Marquee Sports Network, the regional sports network home of the Chicago Cubs, faces a pivotal carriage renewal negotiation with Comcast, with the current deal expiring in September. 

The channel’s top executive, Cubs president of business operations Crane Kenney, told Chicago radio station 670 the Score's Bernstein & Holmes show that he’s not confident that Marquee will maintain distribution with a pay TV provider that controls around half the channel’s reach. 

“I think distribution is going to be a challenge,” Kenney said. “And I’m sure you’re going to be asking me in September, ‘Hey, what’s going on now?’ Because it’s going to be bumpy.”

The Cubs launched the channel in the middle of a pandemic back in spring 2020, a joint effort with Sinclair Broadcast Group. Marquee also launched a $20-a-month direct-to-consumer app last year, but that effort seems far away from providing enough revenue to support the channel.

Meanwhile, Comcast — which remains at a distribution impasse with 18 Bally Sports regional sports channels operated by bankrupt Sinclair subsidiary Diamond Sports Group — might not be inclined to deviate from its current trend line and break the bank for an RSN built around a 33-35 ball club currently trying to keep its mouth and nose above water in Major League Baseball's National League Central Division. 

“I wish the clock was turned back to 2011,” Kenney said. “Because the market is in turmoil. You’ve got half the RSNs in bankruptcy, being rejected in their rights agreements. You got wonderful markets like Atlanta — like if you’re a Comcast subscriber in Atlanta, you can’t watch the Braves [on Bally Sports] today. If you’re a Comcast subscriber in Milwaukee, you can’t watch the [Brewers] today. If you’re a Comcast subscriber in Detroit, another great baseball market, you can’t watch the Tigers today.”

Kenney also noted that earlier this month, Chicago Bulls and White Sox owner Jerry Reinsdorf exited his teams’ RSN partnership with Comcast on NBC Sports Chicago. The teams, along with the NHL's Chicago Blackhawks, are launching a new multi-platform channel, Chicago Sports Network, in partnership with broadcaster Standard Media Group.

"Comcast has made it pretty clear that they are exiting the sports market,” Kenney added. “And half of our homes are Comcast homes. And our contract with Comcast ends in September. So trust me, the reason I spend — other than worrying about our batting average with runners in scoring position — the other thing that keeps me up all night is worrying about what’s going to happen with distribution.”

On June 18, 2024, Houston bankruptcy judge Chris Lopez will decide if Diamond Sports Group has come up with the right restructuring plan to finally exit a Chapter 11 restructuring process that began in March of the previous year. 

Diamond Sports Group, the bankrupt Sinclair Broadcast Group subsidiary that manages the Bally Sports regional channels, seemed almost certain to face liquidation as recently as early January. 

But then its fortunes began to turn around. 

In early February, Diamond filed three bankruptcy court motions, indicating that it had somehow, some way, through mediation, reached agreements with the Texas Rangers, Minnesota Twins and Cleveland Guardians to keep the team on its regional sports network through Major League Baseball's regular season.

With the NBA, NHL and MLB agreeing to stick around, and its estranged parent company, Sinclair, willing to settle bad blood, Diamond embarked on a series of successful renewal negotiations, shoring its core distribution business, securing multiyear deals with Charter Communications, DirecTV and Cox Communications. 

On April 30, Diamond and its CEO, David Preschlack, found themselves one renewal away from completing perhaps the most stunning comeback in sports media history. Alas, Diamond could not reach an agreement with Comcast, once again putting the whole gambit in jeopardy. 

So how did we get here? Next TV contributor Scott Lehane details Diamond's long, arduous journey.

Seemed Logical at the Time

In August 2019, Sinclair Broadcast Group acquired 21 Fox Regional Sports Networks (RSNs) from the Walt Disney Co., along with Fox College Sports. The purchase price was $9.6 billion, valuing the business at $10.6 billion. Byron Allen’s Allen Media Group also came on board as an equity partner. The current roster includes 17 Bally-branded RSNs, which are listed here along with a couple that have since folded.

The RSNs were absorbed into a newly created subsidiary, Diamond Sports Group, and the customer-facing offering was rebranded as Bally Sports in March 2021 as part of a 10-year deal with sportsbook and casino operator Bally’s. 

Sinclair CEO Chris Ripley said at the time: “We are very excited about the transformational aspects the RSN acquisition will have on Sinclair and are eager to bring those opportunities to life ... We have an exciting future ahead of us.”

Indeed, the future looked bright back in those heady days before COVID-19, when major league sports were still almost exclusively on cable and it was generally understood throughout the video industry that holding live sports rights gave you a license to print money. Sports fans seemed willing to pay just about anything. 

Fast-forward a few short years and Diamond Sports is on the verge of emerging, bruised and battered, from a 10-month bankruptcy proceeding that saw the company fight tooth and nail to salvage some kind of viable business model. 

Things changed quickly. How did this happen?

The Short Story

Sinclair was in the right place, but at the wrong time. The acquisition came just as cord-cutting in the pay TV industry was hitting an inflection point and distributors were starting to balk at the exorbitant sports-driven price increases of the past. 

The COVID-19 pandemic put a damper on sports viewership in general with canceled games, truncated seasons and games played in empty stadiums. Then inflation started eating into household budgets, further fueling cord-cutting. Rising interest rates made it harder to service Diamond’s $8.6 billion in debt. Meanwhile, streamers were starting to flex their financial muscle on the sports rights marketplace, driving up prices and expectations from the leagues themselves.

In the fall of 2021, Diamond Sports Group unveiled plans to expand its linear pay TV service into a direct-to-consumer streaming platform. And while the company was eventually able to score streaming rights deals with the NBA and NHL, MLB commissioner Rob Manfred balked at the proposal. “We’ve been very clear with them from the beginning that we see both those sets of rights as extraordinarily valuable to baseball, and we're not just going to throw them in to help Sinclair out,” he said. 

In November 2021, Diamond Sports Group bonds tumbled on news that Sinclair Broadcast Group wasn’t even able to secure carriage rights for the RSNs as part of its broader retransmission deal with Dish. 

It was a major blow to the group’s plans. According to Multichannel News at the time: “Sinclair had been counting on the Dish agreement to include the RSNs -- in earlier filings the broadcaster had appeared to include revenue from Dish as a portion of its overall projections for the linear networks.”

Playing the 'Plus' Game

In July 2022, the company finally launched its Bally Sports Plus direct-to-consumer streaming service in five markets where Bally Sports had managed to secure streaming rights from the local MLB teams.  

For $19.99 a month, or $189.99 a year, the app enabled fans to watch games without subscribing to a multichannel pay-TV provider.  The app is available on Roku, Amazon Fire TV and Android TV devices. It’s also supported on iOS and Android mobile.

In September 2022, Bally Sports Plus expanded to all 19 markets in the Bally Sports regional sports networks empire. 

The national launch was timed to the NBA and NHL seasons, since Sinclair had national streaming rights deals with the pro basketball and hockey leagues allowing it to stream all eligible games for each team contracted under its RSN rights umbrella. 

“Launching a streaming service like Bally Sports Plus across 19 different regions, all with unique content offerings, is an unprecedented undertaking,” said Michael Schneider, COO and GM of Bally Sports Plus.

Company execs pinned some high hopes on the DTC streaming service as the antidote to the accelerating quarterly decline in pay-TV subscribers. 

In a November 2022 investor call, Sinclair CEO Chris Ripley reported that “We have seen encouraging demand for the service despite relatively low product awareness in the marketplace.”

He didn’t offer any subscriber numbers, but the company’s third quarter of 2022 was a blood bath. Diamond Sports reported a net loss of $1.2 billion, compared to a loss of $132 million in 2021. Revenue fell 10% to $684 million. Distribution revenues were down 11% to $565 million and ad revenues dropped 5% to $112 million.

On the call, Ripley was forced to shoot down persistent rumors that the company was considering unloading Diamond Sports in a fire sale. 

He admitted that the company had retained advisors LionTree and Moelis & Co., but stressed that, “There’s no sale process, but they’re talking to parties about deleveraging, strategic partnerships and things of that nature.”

The only tally of Bally Sports Plus subscribers came last June, amid a vitriolic court exchange with MLB commissioner Rob Manfred when the company revealed that that its Bally Sports Plus streaming app only had 203,000 subscribers, 55% of the company’s goal, nine months after its national rollout.

The Next Chapter Goes to 11

It was soon clear that Diamond Sports Group was heading for bankruptcy. In January, Bloomberg was first to report that Diamond was preparing to skip its mid-February $140 million interest-only payment servicing around $8.6 billion in debt and pursue Chapter 11 restructuring instead.

And in February, the company carried through, missing an interest payment in order to preserve cash flow. Diamond then took advantage of a 30-day grace period to hold discussions with creditors “regarding strategic alternatives and deleveraging transactions to best position Diamond Sports Group for the future.”

Almost immediately, S&P Global Ratings downgraded Diamond Sports Group’s credit rating to D from CCC.  

Diamond officially filed for chapter 11 protection in Texas on March 14, 2023. What followed was a lengthy series of legal maneuvers in front of Houston bankruptcy Judge Christopher Lopez overseeing the company’s restructuring.

Bankruptcy protections gave the company the ability to renegotiate some of its rights deals, shedding its less profitable contracts while holding on to others in an effort to salvage a viable business model. 

This led to some acrimonious legal maneuverings, putting particular strain on the company’s relations with Major Leage Baseball (MLB) as most of the drama played out during baseball’s regular season.

Early on, Major League Baseball pledged support for any of its teams that Diamond stopped paying. 

As 2023 spring training kicked off, Major League Baseball commissioner Rob Manfred spent most of his press conference fielding questions about the league’s contingencies for Diamond filing for chapter 11.  

"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," the commissioner said. 

"In the event that MLB stepped in, what we would do is we would produce the games, we would make use of our asset, the MLB Network, to do that. We would go directly to distributors -- meaning Comcast, Charter, the big distributors -- and make an agreement to have those games distributed on cable networks," Manfred explained.

He also staked out a streaming claim for MLB.tv to give fans the option to buy an out-of-market package alongside in-market games, “which I see as a huge improvement for fans," Manfred said. 

After Diamond missed payments to certain teams, Major League Baseball tried to get court approval to rip up several contracts, including deals with the Arizona Diamondbacks, Cleveland Guardians, Texas Rangers and Minnesota Twins. However, in April, the bankruptcy judge ruled that Diamond could pay half of what it owed each team, and still keep the clubs under the Bally Sports umbrella. 

Lopez explained that he was adhering to restructuring norms, where debtors are ordered to “pay the uncontested and reserve for the disputed portion of it.”

In May, when Diamond Sports Group cut the San Diego Padres loose, MLB stepped in to provide Padres games through its MLB.TV app and helped set up a new cable channel for Padres fans in partnership with a number of local pay-TV providers, including DirecTV, Cox, Charter and vMVPD service Fubo.

As the bankruptcy restructuring dragged on, numerous other baseball teams, including the Cincinnati Reds, came close to breaking loose from their contracts and going it alone. But with an assist from the bankruptcy court, Diamond always managed to make its minimum payments at the last possible minute to keep them contractually bound.   

The Reds were ready to break free from Bally Sports Ohio in early May. The team had even lined up a new linear channel on DirecTV and Charter Spectrum, but Diamond rendered payment on the last day of the grace period.

In early June, the Judge told Diamond to either pay the Arizona Diamondbacks, Cleveland Guardians, Texas Rangers and Minnesota Twins their full contracted rates, or cut them free. 

Major League Baseball told the court that it would be happy to just tear up the contract for the Arizona Diamondbacks in order to set up a new channel to broadcast Diamondbacks games locally, in partnership with local pay-TV operators, much as the league did for the San Diego Padres.

In July, the Court allowed Diamond to drop the Arizona Diamondbacks, tearing up what Diamond called a “profitless, 20-year, $1.5 billion local TV rights marriage.” Major league baseball quicky set up a new cable channel that carried Diamondback games through the rest of the season.

At the time, DirecTV also petitioned the court asking to set aside its contract with the Bally Sports Arizona RSN, after losing the Diamondbacks, plus the NBA’s Phoenix Suns and the WNBA’s Phoenix Mercury who let their existing rights deals with Diamond expire in April and partnered with Gray TV to broadcast their games on local stations. 

All that remained in terms of big-league contracts for Bally Sports Arizona was a deal with the NHL’s dessert hockey team, the Arizona Coyotes. When the RSN finally walked away from the Coyotes, local broadcaster E.W. Scripps pounced on the opportunity, snatching up 81 of their 82 regular season games for its KNXV Phoenix station. 

A Long, Arduous Restructuring Process

As the restructuring process dragged on with little progress to show, the parties started venting their frustrations publicly. 

In August, after the Judge granted Diamond’s first request for an extension of its bankruptcy protections, NHL lawyers warned the court that they may seek injunctive relief if a restructuring plan couldn’t be worked out soon. 

At the end of September, Diamond asked for a second extension to its chapter 11 protections giving the company until Jan. 29 to solicit approval of the restructuring plan from its creditors. 

DirecTV accused the company of squandering precious time and resources in a costly battle with Major League Baseball. 

MLB opposed the extension saying, that Diamond had “made no progress toward reorganization and no progress in negotiations with their creditors.”

But at the time, the company was able to show that it had made at least one small step forward with short-term carriage renewal deals with Comcast and DirecTV to keep Bally Sports on the air for another year. 

Dealing With an Estranged Parent

Sinclair’s relationship with its troubled corporate child spawned a dramatic little side show to the bankruptcy proceedings. 

Since early 2022, Sinclair has been trying to nudge Diamond Sports Group out of the nest and get it off the corporate balance sheet. 

In July 2022, Sinclair Broadcast Group brought in former Hulu and Fox executive Randy Freer to chair a new five-member board of managers to oversee Diamond Sports Group.

On its Q2 earnings report in August 2022, Sinclair separated its finances from Diamond’s. 

In December of 2022, Diamond Sports Group tapped former NBC Sports Regional Networks president, David Preschlack, as its first CEO as part of a plan to make Diamond more independent. 

In March 2023, shortly after seeking chapter 11 bankruptcy protection, former Universal TV exec and Sinclair-appointee Steve Rosenberg was ousted as Diamond Sports president as the group really started taking control of its own affairs and looking out for its own interests. 

Then last Summer, Diamond filed an explosive lawsuit against its former corporate parent, Sinclair Broadcast Group, accusing the company of “milking” Diamond for more than $100 million annually in purported management fees and saddling the company with $1.5 billion in debt as part of its exit strategy. 

Diamond also alleged that Sinclair had inappropriately paid back most of a $1.025 billion investment from JP Morgan Chase that helped the company acquire the Fox RSNs, while leaving other primary creditors waiting. The company also claimed that Sinclair was profiting from the $100 million naming rights deal with casino operator Bally's Corp. 

Sinclair responded that it had held off billing the company for months in an effort to support Diamond’s liquidity. If Diamond didn’t want Sinclair’s management services, it was welcome to take its business elsewhere, but it was $140 million in arrears at the time.  

In September, Sinclair Broadcast Group and JP Morgan asked the bankruptcy court to dismiss Diamond’s claims, saying that the allegations “present a series of ordinary business transactions and extraordinary efforts by Sinclair to support the Diamond enterprise, including in the face of a global pandemic and unprecedented business disruption."

