The Texas Rangers have become the fifth of the 14 Major League Baseball teams under the Bally Sports umbrella not to receive their regional sports network fees from Sinclair's Diamond Sports Group for the new 2023 season.

The club has joined a motion filed by MLB to the Texas bankruptcy court overseeing the restructuring of debt-ridden Diamond, which continues to broadcast games for the five teams it hasn't paid. 

MLB wants the court to terminate the contracts for the unpaid teams so it can step in and help them stream their games to fans. Diamond, which is trying to shed $8 billion of debt, wants business to proceed as usual until the court can restructure its money-losing deals with individual team.

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

“That ‘there ain’t no such thing as a free lunch’ is a well-recognized, simple, but axiomatic economic principle,” the Rangers wrote in the court filing. “Everyone understands it -- everyone, apparently, except the Debtors [Diamond]. Here, they are getting lunch -- using the right to create content based on the Rangers’ baseball games, and in turn selling that content to distributors -- but without paying for it.

“The Rangers now join the growing list of MLB teams being held hostage by the Debtors," the motion added. 

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In 2010, the Rangers entered a 20-year, $3 billion deal with Fox Sports Southwest, one of 19 Fox-owned regional sports network channels purchased in 2019 by Sinclair Broadcast Group for $10.6 billion. Sinclair subsequently set up a subsidiary, Diamond, to manage the channels, which were rebranded as "Bally Sports."

Cord-cutting, as well as fast-increasing team rights fees, cut margins on the channels from around 50% to well under 20%.

The Athletic pegged the Rangers' annual rights check at around $111 million. 

Earlier this week, the Sports Business Journal reported that Diamond had missed the payment deadline for the Cincinnati Reds. This followed earlier missed payments to the Arizona Diamondbacks, Cleveland Guardians and Minnesota Twins. 

With the Reds owning a piece of Bally Sports Ohio, Sports Business Journal reported that the club is able to use existing production resources and is probably closest to taking over its own game broadcasts. 

In all, Diamond has RSN contracts with 52 pro teams across MLB, the National Basketball Association and the National Hockey League. 

Conducting a news conference in Phoenix, Arizona Wednesday to mark the beginning of spring training, Major League Baseball Commissioner Rob Manfred was anxious to talk about league-wide momentum that saw ticket sales surge 10% in September, as well as how changes including the new balanced schedule might improve the overall fan experience. (Watch the full presser below.)

But the bulk of Manfred's 16-minute Q&A was spent responding to questions about what appears to be the imminent Chapter 11 filing by Sinclair Broadcasting's Diamond Sports Group, which owns the Bally Sports-branded regional sports networks that have broadcast rights deals with 14 MLB teams. 

Manfred stressed that he hopes Diamond is able to pay MLB's clubs "as required under its contract." But if that doesn't happen?

"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 added.

If it comes to that, and MLB ends up negotiating a carriage deal for its teams, the commissioner said he'd like to carve out streaming rights for the league to handle itself. 

"We would also be seeking flexibility on the digital side, so that when you look at MLB.tv, you'd go in, you can buy your out-of-market package like you've always had, but you would have the option to buy up into in-market games, which I see as a huge improvement for fans," Manfred said. 

This week, as expected, cash-strapped Diamond elected not to pay a $140 million mid-February all-interest payment to lenders covering around $9 billion in debt. It's expected that Diamond will file for bankruptcy after the 30-day grace period for that payment expires in March. 

Sinclair paid over $10 billion back in 2019 to acquire 19 regional sports networks from Fox, as the entertainment conglomerate was divesting many of its assets to Disney. 

Sinclair, which rebranded those channels as "Bally Sports" and set up a subsidiary, Diamond Sports Group, to manage them, has embarked on two stock buyback campaigns since that purchase. In fact, the money from those buybacks could have floated what Diamond owes the MLB teams for their broadcast rights, MLB biz watchers note.

But in addition to its creditors, there's now serious questioning as to whether Diamond can pay MLB's clubs what it owes them. And due to the seasonality of the deal structuring, the bulk of this year's payments are due between now and April 1, Manfred said. 

The affected MLB teams under Bally Sports contract include: the Arizona Diamondbacks, Atlanta Braves, Cincinnati Reds, Cleveland Guardians, Detroit Tigers, Kansas City Royals, Los Angeles Angels, Miami Marlins, Milwaukee Brewers, Minnesota Twins, San Diego Padres, St. Louis Cardinals, Texas Rangers and Tampa Bay Rays. 

Meanwhile, the Chicago Cubs and New York Yankees co-own RSNs with Diamond that aren't branded under the Bally Sports portfolio. 

The Bally Sports channels also have broadcast contracts with 16 NBA franchises and 12 NHL teams, all of which don't wrap up their 2022-23 regular season schedules until April. 

And to make matters worse for the pro sports ecosystem: AT&T SportsNet RSNs contracted with the Colorado Rockies, Houston Astros and Pittsburgh Pirates --- channels that are now owned and operated under the spun off Warner Bros. Discovery -- have in recent weeks handed over to the teams "lighter than expected envelopes," according to a report in Sportico earlier this week. 

Manfred didn't address the AT&T SportsNet payment shortfall in his Wednesday discussion. 

The commissioner did, however, address the larger longterm fate of regional sports networks ... which he believes will live on, but not at the scale we've all become used to. 

"It's hard to escape the reality that change in media consumption has been particularly hard on the RSNs," Manfred said. "Obviously, we want all of our broadcast partners to be successful. We don't want them to have financial difficulties. We have been spending a lot of time and effort trying to work with Diamond to figure out exactly where they are.

"Obviously, our first choice would be that Diamond pay the clubs what they're contractually obligated to pay them," he also said. "But because I'm a contingency planner by nature, we are prepared no matter what happens, with respect to Diamond, to make sure games are available to fans in their local markets. We think it will be both linear in the traditional cable bundle and digitally on our own platforms, but that remains to be seen."

