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Tuesday, September 21, 2021

How Declining Subs For Regional Sports Networks Could Impact MLB Relocation And Expansion

In other words, MLB is at a tipping point. While other sports properties will be affected, no other sport leans as heavily into the lucrative revenues of RSNs as big-league baseball does. They can’t jump off the ship just yet, but in the coming years, dealing with the shift to streaming will become critical.

That plays into commissioner Rob Manfred’s plans around possible relocation and expansion. With large domestic markets gobbled up by existing franchises, the league is left with small or mid-market locations to work from.

That presents a problem given the extra weight needed for a healthy deal out of a regional sports network deal as a way to ensure steady annual revenue flow when the gate is more susceptible to dramatic swings: fans are new and not generational as other well-entrenched clubs with long histories.

As an example, the A’s have made the threat of moving to Las Vegas as a way to achieve funding for a new ballpark in Oakland at the Howard Terminal location. Irrespective of market saturation in Las Vegas with the Golden Knights, and Raiders, the designated market area (DMA) – a measure of market size for television – ranks just 39th in the country with just 743,220 TV households, according to the most recent measurement by Nielsen Media NLSN -1.4%. Traditional TV bundles would mitigate some of this, but a streaming deal in-market would see low returns given the DMA size.

And this tipping point affects expansion, as well. Markets such as Nashville (ranks 28th by DMA), Portland (ranks 22nd), and Charlotte (ranks 21st).

RoyalsRetro (AG#1F) Posted: September 21, 2021 at 11:16 AM | 15 comment(s)
  Beats: expansion, rsns

 

 

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