crap in my closet (is that you R. Kelly?) but I don’t think there’s any Orioles stuff in there. That is, unless some of my old Twins stuff somehow transformed – kind of like what happens to stuff left in the refrigerator at work.

      • DJ MC - Aug 7, 2014 at 9:21 PM

        Are you a former Original Senators fan, or did you come by Twins fandom elsewhere?

        Not teasing, legitimately curious :)

    • natstowngreg - Aug 7, 2014 at 10:32 PM

      I was at the game Monday night. May not have been 50/50, but Orioles fans were well-represented.

      This is the Nats’ 10th season. Before that, the Orioles had a third of a century to establish themselves in Washington. The Nats have made a lot of progress in overcoming that, and developing their own fan base. More time and winning is needed. I’m optimistic.

    • cmoney4949 - Aug 8, 2014 at 9:39 AM

      Every O’s vs nats game I have been to in DC the last couple of years the stadium is pretty much sold out and the fans are definitely 50/50 if not more O’s fans.

      Whatever the out come they better keep the O’s on TV out in the Outer Banks for when I go on vacation every summer down there.

  16. mybrunoblog - Aug 7, 2014 at 6:22 PM

    Hey are the Nats sending Harper to the minors ?

  17. tearlw - Aug 7, 2014 at 6:50 PM

    I posted this information a couple of weeks ago when the Hollywood Reporter story came out. It seems like a good time to throw it out there again.
    Full disclosure, as a lifelong Yankees fan I hate Peter Angelos with the white-hot passion of a thousand suns. But, I think he might be on the right side of this one. (Guh. I think I just threw-up in my mouth a little bit.)

    “According to SportsBusiness Journal’s annual July assessment of local TV ratings for baseball’s 29 U.S. franchises, Nationals ratings in the D.C. television market on MASN/MASN2 and WUSA are averaging a 1.90 rating, which is down 34 percent from the same point last season. That’s the third-biggest drop in baseball, behind just the Dodgers — who are struggling with distribution on their new regional network — and the last-place Rangers.
    The Nats are averaging 46,000 homes through the first week of July; last year at this time, they were averaging 67,000 homes.
    In the Baltimore market, meanwhile, the Orioles are averaging a 5.58 rating and 62,000 homes for broadcasts on MASN, MASN2 and WJZ, according to SportsBusiness Journal. That’s down 7 percent from the same time last season.
    The Nats have the 21st biggest average rating of the American teams, and the 24th biggest average audience. The Orioles have the eighth biggest average rating, and the 17th biggest average audience.”
    (Source: Washington Post’s Dan Steinberg)

    So the Orioles have, by themselves, the 17th biggest tv audience, while the Nats have the 24th. When people say that MASN can’t survive without the Nats, I’m not sure that’s true. Even more on point, the O’s seem to deserve their larger share of revenue.

    • gargamelsmentor - Aug 7, 2014 at 6:59 PM

      Good stuff tearlw…..do you have a picture book version so that the Nats fans can understand it? :-)

    • voteforno6 - Aug 7, 2014 at 8:36 PM

      TV ratings are kind of irrelevant here. Regardless of how many people are watching, everyone with a cable subscription is still paying. How do the D.C. and Baltimore media markets compare to each other? The D.C. market is roughly twice the size of Baltimore, and it’s wealthier. If the Nats broke loose from MASN, the network would risk getting dropped by cable providers in the D.C. market. At the very least, it would get a lot less in carriage fees from those providers.

      Considering that these are separate media markets (and anyone who lives in the area would tell you that D.C. is not Baltimore), one has to ask: why should a team based in Baltimore be entitled to any piece of the D.C. market? Especially considering that the Baltimore market is quite a bit smaller?

      • tearlw - Aug 7, 2014 at 9:00 PM

        Ratings aren’t irrelevant here. The amount people pay their cable company for MASN is based on the rating MASN gets because the amount MASN charges the cable company to carry it is based on ratings.

        DC may be bigger and wealthier than Baltimore, but the point I was making was, because of higher ratings for the O’s vs. the Nats, the O’s are better positioned to go it alone than the Nats are. At the very least they deserve a bigger cut than the Nats do if they stay with the same network.

        They’re entitled to a piece of the DC market because for 34 years (1971-2005) they were the only game in town (in both towns) and built up quite a fan base in that time. Even if there are more Nats fans in DC now than O’s fans, there are still enough O’s fans in DC that it’s unlikely a cable provider would throw away the money they could make carrying O’s games in the DC market.

      • simon94022 - Aug 7, 2014 at 9:26 PM

        Voteforno6 is exactly right: ratings have nothing to do with this. In the first place, MASN is founded on an artificial “Baltimore-Washington media market” which doesn’t exist. Baltimore is a separate, small market, but the Orioles have close to 100 percent market share there. The Nats have a smaller but still dominant share of the larger DC-Northern Virginia-Montgomery Co Md market. If you’ve spent any time in DC or Northern Va, you can’t seriously believe it’s anything other than overwhelming Nats territory.

        The Nats – having given MASN years of broadcasting their games at below market rates – are now contractually entitled to receive fair market value. Because they are the home team and dominant team in the Washington media market, the fair market value of the rights to their games is substantial, and considerably more than the value of Baltimore games.

      • tearlw - Aug 7, 2014 at 9:35 PM

        How in the world are ratings irrelevant if the argument is over fair market value. How do you think you establish fair market value without at least considering the ratings?

      • simon94022 - Aug 7, 2014 at 10:21 PM

        Ratings are a short term consideration. Fair market value is what the highest bidder would pay for exclusive rights to broadcast the games of the Washington team in the Washington market. Keep in mind that we are talking about a Top 10 media market (without counting any part of the Baltimore area), which is also one of the nation’s wealthiest.