Sinclair Broadcast Group is expanding distribution of OTT service Bally Sports Plus to all 19 markets in the Bally Sports regional sports networks empire starting Sept. 26.

The $19.99-a-month streaming service enables consumers within coverage zones of Bally Sports RSNs to watch these channels' live and pre-recorded content without a pay TV subscription. 

Only five Bally Sports channels have deals with Major League Baseball teams. And it was markets covered by Bally Sports Detroit, Bally Sports Kansas City, Bally Sports Florida, Bally Sports Sun and Bally Sports Wisconsin that received Bally Sports Plus first when the service launched in June. 

Sinclair, however, was able to carve out league-wide rights deals with the NBA and NHL, which will be ramping up their seasons by Sept. 26 

The remaining portfolio includes Bally Sports Arizona, Bally Sports Great Lakes, Bally Sports Indiana, Bally Sports Midwest, Bally Sports New Orleans, Bally Sports North, Bally Sports Ohio, Bally Sports Oklahoma, Bally Sports San Diego, Bally Sports SoCal, Bally Sports South, Bally Sports Southeast, Bally Sports Southwest and Bally Sports West. 

“We view Bally Sports Plus as a great complement to the incredible value our distribution partners provide our linear networks; and with both models, we are uniquely positioned to help our team partners grow their fan bases for years to come," said Sinclair CEO Chris Ripley. 

Michael Schneider, COO and GM of Bally Sports Plus, added: “Launching a streaming service like Bally Sports Plus across 19 different regions, all with unique content offerings, is an unprecedented undertaking. This full introduction marks a key moment in the evolution of RSNs, but it is also a great moment for local fans who now have another viewing option for their favorite teams.”

Bally Sports Plus content includes not only live game coverage of local teams, but also pre- and post-game shows, regionally produced programming -- including college football and basketball and high school sports -- and Bally Sports’ The Rally and Live on the Line, Powered by BetMGM. 

Platform support is limited. 

At launch, subscribers can access Bally Sports Plus via iOS and Android mobile devices, Android TV, Apple TV and BallySports.com.

The Bally Sports RSNs are managed by Diamond Sports Group, a wholly owned subsidiary being spun off of Sinclair. 

Diamond hasn't yet announced any usage figures for Bally Sports Plus. 

Other operators of regional sports networks are taking the risky OTT plunge. 

In early June, several weeks before the launch of Bally Sports Plus, New England Sports Network (NESN), home of MLB's Boston Red Sox and the NHL's Boston Bruins, launched the app-based NESN 360.

And YES Network, the New York Yankees RSN home jointly owned by Amazon, Sinclair and several other companies, is streaming 60 games this baseball season outside the pay TV ecosystem. ■

Sinclair Broadcast Group announced a broad-reaching program licensing agreement with Charter Communications, re-upping retransmission for its local broadcast channels on the nation's No. 2 cable system while also re-establishing carriage for Tennis Channel, 19 Bally Sports-branded regional sports networks, Marquee Sports Network and the YES Network.

The deal was somewhat fait accompli -- word leaked out earlier that both sides were determined to get an agreement made, and several temporary extensions had been carved out without brinkmanship or rhetoric.

In the run-up to the negotiations, Sports Business Daily had notably tagged it "The Biggest Sports Deal of 2022," with its impact potentially determining the fate of a pay TV bundle that has, up to now, largely been held together by the glue of live sports. 

Certainly, the agreement comes at a pivotal time for Sinclair, which is in the process of taking the Bally Sports RSNs over-the-top with a direct-to-consumer streaming service. For now, it means Sinclair can keep its bundle and launch a DTC service at the same time.

Sinclair, which built its Bally Sports portfolio with its purchase of the Fox Sports RSNs three years ago, needs to work off nearly $10 billion in debt for the enterprise. 

It has sold its DTC launch to investors as a means of achieving that objective, but it can't afford for the linear floor to collapse under Bally Sports' feet. 

Notably, last fall Dish Network re-upped retrans for Sinclair broadcast stations but kept the RSNs dark on its satellite TV system. 

Bally Sports networks have also recently gone dark on virtual pay TV services YouTube TV, Hulu + Live TV and fuboTV. More optimistically, Sinclair was able to carve out a similarly broad-skewing agreement with the No. 1 cable operator, Comcast, in 2021. It's next big pay TV negotiation won't occur until the end of next year, when its DirecTV deal comes up for renewal. 

Terms of the Charter deal -- and any potential compromises made by Sinclair, if any -- were not disclosed.

Among equity analysts there had been skepticism as to whether Sinclair, which manages its Bally Sports channels under its Diamond Sports Group subsidiary (DSG) could reach an agreement with the large cable operator. 

"Imagine being on the Charter management team and hearing that DSG is going over the top on an a-la-carte basis," wrote LightShed Partners' principal Rich Greenfield in January. "Charter has to pay for every single Charter subscriber in a DSG RSN market, despite only a small fraction watching or even caring about their local RSN. Meanwhile Sinclair’s DSG can offer a digital version of the RSN service directly to ONLY those that want it."

Meanwhile, Sinclair continues to hammer away on its DTC plan, the launch for which just got pushed back until later this summer, with most of the Major League Baseball teams covered by Bally Sports channels still not in the fold.

Rob Weisbord, Sinclair COO and president of broadcast, said earlier this month that he's "cautiously optimistic" the roster of Major League Baseball teams participating in the Bally Sports DTC service will soon grow, now that pro baseball's recent labor impasse has ended. 

“I believe that there is a path for a deal to get additional teams. But it takes a lot of conversations to get there and we’re having ongoing dialogue," Weisbord said during a virtual event conducted by the Digital Entertainment Group. ■

With the baseball regular season fast approaching -- Opening Day is officially April 1 -- several regional sports networks are facing deadlines to hammer out deals with over-the-top players and streaming services, but according to some observers, they shouldn’t hold out too much hope of landing a deal by the first pitch. 