Sinclair even offed to buy back Diamond Sports Group (for pennies on the dollar). As part of the $850 million offer, Diamond would drop it’s $1.5 billion suit against Sinclair. 

In November, David Seligman, outside counsel for Sinclair Broadcast Group, testified before the Houston bankruptcy court, giving a grim assessment of his client's estranged subsidiary. 

“To Sinclair folks who originally acquired Diamond, they’re kind of bummed … they’re bummed that this business that they put in a billion and a half of equity value in, is now going to be shut down,” Seligman said. “There’s going to be people losing their jobs … Diamond’s business is going to go away.”

An Unexpected Turnaround

It came as a bit of a surprise when things started turning around for the beleaguered Diamond Sports Group in November when it managed to carve out a deal to keep all 13 of the NBA teams on Bally Sports through the 2023-2024 season. 

After this season, Diamond was supposed to relinquish linear regional-sports-network and direct-to-consumer rights early for all 13 teams, with the league taking full control. 

In December, Diamond struck a similar deal with the NHL to keep the 11 clubs that were currently available via Bally Sports until the end of the regular season. The agreement allowed Diamond to reduce fees for certain clubs, but when the season ends in April, local TV and streaming rights will revert back to the league. 

Finally, in December, the company hammered out a short-term deal with Major League Baseball. As part of the deal, nine of the teams will be paid their full contracted rates for the 2024 season, including the Los Angeles Angels, Atlanta Braves, Cincinnati Reds, St. Louis Cardinals, Detroit Tigers, Florida Marlins, Kansas City Royals, Milwaukee Brewers and Tampa Bay Rays. 

Not included in that deal were the Minnesota Twins, whose local TV rights deal with Diamond expired at the end of the 2023 regular season in October. The Twins are still considering their options, but the company has been searching for alternative local TV-rights arrangements to help offset the $55 million annual revenue stream that came from Bally Sports North. 

But the Twins will have plenty of dance partners if they don’t end up coming back to Bally Sports. Throughout the process, local broadcasters have been circling ready to snatch up any crumbs that fell from the table. 

In August news emerged that broadcast station group operators Nexstar, Scripps, Gray and even Sinclair were in conversation with the NBA and NHL about taking over their local TV deals.  

Gray president and co-CEO Pat LaPlatney addressed the issue on the company’s second quarter earnings call, saying that the company was hoping to replicate what it done with the Phoenix Suns and Phoenix Mercury in other markets, with other teams and leagues. 

“We see a growing recognition in the market that returning professional sports to local broadcast stations will increase marketing value, advertising sales revenues, fan engagement as well as team value,” he said.

While local sports might seem to be the perfect fit for local TV broadcasters who could really use a boost right now, Big Tech has also been waiting in the wings with boatloads of cash ready to “disrupt” the industry.

In August Bloomberg reported that Disney/ESPN, Apple, Amazon, Google and DirecTV had inquired about acquiring local TV contracts from National Basketball Association and National Hockey League teams.

But in the end, it was Amazon that clinched a deal.

Diamond’s Rehabilitation

In December, The Wall Street Journal first reported that Amazon was in talks about a multiyear investment and partnership with Diamond Sports. 

The details of a plan to exit bankruptcy were finally revealed January 17. Amazon bought a stake in the company for $115 million and Sinclair Broadcast Group settled its outstanding suits with Diamond for $495 million, giving the RSNs substantial capital to go back out on the field having shed some of its least profitable operations and wiping out a fair bit of debt. 

But Bloomberg reported that MLB execs were caught off guard by the announcement, calling it a “complete shock.” MLB’s bankruptcy attorney James Bromley said that the league needs time to digest the proposal “because Diamond is proposing to radically alter the way it does business with MLB and its clubs.” 

Diamond's restructuring support agreement (RSA) was awaiting court approval at press time. As part of the deal, Bally Sports RSNs will now be funneled through Amazon Prime Video.

But what form it will take in the future is unclear. The big question is whether the leagues will stick around beyond the current season. 

The “Cooperation Agreements” that Diamond struck with the NBA, NHL and MLB to make it out of bankruptcy protection were all short-term deals, set to expire at the end of the 2024 season. In exchange, the leagues accepted a reduced fee. It’s as though those agreements were designed to wind things down in an orderly fashion, giving the leagues time to plan for post-RSN future.  

But Diamond lawyers threw a bit of a curveball into the mix when they argued in bankruptcy court that those cooperation agreements never actually took effect, so the teams are still on the hook for their original Bally Sports contracts. 

In short, they want everything to go back to the way it was before this whole bankruptcy thing happened. 

But everything changes with Amazon on board. Of course, to Amazon, $100 million is just chump change, but it gives them a compelling entry point into a local advertising pool that company execs have been eyeing as an underexploited growth area — a market that very much overlaps with traditional local TV advertisers. 

A robust marketing push from Amazon might be enough to put Diamond back on solid footing, and just a little more Amazon pocket change could go a long way toward shoring up any lingering rights issues. 

The big question is: How committed is Amazon to this? Maybe for Amazon, it’s just a strategic investment. Maybe it’s a segue into a new regional sports genre. Maybe Amazon has broader ambitions in the local sports market. Maybe they’ll end up swallowing Diamond Sports Group, or maybe they’ll just strip mine it. 

And maybe … just maybe … With Amazon on the mound, local sports teams will be happy to let bygones be bygones and just play ball. 

Watch this space. We’ll be updating with major developments.

Sinclair Broadcast Group said its television stations will be carrying Tennis Channel's T2 network on virtual channels available using the NextGen broadcast standard.

T2, aimed at younger adult viewers, will be available free and over the air in 43 markets where Sinclair stations are broadcast using the new ATSC 3.0 technology.

“With this new NextGen broadcast platform that Sinclair is leading the way in introducing, people all over the country will have more ways to watch live, top-tier professional sports around the clock, with the best players in the world, all year long,” said Ken Solomon, president of Tennis Channel, which is owned by Sinclair.
"This means hours and hours of daily, continuous play and original programming that only exists on T2.”

T2 programming will use Advanced HDR by Technicolor, which gives viewers better contrast, higher brightness and a wider range of colors. 

“We are excited to expand the reach of T2, improve the viewer experience with HDR, and extend our flexible cloud distribution strategies,” said Mike Kralec, Sinclair’s Chief Technology Officer. “Delivering high quality programming via connected smart TV provides an initial path for distribution that can precede that same programming eventually being received over-the-air.”

Sinclair Broadcast Group said its television stations will use TopLine, an AI-driven advertising sales system from Futuri.

Sinclair ran a pilot program of TopLine last summer and found improved sales efficiency and revenue growth.

"We are thrilled about our partnership with Futuri and the integration of TopLine® into our sales operations," said Ryan Moore, Sinclair’s senior VP and chief revenue officer. "This technology not only equips our sales team with cutting-edge tools and a competitive edge to engage new advertisers, but it also empowers them to spend more quality time with our clients, enhancing our relationships and driving our sales  strategy forward." 

TopLine combines AI technology with sales research and data-driven presentations, enabling sales teams to extend into new categories, get more appointments, and reach new  types of buyers. 

"Sinclair’s adoption of TopLine represents a shared commitment to innovation and a significant leap forward for the media industry,” said Daniel Anstandig, CEO of Futuri. “Sinclair's forward-thinking ethos perfectly complements our vision at Futuri, setting the stage for exciting developments in media technology and audience engagement."  

On Sunday, Alden Global Capital, a private equity firm with a reputation for sucking the remaining blood out of failing newspapers before offloading what’s left of them, sold the Baltimore Sun to Sinclair Broadcast Group executive chairman David Smith, who has a reputation for using his local news assets to propagate his far-right ideology. 

It wasn't a surprise when one of the paper's most notable alums, writer-producer David Simon, let loose on Twitter/X almost immediately after the news broke. 

“Instead of a family with deep civic roots and a sense of noblesse oblige that allowed for an editorial product that was not first beholden to any ideological fervor, the Baltimore Sun is now owned by someone who has delivered a news product … that begins with a hard ideological premise and then tailors all coverage and editorializing to fit,” Simon wrote on an X thread that spanned more than a dozen entries while also detailing the tragic, steady decline of the American metropolitan newspaper in the internet age. 

“The irony is perfect: In Baltimore, where a newsroom of 500 souls once labored to deliver a politically centrist morning and evening newspaper that gave good weight … to trying to get stuff right, that newspaper has been returned to local ownership so that about 60 or 70 souls can labor to deliver a single, thin edition of a beholden political organ that will not give weight … to any view of reality that cannot achieve some advantage or gain for a fixed ideology,” Simon added. “Wall Street and out-of-town newspapering has, in four decades, devoured the very ideal of an independent newspaper in Baltimore. And done so at great profit.”

Simon urged local Baltimore news consumers to turn to startup digital news platform The Baltimore Banner, a nonprofit started by Democratic businessman and philanthropist Stewart Bainum Jr.

Smith, meanwhile, told the Sun: “I’m in the news business because I believe … we have an absolute responsibility to serve the public interest. I think the paper can be hugely profitable and successful and serve a greater public interest over time. We have one job, to tell the truth, present the facts, period. That’s our job.”

Smith held a meeting with Sun staffers on Tuesday. By the social internet sounds of it, not all editorial workers were encouraged.

As eloquently showcased by this still poignant 2018 video compilation, produced by Deadspin, Smith has deftly used Sinclair’s local news platform to push his ideological agenda.

Meanwhile, Simon, 63, worked on the Sun city desk from 1982-1995, writing during the latter part of that span the book that changed his career trajectory, Homicide: A Year on the Killing Streets, after shadowing the Baltimore Police Department all throughout 1988.

The book, of course, was adapted into one of the first broadcast network procedurals by Barry Levinson. And Simon later took his TV production learnings to HBO to create seminal crime drama The Wire.

Sinclair Broadcast Group and JP Morgan have filed motions in a Texas federal bankruptcy court seeking dismissal of lawsuits rendered against them by the broadcaster's spun-off Diamond Sports Group subsidiary.

Bankrupt Diamond, which was set up to manage Sinclair's heavily leveraged Bally Sports regional cable channels, said in a lawsuit filed in July in the court overseeing its restructuring that Sinclair "milked" it out of around $1.5 billion, through means such as charging the subsidiary shady management services fees. 

Diamond also sued JP Morgan, claiming the bank was allowed to improperly cut in line in front of other creditors and was made whole because of that advantage 

Also read: Sinclair 'Milked' Bally Sports Subsidiary Out of More Than $1.5 Billion, Diamond Sports Group Suit Says

In its motion filed Tuesday, Sinclair dismissed Diamond's repeated "milking" allegations as "lactose-infused rhetoric," claiming it had every interest of its own to make Diamond and Bally Sports successful after putting $1.4 billion of its own cash into acquiring the Bally Sports channels from Fox. 

"The debtors’ complaint strains to portray a nefarious plot by Sinclair at Diamond’s expense. Beneath the overheated rhetoric, however, the debtors’ own allegations present a series of ordinary business transactions and extraordinary efforts by Sinclair to support the Diamond enterprise, including in the face of a global pandemic and unprecedented business disruption," Sinclair's motion reads. 

Sinclair argues that Diamond had to get management services provided from someone, and the subsidiary -- sporting "newly manufactured antagonism" -- never told the court what those services might cost otherwise if they were provided by a party other than Sinclair.

Meanwhile, Sinclair said that Diamond's quest to reclaim $929 million paid back to Sinclair's preferred equity partner JP Morgan would violate bankruptcy laws pertaining to how securities are dealt with in restructuring.

"Preferred equity units are securities, and the transfers here relating to them are qualifying transactions protected under Section 546(e)," Sinclair's lawyers argue.  

Sinclair paid $10.6 billion in 2019 to acquire 19 Fox SportsNet-branded regional sports networks which were, at the time, spinning off margins in excess of 50%.

Shortly after that purchase, the channels were dumped by Dish Network and cord-cutting accelerated in a rather dramatic way. Meanwhile, the pandemic wiped out live sports for months.

In March, Diamond Sports Group -- the subsidiary established by Sinclair to manage the channels, rebranded as "Bally Sports" -- entered bankruptcy, looking to renegotiate team deals, trade equity for debt relief and shed over $8 billion in debt overall. 

At the end of September, Diamond is scheduled to finally reveal a finished restructuring plan, but many questions still await answers. 

With the National Basketball Association and National Hockey League seasons getting underway next month, how many renegotiations with Bally Sports-affiliated teams in those leagues await? Even harder to answer right now: Are there any teams for which agreements won't ultimately be hammered out, resulting in Diamond using Chapter 11 to cut ties with them?

Amid this volatility, Diamond must negotiate new carriage deals with DirecTV, Comcast and Charter Communications. As Disney's complicated renewal of ESPN with Charter just showed us, pay TV operators are leery of big licensing rate increases for even live sports these days. And how much will the current flux of the Bally Sports team/channel lineup complicate those negotiations?

As part of a longterm affiliation agreement between Sinclair and the Nexstar-owned CW network, 21 CW affiliates controlled by Sinclair are being restored to DirecTV Stream.

The local channels were taken down from the virtual pay TV service in July, as part of the ongoing retransmission renewal impasse between Nexstar Media Group and private-equity-controlled DirecTV. 

Since networks typically control vMVPD negotiations and not station owners, at least for now, Nexstar involved the 21 stations in a two-month-old DirecTV blackout that has spanned more than 200 local stations nationwide. (The full list of affected CW affiliates is below.)

Nexstar purchased a 75% stake in the CW a year ago, and Sinclair operates 21 of the network's affiliates nationwide. Some of those 21 stations are not owned by Sinclair, but controlled by the large broadcaster under management services agreements with Cunningham Broadcasting Corp., Deerfield Media, MPS Media and GoCome Media. 

“We’re certainly pleased that Sinclair seems to have seized the right to provide its viewers, and our customers, the programming they should have always retained in the first place," said a DirecTV rep in a statement to Next TV. 

Station owners, which have traditionally controlled broadcast retransmission fee negotiations with linear MVPDs, are seeking to have more control over relationships with virtual MVPDs, which have so far worked with the larger networks on retrans deals. 

Diamond Sports Group has accused its estranged corporate parent, Sinclair, of "milking" around $1.5 billion out of the subsidiary via means including an over-priced management services agreement. 

On Monday, in the same jurisdictional setting -- the Houston bankruptcy court overseeing Diamond's troubled restructuring -- Sinclair Broadcast Group responded with a counterclaim. 

The essential takeaway: "You don't want our supposedly way overpriced management services? Fine. Pay us the $140 million you owe us for them, and we'll be on our way." 

In its counterclaim, Sinclair said it has held back on billing Diamond a portion of what it charges the subsidiary for management services since March of 2022 in order to "support Diamond's liquidity." 

Diamond has so far run up an outstanding management services agreement (MSA) bill of around $140 million, Sinclair said. 

And in the five months since Diamond entered bankruptcy, the subsidiary "still has not yet engaged with Sinclair regarding any comprehensive restructuring discussions about the MSA (or otherwise), nor has Diamond taken action to assume or reject the MSA, despite Sinclair’s repeated requests to engage in such comprehensive discussions," Sinclair claimed.

"The current situation is untenable," Sinclair concluded. 

