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Thursday, September 28, 2023

MLB commissioner Rob Manfred calls eliminating local blackouts ‘business objective number one’

“I believe that one of the fundamental goals that we have as the media landscape is reworked is that whatever exclusivity we give to a particular cable provider, we oughta have the ability to go side-by-side with a digital product so that people are not blacked out,” Manfred said. “That is business objective number one at Major League Baseball right now.”

“The reason it has taken a long time to get at this blackout issue is that when clubs make long-term RSN agreements, they historically grant exclusivity that covers both sides of the house to that cable provider. If the cable provider doesn’t get distribution in a particular area, you have a blackout, right? And that’s beyond our control. That’s a product of a contractual arrangement between an individual club and an RSN, and that’s one that has been hard to deal with.”

This has been an ongoing issue for MLB, and Manfred has been publicly speaking about the league’s desire to solve the problem for at least a year. Last summer, he called ending blackouts a “top priority” for the league. Weeks later, he elaborated by saying that eliminating the blackouts was a “massive undertaking” that would require a “fundamental reordering” of media rights across the league.

RoyalsRetro (AG#1F) Posted: September 28, 2023 at 12:21 PM | 15 comment(s) Login to Bookmark
  Tags: blackouts, rob manfred

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   1. Karl from NY Posted: September 28, 2023 at 03:23 PM (#6142604)
Just to clarify the reason that the blackouts exist: The RSN wants the exclusivity as their leverage to expand their subscriber and coverage base. If you live somewhere that is blacked out, what you're supposed to do is petition your cable provider to add the RSN until they do so.
   2. Tom Goes to the Ballpark Posted: September 28, 2023 at 03:50 PM (#6142613)
According to the article, 10 teams currently have DTC offerings. That’s a pretty good start and more will come online next year.
   3. The Yankee Clapper Posted: September 28, 2023 at 04:08 PM (#6142616)
MLB can mandate that all new cable contracts allow teams to retain a separate direct to consumer streaming option. That will reduce what teams will get for their cable TV rights, but MLB probably calculates that teams will make more from two platforms than one. They aren’t changing the blackout policy to cost themselves money.
   4. Walt Davis Posted: September 28, 2023 at 04:30 PM (#6142621)
Of course it isn't a "blackout" policy, it's an "exlcusive rights" policy. You can currently watch local games with the right cable subscritpion. You will have the chance to watch local games with a streaming subscription ... except of course for games for which ESPN or Apple or whoever own the exclusive rights.

There are two advantages for consumers. Minaly, the one-sport DTC streaming subscription will cost substantially less than the cable subscription. (Whether that will be true if you want to watch your local basketball (pro and college) and hockey teams too mayy be a different story.) Second, and this is where I think MLB got caught by surprise, you will no longer be caught in the cable provider vs content provider wars where your local cable monopoly decides not to carry your local RSN monopoly. I really can't imagine MLB expected large portios of, for example, the Dodgers' fanbase to not even have the opportunity to buy access to Dodgers games.

Still, there's really been no change to "blackout" policy which has always been nothing more than "you have to pay to watch" policy. It's just that some fans will now have a choice between two providers, one of whom will be offering a lower-cost subscription (that only covers baseball games). Exactly how this is going to work in the case of the teams that own their own RSNs I'd imagine is still unclear (but then I didn't RTFA).
   5. Tom Goes to the Ballpark Posted: September 28, 2023 at 04:38 PM (#6142623)
Still, there's really been no change to "blackout" policy which has always been nothing more than "you have to pay to watch" policy. It's just that some fans will now have a choice between two providers, one of whom will be offering a lower-cost subscription (that only covers baseball games). Exactly how this is going to work in the case of the teams that own their own RSNs I'd imagine is still unclear (but then I didn't RTFA).
There are significant portions of the US that multiple teams claim as their territory, but do not have distribution of the appropriate RSN. DTC improves that situation dramatically.
   6. The Duke Posted: September 28, 2023 at 05:50 PM (#6142641)
As Rumsfeld said, "what you measure improves". Measure it, talk about it, focus on it. It will improve
   7. Greg Pope Posted: September 29, 2023 at 08:36 AM (#6142715)
Just to clarify the reason that the blackouts exist: The RSN wants the exclusivity as their leverage to expand their subscriber and coverage base. If you live somewhere that is blacked out, what you're supposed to do is petition your cable provider to add the RSN until they do so.