Satellite TV giant Dish Network and its OTT arm Sling TV, have set an April 1 deadline for dropping three NBC Sports RSNs --  NBC Sports California, NBC Sports Washington and NBC Sports and NBC Sports Bay Area. Dish already dropped the remaining NBC Sports channels -- NBC Sports Chicago and networks in Philadelphia, Boston, and the Pacific Northwest -- in 2019. If the recent blackout threat holds, Dish and Sling TV customers will miss baseball from the San Francisco Giants and Oakland A’s, hockey from the Washington Capitals and San Jose Sharks, and basketball from the Golden State Warriors and Washington Wizards. 

“As of 4/1/2021, NBC Regional Sports Networks will no longer be on SLING. We are committed to providing the best value with the flexibility our customers deserve and, unfortunately, we were unable to come to an agreement on those terms,” Dish said in an email to customers, according to The Streamable. 

Also Read: Sports and OTT: Streaming Could Squeeze the Last Vestige of Appointment TV 

Pricing is the main culprit in the failure to reach a Dish deal. Dish Network chairman Charlie Ergen has battled with programmers -- particularly sports programmers - for years over what he believes are exorbitant fees. If Dish drops the NBC Sports networks it will be totally devoid of RSNs, having dropped others like MSG Network decades ago.    

Ergen has said he has nothing against sports, but it’s evident that most pay TV customers don’t watch them and in turn don’t want to pay for them.

“I think you’ve got to change that model,” Ergen said of RSNs on Dish’s Q3 earnings call in November, adding that the value of regional sports to his customers was “overrated.”  

Also Read: Comcast’s Xfinity Flex Adds MLB.TV

While most RSNs have managed to hammer out agreements over the past couple of years with traditional distributors, the failure to launch with streamers should be especially troubling. RSNs like YES Network and Sinclair Broadcasting Group’s Fox Sports Networks (rebranding as Bally Sports on March 31) still don’t have deals with the likes of Sling TV, FuboTV, Hulu Live + TV and YouTube TV (although YES recently agreed to stream 21 Yankees games on Amazon Prime Video). Streaming services are supposed to be the future -- it’s the way all the kids are watching content today -- and failure to land carriage could hurt the networks in the long run. 

According to The Streamable, AT&T TV is the only OTT service provider that offers access to every RSN. But AT&T TV is priced at about $84.99 per month, making it eerily close to the traditional TV package that most youngsters abhor.

While distributors are trying to find programming that people are compelled to watch, and sports is still a ratings grabber, it doesn’t always justify the cost. RSNs have been under fire for their pricey affiliate fees and operators have begun to push back.

Also Read: Pluto TV Winds Up to Launch MLB Channel

Sports consultant Lee Berke, president and CEO of LHB Media & Entertainment, said the current stance by streamers harkens back to their early days. When streamers like Hulu Live and YouTube TV launched, they avoided RSNs because of their high price. The turning point was in 2016 when Sling TV agreed to carry some Fox RSNs. 

Now that most of the vMVPDs have national deals with sports networks like ESPN and FS1, local broadcast deals that also include games and out-of-market packages with several leagues, the strategy has shifted. 

“I think they are trying to see if they can get by without the RSNs,” Berke said of the streaming services, adding that the start of the MLB season could be the moment of truth. 

“That’s the crunch point,” Berke said. “Will the overwhelming number of games that are being offered up by the league cause enough grief with the streamers to say they’ll come back in and strike a deal.” 

In the past many of these deals with traditional MVPDs were done literally seconds before the first pitch of the regular season, mainly because ultimately those distributors realized that sports was the glue that held the bundle together. Streamers don’t feel the same way.

“Maybe one of them will,” Berke said on the possibility of a last-minute streaming RSN deal. “It’s difficult to see all three of them coming back in.” 

Unlike the dynamic between MVPDs and RSNs, streamers seem to hold the advantage, at least for the short term. Berke pointed to Minnesota Twins president Dave St. Peter, who complained recently that fans on his Twitter feed are frustrated they can’t see games on Fox Sports North because the RSN doesn’t have a streaming deal, over which the team has no control. The RSN is available through a traditional pay TV subscription. 

"I don't enjoy going to my Twitter account as often as I used to because there are some people who are taking it out on me," St. Peter told the Minneapolis Star-Tribune. "That's OK. I've got a thick skin. Look, life is hard in a lot of cases and people want to be able to watch their teams. I don't think that is an unrealistic or unfair expectation from our fans." 

That should be a wake-up call to both streamers and traditional MVPDs.

“People who are on his [St. Peter’s] Twitter feed are relatively younger and tech savvy,” Berke said. “They could watch Twins games on Comcast or Spectrum or whatever on a linear pay TV service, but that’s not part of who they are anymore. They stream. So if they’re not getting it as part of Hulu or YouTube TV, from their standpoint they can’t see those games.” 

While Berke added that a big enough drop in subscribers could force the streamers to the table, eventually the model will have to shift to direct-to-consumer. Already a few RSNs have set the stage for such an offering. Earlier this month, YES Network debuted a dedicated streaming app that offers a 24/7 feed of the network, including live games from the New York Yankees, Brooklyn Nets, NYFC and New York Liberty. Viewers still need to authenticate through their pay TV subscription to see the programming, but that could easily change in the future. Sinclair has said it plans to launch a DTC app next year. 

Berke added that direct-to-consumer should be the goal for RSNs and distributors alike.

"From a streamers standpoint, from a network standpoint from an RSN standpoint, you have to be able to say, 'I’m going direct-to-consumer,'" Berke said. “And by the way, when you’re negotiating with Comcast, they’re going direct-to-consumer as well. We’re trying to defend the bundle, meanwhile we’re doing everything possible to undercut it. But that’s fair enough, that’s what they should be doing. That’s the way media technology works.”

He added that the shift to streaming is in part being done because of necessity. Pay TV subscribers are declining at an accelerated rate that doesn’t seem to be slowing. 