"To be clear, Sinclair is amenable to Diamond’s assumption and full cure of the MSA and is willing to negotiate over mutually acceptable post-assumption terms," Sinclair added in legalese. "However, Sinclair believes that Diamond will never assume the MSA (as its counsel has made abundantly clear), and therefore should be compelled to reject the MSA now or a number of reasons.

"First," Sinclair added, "if Diamond truly believes, as it said in its adversary complaint, that the MSA is a terrible economic deal for Diamond, assumption of the MSA would be starkly inconsistent with Diamond’s fiduciary obligation to maximize estate value."

Secondly -- for Diamond to keep using Sinclair's management services for the duration of bankruptcy, without paying for them, would be "highly prejudicial" to Sinclair.

Oh, and Sinclair sees a future "nowhere in sight" in which Diamond actually emerges from bankruptcy with a restructuring plan. 

Privately, Sinclair says it has little to do these days with the subsidiary it set up in 2019 to manage the 19 regional sports networks it paid $10.6 billion to acquire. 

Now there could be even fewer ties between Sinclair and Diamond. 

Sinclair Broadcast Group named Rocky Wagonhurst VP and general manager of WVTV-TV in Milwaukee.

Wagonhurst had been director of local, regional and national sales at Hearst TV’s WJZ-TV, Baltimore. Sinclair is based in Baltimore.

He succeeds Pete Monfre, who retired. 

“Rocky is an accomplished leader with a strong background in developing effective sales strategies and driving revenue growth. We are excited to have him at the helm of WVTV in Milwaukee,” said Rob Weisbord, COO at Sinclair and president of local media.

Before WJZ, Wagonhurst was director of sales at Comcast Spotlight and general  sales manager at WUBT-TV in Baltimore. He also held positions at Harrington, Righter & Parsons, Blair, KDVR-TV, Denver and KOVR-TV, Sacramento.

“I am thrilled for the opportunity to join Sinclair Broadcast Group and look forward to leading the WVTV team in a great community like Milwaukee,” Wagonhurst said.

The broadcast business may have had a rough go in recent times, but one thing hasn’t changed is the importance of live sports, said Christopher Ripley, CEO Sinclair Broadcast Group, the second largest TV station collective in the country.  

Sinclair recently reorganized, dropping the words “broadcasting group” from its holding company name and putting its dozens of broadcast stations into one of two divisions. The other division, Ventures, includes such high-growth opportunities as the Tennis Channel and its related media outlets, and the Compulse marketing and advertising platform. 

While the company explores more investments on the Ventures side (and stops adding to broadcast holdings under the current regulatory regime), one thing hasn’t changed. 

“Sports is still at the heart of this company,” said Ripley, who has been Maryland-based Sinclair’s CEO since 2017. “Take a look at what drives our business on the local media side and the broadcast side, it’s sports. And we continue to believe that it should be gamified and more highly integrated with sports betting, but also, not-for-money interactivity for virtual goods, or badging, or recognition.”

The Tennis Channel has been the lab for much of the company’s sports experimentation, Ripley said, including an immersive online experience tied to the recent Indian Wells Masters, one of the pro circuit’s most-popular tennis tournaments. 

“You could walk through all of Indian Wells on a virtual basis and play games, while you also watched the tennis matches,” Ripley said. The Tennis channel is now far more than a single cable-based premium sports network.  

“We’re really excited about what we're doing at Tennis because we're not just looking at it domestically, we're looking at internationally,” Ripley said. “We're in eight countries now, about to launch a ninth. We have T2, which is just purely ad supported (TV network) and will be available on a direct consumer basis for a premium product. Next year, we're moving into other sports like pickle ball and padel in Europe. We're the home for everything tennis, Tennis Magazine, tennis.com.”

On the ad-sales side, Sinclair aggregates its sports content with the many digital channels of Wave Sports and Entertainment (Wave.TV, FTBL, Break Ankles Daily, Benchmob, Dingers), and BlueWire, which distributes podcast series featuring prominent athletes and other sports personalities. 

“We're aggregating together more impressions on the sports side and then linking them together with all the all the various sports impressions that we have,” Ripley said. “So we think sports is going to be a major component of our linear networks, sports and news for the foreseeable future. 

Sports is fast becoming "what’s left that works" for U.S. media companies. 

Hollywood’s actor and writer strikes have shut most scripted productions, delayed the Emmys, and transformed the fall season into a bleak landscape of game shows, reality competitions and reruns.

Sports doesn’t face such limitations. NFL and college football broadcasts already comprised three-fourths of the most-watched shows on legacy TV the past few years. That dominance should only increase, especially if the strikes push deep into the fall. 

Sinclair’s biggest bet on sports so far ended up a loser. It spent more than $10 billion to acquire part or all of two-dozen cable regional sports networks that Disney divested as part of its 2019 acquisition of most of Fox. 

Also read: Diamond Does It: Files for Bankruptcy Looking to Shed $8 Billion in Bally Sports Debt

Months after the deal closed, the pandemic shut down virtually all live sports for months, a lethal blow to RSNs that thrive on a steady diet of games to justify their place on the programming guide. With cord-cutting accelerating, dropping the expensive sports nets was often a quick means of savings for MVPD operators.

Since then, Sinclair has steadily distanced itself from the investment and its brutal impact on Sinclair’s bottom line. After partnering with casino operator Bally to rename the RSNs, the company wrote off most of its investment, implemented other spending controls and layoffs, and spun off the RSNs into Diamond Sports Group as a separate company. 

Diamond, now in bankruptcy, is suing Sinclair over $1.5 billion that Sinclair retained in the spin-out. The NHL just told a bankruptcy judge it may seek to bail on its deals with Diamond RSNs if a restructuring plan isn’t sorted out soon. 

Ripley said he couldn’t speak to the lawsuit allegations or other pending litigation. But he, too, asserted Sinclair’s separation from Diamond. 

“Diamond is on its way,” Ripley said. “It has its own management team, it has an independent board. We provide management services, and you know, it will figure out its own way, Largely Sinclair's passive at this point. We've been in that position for quite some time now. And we just have to support Diamond and whatever its future may be. And you know, that's getting worked out right now. But we're largely bystanders, and outside viewers just like you.”

In recent months, Diamond has essentially handed back the keys on some rights deals with more than 40 professional franchises, including the Arizona Diamondbacks and San Diego Padres, but had kept up payments to other teams. The Phoenix Suns also departed from a Diamond/Bally Sports RSN, then cut a distribution deal with broadcast operator Gray TV.

Separately, Sinclair actually benefitted from the shutdown of an RSN, when Warner Bros. Discovery walked away from five "AT&T SportsNet-branded" channels. The NBA’s Utah Jazz then turned to Sinclair’s Salt Lake City station, which had a particularly apt call sign. 

The Jazz “recognize that they really needed to get maximum reach,” Ripley said of the deal. “And it really was the best place to do that. We had a very unique station, K-Jazz (KJZZ-TV) in Salt Lake, and they wanted to be on it. And we were able to come to, I think, a very sensible arrangement to make that happen.” 

Similar deals with other sports franchises, especially as Sinclair’s stations finish converting to Next-Gen TV (ATSC 3.0) capabilities, could be a part of the company’s future too, Ripley said. Sinclair and station-group competitors Nexstar, Gray and Scripps have all been in talks with the NBA and NHL to step in on abandoned RSN deals. Disney, Apple, Amazon and Google also have reportedly kicked the tires.

“It remains to be seen. I guess it's too early to say,” Ripley said. “But I think it's an interesting development. And to me, it points back to the heavy sports portfolio that we already have on our core broadcast stations. And it points to this truism about sports and over-the-air broadcasts and how well they fit together.”

The bigger question for sports leagues, and their advertisers, is how do they grow their fan base and viewership in the future? 

Dedicated sports networks can deliver, for a stout price, the ardent fans who want deep access to their favorite sports and teams. But when those dedicated services are separated from a broader bundle of entertainment programming, as is increasingly the case, the casual fan seldom gets a chance to see even some big games.

And the casual fan is important when it comes to building a sport’s long-term health and fan base. For all the limitations of the cable bundle and traditional broadcast programming, they gave casual fans ready access to at least the big games. That’s in danger in an a la carte era. 

“I think any sport should be looking at their strategy and including over-the-air broadcast as a significant component,” Ripley said. “It doesn't have to be everything, but having a component of your sport on the most broadly available and most broadly watched platform will continue to make your sport healthy, and that will only be accelerated by Next-Gen TV.”

Next-Gen TV broadcast signals can provide Ultra High-Def resolution, HDR color gamuts, and more immersive audio, Ripley pointed out. They also provide interactivity in both game-related data and advertising. And of course, gambling information and even betting can be enabled. 

“I talked about this gamification and interactivity that can all exist natively on Next-Gen TV,” Ripley said. “And so it'll really take it to the next level, as it relates to what the (audience) engagement level and the service can be.”

Across the industry, media and tech companies are making expensive bets that sports will continue to keep viewers around. 

Warner Bros. Discovery ditched five RSNs in Utah and elsewhere, but reportedly will add a sports tab to its Max streaming app this fall. The company has broadcast rights with the NBA, NHL, Major League Baseball, and some college sports, plus Discovery’s Eurosport division provides European channels with Olympic and other sports rights on the Continent. 

Disney last week announced a $2 billion deal between ESPN and sports-gambling operation Penn Entertainment, a notable reversal in CEO Bob Iger’s long-stated concerns about sullying Disney’s family-friendly brand.  

Apple, meanwhile, appears to have unearthed a windfall from its $2.5 billion, 10-year deal with Major League Soccer, whose visibility skyrocketed when superstar Lionel Messi joined the Miami franchise several weeks ago. 

And make no mistake. Figuring out a competitive TV rights deal will be vital for sports leagues and franchises. Just look at the collapse this month of the Pac-12. The century-old college athletic conference known for its many championships just imploded with the departure of most members to conferences with far better TV deals. 

Sports and TV -- whether broadcast, Next-Gen TV, cable, or streaming -- need each other, badly. As Sinclair is exploring, they just have to figure out how to make all the pieces come together in a sustainable way.  

KTUL, Sinclair Broadcast Group’s television station in Tulsa, Oklahoma, named Joie Bettenhausen as morning meteorologist.

Bettenhausen will deliver weather forecasts on Good Morning Oklahoma on weekdays from 4:30 to 7:00 a.m.

Bettenhausen joined the station in 2022  as the station’s traffic reporter and midday meteorologist from KWWL Waterloo, Iowa. She has been filling in on the morning show since Bud Ford left to go to flight school.

“Joie is a positive, energetic, and knowledgeable meteorologist.  She knows severe weather and is an excellent forecaster.  She makes the mornings more fun to watch,” said Dan Threlkeld, chief meteorologist at KTUL.

Bettenhausen holds a B.S. degree in meteorology from Valparaiso University She was a weather intern at WCIA Champaign, Illinois, and WGN Chicago before becoming weekend meteorologist at KSNF Joplin, Missouri. 

“I’m very grateful for the opportunity to become the morning meteorologist at KTUL,” Bettenhausen said. “I work with the best team and I’m excited to continue working with them in a larger role. Tulsa is home and I hope to have a long career at this station.” 

Sinclair Broadcast Group is being sued by the bankrupt subsidiary it set up four years ago to manage a collection of 19 regional sports networks it paid, ruinously as it turned out, $10.6 billion to acquire. 

Early Wednesday evening, cover sheets for two separate but related lawsuits emerged in the document portal set up by the Houston court overseeing Diamond Sports Group's bankruptcy. 

One lists Sinclair, company executive chairman David Smith, CEO Christopher Ripley and several other Sinclair executives as defendants, along with Bally’s Corp. All the Diamond-branded holding companies are being sued by Diamond Sports LLC, as well. 

The other cover sheet calls out JP Morgan Chase & Co. as the defendant. Diamond lawyers subpoenaed JP Morgan officials two weeks ago. 

Next TV wasn’t able to see the actual lawsuits, but an individual with knowledge of the complaints told us that Diamond, equity for which will soon be owned by  secondary creditors once restructuring is completed, is trying to claw back Sinclair's preferred equity repayment to JP Morgan.

In February, with Diamond about to enter bankruptcy, Sinclair paid JP Morgan $190.2 million, a transaction that nearly made the investment bank whole on the $1.025 billion in preferred equity units it purchased back in 2019 to help Sinclair buy the Fox-owned RSNs that became Bally Sports.

The plaintiffs contend that even though Sinclair knew the bankruptcy would wipe out all equity in Diamond Sports, including its own, it manipulated the payment schedule so that JPMorgan was nearly made completely whole on its investment.

Put another way: Diamond's lawyers are asking the court why the secondary creditors should be left holding the bag for the bankrupt and bleeding Bally Sports regional sports networks business when JP Morgan got mostly paid in full on its investment?

Entering Chapter 11, the more than $8 billion in debt tied to the original purchase of the Fox RSNs was attached to Diamond and not Sinclair, which has written off its investment and has been largely banished from Diamond management control for some time now.

According to our source, Diamond is also suing over how Sinclair has profited from the $100 million Bally naming rights deal with Bally's Corp. 

Diamond also claims that Sinclair charged it too much for management services. 

Neither Diamond or Sinclair has yet issued a statement. 

Diamond entered bankruptcy in March, aiming to trade equity for debt relief, while using Chapter 11's leverage to compel Major League Baseball to play ball with its direct-to-consumer streaming service, Bally Sports Plus. Diamond also wanted MLB teams with unprofitable local sports linear contracts to lower their fees. 

The outcome has been different. 

Two MLB teams, the San Diego Padres and Arizona Diamondbacks, refused Diamond's terms and Diamond tore up their contracts. MLB has stepped in and is now showing their games on new channels it has established. 

Diamond is now largely paid up with MLB teams for the 2023 season. But with seven still out of the Bally Sports Plus fold, the future remains uncertain. 

Updated: An earlier version of this story incorrectly identified plaintiffs. Several other points of legal terminology and nomenclature have also been corrected. We try not to look back, but we do regret errors. 

The retrans fight raging between DirecTV and Nexstar is getting downright petty, and we're not talking about either "Richard" or "Tom" here.

DirecTV fired off a letter to the FCC Tuesday morning, complaining that Nexstar Media Group has further expanded an ongoing station blackout, the biggest in pay TV history, to include the CW network streaming feeds that Sinclair Broadcast Group provides for its stations on the DirecTV Stream platform. 

Nexstar, the largest station owner in the U.S., purchased a controlling interest in CW last October. Sinclair is the second largest U.S. station operator. 

Two weeks ago, more than 160 Nexstar-owned stations were removed from the program guides of DirecTV satellite, U-Verse and DirecTV Stream. More than 40 stations owned by Mission Broadcasting and White Knight Broadcasting have also been affected. 

In its letter to the FCC, DirecTV accuses Nexstar of dragging "into its dispute new viewers of a competing broadcaster against their will and regardless of DirecTV’s agreements to serve these viewers."

"Nexstar is and always has been in full compliance with FCC regulations, and the allegations raised by DirecTV in today’s filing are without merit," Nexstar said in a statement provided to Next TV.

The antipathy between the pay TV operator and the broadcaster runs deep. 

Over the weekend, the New York Supreme Court ruled in favor of DirecTV in an eight-year-old retrans dispute involving a Washington, D.C. affiliate. 

DirecTV has a separate fraud claim in that dispute and is seeking millions of dollars more in punitive damages. 