There are two different types of blackouts, though. To take Chicago as an example. At least before Marquee's recent a la carte offering.

The first is in the city. You have to get certain TV packages such as DirecTV or Comcast in order to see the Cubs. No OTA broadcasts. And if you get your TV from the wrong provider, you can't see them. So it's leverage to go with one of the broadcasters that has Marquee. And then you pay the RSN fee.

The second is the territory. The Cubs territory extends into Wisconsin and most of Indiana, plus all of Iowa. In many of those cases, it's impossible for you to watch. The local providers do not pay for Marquee so there are no packages you can get to watch them. What Karls says is true, that the theory is that people in Des Moines will petition their providers. But that hasn't happened, so those people are stuck. Even if you get MLB.tv, you can't watch the Cubs.

I know the concept is the same behind these blackouts, but they're different. In the first case, it's simply that there's a monopoly. In the second case, you're blocking out potential customers. MLB must be calculating that they will get more money from people in Iowa and Indiana that will pay for MLB.tv or Marquee than they will lose by reduced exclusive pricing.
   8. DL from MN Posted: September 29, 2023 at 09:59 AM (#6142719)
If you live somewhere that is blacked out, what you're supposed to do is petition your cable provider to add the RSN until they do so.


But what you actually do is cancel your cable subscription.
   9. DL from MN Posted: September 29, 2023 at 10:05 AM (#6142722)
Kudos to MLB recognizing that they need to grow their audience to thrive. Adding TV viewers is better in the long term than adding TV revenue in the short term.
   10. Karl from NY Posted: September 29, 2023 at 04:39 PM (#6142760)
There are two different types of blackouts, though.

The first one isn't a blackout at all. The games are perfectly available to you in the city, you just choose not to pay for the services. That's just the market pricing of capitalism.
   11. Cris E Posted: September 29, 2023 at 06:50 PM (#6142781)
MLB must be calculating that they will get more money from people in Iowa and Indiana that will pay for MLB.tv or Marquee than they will lose by reduced exclusive pricing.


Kudos to MLB recognizing that they need to grow their audience to thrive. Adding TV viewers is better in the long term than adding TV revenue in the short term.


I think DL has it right in #9, and the move away from the RSN is a financially painful move but one that has to happen to build the next generation of fans. You have to make it easy to find the games so that the casually curious can get engaged, and blackouts that intrude on the online experience are a huge problem to people who assume that you can find anything on the internet. If some kid in Portland, OR gets excited about the Mariners' pennant race but can't find the game it's not going to stick. Owners have to know this is coming and it's kind of amazing it's waited this long to drift into the light.
   12. Greg Pope Posted: September 30, 2023 at 10:01 AM (#6142834)
The first one isn't a blackout at all. The games are perfectly available to you in the city, you just choose not to pay for the services. That's just the market pricing of capitalism.

Right. I said it was simply a monopoly. However, there have been cases where even the locals can't get the broadcasts because the city's main provider won't pay the fees.
   13. Greg Pope Posted: September 30, 2023 at 10:03 AM (#6142835)
If some kid in Portland, OR gets excited about the Mariners' pennant race but can't find the game it's not going to stick. Owners have to know this is coming and it's kind of amazing it's waited this long to drift into the light.

In Iowa, I believe that the nearest team a kid could watch if their parents subscribed to MLB.tv is the Tigers. How are you going to build fans when the kid can't watch the nearest 6 teams?
   14. What did Billy Ripken have against ElRoy Face? Posted: September 30, 2023 at 02:59 PM (#6142866)
So, nothing under consideration is going to allow me to watch Cubs games in Chicago through the MLB.tv app, right? This is just “hey, you get to decide whether to pay for Marquee streaming!”
   15. Greg Pope Posted: September 30, 2023 at 04:14 PM (#6142875)
So, nothing under consideration is going to allow me to watch Cubs games in Chicago through the MLB.tv app, right? This is just “hey, you get to decide whether to pay for Marquee streaming!”

I assume that's true. I think there are two groups of people that pay for MLB.tv:

1. People who want to watch a lot of baseball
2. People who want to watch their favorite team but live in another city

MLB is acting like the second one is dominant.

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