“There’s a reckoning that is coming to pass for every network,” Berke said. “You’re seeing the strategies being laid out with all the streamers and how they are laying out programming, how they're categorizing it, how they’re pricing it, how they’re producing content, sports entertainment and news. But when it comes to sports in particular, when it comes to the RSNs in particular, they are going to have to make those moves in the next few years, and they are going to have to start preparing for it now.”

Sinclair Broadcast Group, Nexstar Media Group and the E.W. Scripps Co. on Tuesday began broadcasting using the new ATSC 3.0 Nextgen TV format at their stations in Las Vegas.

The new standard is designed to better mesh with internet-like technology and is expected to give viewers better pictures and sound and enable mobile reception. The stations are also working to develop new data broadcasting services.

“Today’s announcement is the realization of two decades of work, and we are proud to share this moment with Nexstar and Scripps as we usher in a new era of television with Nextgen TV,” said Sinclair CEO Chris Ripley. “With Las Vegas leading the way, select audiences will soon enjoy a more personalized and immersive experience, with better access to news and media than ever before. Looking ahead, we are eager for continued collaboration within our industry to fully realize the promise of Nextgen TV, and are excited to bring this innovation to audiences across the country, forever changing the way we use, and think of, broadcast television.”

Short-term the revenue impact will be limited until consumers buy new receivers and sets.

The new technology should help the stations better monetize its advertising inventory because of enhanced targeting capabilities, Ripley said. It also helps to protect content against piracy, he said.

The standard is capable of providing precision GPS services and efficiently send commands to internet-of-things devices, Ripley said. The biggest opportunity could come with the biggest mobile device, the automobile.

“As cars get more and more autonomous, they will demand more connectivity and data and our distribution system is ideally suited to send out large files to large geographic regions,” Ripley said. Sending 3D maps to vehicles is one application that has already been tested with automakers.

“Our successful collaboration with Sinclair and Scripps has brought Nextgen TV to Las Vegas. We look forward to cooperating with other broadcasters to roll out this new technology across the country,” said Perry Sook, CEO of Nexstar.

“Residents of Las Vegas will be among the first in the country to enjoy the immersive audio and video experience associated with this technical advancement,” said Brian Lawlor, president of Local Media for Scripps. “As we have seen in recent weeks, local television continues to play a critical role in the information and entertainment needs of families across America. Las Vegas will shortly benefit from an exciting modern viewing experience from local broadcasters.”

Ripley said that the broadcast business has commitments in hand to light up 3.0 in about 70% of the country.

“It does take some time and it took us about a year to do this Las Vegas deployment, so it's a little bit like herding cats and getting it all figured out,” he said. “This is a huge moment for us as an industry. Getting the first one's always the hardest and we have 25 cities that we are anticipating deploying in this year. So the ball is rolling as they say and it's just going to snowball from here.” 

Hours after YES Network alluded in its own dispute with YouTube TV that the streamer had yet to strike a carriage deal for minority partner Sinclair Broadcast Group’s other regional sports networks, Sinclair said it has secured renewals for most of those networks.

Sinclair said YouTube TV has agreed to carry 19 of Sinclair’s 21 RSNs: Fox Sports West and Prime Ticket were not part of the transaction and will no longer be carried by the streaming service as of March 5.

The channels involved in the agreement include Fox Sports Arizona, Fox Sports Florida, Fox Sports Midwest, Fox Sports North, Fox Sports Ohio, Fox Sports San Diego, Fox Sports South, Fox Sports Southwest, Fox Sports Southeast, Fox Sports Sun and SportsTime Ohio.

Earlier today YES Network, in which Sinclair is a minority partner, said it was dropped by YouTube TV. In making that announcement, YES said Sinclair, “for its own reasons, elected to make a deal for some but not all of its programming services which excluded large-market RSNs featuring iconic franchises and star players.”

Whether that means that Sinclair’s joint venture RSN with the Chicago Cubs -- Marquee Sports Network -- also lacks a carriage agreement is unclear. Marquee Sports was not mentioned in the announcement.

“We are pleased that YouTube TV was able to agree to terms on 19 of our RSNs and that they will continue to provide subscribers with access to some of the most in-demand sports networks in the nation,” said Sinclair SVP and general counsel David Gibber in a press release. “Millions of fans across the country tune into sports content daily and, at Sinclair, our goal is to make this as widely accessible as possible.”

He continued that Sinclair was “deeply disappointed” with YouTube TV’s decision to pass on Fox Sports West and Prime Ticket. “We offered competitive market terms but, ultimately, YouTube TV declined,” Gibber said in the release. “We encourage YouTube TV subscribers who value these RSNs to turn to other streaming services or their local cable or satellite provider for continued access, or to directly contact YouTube TV with feedback.”

Prime Ticket and Fox Sports West remain available on various other streaming platforms. Sinclair has asked fans of these channels to visit here to learn more about their streaming options. 

After what seemed like a reprieve in the increasingly tense carriage negotiations between YouTube TV and Sinclair Broadcast Group regional sports networks, the Yankees Entertainment and Sports Network (YES), which includes Sinclair as a minority partner, said it has been dropped by the streaming video service.

“YouTube TV, for its own selfish reasons and with total disregard for its YES customers, has refused to pay the market rate and accept market terms and conditions that other YES distributors have agreed to,” YES said in a statement. “In fact, YouTube TV sought a rate that was well below what other YES distributors are paying, and because YES keeps its word to all of its distributors, it could not make the deal. When YouTube TV realized it could not get a sweetheart, below-market deal, it dropped the YES Network.”

YouTube TV appeared to avoid a blackout of several Sinclair-owned RSNs earlier this week, when after threats to drop the networks, YouTube TV agreed to an extension that would keep the channels on the service while talks continued. But even that seems to be subject to interpretation, according to a statement from YES.