DirecTV is also litigating against Nexstar over its operational arrangements for Mission and White Knight stations.  

After firing its former president, Steve Rosenberg, back in March right after it entered Chapter 11 restructuring, Sinclair's Diamond Sports Group has filed a brief seeking approval from the Houston court overseeing its bankruptcy to approve its settlement agreement with the longtime Universal Television executive. 

Let's just say Rosenberg will land on his feet ... on the putting green. 

The proposed settlement agreement calls for Rosenberg to be kept on as a consultant with a monthly fee of $109,665. For the first seven months, $49,140 of that total will be used to pay off a loan Sinclair approved for him to pay for $343,980 golf club membership last year. That money came out of subsidiary Diamond's coffers. 

"Mr. Rosenberg has agreed to provide the Services to the Debtors on an as-requested basis and only as directed by the Debtors’ Chief Executive Officer and Chief Operating Officer," the settlement motion reads. 

"Accordingly, the Settlement Agreement would not only prevent Mr. Rosenberg from competing with the Debtors’ business and soliciting its customers and employees during this critical time of transition, but also ensure that all services provided by Mr. Rosenberg going forward will be in lock-step coordination with the Debtors’ current executive leadership team," the document adds. 

Rosenberg, who headed Universal Television in the late 1990s and aughts, was hired by Sinclair in July 2020, ahead of the company's move to place management of its Bally Sports regional sports networks in subsidiary Diamond.

Rosenberg's role was filled by Diamond chief financial officer David DeVoe, with his reports answering on an interim basis to CEO David Preschlack. 

Sinclair Broadcast Group said that KTUL, its ABC affiliate in Tulsa, Oklahoma, has upgraded its signal to UHF from VHF.

Sinclair said the change increases the station’s power to a full 1 megawatt, the maximum allowed by the Federal Communications Commission for UHF stations. That will enable the station to reach more viewers in the market.

“The upgrades, and the switch from VHF to UHF transmission, allows KTUL to broadcast with a stronger signal, allowing us to reach more of the Tulsa community who rely on over-the-air broadcasts for their news, content and emergency information,” KTUL chief engineer David Shaffer said. “The project, which took nearly two years to complete, is one of the most significant upgrades we have made at the station and we are excited to roll out reception and picture quality like never before.”

The station is urging viewers to rescan their TV sets in order to receive KTUL, also known as NewsChannel8, on the new signal. 

Sinclair Broadcast Group named Kevin Dunaway as VP and general manager of its TV stations in Flint, Michigan, including WSMH-TV, WEYI-TV and WBSF-TV.

Dunaway had been VP, affiliate relations and content for VUit, Syncbak’s local news streaming service. He replaces Rebecka Butch, who returned to Adams Outdoor in March.

“We’re excited for Kevin to lead the team in Flint.  He has deep roots in Michigan and a strong track record of local station success,” said Rob Weisbord, COO and president of broadcast at Sinclair.

Before joining VUit, Dunaway spent 22 years at Heritage Broadcasting's WWTV in Traverse City, Michigan, rising from news producer to general manager. He attended Central Michigan University.

“I am very excited, as a lifelong Michigander, to be able to join the team at NBC 25 and Fox 66 in Flint.  Local media has been a large part of my career and I cannot wait to work with the stations and help them continue to grow and make a difference in our communities.  Having the opportunity to join Sinclair Broadcasting and its forward-thinking leadership, as well as its dedication to local media is something that I look forward to," said Dunaway.

The Chicago Cubs plan to launch a streaming service in July that will carry its games, the team’s president of business operations Crane Kenney said.

Cubs games are televised by Marquee Sports Network, a joint venture between the Cubs and Sinclair Broadcast Group. Diamond Sports Group, which runs most of Sinclair’s other regional sports networks, filed for bankruptcy protection in March.

The new streaming service would make the games currently available on Marquee to fans who don’t have a traditional pay TV bundle or a virtual pay TV service like Fubo, Kenney said in an interview on The Score, a sports radio station in Chicago.

No price point was disclosed for the direct-to-consumer offering.

Kenney had confirmed the team was looking at streaming options in March. 

“People are finding their programming in all sorts of ways, not just with cable and satellite subscriptions,“ Kenney said. “Streaming services seem to be popping up daily. We’ve seen a few teams — the Red Sox and Yankees and then a few of the Bally teams and most notably the Padres just launched a streaming service after their rights were returned to them in the bankruptcy.

“So the world is changing very, very quickly, even since the 2019 launch of Marquee, which is primarily on cable and satellite. And to reach our fans that have cut the cord, we’re going to be introducing a streaming service this year,” he said.

Kenney said Marquee has been working on the streaming service for about a year.

“We’re taking our time to make sure this thing is exactly right in terms of both the quality of the program, the type of program, pricing, marketing, ease of access so that it’s available on all devices, whether it’s Roku, a handheld, etc.” Kenney said.

With Warner Bros. Discovery looking to abandon its limited presence in the declining regional sports networks business, the NBA’s Utah Jazz, which had called WBD's AT&T SportsNet Rocky Mountain home, have been looking to develop what the team calls a “hybrid model” for its next distribution agreement. 

They seem to have found it in a somewhat ironic place. Next season, the Jazz will locally broadcast all of their games not picked up by national networks ESPN, ABC and TNT free and over the air on channel 14, aka KJZZ Salt Lake City. That station is owned by a company on the leading edge of dismantling the regional sports networks business, Sinclair Broadcast Group. 

The Jazz will also show their games on a new direct-to-consumer streaming service, founded by the team's new media venture, Smith Entertainment Group (SEG), which is named after team owner Jason Smith. 

Also read: Phoenix Suns Could Have Big ATSC 3.0 Distribution Plans, and Other Teams, Including the Utah Jazz, Might Soon Follow

“It’s not a super long-term deal, but with the flexibility, it’s probably much more of a partnership than a deal," Smith told local paper the Salt Lake City Tribune. 

The length of the contract wasn't defined.

"With KJZZ, if we’re good partners, we’ll keep going, and if we’re not good partners with each other, we won’t," Smith added. 

WBD told its AT&T SportsNet team partners in February that it was looking to divest itself from the channels. 

RSN margins have whittled away quickly amid cord-cutting — non-sports fans have exited the pay TV ecosystem in droves, driving down the market value of local sports network dramatically. 

Sinclair, for example, paid $10.6 billion to acquire 19 Fox Sports Net channels in 2019.  At the time, those channels were spinning off margins in excess of 50%. By March of this year, those average margins had whittled below 15%, and the division Sinclair had set up to manage its sports networks, Diamond Sports Group, entered bankruptcy. 

Certainly, it didn't help that Sinclair management elected to pursue expensive stock buyback initiatives rather than pay down debt on the regional sports networks it branded as Bally Sports. Investors — and perhaps more so, creditors — will just have to forgive management, financially well off personally as they may be now, for that fateful decision. 

As for the “partnership” between the Jazz and Sinclair, don’t be surprised if the broadcast station group finds a way to use its acumen with ATSC 3.0 to develop a new broadcast sports business model with the pro hoops team down the road. Smith did talk about "flexibility," after all.  

Just our prediction. 

Updated: On June 15, Diamond reportedly rendered its full local TV rights payment to the Texas Rangers. 

From before:

Sinclair subsidiary Diamond Sports Group has already used federal bankruptcy protection to walk away from one Major League Baseball team, the San Diego Padres, with which it has a money-losing distribution deal. 

And it’s looking more and more like Diamond will banish more MLB teams from its Bally Sports portfolio of regional sports networks. 

But a hard deadline approaches: According to recent bankruptcy court filings, Diamond has until Thursday to either pay the Texas Rangers for 2023 local TV rights or cut the team loose from its Bally Sports contract. 

Diamond has payments to three other MLB teams due on July 1.

This time, there doesn't appear to be any grace period. 

Last week, Diamond’s lawyers asked the U.S. Bankruptcy Court for the Southern District of Texas in Houston, which is overseeing its restructuring, to clarify what happens to money it has already paid MLB clubs should it decide to tear up their contracts. Since payments are made for games that are in the future, Diamond doesn’t want end up paying for rights it doesn’t use. 

Reads a Diamond motion filed on June 7: “For example, if the Debtors were to make a telecast rights fee payment to a Club on July 1, 2023 that covers the remainder of the MLB season, and the Debtors were to subsequently reject the Agreement with that Club effective as of August 1, 2023 and cease broadcasting that Club’s games (when the season otherwise goes through the middle of September), that particular Club would have received more in payment than it is entitled to as an administrative expense claim.”

Diamond added, ”As the Debtors previewed at the Hearing, and as the Court recognized, the Debtors are in the process of determining whether to assume or reject one or more of the Agreements.“

U.S. Bankruptcy Judge Chris Lopez rejected that motion, saying he’ll clarify any reimbursements when Diamond files to reject the contracts. 

A little necessary backstory here: Diamond, the subsidiary set to manage Sinclair’s 19 Bally Sports-branded local sports cable channels, entered bankruptcy in March, aiming to shed $8 billion in debt by swapping equity with creditors and renegotiating deals gone bad among its 42 MLB, NBA and NHL team partners. 

Diamond not only wanted the Padres, for example, to take less than the $1.2 billion over 20 years it agreed to pay for TV rights, it wanted the club to surrender its direct-to-consumer streaming rights to subscription service Bally Sports Plus. 

Backed by MLB, the Padres demurred. And since the club owned part of Bally Sports San Diego, it fell under different bankruptcy court guidelines. Diamond simply walked away from the Padres, and the club, working with MLB, established a new pay TV channel.

Diamond had been waiting for the court to restructure deals on four MLB teams that were under court jurisdiction — the Arizona Diamondbacks, Cleveland Guardians, Minnesota Twins and Texas Rangers — before rendering them complete payments for the ongoing 2023 season. 

On June 2, after acrimonious testimony between Diamond and MLB Commissioner Rob Manfred, Lopez sided with an MLB motion and ordered Diamond to get up to date in full with those four teams, per existing contracts. 

Speculation since then is Diamond will soon tear up its contracts with all or some of those teams. And the subsidiary’s motion seems to confirm that it’s thinking about doing just that. 

Sinclair Broadcast Group said it sold its controlling interest in sports network Stadium to Jerry Reinsdorf’s Silver Chalice.

Reinsdorf is the owner of the Chicago White Sox of Major League Baseball and the Chicago Bulls of the National Basketball Association. 

Financial terms of the deal were not disclosed. Chalice has owned a stake in Stadium since it was started in 2017.

Sinclair has been unwinding its sports businesses. The broadcaster bought the Fox regional sports networks from The Walt Disney Co. in 2019. Those network were renamed Bally Sports following a deal giving Sinclair equity in Bally’s. 

With cord-cutting and rising costs for sports rights, the regional sports network business has collapsed and Diamond Sports, the division of Sinclair that runs the Bally RSN, declared bankruptcy in March.

A Sinclair spokesperson said the decision to sell Stadium was not related to the RSN situation. Instead, they said Stadium did not generate enough audience interest to continue funding.

The local broadcast rights deals for both teams with NBC Sports Chicago expire in 2024. With the decline of the regional sports network business, the way those teams deal with local carriage is likely to be different going forward.

With its studios located in Chicago’s United Center — where the Bulls and Blackhawks of the National Hockey League play — Stadium assets could be used to build a TV business that could carry those teams.

The sale of Stadium was initially reported by Front Office Sports.

Sinclair Broadcast Group’s collection of over-the-air multicast networks — Comet, Charge! and TBD — has acquired new programming to take advantage of their beefed-up distribution and viewership gains ahead of the upfront advertising market.

TBD will be adding The Laugh List, an exclusive original series from Vin Di Bona Productions, creator of America’s Funniest Home Videos, in the fall

Charge! will add Law & Order: Criminal Intent to its lineup of procedural dramas in October.

And Grimm will join the sci-fi and fantasy-filled lineup at Comet. That network will be holding its first virtual Comet Fest June 16-18, saluting Star Trek. Comet Fest will lead into the launch of Grimm in June.

All three networks are scheduled to launch on YouTube TV on June 1.

“The networks are on a roll as viewers continue to leave cable TV networks in search of new entertainment options such as free over-the-air multicast networks and streaming,” said Adam Ware, senior VP of Sinclair’s growth networks group.

At a time when some digital broadcast networks are seeing decline, the Sinclair networks — marketed as The Stack — are up 21% among viewers 25-54 in primetime this year through April. That should appeal to ad buyers looking for ways to replace the reach of cable with familiar programming.

Ware told Broadcasting+Cable that TBD, originally designed to show short bits of social-media type programming, has moved up to longer-form funny unscripted series including Wipeout, Fear Factor and World’s Dumbest.

In February, TBD ordered a test of an original series from Vin DiBona Productions. Sinclair tested the show in several markets to see how it would perform and then ordered 50 half-hour episodes of The Laugh List.

“It looks like America’s Funniest Home Videos without an audience,” Ware said. “They have a formula and it really works. They celery know how to produce this kind of content.”

Comet has found a fandom niche with a primetime block featuring Buffy the Vampire Slayer and X-Files. “If Buffy and X-Files had a baby, it would be Grimm,” Ware said. Grimm was a Friday-night hit for NBC, running from 2011 to 2017 and peaking with 8 million viewers.

Grimm will be introduced to Comet with Comet Fest, which in its inaugural year will celebrate Star Trek from June 16 to 18. Comet will air the first four Star Trek films — Star Trek: The Motion Picture, Star Trek II: The Wrath of Khan, Star Trek III: The Search for Spock and Star Trek IV: The Voyage Home — and The Captain’s Closeup, a series featuring William Shatner interviewing Sir Patrick Stewart, Avery Brooks, Kate Mulgrew and Scott Bakula. All of that will lead into a preview of Grimm on June 18, a Sunday night. The series will debut in its primetime timeslot on June 19.

Comet Fest will also feature a cosplay contest and giveaways.

Grimm will also run in the afternoons, and possibly in late night. “We’re really high on it,“ Ware said. “I think Buffy, X-Files and Grimm are a really powerful package and I think fans will dig it.”

Charge! has established itself with procedurals with CSI: New York and CSI: Miami in prime time, Ware said. Law & Order: Criminal Intent should be a good fit on Charge! “It’s a very distinct show,“ Ware said. “I just like Vincent D’Onofrio. I think that positions us quite nicely against other networks that are declining with series that are appealing to a similar audience.”

Sinclair Broadcast Group said it plans to replace local newscasts at stations in five markets with its national news program The National Desk in five markets beginning May 15.

The stations affected are WNWO Toledo, Ohio; KPTM Omaha, Nebraska; KTVL Medford, Oregon; KMEG Sioux City, Iowa and WGFL Gainesville, Florida.

The newscasts in each market were low-rated.

Some news staffers will be affected. In Toledo, for example, WNWO’s newscast was being produced by WSBT South Bend, Indiana, and the station had only a handful of news staffers.

The National Desk will air in what are currently local news slots. In some cases, local news cut-ins will be added to the broadcasts.

“We are changing the way we produce news in these markets to ensure long-term success,” Sinclair said in a statement. “Beginning May 15, The National Desk, which provides real-time national and regional news from Sinclair’s television stations across the U.S., will air during the stations’ regularly scheduled news time periods, with an opportunity for local news cut-ins in the newscast. TND offers an alternative choice for news, and has grown exponentially over the last year, reaching nearly 3 million viewers per week, across all dayparts.”