        The fair market value of the Nats rights in that market is certainly much closer to the arbitration-determined $100 million per year than it is to the Orioles’ rather ridiculous suggestion of $30 million.

      • tearlw - Aug 7, 2014 at 10:36 PM

        Short term consideration means it’s not irrelevant.
        Wouldn’t the highest bidder look at the money they would expect to recoup as an important part of their calculating their bid? How else do cable companies calculate licencing fees other than ratings? If MASN broadcasts commercials during O’s/Nats’ games, then ratings play a part in the money. It doesn’t matter how rich the market is or how big it is, you can’t make money if people aren’t watching.
        Again, my point was, if the teams share a network, then O’s deserve a bigger cut, but if they go their separate ways (as some people would like) I think the Nats would be worse off than the O’s. Whether they would be worse off than they are now is a different question.

    • voteforno6 - Aug 7, 2014 at 8:45 PM

      Also, there is an inherent conflict of interest in having a network owned by another team, in that it doesn’t have much incentive to promote that other team’s broadcasts. This was rather apparent when the Nats first got to town – it was difficult at times just finding the games on TV.

      • DJ MC - Aug 7, 2014 at 9:07 PM

        That’s because even though a lot of carriers picked up MASN, not all picked up MASN2. It wasn’t because of a lack of desire to show Nationals games: your argument is premised on DC being significantly larger than Baltimore, so why would it make sense to not show the games that people wanted to watch? Even if the Orioles get priority, they still want those eyeballs.

  18. sophiethegreatdane - Aug 7, 2014 at 8:15 PM

    Why do people keep saying that Angelos is trying to claim DC as Orioles territory? I think people are misunderstanding what the argument is here.

    • voteforno6 - Aug 7, 2014 at 8:38 PM

      That claim is baked into the original “agreement” that the Orioles cut with MLB to allow the MLB-owned Expos to relocate to Washington.

    • DJ MC - Aug 7, 2014 at 9:19 PM

      The argument is that the Orioles (not Angelos, that really needs to be made clear) cultivated a fan base in the Washington region over the three-and-a-half decade period between the Senators leaving and the Expos/Nationals arriving. That metro area also happens to lay almost entirely within the 75-mile radius* that MLB allows teams exclusivity within, so the Orioles needed to give permission for the franchise to enter the area.

      *More than I thought, actually. According to Google Maps, 75 miles from Camden Yards would extend almost as far south as Fredericksburg and almost as far west as Winchester.

      This approval was received in 2005 in exchange for the MASN agreement, which through ownership of the network gives the Orioles ownership* the majority (though shrinking each year) of the profits, and thus still some ability to draw direct income from that region.

      *Because the ownership of MASN is not through the team, but directly held by the Angelos-led ownership group (and I would assume similarly on the Nationals’ end with their share) there is some question over the future of the network if or when the franchise were to be sold.

  19. simon94022 - Aug 7, 2014 at 9:36 PM

    DC MJ – your history and legal interpretation are incorrect. MLB has no “75 mile radius” rule. Territories and relocation rights are spelled out in the MLB Constitution.

    The Orioles did not consent to the move of the Nats to Washington. The vote was 29 to 1, with Baltimore casting the lone dissenting vote. It didn’t matter, since Baltimore’s Territorial Rights were not affected and the Orioles had no veto.

    MASN was created nearly 6 months later as a sop to Angelos. The Nats were already operating in DC anyway.

    • tearlw - Aug 7, 2014 at 9:58 PM

      Where in the MLB Constitution does it spell out TV territories? All it says on the subject is:

      Art VIII Sec. 9. Home Television Territories. The definitions of the home television
      territories of the Major League Clubs shall be maintained in the Commissioner’s Office.
      Amendments to such territories shall be made only with the approval of the Executive
      Council.

      Section 8 lists territories the teams are obligated (and have the right) to play games in, not their media markets.

      • tearlw - Aug 7, 2014 at 10:00 PM

        Whoops. Ignore that. I thought you were saying something else.

  20. djpostl - Aug 8, 2014 at 12:21 AM

    The thing is though, it’s not really the Orioles who have issue with this, it’s their owner.

    Typically this is just splitting hairs but in this case it has some meaning because this is the same guy who, despite having a chance to give the team a favorable deal off MASN revenues because he essentially is both parties, gave the O’s the shaft, choosing to pocket the money rather than pump it back into the team.

  21. ziplock10 - Aug 8, 2014 at 11:24 AM

    Just wanted to say… I was a Baltimore fan! I live in Maryland. The colts left when I was a kid. So my favorite RB for the Colts went to the Redskins. Started following them. Angelos got Maryland to pay for Camden yards. He raked in 100’s of millions. He fired HOF announcer John Miller, soured on the Glenn Davis & Albert Belle acquisitions and never tried to get another Free agent or keep one of worth. Fired Davey Johnson and milked Cal for all he was worth. Never mind the fact he was a billionaire cancer lawyer. Now he leveraged MLB to get all he could for the Nats coming to DC and he still fights for all the $$ he can?? This man is George Steinbrenner without the spending on his team. What a greedy pig. I do NOT hate the O’s, but will never wish them 1 day of success because of him…

    • sportsfan18 - Aug 8, 2014 at 10:39 PM

      well, at least you have your reasons…

  22. sportsfan18 - Aug 8, 2014 at 12:19 PM

    Mr. Selig,

    You threatened severe sanctions if they did this.

    They’ve done it.

    Time to honor your words sir. Words you CHOSE to utter.

    Don’t go out of office with your words ringing hollow…

    Bring down the same hammer you used on Arod (I’m sure you know right were it is… like in a glass enclosed case with bright lights shining down on it in your office. Oh, I love the inscription on the case you chose… it says “Thor has nothing on me”)

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