[embed]https://twitter.com/TeamYouTube/status/1235541185919320070[/embed]

YES was purchased by a group including the New York Yankees, Amazon and Sinclair in August for an estimated $3.47 billion from The Walt Disney Co., which was forced to divest its RSNs as part of federal approval of its $71.3 billion purchase of 21st Century Fox assets.

[embed]https://twitter.com/YESNetwork/status/1235452211880222720[/embed]

“Sinclair, for its own reasons, elected to make a deal for some but not all of its programming services which excluded large-market RSNs featuring iconic franchises and star players,” YES continued in its statement. “The New York Yankees have made it clear to Major League Baseball and YouTube TV that the Yankees will not appear on any national games televised by YouTube TV through its national telecast agreement with Major League Baseball. We urge all of our fans to go to YESNetwork.com to see the list of other streaming services and other distributors that carry the YES Network. With YouTube TV no longer carrying YES, it appears as though YouTube TV customers will pay the same while getting less.”

[embed]https://twitter.com/EricFisherSBG/status/1235533599161462789[/embed]

Sinclair Broadcast Group is warning AT&T customers across the country that they could lose access to 136 stations in 86 markets affiliated with the Big Four networks if their retransmission consent deal isn’t renewed.

Sinclair said its original carriage deal with AT&T expired in August, but the broadcaster granted a five-week extension while talks continued. Those negotiations have apparently reached an impasse, prompting Sinclair to warn DirecTV, AT&T TV Now,and U-verse customers of the potential for a blackout. The extension will expire at 5 p.m. ET on Sept, 27, according to Sinclair.

“AT&T is the largest MVPD in the country and seems intent on using its tremendous market power to dictate to viewers which programming from other content providers they can receive, even as they continue to acquire content providers and push their own content to viewers,” Sinclair SVP and general counsel David Gibber said in a press release. “Despite the tremendous market power of AT&T, most consumers of AT&T and DirecTV do have some other alternatives to receive our in-demand programming. Although it would be unfortunate to lose AT&T and DirecTV as customers, we are simply not prepared to sell our programming to them at the below market rates they are demanding due to their overwhelming market power.”

Of the Sinclair stations go dark, they would be the third programmer to pull their content from AT&T in the past several months. On May 30 about 17 stations in smaller markets -- many of them managed by Sinclair -- went dark to AT&T in a retrans dispute. Last month, regional sports network Altitude Sports and Entertainment went dark to DirecTV and Comcast customers. Earlier this month The Walt Disney Co. warned AT&T customers that their networks could go dark. Those talks continue, and the channels remain available to customers.

Sinclair said it has and will continue to negotiate in good faith to reach a deal, but didn’t seem overly optimistic, pointing out that AT&T has established a “pattern of insistence on terms that greatly undervalue the content of local broadcasters.”

In a statement, AT&T said that Sinclair controls nearly 200 stations in 100 markets across the country, and recently spent about $10 billion buying regional sports networks and routinely threatens to pull access to those assets for one purpose: to drive up affiliate fees. 

"Sinclair has made egregious demands for broad carriage and payment on one of the most expensive single-team RSNs ever with the Cubs in Chicago; for carriage of multiple cable channels that don’t even exist or that Sinclair hopes to someday acquire; and for RSNs that aren’t even up for renewal – just to name a few," AT&T said in a statement, adding that it will continue to negotiate in good faith with the broadcaster.

"We are on the side of customer choice and value and hope to avoid any interruption to channels some may care about," AT&T continued. "Our goal is simple – to deliver the content our customers want at a value that also makes sense to . And to enable anyone the freedom to experience favorite shows, channels and teams wherever, whenever and using whatever device they may choose."

The New York Yankees completed a deal to acquire the remaining 80% interest in the regional sports network that bears its name — the Yankees Entertainment and Sports Network — teaming up with online retailer Amazon and Sinclair Broadcast Group in a deal valued at about $3.47 billion.

Officially, YES Network was purchased by Yankee Global Enterprises, which includes the team and strategic partners Sinclair and Amazon from The Walt Disney Co. Additional equity investments were provided by RedBird Capital, funds managed by Blackstone’s Tactical Opportunities business and Mubadala Capital.

Sinclair said it paid about $346 million for a 20% interest in the network through its Diamond Sports Group subsidiary.

“We are excited about partnering with such a renowned franchise as the New York Yankees,” Sinclair CEO Chris Ripley said in a press release. “With this investment, we will have 23 RSN brands, including Marquee with the iconic Chicago Cubs, and 21 RSN brands acquired from the Walt Disney Company last week.”

According to New York Yankees president Randy Levine, the team has a 26% interest in the YES Network, while Amazon has a 15% stake with the right to go higher. The remaining 39% is split fairly evenly between RedBird, Blackstone and Mubadala.

The YES Network was one of 22 RSNs controlled by 21st Century Fox that were sold to Disney as part of a larger deal for certain assets valued at $71.3 billion. As part of the federal approval process for that deal, Disney agreed to divest the networks, selling 21 of them to Sinclair earlier this year for about $9.6 billion. The YES Network was separated from that sale because the Yankees had the right of first refusal to purchase Fox’s 80% stake.

Speculation that the Yankees had enlisted the help of Amazon and Sinclair has been rampant for months. Thursday’s announcement basically confirms those earlier reports.

In addition to Yankees games, YES Network offers content from the NBA’s Brooklyn Nets, Major League Soccer’s New York City FC, and the WNBA’s New York Liberty. The RSN is the most watched RSN in the country, according to the channel.

“This transaction brings the YES Network and all of its popular programming even closer to the organization that inspired its very development,” said Yankee Global Enterprises CEO Hal Steinbrenner in a press release. “Along with our partners, we look forward to greatly expanding the way that sports content is delivered and consumed by fans everywhere.”

Sinclair, which also owns The Tennis Channel in addition to the former Fox RSNs, will work closely with YES to manage traditional and virtual distribution relationships. Current YES Network president Jon Litner will remain in that role. 

