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Baseball Primer Newsblog — The Best News Links from the Baseball Newsstand Monday, March 20, 2023Why MLB Feels RSN Pinch More Than Other Leagues
RoyalsRetro (AG#1F)
Posted: March 20, 2023 at 04:38 PM | 7 comment(s)
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1. Walt Davis Posted: March 20, 2023 at 05:33 PM (#6120840)They've been kicking the local DTC streaming can down the road for over a decade now. If MLB had shareholders in the traditional sense, they should all be pissed off that they don't have some solution ready to go.
Most MLB teams are in the 18% to 25% range
The low rights teams will be below that 18% though. They're getting $230 in common and shared revenue plus half their local revenue (tix, media rights, etc.) so they're at a min around $280 M in total revenue, I'd guess more likely $300. But we're talking cable deals in the $30-50 M range at the low end of the market. They're probably around 14-15% of total revenue.
Now if the DBacks have gone from $30 M to $0 then obviously a 15% revenue drop hurts bad. But if they've gone from $30 to $20 then it's a 5% drop in revenue of which they were only keeping 2.5%.
At the broader level, obviously the DBacks aren't alone but if it's a drop of $10 M each for 6 teams that's just a $2 M hit across all 30 teams so maybe the common/shared revenue payments are $228 M instead of $230 M. And in the short term, MLB can redirect Cohen's lux tax payments to help out the struggling teams.
Now if the Angels' $130 M deal (from memory) is now worth $65 M and similar for Dodgers, Cubs, Yanks, etc. then that's a big problem. But it is a sport where average team revenue is up to about $375-400 M while almost nobody runs a MLB payroll over $230 M and otherwise a baseball team is a pretty small business with mainly low/average-paid employees in an industry where nobody's gone bankrupt in a century. There is zero chance the DBacks are going to miss their $130 M (total) payroll payments much less the A's struggle to meet their $75 M obligations.
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