Sinclair Broadcast Group said it reached a new carriage deal with YouTube TV that adds the broadcaster’s digital broadcast networks and Tennis Channel to YouTube TV’s lineup.

YouTube TV continues to not carry the Bally Sports regional sports networks, owned by Sinclair’s bankrupt Diamond Sports Group subsidiary.

The new YouTube TV agreement also extends the virtual multichannel video programming distributor’s existing carriage of Sinclair’s CBS and MyNetwork TV affiliates. CBS and its affiliates recently reached an agreement covering carriage of virtual multichannel video programming distributors like YouTube TV.

Carriage of Tennis Channel and its T2 free ad-supported streaming television (FAST) channel starts June 1 in time for the French Open.

Financial terms were not disclosed.

"We are pleased to reach an agreement that brings Tennis Channel, T2 and all three of our emerging networks to YouTube TV, a valued partner of ours,” Sinclair senior VP, head of distribution & network relations Will Bell said.  “As the media landscape continues to evolve, our goal remains the same — to bring our unrivaled content to people wherever they want to experience it. With Roland-Garros kicking off May 28th, the timing is perfect for YouTube TV customers.”

Sinclair’s digital networks are Comet, Charge! and TBD. YouTube already carried Comet and the new deal renews carriage of the sci-fi-focused network. Charge! and TBD are scheduled to launch on YouTube TV June 1.

As Sinclair continues to play bankruptcy chicken with its creditors and league partners in an attempt to restructure more than $9 billion in debt tied to its Bally Sports channels, Warner Bros. Discovery has reportedly told teams tied to its four regional sports networks that they have until March 31 to buy back their TV rights.

According to Sports Business Journal, WBD told 10 teams affiliated with Major League Baseball, the National Basketball Association and the National Hockey League they have until March 31 to negotiate a buyback of their rights. If an agreement can’t be made, WBD will conduct a Chapter 7 liquidation filing. 

Also read: Is WBD Cool to the RSN Biz, Too? Light AT&T SportsNet Envelopes Stir Concerns Among Sports Media Watchers

WBD’s declaration means that currently, key revenue streams from TV rights for a collective 52 teams across three major sports leagues are in limbo, factoring in the 42 teams impacted by the Bally Sports issue.

And things are tough all over for regional sports networks, which routinely generated profit margins of 50% or more just four years ago. 

Earlier this month, for instance, The Walt Disney Co. disclosed that its SEC Network ended 2022 with 51 million subscribers, down 14% since 2019. (See page 7 on Disney's 10K filing.) 

NBCUniversal, meanwhile, said it has only 15 million remaining customers for its five NBC Sports RSNs, down from 21 million in 2021. (That's page 8 on Comcast's 2022 10K. Some of that loss can be attributed to NBCU selling its share of its Washington/Baltimore RSN back to its partner teams a year ago.)

And the moribund Pac-12 Networks might, according to a published report, sign a distribution deal with Apple “because no one else will give them money,” a individual familiar with the negotiation told Next TV. 

“The RSNs are definitely the hot-house flowers of pay TV,” Patrick Crakes, a former Fox executive turned sports media consultant also told Next TV. 

The “decade-long phenomenon that is cord-cutting“ is taking are particularly acute toll on programming networks with narrowly focused content, Crakes explained, but this shouldn’t fool anyone to believe the leagues will suddenly shift their rights to streaming. 

”Nobody has been able to make that work yet, including Netflix,” Crakes said, noting the more than decade — and billions of dollars — of deficit spending it took the streaming giant to get to a place where it could report a profit. 

Also read: Scripps Sports: Phones ‘Already Ringing’ as Regional Sports Nets Implode

On Friday morning during an earnings call, E.W. Scripps CEO Adam Symson said his phone has been ”ringing off the hook” with those seeking to discuss moving live sports programming on RSNs to local broadcast, as the RSN business experiences what he called an ”implosion.” 

Crakes bristles at that hyperbolic word choice — there’s simply too much tread left on the RSN business, he said, and the OTT ”plus” business simply can't generate replacement revenue yet. 

To Crakes’s thinking, the RSN business has indeed peaked, but channels can still yield margins of 10% to 20% for those such as NBCU who aren’t carrying any debt on them. 

And he believes that once the dust settles with the current Sinclair and WBD restructurings, that’s exactly the kind of mature business RSNs will settle into — one that will let both media companies and pro sports team partners bide their time until digital models do generate enough revenue to support the lifestyles in which they’ve all become accustomed. 

Sinclair Has 'Very Effectively Used Bankruptcy'

While MLB commissioner Rob Manfred seemed to issued a stern ultimatum when he suggested nearly two weeks ago that pro baseball was prepared to replace TV distribution for 14 of its teams should a bankruptcy filing by Sinclair’s Diamond Sports Group disrupt TV rights revenue, Crakes doesn't think the MLB really has any such alternatives. 

Digital distribution can’t replace the 10% to 30% of overall revenue teams receive from their RSN deals with Diamond. It’s still overwhelmingly in their best interest to find a way for Sinclair, Diamond and Bally Sports to go on. 

Diamond, Crakes also said, isn’t actually as cash-strapped as many have been led to believe. But the cost of maintaining all the debt on the Bally Sports channels has reduced margins to razor-thin levels. Sinclair, he explained, has “very effectively used bankruptcy” to move forward with a reshuffling of the deck, hoping to trade equity in the 19 Bally Sports channels for its debt. 

Sinclair hopes to come out of all this as a minority owner of an RSN group that generates around 15% margins, debt-free, with a new ownership group — perhaps private equity — in control. 

Meanwhile, some of the 19 Bally Sports channels might be offloaded to other RSN groups, such as NBC Sports, that could provide a better fit for them, Crakes said, noting the networks’ origins under Fox Sports ownership. 

”That portfolio was designed for us at Fox in a different era, where they would be bundled with news channels and FX and local affiliates,” Crakes said. 

As for the AT&T SportsNet channels serving Denver, Houston and Pittsburgh, they were inherited by AT&T amid its DirecTV purchase in 2015, and then spun off with WarnerMedia and tied up into the $43 billion merger with Discovery. 

Crakes called this AT&T SportsNet portfolio — which also includes a minority stake in Root Sports Seattle — an ”orphan,“ a poor fit for an indebted WBD that’s conducted around $4 billion in synergy cuts recently. 

In fact, AT&T itself tried to sell the channels to Sinclair, before Sinclair paid $10.6 billion for the Fox Sports networks in 2019, later rebranding them as “Bally Sports.”

AT&T, too, is leveraging the bankruptcy threat to push its debt and team partners to help restructure the AT&T SportsNet business. 

“The teams are going to work with the distributors to keep the value chain intact,” Crakes predicted. The RSN business is “never going to be a growth business again,” but it will reemerge after the Sinclair and WBD restructurings as still viable, at least in the near term. ■

S&P Global Ratings downgraded its credit ratings on Diamond Sports Group to D from CCC after the Sinclair Broadcast Group subsidiary announced it would not make a $140 million payment due on certain notes.

Diamond operated the struggling Bally Sports regional sports networks. The payment was due Wednesday. The company is now in a 30-day grace period with its creditors.

“We do not expect the company to make its interest payments within the 30-day grace period to preserve financial flexibility. DSG is discussing strategic alternatives with creditors and other key stakeholders, which we believe will likely result in a comprehensive debt restructuring or bankruptcy filing,” S&P said.

Diamond operates as an independent subsidiary of Sinclair. Its finances are not incorporated into Sinclair's

The D rating applies to Diamond's senior secured second-lien notes, its senior secured third-lien note and its senior unsecured notes. Payment on those notes was not made. S&P also downgraded the ratings on  Diamond’s senior secured second-lien notes to D from CCC and senior unsecured notes to D from C. The company’s senior secured third-lien notes are unrated.

A bankruptcy filing could have a profound effect on local sports on TV. In a bankruptcy, Diamond could try to cancel some contracts and negotiate others.

Major League Baseball has indicated that it could take back the TV rights to teams’ games if those teams do not receive the payments called for in their current contracts. ■

Diamond Sports Group, the Sinclair Broadcast Group subsidiary that runs the troubled Bally Sports regional sports networks, said that rather than pay $140 million in interest due Wednesday, it will enter a 30-day grace period.

Diamond said it will use the flexibility provided by the grace period to spend the next 30 days in discussions with creditors and other key stakeholders “regarding strategic alternatives and deleveraging transactions to best position Diamond Sports Group for the future.”

The alternatives include bankruptcy and a structured reorganization. In a bankruptcy, Diamond could get out of contractual obligations and renegotiate others, including its rights deals with the teams whose games the RSNs carry. 

In the meantime, Diamond Sports Group said it “expects that its business will continue as usual, and it will keep broadcasting quality live sports productions for fans while it addresses its balance sheet.”

The grace period will end just before the start of the Major League Baseball season.

The financial troubles at Diamond and the Bally RSN could have a profound effect on the future of local sports on TV. 

Sinclair borrowed about $9 billion to buy the Fox Sports regional networks from The Walt Disney Co. after Disney bought 21st Century Fox. In a deal with Bally, Sinclair rebranded the RSNs in 2021.The debt load became more burdensome as cord-cutting eroded the number of pay TV subscribers and the amount of distribution revenue the RSNs could collect as sports rights fees continued to rise.

Last year, Sinclair separated itself from Diamond financially — Diamond’s financials were no longer in Sinclair’s quarterly earnings — and in December, Diamond hired former ESPN and NBC Sports executive David Preschlack as CEO to operate independently from Sinclair. 

The leagues have been monitoring the situation and Major League Baseball is considering taking back Bally Sports’s rights to games should Diamond attempt not to pay the fees agreed in to the teams’ current contracts.

Standing on the sideline waiting to get into the game, are Apple, Amazon and Alphabet, which have been getting deeper and deeper into the sports streaming business, as well as broadcasters including Nexstar Media Group and E.W. Scripps, which could air local sports on their stations. Scripps has already formed Scripps Sports, a new division looking to secure sports rights. ■

Diamond Sports Group, the division of Sinclair Broadcast Group that runs the troubled Bally Sports regional sports networks, has a deadline of Wednesday (February 15) to make a $140 million interest payment.

UPDATE: Diamond Sports Opts Not To Make Interest Payment, Enters Grace Period Before Bankruptcy

How the day plays out could have a big impact on the future of local sports on TV.

While most reports have indicated that Diamond — which now operates independently from Sinclair — will decide not to make the payment, a source familiar with the situation maintains that Diamond making the payment remains in play.

Not making the payment could lead to Diamond filing for bankruptcy, but first it has a 30-day grace period. During the grace period, Diamond can negotiate with creditors and try to come up with a restructuring plan. The grace period would run out just before Major League Baseball’s opening day on March 30.

Diamond would prefer to have a restructuring plan with as many creditors as possible signed on to bring to bankruptcy court. 

During its third-quarter earnings report in November, Sinclair said that it hired advisers LionTree and Moelis & Co. to “talk to parties about deleveraging, strategic partnerships and things of that nature.”

Diamond Sports’s bond prices have been dropping and, according to Bloomberg, a restructuring would lead to debt being converted into equity, with Diamond’s largest creditors — Prudential Financial, Fidelity, Hein Park Capital Management and Mudrick Capital Management — becoming owners of the Bally Sports RSNs. 

The alternative to having a plan in place would be a messy court fight with a judge deciding how to dispose of Diamond's assets.

A bankruptcy would also enable Diamond to terminate or renegotiate the rights deals it has with the 40 Major League Baseball, National Basketball Association and National Hockey League teams whose games the RSNs carry. 

The leagues have been monitoring the situation and Major League Baseball is considering taking back Bally’s rights to games should it attempt not to pay the fees agreed in the teams’ current contracts.

Standing on the sideline waiting to get into the game are Apple, Amazon and Alphabet, which have been getting deeper and deeper into the sports streaming business, as well as broadcasters including Nexstar Media Group and E.W. Scripps, which could air local sports on their stations. Scripps has already formed Scripps Sports, a new division looking to secure sports rights.

Also: Scripps Sees Opportunity in ‘Broken’ RSN Business

If Diamond Sports opts to make the payment, it might not face another critical deadline for six months.

Sinclair borrowed about $9 billion to buy the Fox regional sports from The Walt Disney Co. after Disney bought 21st Century Fox. In a deal with Bally, Sinclair rebranded the RSNs in 2021.The debt load became more burdensome as cord-cutting eroded the number of pay-TV subscribers and the amount of distribution revenue the RSNs could collect while sports rights fees continued to rise.

Last year, Sinclair separated itself from Diamond financially — Diamond‘s financials are no longer in Sinclair’s quarterly earnings — and in December, Diamond hired former ESPN and NBC Sports executive David Preschlack as CEO. ■

Taking back Bally Sports’ local TV rights to teams’ games is one of the options being explored by Major League Baseball, according to a published report.

Diamond Sports Group, the Sinclair Broadcast Group division that runs the Bally Sports-branded regional sports networks, is considering filing for bankruptcy as a payment on its debt approaches.

Sinclair took on about $9 billion in debt when it bought the 19 Fox regional sports networks from The Walt Disney Co. in 2019. Since then, cord cutting has eroded the RSNs subscriber base and rights costs have risen, putting the RSNs in a bind.

In a bankruptcy, Diamond might be able to try to relieve itself of some payments and renegotiate contracts. All of which has Major League Baseball looking at contingency plans, according to Front Office Sports. 

“Our strong preference would be for the RSNs to be able to fulfill the agreements they signed with the clubs. However, we need to be prepared if the RSNs are unable to do so,” Noah Garden, MLB chief revenue officer, said in a statement to Front Office Sports. “This is a situation we have been monitoring for a long time.  We have been contingency planning to ensure that no matter what happens with the RSNs, fans will be able to continue watching their favorite teams in their local market.”

During its third-quarter earnings report in November, Sinclair said that it hired advisers LionTree and Moelis & Co. to “talk to parties about deleveraging, strategic partnerships and things of that nature.”

According to a report from Bloomberg, under a restructuring plan described by unnamed inside sources, debt would be turned into equity, and Diamond's largest creditors — Prudential Financial, Fidelity, Hein Park Capital Management and Mudrick Capital Management — would become owners of the Bally Sports RSNs. ■

Sinclair Broadcast Group said its free, over-the-air multicast networks Comet, Charge! and TBD have made deals that will add 2.4 million TV households to their distribution footprint by the end of the second quarter.

The added distribution reflects new broadcast affiliation agreements with Nexstar Media Group, Gray Television and Entravision in markets including San Francisco, Phoenix, San Diego and Hartford/New Haven.

The networks are also adding distribution on cable. 

“These affiliate additions are a continuation of the distribution and ratings momentum that began in 2022, as we moved into new DMAs or upgraded coverage within the networks’ existing local broadcast affiliate footprints. As viewers continue to watch less cable TV, we’re excited Comet, Charge! and TBD will be available to an additional 2.4 million viewers across the country,” Adam Ware, senior VP, Growth Networks Group, said.

Also: With Ratings Surging, Sinclair Eyes Adding New Digital Net

Charge! Is being carried on KRON San Francisco; WWAX Hartford-New Haven, Connecticut; WVLT Knoxville, Tennesee; KVSN Colorado Springs, Colorado; and KEUS San Angelo, Texas.