Two new reports underscore the growing challenges of fragmented news viewing preferences and increased media concentration.

A Pew Research Center study, unveiled on Wednesday, showed that nearly a third of U.S. adults (31%) follow local news very closely, but various demographic groups have widely different media preference. Few Americans ages 18 to 29 (15%) follow local news very closely, according to Pew, compared with 28% of those 30 to 49 age bracket and 39% of those 50 and older.

"Older Americans, black adults and those with a high school education or less show considerably more interest in local news than their counterparts," the Pew report concluded. Those categories prefer getting their local news via the TV rather than online.

Meanwhile, a Gallup Panel survey issued on Thursday concluded that more than nine out of ten Americans are "very" or "somewhat" concerned that the consolidation of news organizations will mean that owners' political views will influence coverage of local and national news. The Gallup study also found that 77% of viewers are concerned that new owners would cover less local news.

The Gallup analysis is part of the Gallup-Knight Foundation series on trust, media and democracy that seeks to better understand Americans' evolving opinions of the media.

Pew: TV's role is solid, but its audience is aging

According to the Pew assessment, news consumers older than 50 years primarily turn to the TV set, while those younger than 50 mostly prefer online pathways to local news. Black Americans and those with a high school diploma or less education also express a far greater preference than their counterparts for getting local news through the TV set rather than online, in print or on the radio, Pew found. About half of those with a high school diploma or less prefer the TV set (52%) compared with 29% of those with a college degree and 39% of those with some college education.

Those groups who are less likely to prefer TV tend to express a greater preference for the internet, Pew said. It found that 60% of people ages 18 to 29 prefer the internet, along with about half of 30- to 49-year-olds (47%).

Among the questions in Pew's survey was a question about how much influence local news media have within a community. Thirty-seven percent said "a lot" and 61% responded "not much."

The Pew research also delved into the emerging preference among digital news consumers, distinguishing between social media and "news websites. Not surprisingly, about 30% of audiences in the 18 to 29 year old age group prefer both digital formats to legacy delivery systems (print, radio, TV). But the differences become very distinct in the 30 to 49 age bracket, when 17% favor social media versus 30% choosing news websites. For audiences older than 65, only 3% go to social media compared to 11% who use news websites.

Not Interesting Enough to Pay for News

Pew also found that younger Americans are less likely to pay for local news, which is tied to their explanation that they are not interested in it. Overall, very few U.S. adults (14%) pay for local news, but among younger age cohorts the willingness to pay is even lower: 7% for ages 18 to 29 and 9% for ages 18 to 29. Pew noted that 29% of people above age 65 have paid a local news organization either via subscriptions, donations ore membership.

Black and Hispanic Americans are more likely than white Americans to say they want to see/hear or read about local topics such as crime, schools, jobs/employment, sports, traffic/transportation, prices and government/politics, Pew said. For example, Black and Hispanic adults are about three times as likely as white adults to say they want to be informed about jobs and unemployment for their daily lives. These minority audiences are about twice as likely as whites to call schools and local events important, according to the Pew survey. The Pew Research Center is allied with the Pew Charitable Trusts, which received support from the Google News Initiative, the Silicon Valley company's effort to work with the news industry to help journalism thrive in the digital age.

As usual, Pew did not offer analyses or recommendations to accompany its findings - but it is clear that there is still sizable, albeit dwindling, interest in and support for local news. Pew's findings augur the drastic changes in the ways people want to obtain it.

The new Gallup research for the Knight Foundation (which backed the recent Knight Commission report on democracy, media and trust) focused on another aspect of the same issue: the credibility of media companies in a consolidating world. In addition to last week's Gannett/ Gatehouse newspaper merger, Knight's report cites the scuttled Sinclair Broadcasting Group effort to acquire Tribune Media. During that failed merger process, critics assailed Sinclair's policy to broadcast its conservative political commentaries via local stations.

Related: FCC Investigating Sinclair Over Tribune Deal

The Knight Foundation, in a statement, said that the Gallup poll confirmed that local news consumers are aware of this "very real trend in local news" in which local outlets are covering more national stories than in the past.

"But this shift appears to stem from decisions made by local news organizations, rather than a response to increased consumer demand for such news," according to the Knight Foundation. It cited a recent Pew study that found that most Americans think their local news media are doing well financially, despite evidence to the contrary.

"The results are similar among all relevant demographic subgroups of Americans, including party, age and education, as well as by different levels of attention to local news," Knight said. It emphasized that all categories of news consumers "express concern over ... [the] risks of national news ownership of local news" and emphasized that there is "particular concern about the potential for political bias."

Taken together, the Pew and Knight research projects recognize the fragmenting local news opportunity at a time when many local media operations are struggling to find a role in the evolving mediascape.

DENVER -- With the pay TV eco-system losing around 1.4 million customers in the first quarter, per estimates, the smart money wouldn’t seem to be on the bundle coalescing anew.

But that was the very idea put forth by a couple of pay TV industry pundits at a video trade show in Denver this week.

“The return of the big bundle—that’s where we’re headed,” declared Scott Ehrlich, VP of emerging platform Content, Sinclair Broadcast Group, speaking on a panel Tuesday. “Everything that gets disaggregated gets re-aggregated.

According to fellow panelist Gary Schanman, senior VP of products for Charter Communications, many customers are coming to the realization that they can’t beat the value of his company’s managed network video services on price, now that many virtual MVPDs have upped their monthly fees.

“We still think we have an advantage,” Schanman said.

Meanwhile, the panelists said that media companies—now charged with distributing, marketing and doing pretty much everything else needed to get their shows seen in direct-to-consumer models—might soon miss the ease of the pay TV bundle.

“It’s really hard. You’re going to see a lot of guys try to get into [direct-to-consumer], blow through their libraries, and then blow through their budgets,” said Bob Greene, managing director of business development for Liberty Global.

“You’re going to see them return,” he added.

