What Happens If Bally Sports Network Goes Under?
Diamond Sports Group, which owns and operates the popular Bally Sports network may be on the brink of bankruptcy.
After failing to make a $140 million interest payout on Wednesday, the broadcast media group may have to file for Chapter 11 bankruptcy soon.
The company is currently in a 30-day grace period as they continue to negotiate and figure out their next steps.
THE LATEST
On Wednesday, Diamond released a statement that explained what options they have.
"The company intends to use the 30-day grace period to continue progressing its ongoing discussions with creditors and other key stakeholders regarding potential strategic alternatives and deleveraging transactions to best position Diamond Sports Group for the future," the statement read.
The company has been dealing with a troubling financial situation for some time. Last September, Diamond reported a debt of $8.6 billion.
Diamond is a subsidiary of the Sinclair Broadcast Group Inc. and owns Bally Sports.
Many sports fans are familiar with and regularly tune into one of Bally's 19 regional networks that carry a total of 42 different professional sports franchises, including 24 MLB, 16 NBA and 12 NHL teams.
WHAT DOES THIS MEAN FOR FANS?
Various sports teams have agreements with regional networks to have exclusive rights to broadcast their games. In return, the networks will pay the teams. For example, Diamond pays the Milwaukee Brewers $20 million in order to have their games.
But if Diamond and subsequently Bally's goes under, then what will happen to the money that the teams had been counting on that helps the upkeep of the stadium and of course, the player's salaries?
Major League Baseball Commissioner Rob Manfred spoke about just this on Wednesday with reporters.
According to Manfred, Diamond has said they will continue to adhere to their contracts with the sports teams. But with such a fluid situation that involves billions of dollars, there's no guarantee that they will adhere to their word.
If that doesn't happen and Diamond is unable to pay "every single one of the contracted teams," then Major League Baseball will terminate the Diamond deal.
DIAMOND HOPES TO CONTINUE TO PAY MLB TEAMS
“We’ve been really clear that if Diamond doesn’t pay under every single one of the broadcast agreements, that creates a termination right, and our clubs will proceed to terminate those contracts,” said Manfred on Wednesday.
“We are prepared no matter what happens with respect to Diamond to make sure the games are available to fans in their local markets,” Manfred told reporters. “We think it will be both linear in the traditional cable bundle and digitally on our own platforms, but that remains to be seen.”
“In the event that MLB stepped in, what we would do is we would produce the games, we would make use of our asset with the MLB Network to do that, we would go directly to distributors, Comcast, Charter, the big distributors, and make an agreement to have those games distributed on cable networks,” Manfred added.
"We would also be seeking flexibility on the digital side so that, when you look at MLB.TV, you could buy your out-of-market package like you always had but have the option to buy up into in-market games, something the fan has never had before, which I see as a huge improvement for fans.”
Diamond Sports Group is facing severe financial difficulties. (Photo by Michael Reaves/Getty Images)
AND FOR HOCKEY?
As far as hockey fans go, the local RSN's don't broadcast any of the playoff games after the first round. So, if your team is making a playoff push you'll be able to watch those regardless of what happens to your local broadcast.
However, the 30-day grace period ends on March 15th, while the NHL regular season ends on April 15th. There could be some layover in game broadcasts unless the new broadcast owner leases the games to a local network.
It's unclear what the NBA, who is currently in their All-Star break, would do however you can be sure that the league and teams are working on a contingency plan.
WHAT'S NEXT?
Diamond Sports Group is continuing to negotiate and speak with creditors about what their options are with their massive debt. The fact that they couldn't even pay $140 million isn't a good sign.
Some of the biggest sports markets and teams have their own networks, outside of Sinclair and Bally. For example, the Boston Red Sox, Bruins and Celtics are on NESN. The Brooklyn Nets and Yankees are on the YES Network, etc. None of those teams will be impacted by a potential Chapter 11 bankruptcy.
There had been reports that the MLB, NBA and NHL could buyout part, if not all of Bally's regional networks which is reportedly being shipped for anywhere from $2-3 billion dollars. That price is a HUGE discount, considering Sinclair paid $10.9 billion to buy the Fox Sports Networks in 2019. (Those individual networks helped create the Bally ones as we know today).
Major League Baseball could then potentially expound their digital properties with MLB.tv, which would bypass the need for any regional sports networks.
So get the popcorn out and sit back and watch your favorite sports teams while you still can on Bally Sports, because you may not be able to soon.