Comet is being carried on KGHB-TV in Colorado Springs.

TBD is being picked up by KPHO Phoenix; KBNT San Diego; and KZBO Lubbock-Midland, Texas. ■

Giant station owners Sinclair Broadcast Group, Nexstar Media Goup, Gray Television, E.W. Scripps Co., Tegna, Hearst Television and Cox Media Group have pulled their stations’ signals from FuboTV in a dispute with Paramount Global’s CBS Television Network, according to sources familiar with the situation.

The conflict shows some of the strains between networks and their affiliates at a time when media companies are shifting programming to direct-to-consumer streaming platforms.

Carriage deals for FuboTV and other streaming virtual multichannel video programming distributors (vMVPDs) have been handled at the network level, but the CBS affiliate board rejected the terms of the deal CBS negotiated with Fubo.

Also: YouTube TV Drops MLB Network

CBS is providing a network feed — without local programming — to FuboTV for markets where affiliates have not agreed to the deal. The network is using programming from the CBS News Streaming Network to replace local newscasts.

CBS's owned and operated stations are being carried by Fubo, Fubo said.

Most individual station owners declined to comment. The affiliate board has hired a public relations agency to be able to put out a unified message. Hearst and Scripps confirmed their stations were no longer on Fubo.

UPDATE: Nexstar put out a statement: “Nexstar’s CBS stations are currently not available on the streaming service Fubo, denying Fubo subscribers the critically important local news, weather updates and other local programming we provide. This programming is being denied to Fubo subscribers because CBS’s owner, Paramount, has been unwilling to include Nexstar and other local broadcast groups in the negotiating process and unwilling to allow them to negotiate with Fubo on their own.”  

UPDATE: The only station group with a representative on the CBS Affiliate Board whose stations are still on Fubo is Allen Media Broadcasting, part of Allen Media Group. Allen Media Broadcasting said paperwork approving the deal was signed in error and sent to CBS. The company is trying to have its approval rescinded. “The arrangement that CBS has proposed is not appropriate,” Allen Media Broadcasting said. 

Neither CBS nor sports-focused Fubo has said how many CBS affiliates are allowing their signals to be streamed by Fubo after Monday’s deadline, which came after CBS’s broadcast of the AFC Championship Game on Sunday, one of the highest-rated telecasts of the year.

UPDATE: Fubo has published a website showing CBS affiliates and whether or not they're available on Fubo. One CBS affiliate noted several errors on the website, but said it appeared that non-CBS owned affiliates representing less than 10% of the country were still available on Fubo.

“CBS, through our Affiliate Board, provided our affiliates a fair opportunity to continue their carriage on FuboTV with short-term, mid-term and long-term options, including under the existing contract,“ CBS said in a statement. “Unfortunately and inexplicably, the Board did not endorse any of our multiple solutions. As a result, some CBS affiliates have elected to discontinue their local feeds on the FuboTV platform.

“In an effort to prevent a viewer disruption in affected markets, CBS may provide a network content feed to ensure that FuboTV subscribers retain access to news, sports and entertainment programming from America’s most-watched broadcast network,” CBS said. “We are committed to working in good faith, and we hope the Affiliate Board will reconsider the opportunity on behalf of its CBS affiliates.”

In a note to stations last week, the CBS affiliate board said it “remains adamantly opposed to Paramount’s insistence on controlling the retransmission rights of independently-owned local CBS affiliates on vMVPD platforms like Fubo.”

The board noted that “Paramount negotiates on behalf of 100% of all local stations in conjunction with Paramount’s other over two dozen cable networks. Once Paramount reaches an agreement conferring unknown value on its own cable channels and other assets, it presents a take-it-or-leave-it' offer to 'opt in' to a vMVPD distribution agreement with no changes.”

The board said it does not endorse the deal proposed by CBS. ■

With Sinclair's Diamond Sports Group subsidiary controlling the regional sports network fates of 16 Major League Baseball teams, a painful restructuring wrought by the subsidiary's likely bankruptcy will have a major impact on a TV source that supplies 20% to 30% of MLB's total revenue. 

But even in a worst-case scenario, where Diamond enters Chapter 11 without a restructuring plan and the local TV rights of MLB teams are tied up in bankruptcy for a protracted period, baseball will manage to get its three outs. 

Indeed, according to an observer of the league's economics, Baseball Prospectus writer Daniel R. Epstein, MLB will be just fine, generating record revenue of around $10.8 billion in 2022.  

"MLB will continue to thrive financially even if they take a hit on RSNs," Epstein wrote. 

Certainly, a restructuring that allows the 19 Bally Sports RSNs to duck out of deals with teams could be disruptive to those franchises in the short term. 

Some Major League teams in the Sinclair/Diamond's Bally Sports tent hold an ownership stake of 20% or more in their respective channels, such as the Los Angeles Angels, San Diego Padres and St. Louis Cardinals. And some teams collect a greater percentage of their overall revenue from their Bally Sports licensing contract than others. 

Given MLB's historically pioneering acumen in regard to live streaming, as sportswriter Maury Brown noted in Forbes Monday, the league could find a solution for its suddenly local-TV-bereft teams in the form of direct-to-consumer streaming. 

Added Epstein, "If there’s one thing [MLB Commissioner] Rob Manfred does well (loath as I am to compliment him), it’s negotiate lucrative media contracts," noting the $115 million-a-season national TV rights deal the league signed with Apple for "Friday Night Baseball" last spring. 

However, despite having plenty of resources to quickly move past the disruption cause by the fading pay TV ecosystem -- not to mention Sinclair's avarice and mismanagement -- baseball, Epstein said, will likely be "crying poor" as it looks for reasons to justify raising ticket prices, lowering player salaries and leveraging taxpayer money for stadium builds and renovations.

"If history is any indicator, RSN uncertainty will give them an excuse to take out their imaginary financial frustrations on everyone in their blast radius," Epstein added. 

Sinclair paid $10.6 billion in 2019 to acquire 19 former Fox Sports channels, which are now branded as Bally Sports. Sinclair, which set up its Diamond subsidiary to manage it all, also co-owns channels operated by the New York Yankees and Chicago Cubs. 

Beyond the culpability of dismissing the obvious erosion of the linear pay TV ecosystem before entering that huge Fox deal, Sinclair chose to conduct a ruinous spree of stock buybacks instead of paying off its debt.

"The amount of money they invested in their own stock through the two buyback initiatives is a little more than the amount their subsidiary, Diamond, owes to teams for broadcasting rights," Epstein wrote. 

Buybacks, of course, enhance the compensation outlook for Sinclair CEO Chris Ripley and other top-level Sinclair managers, offering investors in the words of Epstein, "the illusion of success."  

Takeaway: Nobody is going to come away looking good in this debacle. 

Culminating perhaps the biggest financial disaster in sports media history, Diamond Sports Group, the heavily indebted subsidiary that manages Sinclair Broadcast Group's 19 Bally Sports-branded regional sports networks, is headed for bankruptcy. 

Bloomberg was first to report Wednesday that Diamond will probably skip a mid-February $140 million interest-only payment servicing around $8.6 billion in debt as it prepares for a Chapter 11 restructuring that will roil the $55 billion U.S. sports media business. 

Sinclair reps didn't have comment when summoned by Next TV. 

During its third-quarter earnings report in November, Sinclair said that it hired advisers LionTree and Moelis & Co. to “talk to parties about deleveraging, strategic partnerships and things of that nature.”

At that time, the consensus belief was that either one or all of Diamond's pro league partners from the NBA, NHL or Major League Baseball would either have to step in and assume an ownership stake, or the RSN operator would have to restructure in early 2023. 

The latter appears to be happening. 

According to Bloomberg, under a restructuring plan described by unnamed inside sources, debt would be turned into equity, and Diamond's largest creditors — Prudential Financial, Fidelity, Hein Park Capital Management and Mudrick Capital Management — would become owners of the Bally Sports RSNs.

Diamond's $630-million first-lien loan is trading at 92 cents on the dollar, Bloomberg reports, while nearly $5 billion in “lower-ranked bonds” will trade at under 10 cents on the dollar. 

This signals “a near-total wipeout for subordinated creditors,” the news service said. 

Meanwhile, pro teams relying on TV rights revenue from their deals with the 19 Bally Sports RSNs will face severe belt-tightening, since rights deals with them can be terminated amid the restructuring. 

For example, MLB’s St. Louis Cardinals have been identified as a franchise likely to take one of the hardest blows, since so much of its revenue comes from RSN TV rights. 

Meanwhile, Bloomberg also reports that Sinclair wants to goose a DTC revenue stream that started last year when Bally Sports launched its channels over-the-top via Bally Sports Plus. A streaming iteration that charges customers by the game has been discussed. 

But for Bally Sports, that kind of new revenue-stream talk is a day late and billions of dollars short. 

Sinclair reported in late November that Diamond has around $585 million in cash on hand, but it needs to pay its team partners around $2 billion this year just to maintain its rights deals.

This mess all started back in 2019, when Sinclair paid around $10 billion to acquire the Fox Sports RSNs amid Disney's purchase of select Fox entertainment assets. At that time, the channels were spinning off around $1.9 billion of EBITDA. 

Since then, cord-cutting and other erosive forces within the technical-media-telecom business have rendered the associated debt nearly impossible to service. ■

Major League Baseball said it hired Sinclair Broadcast Group regional sports network executive Billy Chambers as executive VP, media and business development.

In his newly created role, Chambers will oversee the management and distribution of MLB’s local media rights, working closely with the league’s 30 teams.

The move comes as MLB and Sinclair’s Bally Sports Networks have wrestled over local streaming and direct-to-consumer rights.

With cord-cutting eroding cable and satellite subscribers, regional sports networks have been getting squeezed and are seen as unlikely to be able to continue to pay the big bucks they’ve been spending on local TV rights to baseball games.

Sinclair ran up about $9 billion in debt buying the 21 Fox Sports RSNs from The Walt Disney Co. The RSNs -- rebranded as Bally Sports Network -- are now operated by Sinclair’s Diamond Sports Group unit, which has been separated from the main company financially.

Diamond Sports also last year named a new CEO, former ESPN and NBC Sports executive David Preschlack, in a bid to build better relationships with rights holders including MLB.

Chambers was chief financial officer and chief operations officer for the Bally Sports RSNs. He was with them when they were acquired by Sinclair and assisted Disney in making the sale. (Disney acquired the Fox RSNs when it acquired 21st Century Fox.)

Chambers spent 20 years with Fox Sports Media Group, where he was CFO, overseeing Fox Sports, the RSNs, FS1, FS2, Big Ten Network and Fox Deportes. He negotiated rights deals with MLB, the NBA and the NHL, as well as team rights.

“Billy is an important addition to Major League Baseball and will play an integral role in how we navigate the rapidly evolving local media landscape in the future,” baseball commissioner Rob Manfred said. “Billy’s extensive knowledge and experience in all areas of regional sports network operations will help us maximize the reach of our game in the clubs’ local markets.”

MLB also promoted Kenny Gersh to executive VP, media and business development.

Chambers will work closely with Gersh, whose role has expanded to include oversight of all of MLB’s national and international media rights, distribution, and production.

Gersh joined MLB in 2006 as an executive at MLB Advanced Media, the interactive media company of MLB.

Chambers and Gersh report to MLB CRO Noah Garden. ■

Sinclair Broadcast Group named Todd Bernstein VP and general manager of WJLA-TV and WLA-24/7 in Washington, D.C.

Bernstein, who joined the station in 2005 as a sales manager, was named station manager in 2022. 

As GM, he succeeds William Fanshawe, who remains group manager at Sinclair.

“Todd has nearly 20 years of broadcast and sales management experience at WJLA, with deep roots in the Washington DC community. We are thrilled he is stepping into the GM role to lead the team, and we’re confident he will continue to successfully grow the station and revenue,” said Rob Weisbord, Sinclair’s COO and president of broadcast.

Bernstein began his media career as an account executive at rep firm Harrington, Righter & Parsons, where he was responsible for the oversight of the advertising for Sinclair-owned stations. ■

Sinclair Broadcast Group said it named Cory Culleton as VP and associate group manager.

In his new post, Culleton will be responsible Sinclair’s operations in the Raleigh, N.C.; Pensacola, Fla./Mobile, Ala.; Tallahassee and Gainesville markets. He will continue as VP and GM of WEAR-TV and WFGX-TV in Pensacola and  oversee the provision of services to WPMI-TV and WITC-TV, in Mobile.

“With over 20 years of experience in television, digital strategies and advertising sales, Cory has a long history of success, and we are excited to have him expand his market oversight into Gainesville, Tallahassee and Raleigh,” said Rob Weisbord, Sinclair’s CEO and president of broadcast. 

Before running the Pensacola stations, Culleton served as GM for Sinclair’s Gainesville, Fla., stations. He has also held positions in Savannah and Macon.

“It is a privilege to be expanding into the Florida teams in Gainesville and Tallahassee, and also Raleigh NC,” said Culleton. “I am humbled and excited to be a part of the great things happening at this group of stations and I am honored to have this opportunity. I look forward to building relationships in all of these Sinclair stations and our local communities.” ■

Sinclair Broadcast Group said it completed a demonstration of how it can use NextGen TV signals to deliver a variety of in-vehicle services to equip automobiles.

Sinclair worked with Hyundai Mobis and Cast.Era, a joint venture of Sinclair and SK Telecom, during the demo, which took place in Arlington, Virginia, on December 22.

A live ATSC 3.0 feed was delivered to a Hyundai Palisade equipped with a Wi-Fi gateway. The feed enabled individualized in-car video entertainment, including location-targeted ad insertions, GPS services and emergency alerts.

Broadcasters including Sinclair have been upgrading their stations to transmit ATSC 3.0 signals and have been forecasting that NextGen TV will enable businesses to generate billions in incremental revenue for the industry.

“This achievement demonstrates Datacasting as one of the critical designed-in ‘Mobile First’ features of the NextGen Broadcast standard,” Mark Aitken, president of Sinclair’s One Media 3.0 unit, said. “As we build out our national wireless IP data distribution network, it is easy to see that the use cases of the automotive sector are centrally aligned with the efficient nature of a broadcast-enabled data distribution platform.  This is simply the tip of the iceberg — natural synergy ripe for further development.”  

The demonstration was the first collaboration under the recently executed Memorandum of Understanding between Hyundai Mobis and Sinclair. The companies agreed to partner on the development and implementation of NextGen Broadcast-enabled automotive business models in both South Korea and the U.S.

“The one-to-many architecture of ATSC 3.0, paired with 5G, enables the delivery of highly efficient mobile data and entertainment services,” said Kevin Gage, Cast.Era’s chief operating officer. “We are excited to share a first look for the US of our work with Hyundai Mobis for hybrid ATSC 3.0 / 5G geotargeted, in-vehicle usage, furthering our commitment to enhancing mobile services.” ■

If we’re going to reach for a sports analogy, it was kind of like Florida’s decision over the weekend to kick a field goal, down 30-0 to Oregon State with just 37 seconds left in the Las Vegas Bowl.

On Tuesday, virtual pay TV service FuboTV announced a deal to carry all 19 of Sinclair Broadcast Group's Bally Sports-branded regional sports networks in its $69.99-a-month base tier.