“How much money do you save wholesaling through a company that provides you with delivery, marketing and customer service?” said Ehrlich. 

Indeed, at the Pay TV Show, a recurrent theme has been that the rumor of the bundle's demise is overblown. 

Also speaking at the Pay TV Show, Wolfe Research analyst Marci Ryvicker said that cord cutting will eventually "even out," with around 70 million users remaining in the linear ecosystem. 

"I think the bundle is going to stick around for a while. People will start to come back," added Samantha Cooper, executive VP of distribution and development for Viacom, speaking on a Wednesday morning panel. 

Tribune Media snuffed out its merger deal with Sinclair Broadcasting, terminating the deal Thursday and simultaneously filing suit in Delaware Chancery Court claiming Sinclair breached its contract.

Tribune is seeking $1 billion in damages, according to the suit.

The termination ends what has been a year-long journey for both companies. Sinclair announced the $3.9 billion deal in May 2017. The combination would have made Sinclair, already the largest TV station group in the country even more powerful, with more than 200 stations and covering over 70% of the country. But it was that bulk that ultimately did the deal in. 

The Federal Communications Commission was in the process of scheduling hearings into a Sinclair proposal to divest three stations to entities it would ultimately control, which the agency called possible sham transactions. Sinclair later said it would place two of those stations in a trust for later sale to third parties, and decided to keep the other – WGN in Chicago – as part of the deal.

Related: FCC: Sinclair-Tribune Deal as Proposed is Not in Public Interest

Tribune’s decision to scrap the merger comes as a bit of a surprise. Yesterday, in its Q2 earnings conference call, Sinclair said it was continuing talks with Tribune to work out a deal. The deadline to close the transaction was Aug. 8, but it appeared that the two could extend that date to work out an agreement.

That apparently wasn’t in the cards.

In a statement, Tribune said although Sinclair had pledged to use its “reasonable best efforts to obtain regulatory approval as promptly as possible,” instead it engaged in an “unnecessary and aggressive” battle with regulators over station divestitures, refused to sell stations in certain markets and created aggressive divestiture structures and third-party sales that either were rejected or posed a high risk of rejection by regulators.

“In light of the FCC’s unanimous decision, referring the issue of Sinclair’s conduct for a hearing before an administrative law judge, our merger cannot be completed within an acceptable timeframe, if ever,” Tribune Media CEO Peter Kern said in a statement. “This uncertainty and delay would be detrimental to our company and our shareholders. Accordingly, we have exercised our right to terminate the Merger Agreement, and, by way of our lawsuit, intend to hold Sinclair accountable.”

Sinclair officials did not return requests for comment.

The termination could mean that Tribune is back in play, and several other station groups have been aggressively adding properties through deals in recent months, including Gray TV, and Nexstar Broadcasting Group. 

“This morning’s course of action should not be a surprise to investors who have been following the saga, but clearly the prospect of Tribune agreeing to see the administrative hearing process through (presumably in exchange for some form of ‘sweetener’ from Sinclair) is off the table and Tribune begins the next chapter of its history as a standalone entity (for how long, remains unclear),” said Evercore ISI broadcast analyst David Joyce in a note to clients.

In a statement, Free Press CEO Craig Aaron said the termination was good for consumers.

“The collapse of the merger is great news for dozens of local communities that will be spared Sinclair’s slanted coverage and ridiculous must-runs," Aaron said in a statement. "For years, Sinclair has been a dishonest broker at the FCC, using fuzzy math and sketchy shell companies to evade the agency’s rules and expand its empire. Its history of deceit and arrogant approach to the agency finally caught up with Sinclair. The broadcast giant's double-dealing became too much for Tribune executives to bear. As details of Sinclair’s deceptions emerge — and with other investigations underway a the Department of Justice — it’s reasonable to question whether the broadcaster deserves to hold any licenses to profit off the public airwaves.

“Hopefully, FCC opposition to this deal is the start of a trend in favor of more independent voices and local choices for news," Aaron continued. "The FCC majority’s recent gutting of media ownership limits suggests otherwise. The demise of this deal presents an opportunity to embark on a new path, an opportunity that will be squandered if these stations were to be simply served up to other giant conglomerates.”

Other consumer and trade groups were equally pleased with the outcome.

American Cable Association CEO Matt Polka said the termination is god news for cable operators as well as consumers.

"Tribune's decision to pull the plug on the Sinclair merger is great news for consumers who will avoid paying the higher pay-TV rates the deal would have caused," Polka said in a statement. "It is especially great news for those consumers served by smaller video providers that have been victimized in the past by outrageous retransmission consent fee hikes and scurrilous signal blackouts by large corporate broadcasters.

"All along, ACA insisted that the proposed Sinclair-Tribune deal would result in harm to the public stemming from higher retrans fees and higher consumer prices," Polka continued. "Sinclair's illusory 'sales' served only to magnify these harms. Few predicted the collapse of the Sinclair-Tribune deal when it was first announced. ACA is pleased that others joined us in refusing to yield to conventional wisdom and continuing to challenge an obvious attempt by Sinclair to subordinate the public interest to its quest to obtain TV station ownership hegemony."

At Common Cause, former FCC commissioner and special adviser to the consumer group Michael Copps said the demise of the deal  was due in large part to grass roots efforts to block it.

“Good riddance to a really bad deal that would have given Sinclair an unprecedented amount of control of our local media. Broadcasters are supposed to serve the needs of the communities where they operate," Copps said in a statement. "But Sinclair has shown its only interest is taking over as many local stations as possible to become a national network at the expense of local programming and diverse viewpoints. In the end there was massive opposition from all sides, which demonstrated Sinclair’s merger was clearly not in the public interest.

"The strongest impact came at the grassroots level. Hundreds of thousands of people, including over 50,000 Common Cause members, called on the FCC to block Sinclair’s merger," Copps continued. "It’s their victory and shows Americans want a media system that promotes local, diverse, and independent journalism. But Sinclair will be back with more deals, as will other media giants. At a time when we need more independent and diverse voices in our media, we must all stay vigilant and engaged.” 

The U.S. Court of Appeals for the D.C. Circuit Friday (April 20) heard oral argument in the Free Press v. FCC challenge to the FCC's reinstatement of the UHF discount.

While the judges appeared to favor Free Press' arguments, which would not bode well for Sinclair, an attorney familiar with the oral argument, speaking on background, said he was not so sure. He suggested the judges had a lot of issues with the standing of the challengers to bring the suit, though added if the court gets past that bar, he liked Free Press' chances. 

According to audio from the argument, the judges clearly had concerns about not having statements from individual members of the associations challenging the rule establishing particular harms, though one judge suggested Free Press et. al could still submit them. But the judges also clearly had issues with the FCC's restoration of a discount that seemed to have clearly outlived its usefulness.

A politically divided FCC under chair Ajit Pai voted back in April 2017 to reverse the previous Democratic majority's decision to eliminate the discount. That discount meant TV station group owners only had to count half of the audience to their UHF stations towards the 39% national audience reach cap. It dated from the days of analog TV when UHFs were weaker than VHFs, and its restoration paved the way for Sinclair to try and buy the Tribune stations.

Pai has long opposed repealing the discount without also considering adjusting the audience reach cap in the same proceeding. The FCC reinstated it in response to a petition to do so by Ion Media, a major UHF station group.

A coalition of nonprofit media consolidation critics including Free Press, Common Cause, the National Hispanic Media Coalition and Prometheus Radio Project, laid out the case to the D.C. appeals court in their opening brief last September for why the decision to reinstate the discount was arbitrary and capricious and not in the public interest.

Related: Prometheus: Court Should Deny Broadcaster Motions

They said the decision to reinstate the cap is arbitrary and capricious—and thus violates the Administrative Procedure Act—because it is premised on a move—reconsidering the 39% cap—that the FCC does not have the authority to make because the 39% figure was established by Congress.

The previous Democratic-led FCC had eliminated the discount as an outmoded artifact of the analog TV era. The FCC responded in its brief that it was reasonable to reinstate the UHF discount immediately while it considers adjusting the national audience reach cap, that it has the authority to adjust that cap, and that the discount and the cap have to be considered together because the UHF discount is meaningless except in relation to the cap.

The FCC’s decision to restore temporarily a settled framework that had previously been in place for three decades rests well within its discretion under the Administrative Procedure Act, other Congressional enactments, and its own rules," the FCC told the court in asking it to reject the various groups' challenges.

The case could throw a wrench into the Sinclair-Tribune deal given that without the discount a Sinclair-Tribune combo would far exceed the 39% national ownership cap. According to sources, Justice is vetting Sinclair's latest spin-off proposal, but the deal can't get a final decision until the FCC has put the latest iteration of the deal out for public comment of at least 30 days, with at least seven days more for responses to those comments, then renders its decision. Justice vets it for antitrust issues, while the FCC looks beyond competition to a deal's positive or negative impact on the public interest. 

So, if the deal did not close before the court rendered a decision, and the decision reversed the FCC and eliminated the discount, the deal could not get done. But if the deal closed before a decision eliminating the discount, it could not be unwound by a court decision vacating the FCC's reinstatement of the cap--unless the FCC had conditioned the deal on the outcome of the court case.

Oral argument was 15 minutes per side--beginning at 9:30 a.m. It was the first case on the docket for the three-judge panel of Judges Patricia Millett, Cornelia Pillard, and Gregory Katsas. 

Coincidentally, this week also marked the deadline for comments in the FCC's review of the 39% cap and UHF discount. The fact that the discount helped Sinclair was one of the talking points of MVPDs opposed to raising the 39% cap, including de facto raising it via the discount.

Rep. Tony Cárdenas (D-Calif.), no fan of the proposed merger, says the FCC should wait until the court renders a decision before it renders its decision on Sinclair-Tribune, arguing that to allow the deal if the court then eliminates the discount would create "FCC-sanctioned" dominance of the broadcast space by Sinclair.

Sinclair Broadcasting said MVPDs have been "vastly overstating" the impact on ATSC 3.0 on their business, including making false claims about royalties from patents related to the new broadcast transmission technology and disingenuous assertions about how their systems work.

The station owner's charges came in reply comments on the FCC's proposal to allow broadcasters to voluntarily roll out ATSC 3.0.

Related: MVPDs Want Retrans Buffer in ATSC Rollout

Sinclair argued that cable operators are using the rollout to justify a laundry list new regulations on broadcasters' carriage rights, calling it a "transparent" attempt to hijack the proceedings" and turn it into a referendum on retrans.

Related: ACA to FCC: Consider ATSC 3.0 Impact on Smaller MVPDs

MVPDs have told the FCC that broadcasters should have to separate ATSC 3.0 carriage from carriage of their 1.0 signals so that they can't effectively compel 3.0 carriage.

"Most of the MVPDs' asks are rehashed versions of the same overbearing rules they have failed to secure in a decade of direct challenges to the free marketplace retransmission regime Congress adopted."

While some commenters have said the ATSC 3.0 rollout could affect the timeline for repacking stations post-auction, Sinclair said flatly, "It will not."

That said, it still thinks the 39-month timeline is "wholly unrealistic," but said the ATSC 3.0 rollout does not increase the time needed for repacking.

Sinclair also took aim at the suggestion that broadcasters be treated "as secondary to unlicensed white spaces devices."

Computer companies want to make sure that broadcasters don't get any extra spectrum for ATSC 3.0 from channels they wants reserved for wireless broadband.

"The hard capacity limits of existing stations will be stretched during ATSC 3.0 rollout as the same stations attempt to double the number of streams they transmit with the same spectrum assignments," Sinclair told the FCC. "The Commission should make vacant channels available to broadcasters, or to groups of broadcasters, on a temporary basis to improve service to consumers during the transition."