Also read: Bally Sports Breaks Bad: With Subs Down 10% and Cash-Flow Half of 2022 Projections, Increasingly Desperate Sinclair Looks to 'Deleverage'

The agreement with a vMVPD with 1.23 million subscribers will add distribution and revenue to a heavily indebted RSN operation. With FuboTV marketing itself on the strength of its combined sports offerings, the deal is being billed as a win for both Bally Sports and FuboTV, at a time when both could certainly use one.

But it won't move the needle in a meaningful way for Bally Sports and Sinclair, which face an increasingly bleak future.

In late November, Sinclair conceded that its Bally Sports channels had lost 10% of their subscribers year over year. Cash flow was coming in at half of projections, and Sinclair’s Diamond Sports subsidiary — which manages Bally Sports — only has enough resources to service around $9 billion debt and keep the lights on through 2023.

The company would not offer any details on its incomplete Bally Sports Plus direct-to-consumer streaming play, which launched in September.

Two weeks after Sinclair's bleak Q3 earnings report, Diamond's board of directors sought to establish a little space between Bally Sports and Sinclair, installing a known sports TV presence, former NBC Sports executive David Preschlack, as CEO of the subsidiary.

The hope was that Preschlack — who has league relationships that Sinclair lacks — might entice Bally Sports' league partners, Major League Baseball, the NBA and NHL, to become active participants in the RSNs' rescue.

A league partner — or partners — could pay as much as $3 billion, and take on all the debt, to acquire the Bally Sports channels.

But a damning report from the New York Post this week suggests the leagues want no part of this rescue plan and are preparing for what they now expect will be Diamond's inevitable bankruptcy restructuring. (Sinclair has already hired advisers LionTree and Moelis & Co. to help prepare it to walk down this road.)

The leagues have hired their own advisers: MLB has enlisted investment banks Morgan Stanley and Guggenheim Partners; the NBA has retained Allen & Co., and the NHL is now seeking a banker, too, the Post reported.

The leagues expect that Sinclair creditors will reject a number of money-losing team deals in bankruptcy proceedings, such as one paying the baseball's San Diego Padres $60 million a season.

The teams will then be on their own to form new distribution partnerships. And the usual assortment of big tech companies — Apple, Amazon, Google — are expected to get into regional sports distribution for the first time.

Each is aggressively seeking expensive sports rights to prop up their various loss-leader video efforts. Google, for example, is said to be on the cusp of paying the NFL $2.5 billion a season to poach “NFL Sunday Ticket” from DirecTV.

“Right now, there is chaos. But we’ll be able to look back and say this is when a large tech company really entered the regional sports market,” an unnamed MLB team owner told the Post.

That chaos seems to apply to Bally's distribution strategy. While it will supply a much needed infusion of distribution, the FuboTV deal dramatically undermines Diamond's carriage agreement with its other live-streaming partner, DirecTV Stream, which carries the Bally Sports channels in its more premium Choice tier, set to be priced at $99.99 a month plus taxes and fees in January.

This will undoubtedly create yet another for Sinclair and Diamond to try to extinguish. DirecTV is Bally Sports only satellite TV partner, with Dish Network demurring on a renewal of the RSNs in 2021.

The news is probably more meaningful for FuboTV, which has seen its share price decline from nearly $18 a year ago to just over $2.10 on Wednesday.

After stringing together several quarters of negative customer growth and giving up on its sports-betting gambit, the vMVPD added 284,000 subscribers in Q3 and is looking to sustain a little momentum. ■

Sinclair Broadcast Group’s struggling Bally Sports Networks got a boost with a carriage deal with FuboTV.

Sports oriented streaming TV service FuboTV will carry the 19 Bally Sports regional sports networks, giving fans without a traditional cable subscription another way to access those networks and watch their local teams’ games.

FuboTV had previously carried Sinclair’s Tennis Channel and the Marquee Sports Network, a joint venture of Sinclair and the Cubs.

“RSNs are integral to FuboTV’s sports-first content strategy and our mission to superserve local passionate sports fans,” said Henry Ahn, chief business officer, FuboTV. “We are very pleased to bring Fubo subscribers significant local sports coverage through our new partnership with Bally Sports, the nation’s leader in local sports rights. Sinclair has been a great partner and we’re pleased that we were able to work together well to get a deal done that is meaningful and beneficial for both sides. We’re looking forward to bringing the Bally Sports RSNs to Fubo subscribers in the coming weeks.”

Buying the regional sports networks saddled Sinclair with $9 billion in debt. Since then they’ve been under pressure as cord-cutting reduced distribution and advertising revenues and the costs for sports rights continued to rise.

Diamond Sports Group, the Sinclair unit that runs the RSNs, reported a $1.124 billion loss in the third quarter. It also cut its guidance for 2022 EBITDA in half.

Also: David Preschlack Named CEO At Sinclair's Diamond Sports Group

To help its RSNs, Sinclair launched Bally Sports Plus, a direct-to-consumer app that allows non-cable subscribers to stream games. 

In the third quarter, FuboTV said it had 1.231 million subscribers. The company took a $35 million charge against earnings resulting from its decision to get out of the sports-betting business.

“FuboTV has long been associated with connecting sports fans to their favorite teams and we are thrilled to be expanding our partnership to include the Bally Sports regional sports networks across their platform, providing Fubo’s subscribers with streaming access to their favorite hometown Bally Sports teams,” said Will Bell, senior VP, head of distribution and network relations, Sinclair. “Fubo has been a great partner, and we are excited to continue to grow our relationship to serve our collective viewers.” ■

Sinclair Broadcast Group stock dropped 7.3% to close at $14.72 a share Monday following a published report that sports networks are less interested in buying the company’s struggling regional sports networks.

Sinclair incurred about $9 billion in debt when it bought the 19 Fox regional sports networks from The Walt Disney Co. Since then, it has rebranded the channels as Bally Sports.

The regional sports network business has been pressured as cord-cutting has eroded the number of subscribers and the cost of rights to air games continue to rise. Diamond Sports Group, the Sinclair unit that runs the RSNs, reported a $1.124 billion loss in the third quarter. It also cut its guidance for 2022 EBITDA in half.

Also: David Preschlack Named CEO At Sinclair's Diamond Sports Group

To help its RSNs, Sinclair launched Bally Sports Plus, a direct-to-consumer app that allows non-cable subscribers to stream games. That put Sinclair at odds with sports leagues that are eyeing to monetize streaming rights for themselves and their teams.

According to the New York Post, the National Basketball Association, the National Hockey League and Major League Baseball were in talks to buy the Bally Sports RSNs, but in light of the latest financial disclosures from Diamond sports, those talks are faltering.

Without a buyout from the leagues, a bankruptcy filing for Diamond Sports is possible. In bankruptcy, Diamond’s rights contract could be undone, leaving the leagues and teams doing business with Sinclair and Diamond to seek other outlets.

The Post reports that the leagues have hired investment bankers to help in the discussions with Sinclair and Diamond.

The Post quotes a spokesman for Diamond Sports Group, denying that the networks are looking to get out of unprofitable rights deals.

“The idea of rejecting MLB contracts is unequivocally false. DSG is committed to enhancing and strengthening our relationships with the MLB, NBA and NHL by fulfilling our contractual obligations and acquiring more rights,” the spokesman told the paper.

He declined to comment about a potential bankruptcy. ■

UPDATED: This story was revised on 12/15/2022 to reflect several clarifications.

MARINA DEL REY, Calif. -- Representing 42 major league pro sports teams across its 19 regional sports networks, Sinclair Broadcast Group's recently launched direct-to-consumer streaming service, Bally Sports Plus, is one of the most closely observed entities right now the sports media business.

Despite all of its pro sports star power, the nascent $20-a-month DTC service, which launched nationally in September, enjoyed one of its biggest sign-up day ever on Nov. 25, when it exclusively streamed the California CIF Southern Section high school football championship game featuring what are considered the two top prep teams in the country, powerful St. John Bosco of Bellflower, Calif. and perennial giant Mater Dei of nearby Santa Ana. 

Also read: Bally Sports Breaks Bad: With Subs Down 10% and Cash-Flow Half of 2022 Projections, Increasingly Desperate Sinclair Looks to 'Deleverage'

Jack Wilson, director of digital content and post-production for Bally Sports, made the revelation Tuesday on a panel of sports media pros at research company Parks Associates' Future of Video event. 

The two teams actually met earlier in an anticipated Oct. 7 regular season matchup, which was won by Mater Dei 17-7. 

Bally Sports SoCal, home of the NBA's L.A. Clippers, Major League Baseball's Los Angeles Angels, and the NHL's L.A. Kings and Anaheim Ducks. presented the game regionally on its linear RSN and Bally Sports Plus geolocated streaming. 

Given that so many of the athletes in that Oct. 7 game were four- and five-star-rated players on their way to big college football programs dispersed all around the country, Bally Sports offered the game to the 18 other Bally Sports linear RSNs who had the willingness and the program scheduling ability to accommodate it. 

Surprised by the linear uptake and viewership, Wilson said Bally Sports saw the championship rematch, ultimately won by Bosco this time, as an "opportunity to test exclusive content." 

The CIF title contest was again offered to all Bally Sports channels. And on the three-month-old Bally Sports Plus service, the event drove the fifth biggest signup day overall, usurped only by the period surrounding the start of the NBA season in late October. 

Performance was understandably strong in Southern California, one of the most active regions in the nation for prep football. But football fans in the Bally Sports Ohio and Great Lakes region also drove the uptake, with players on both rosters being recruited by Ohio State University. 

On Tuesday's panel, Wilson overstated the performance as driving the top signup day for Bally Sports Plus -- a fact that was later corrected by headquarters. But the event still created a notable usage spike. And it remains an interesting anomaly, given the disrupted RSN business and its reliance on expensive pro sports licensing. 

Sinclair and the subsidiary that manages Bally Sports and Bally Sports Plus, Diamond Sports Group, have been reluctant to discuss specific uptake numbers for the new DTC service. 

But with Bally Sports linear viewers down 10% year over year, the exclusive revealed one interesting, cost-effective way the streaming service might grow its audience in the coming months. 

Beyond that, Wilson -- who worked for Fox Sports RSNs when it was purchased for $9.6 billion by Sinclair three years ago -- said the challenge of growing Bally Sports Plus is to appeal to local sports fans beyond the level of cord-cutting. 

"We're trying to re-engage those fans who have moved away from pay TV," Wilson said. "They may have quit DirecTV, but as long as we can figure a way to make that price point, it does’t mean they love their team less. They just could stomach the bill anymore."

In a move that further separates parent company Sinclair Broadcast Group from the Bally Sports regional sports channels it purchased three years ago, Diamond Sports Group, the subsidiary that oversees the 19 Bally-branded RSNs, has named former NBC Sports and ESPN executive David Preschlack as its new CEO. 

The move, according to the Sports Business Journal's John Ourand, comes as creditors have become increasingly "frustrated with the animosity that has developed" between Sinclair and Bally's major sports-league partners, specifically Major League Baseball. 

To date, only five of the 14 MLB teams licensed by Bally Sports participate in the RSNs new direct-to-consumer streaming service, Bally Sports Plus. 

Extrapolating for Next TV in a Monday morning email exchange, Ourand said these relationships have been "strained for years." 

Diamond's board hopes that Preschlack, a 25-year sports-media veteran who most recently served as president of NBC Regional Sports Networks, will provide the league partners with more confidence that their TV audiences can still grow as linear pay TV erodes and direct-to-consumer streaming is still in its nascent stages. 

"The creditors hope that new blood at Bally’s will start to turn that around," he added. 

Also read: Bally Sports Breaks Bad: With Subs Down 10% and Cash-Flow Half of 2022 Projections, Increasingly Desperate Sinclair Looks to 'Deleverage'

Sinclair and its Diamond subsidiary remain heavily in debt following the purchase of 21 Fox Sports regional sports networks three years ago for $9.6 billion. 

Servicing that debt has become an issue, with the RSN's distribution down 10% year over year and cash flow coming in at half of start-of-2022 projections. Diamond just took a $1.2 billion write-off on the value of its RSNs.

Meanwhile, Sinclair just reported "high engagement" on the Bally Sports Plus service launched over the summer. But the lack of any provided user metrics has left the market skeptical that the streaming service will provide meaningful replacement revenue for declining linear pay TV channels anytime soon.

Notably, it was MLB Commissioner Rob Manfred's comments while being interviewed by Ourand at the CAA World Congress event back in October of 2021 that revealed the lack of confidence MLB has in Sinclair. 

Yes, Manfred conceded, MLB's 14 teams licensing their content to Bally Sports channels needed more reach, but he wasn't sure at all that Bally Sports Plus was an effective way to achieve that goal. 

One thing Manfred was sure about: All that debt Sinclair took on to buy its RSNs was a problem. "There's excessive leverage on that business," he said

Since that time, five of those 14 MLB teams have signed onto the $20-a-month Bally Sports Plus service, as have all of the NBA and NHL franchises under the Bally Sports umbrella. 

But the 2023 MLB season just over 100 days away. It would be a major bummer for Bally Sports Plus to be constricted from carrying its MLB teams in nine of its markets. 

Meanwhile, according to analysts, the leagues have "sobered up" in terms of their attitude toward Bally Sports -- they need find a way to work with the RSNs to keep the revenue up ... and their mega-expensive player payrolls met. 

And that's not anywhere close to happening with their own DTC services.

Any solution is going to come from working with Bally and Diamond. And with Preschlack in place, they no longer have to worry about Sinclair. ■

Struggling regional sports network operator Diamond Sports Group is set to name a CEO Monday, making it more independent from Sinclair Broadcast Group, which has been running the chain of Bally Sports Networks.

UPDATE: David Preschlack Named CEO At Diamond Sports Group

Sinclair bought the RSNs from The Walt Disney Co., taking on about $9 billion in debit. Since the acquisition, the RSN have lost subscribers and the cost of sports rights has climbed, putting Sinclair in a financial bind.

Earlier this year, Sinclair refinanced Diamond’s debt and separated its financials from Diamond’s. 

In the third quarter, Diamond Sports reported a $1.124 billion loss, including a $1.046 writedown of intangible assets. Subscribers were down 10% and the company has lowered its guidance for 2022 EBITDA to half its original guidance. 

Responding to speculation that Sinclair was looking to sell off the RSN, Sinclair CEO Chris Ripley, speaking on the Sinclair/Diamond earnings call last week, confirmed the company had hired LIonTree and Moelis & Co. as advisors. He said they were talking to parties about deleveraging and strategic partnerships, but declared “there is no sale process.”

After the CEO--a new position at Diamond Sports--is named, Sinclair said it will continue to provide management services to Diamond and maintain representation on Diamond’s board.

“Consistent with the financing completed in March of this year and the company’s deconsolidation, Diamond Sports Group is continuing its transition to become more independent. A CEO position as been created to help with this effort, and the board’s appointment will be announced on Monday,” Sinclair said in a statement.

According to a report from  Sportico, the Diamond board has hired form ESPN and NBC Sports executive David Preschlack to run the company. Sinclair did not comment on that report.

“Sinclair will continue to provide management services and maintain representation on the Diamond board. We look forward to our continued partnership with Diamond as they continue their transformation of the regional sports business,” Sinclair said.

In order to reach viewers who no longer subscribe to pay TV, Sinclair launched a direct-to-consumer app, Bally Sports Plus. On last week's earnings call, Ripley didn't say how many subscribers had signed up, but maintained the company was pleased with the engagement it was seeing from people using the app.  ■

It's an increasingly serious economic situation that has grave business implications to roughly a quarter of major league sports franchises in America -- regional sports network operator Bally Sports is deeply in debt, bleeding subscribers and making less and less money. 

Now Sinclair Broadcast Group, the far-right-oriented station group that owns the 19 Bally Sports channels, which are the exclusive RSN homes to 42 NBA, MLB and NHL teams, is looking to "deleverage" a debt load of around $9 billion tacked on when it purchased the channels from Fox three years ago. 

And the pro leagues, which reportedly have no fondness for Sinclair's management but are reliant on the huge TV money their Bally Sports licensing contracts generate, are looking to step in and perhaps buy into the floundering RSN group.

Certainly, the situation is bad.

Sinclair said during its third-quarter earnings call last week that its linear subscribers are down 10% year over year, and its cash flow is now half of what it was projected to be at the beginning of the year. 

Diamond Sports Group, the subsidiary that houses the Bally Sports channels, has only enough financial resources to get through 2023, Sinclair said. 

Sinclair CEO Chris Ripley added during the Q3 earnings call that the direct-to-consumer streaming service launched over the summer to amplify the RSN's revenue flow, Bally Sports Plus, is generating "high engagement," but he said it's "too early" to release subscriber metrics for the $20-a-month platform. 

One sports media consultant, Lee Berke, told The Athletic that was "hogwash." If Bally Sports Plus was helping Sinclair in a meaningful way, Ripley and his executive team would certainly want to let investors know about it. 

Also on the call, Ripley said that the company has retained advisers LionTree and Moelis & Co. to "talk to parties about deleveraging, strategic partnerships and things of that nature." 

Meanwhile, the leagues that rely on Bally Sports to help cover player salary budgets that now regularly exceed $100 million a season have resigned themselves to the fact that they need to help Sinclair out of its jam. 

Rumors started earlier in the fall that Major League Baseball, the National Basketball Association and the National Hockey League were looking to possibly step in with financial support of some kind for Bally Sports. 

“The leagues have no way out, they have nowhere to go,” Patrick Crakes, a sports media consultant, also told The Athletic. “I mean, if they lose the (regional sports network) system, right now, they’re completely f***ed.

“The big story continues to be that the leagues don’t like Sinclair, but they now have sobered up. They’re not talking about pivots to DTC all over the place.”

Indeed, there had been hope among top-level pro league executives that DTC streaming might be a solution to the ongoing woes affecting businesses like RSNs tied to eroding pay TV. But like everyone else in the media business, they're finding that monetization for streaming still isn't close to replacing what they'd lose from giving up on the pay TV ecosystem. 

It was just 13 months ago that MLB Commissioner Rob Manfred publicly declared a preference to go into DTC alone without Sinclair. But The Athletic reported that the mood among the leagues is now more resigned -- they need to help fix Bally Sports.

Certainly, if Bally Sports and Diamond were to flounder, it would be a bad omen for every other RSN operator in the market. 

“The model is going to have to be rebuilt,” Berke added. “I think there still is a very strong marketplace for regional sports network content. It remains to be seen just who is going to be offering that up.”

Sinclair Broadcast Group declared it was pleased with the reception the Bally Sports Plus direct-to-consumer app is performing and said it was not in the process of selling off its Diamond Sports Group unit.

In a call with investors Monday, Sinclair CEO Chris Ripley told one analyst that Sinclair wasn’t trying to sell Diamond Sports, the entity that controls the debt-laden, Bally-branded regional sports networks.

The company has retained advisors, specifically LionTree and Moelis & Co., Ripley confirmed. “There’s no sale process, but they’re talking to parties about deleveraging, strategic partnerships and things of that nature,” he said.

With cord-cutting and distributor resistance cutting into revenues and the price of sports rights rising, regional sports networks are in a financial bind.

Sinclair and Diamond have generated a lot of buzz with plans to take the sports business directly to consumers by obtaining streaming rights to the teams involved. At times, Sinclair’s plan seemed to have opposition from sports leagues including Major League Baseball.

The Bally Sports Plus app had a soft launch early in the baseball season in June and a full rollout September 26. 

The company did not disclose how many people have signed up for the DTC product.

“We have seen encouraging demand for the service despite relatively low product awareness in the marketplace,” Ripley said.

The app was initially offered with a free trial period, and Ripley said that those trial subscriptions are being converted to paid at a 70% rate, consistent with the results the company saw after its soft launch.

DTC subscribers are more engaged than pay-TV subscribers, averaging 1.3 times more minutes watched. DTC subscribers also return more frequently to the app and have longer average session time, Ripley said.

He pointed to "particularly impressive" results at Bally Sports North. Minnesota Wild NHL hockey telecasts and Timberwolf NBA games have generated more than 23 million minutes streamed through the first month of their seasons. Unique streamers per game routinely exceed a 1 rating.

"These early data points not only indicate robust engagement, they underline our significant opportunity to generate revenue beyond B2C subscriptions as we continue to iterate the platform to include gamification elements, targeted ad capabilities, and e-commerce components," he said. "As market awareness builds, and as more and more people that are outside the bundle come in to watch their favorite home teams that should definitely make up for some of these losses that we're taking."

For the third quarter, Diamond Sports had a net loss of $1.2 billion, compared to a loss of $132 million a year ago.

Revenue fell 10% to $684 million. Distribution revenues were down 11% to $565 million and ad revenues dropped 5% to $112 million.

The company said it expected to have negative EBITDA of $42 million to $48 million in the fourth quarter, lowering its full-year guidance because of accelerated subscriber churn.

At a time when streaming platforms are shifting gears from trying to get the maximum number of subscribers to aiming to generate revenue and profit, Ripley said the pricing of Bally Sports Plus was designed to maximize revenue.

"The other consideration in the pricing was giving enough of a gap in retail pricing to the wholesale pricing that we give the distributors since this is a hybrid strategy," Ripley said. “We don't believe the pay-TV linear channels will be going away anytime soon. And so you need to have a wholesale price that's significantly lower than the retail price. And so, those two factors played into decision around pricing, but independent of the wholesale retail dynamic, we are currently priced at what all the evidence that we've seen, and all the research we've done, delivers maximum revenue from a subscriber perspective."

Ripley said that Sinclair and Diamond might be able to raise prices on the app going forward. On the other hand, it also expected to generate revenue and average revenue per unit (ARPU) gains through gamification, commercial, social sharing and other monetizable capabilities.

"I think over time, you'll see the ARPU skew more into these other areas of the ecosystem as we develop the app further, and there'll be less reliance on subscriptions," he said. "Now, does that mean we reduce our price over time? Perhaps, or that means that just that the most of the growth is coming from the other areas." ■

Sinclair Broadcast Group said it has a memorandum of understanding with Hyundai Mobis to develop and implement businesses that will use ATSC 3.0 broadcast signals to deliver services to automobiles, including new forms of in-car entertainment.

Other services under consideration include geo-targeting, enhanced GPS, software updates and real-time emergency information.

Broadcasters say the ATSC 3.0 signal, also known as NextGen TV, in addition to providing an improved picture, better audio and more channels, will also be valuable in delivering new digital services. Some have estimated that revenue from those services could rival what they get from retransmission fees. One survey suggested stations could make as much as $15 billion in incremental revenue thanks to ATSC 3.0.

Also: Sinclair Launching ATSC 3.0 Datacasting Pilot Bringing Content to Vehicle Charging Stations

“This collaboration is an important step towards realizing the promise of using ATSC 3.0 to communicate with the millions of vehicles on America’s roads and to greater serve the American public interest,” said Sinclair President Chris Ripley. “ By collaborating with Hyundai Mobis, we can make these services seamless for consumers while providing the efficiency and robustness of ATSC 3.0 for service providers.”

Independently, in the coming months Sinclair will be demonstrating an integrated automotive entertainment platform including music, talk radio, local television, and more at a local Hyundai dealership in Baltimore, MD. This will be delivered through ATSC 3.0-enabled spectrum from the local broadcast station WNUV-TV. ■

Sinclair Broadcast Group named Camie Nicholas VP and general manager of KSAS-TV and its simulcast stations in the Wichita-Hutchinson, Kansas Market.

Nicholas, who had been the stations’ general sales manager since 2017, will also oversee Mercury Broadcasting’s KMTW-TV, which is managed by Sinclair.

She succeeds John Manzi, who became general manager of Sinclair’s stations in Chico, California. 

“Camie has deep relationships in Wichita and a history of successfully growing the revenue at the stations, and we are thrilled she is stepping into the GM role to lead the team,” said Rob Weisbord, chief operating officer and president of broadcast for Sinclair.

Before joining Sinclair, Nicholas was sales manager for Connoisseur Media in Wichita. She has also held positions with KAKE, KSN, anc Cox Media.

After five years as GSM for Sinclair, I’m thrilled to be given the opportunity to elevate my position to General Manager of Fox Kansas and MyTV Wichita and I look forward to leading such an amazing team.  I appreciate Sinclair for promoting from within and the importance they place on the success of each and every station in our company,” Nicolas said. ■

With media companies prioritizing streaming, the pressure to raise programming fees on affiliates appears to be easing, according to Sinclair Broadcast Group president and CEO Chris Ripley.

Sinclair this week announced it renewed its stations’ affiliation agreement with The Walt Disney Co.’s ABC network. 

On the company’s third-quarter earnings call with analysts and investors Wednesday morning, Sinclair CEO Chris Ripley said “there has been a shift in terms of negotiating position” as networks have moved some of their best content to streaming. 

Disney, for example, has moved Dancing With The Stars from ABC to Disney Plus.

Also Read: Affiliates, Networks Set To Tango at NAB After ‘Dancing with the Stars’ Move Ups Streaming Issues to Faster Tempo

“Given the magnitude of the dollars that we already pay in terms of reverse retrans, we saw a significant reduction in the growth rates for reverse retrans to be more reflective of the value we bring, the value they bring, and what the current subscriber environment is,” Ripley said. “We were very pleased with the outcome at ABC.”

Cable operators and other distributors pay retransmission consent fees to stations in order to carry the broadcasters’ programming. Networks take a chunk of those payments in programming fees, or reverse retrans, to help pay for sports rights and to produce other shows.

Sinclair said it was expecting no increase in its net retrans revenue in 2023, but sees it growing into the low- to mid-single-digit range after that, thanks to the new agreement with ABC and deals to be negotiated with the other networks.

In the negotiations, some of the exclusivity provisions in the agreements were also changed, Ripley said.

But Ripley also said that during the negotiation with ABC he felt Disney’s commitment to the network was strengthening.

“They put more NFL product on ABC after the last NFL deal and they have secured most of their other major sports properties,” he said, adding that “as far as we know, there are no plans to reduce primetime programming as has been rumored on other networks. We thought the negotiation reflected the synergistic relations we have with them, but also reflected the market dynamics and the gives and takes between the two parties.” ■

Sinclair Broadcast Group reported higher third-quarter net income as it got a boost from what are expected to be record levels of political advertising.

The company’s financial results for the quarter do not include its troubled regional sports networks, which are now held separately as Diamond Sports Group.

Net income was $21 million, or 32 cents a share, compared to $19 million, or 25 cents a share, a year ago.

Revenues dropped 45% to $843 million. The year-ago figure includes the RSNs. Excluding the sports business, revenues were up 5%. Excluding sports, media revenues were also up 5% to $836 million.

The results were below Wall Street expectations. Analysts were also disappointed by Sinclair’s guidance for the fourth quarter.

Also Read: Sinclair See Reverse-Comp Demands Slowing As Networks Push Streaming

Third-quarter ad revenues were $374 million, up 14%, excluding the regional sports networks. The company had $88 million in political advertising in the third quarter. Core ad revenues, excluding political ad revenues, were down 10% to $286 million. 

 “The strength in political is the primary reason for cord advertising declining versus a year ago,” said Rob Weisbord, president of broadcasting at Sinclair, speaking on the company’s earnings call. There was also a pullback in advertising by insurance companies and sports gambling companies, as well as a tough comparison with the Olympics a year ago.

Sinclair is now expecting that political ad spending for the fourth quarter to be between $174 and $179 million, putting the total for the year  in the $335 million to $340 million range. That would be up 30% from the previous year and within 2% of the 2020 presidential election year, Weisbord said, 

Distribution revenues, excluding the RSNs, rose 4% to $1.295 billion,

Also Read: With Ratings Surging, Sinclair Eyes Adding New Digital Net

“Strong political revenues continued to drive results in the quarter, and we believe this year we will easily set a midterm election-year record for political advertising revenue,” said CEO Chris Ripley said. “While we saw political displacement this quarter and expect it as well next quarter, we see positive signs for core advertising in certain categories including the legal category and the auto category, which began to grow again this quarter, but overall we are seeing some general ad-market weakness from macro conditions.”

Ripley concluded: “We have been assembling the pieces of these future drivers of our business over the last several years and look forward to our work in these areas beginning to generate meaningful revenues and profits as we move into the future. Given our growth strategies, investment portfolio and sizable cash flow, Sinclair is well-capitalized and well-positioned to continue to develop into a more diversified company with numerous revenue streams and assets.” ■

Sinclair Broadcast Group said it named John Manzi as VP and general manager of its stations in Chico, California.

Sinclair owns KRCR, KRVU and KUCO in the market. Manzi will also oversee the services Sinclair provides to KCVU.

Most recently VP and general manager of Sinclair's KSAS and KMTW Wichita, Kansas, Manzi succeeds Teansie Garfield, who retired.

“When we brought John to Sinclair to lead the stations in Wichita, we knew he would be a great addition to the executive team,” Sinclair chief operating officer and president of broadcast Rob Weisbord said. “He will now shift his leadership and business skills to Chico and we’re confident he will continue his track record of successfully growing the stations and their revenue.”

Before Wichita, Manzi was GM at KDOC Los Angeles and KRCW Portland, Oregon. He began his careers as an account executive for Telerep in New York and has worked at stations in Denver and New Orleans.

“I’m fortunate to be able to return to California and join the Northstate’s leading news team,” Manzi said. “I look forward to immersing myself into this beautiful landscape and to building on the stations’ stellar reputation in the community.” ■

The Walt Disney Co. said it signed a new deal extending affiliations with ABC stations owned and operated by Sinclair Broadcast Group.

The new agreements stretch into 2026, the companies said. Financial details were not disclosed.

"We look forward to continuing to work closely with the Sinclair team to serve our  mutual viewers via the ABC brand affiliation and its unrivaled network programming while  driving strong results across these 30 important local markets well into the future," John Rouse, executive VP, affiliate relations, Disney Media & Entertainment Distribution, said.

Sinclair owns about 40 ABC affiliates. The new agreement also covers WHAM Rochester, New York, and WGTU and WGTQ Traverse City, Michigan, stations for which Sinclair provides sales and other services under agreements with their owners.

"We are pleased to reach a long-term renewal of our agreements with Disney for ABC, a valued partner and provider of some of broadcast television’s most popular entertainment, news and sports programming," Sinclair senior VP, head of distribution and network relations Will Bell said. "The renewals reflect the evolving media landscape and the continued value of the symbiotic relationship between ABC’s programming and the local news and syndicated content we provide." ■