Is Bally Sports going to stop paying the Braves for their broadcast rights?

The Braves broadcaster has filed for bankruptcy and just lost the rights to Padres games

Much has been written about the bankruptcy of Diamond Sports, the holding company for the Bally Sports regional sports networks that broadcast MLB games for fourteen teams, as well as various NHL (twelve) and NBA (sixteen) franchises. 

They filed for bankruptcy back in March, citing the heavy debt load that was used to acquire them from Fox Sports during the merger with Disney. 

But up to today, Diamond Sports had continued paying most teams (and producing the games for all of them), just like normal. The payment deadlines that Diamond did miss were still paid to the teams during the grace period. 

Until now. 

Starting today, the San Diego Padres broadcasts are being run by MLB - Diamond Sports deliberately missed a required rights fee payment to the Padres, and have subsequently lost the broadcast rights to Padres games in the San Diego Area. (Good news - all the production staff works on a freelance basis for Bally Sports, so it doesn't appear that anyone who works on the broadcast has lost jobs because of this). 

MLB will take over production and distribution of all local #Padres games starting 5/31. The new arrangement gives fans the option to now watch on TV or stream digitally without local blackouts (subject to national exclusivity)!

San Diegans can NOW watch Padres games in-market… pic.twitter.com/937YNWxmNN

— San Diego Padres (@Padres) May 31, 2023

While MLB works on a more permanent distribution option, games can be viewed on various local platforms and as a special add-on package for the league's own streaming service, MLB.tv. 

Diamond Sports was willing to skip this payment because they decided the amount of the contract wasn't worth it - 2012's agreement was for twenty years and $1.2 billion dollars, or sixty million a year. Diamond wasn't making money on the deal, which was considered "team friendly" by many sports business reporters. 

Which begs the logical question - is Atlanta next? 

The true answer is we don't know - only Diamond Sports executives know that - but odds are, it's not likely. 

The Atlanta Braves have continued to receive payments for their broadcast rights as scheduled so far through the saga. Atlanta's deal, which was signed in 2007, is believed to be profitable for the Bally Sports RSNs, Bally Sports South and Bally Sports Southeast, that carry the games. It's believed a combination of both reach - the Southeastern footprint is one of the largest in the country - and amount paid to the team, which has been described as below-average for a team of Atlanta's size and prestige - is why the deal is safe. 

(It's believed that the deal was for $80M a year, recently increasing to $100M in wake of the World Series championship of 2021.)

Braves owner Liberty Media, who has been preparing to spin off the Atlanta Braves into their own separate publicly-traded company, have made preparations for a possible rights fee cessation, as well. 

During a recent earning call for Liberty Media, CEO Greg Maffei had this to say about the issue. 

“Even if they were to reject it, which we don’t expect, there’s other alternatives that we can construct in the marketplace that would enable us to get paid and have our product shown to our fans, which is really the most important thing. We’re certainly prepared if we have to go out and exercise those alternatives.”

So in short, things should continue as normal for the Atlanta Braves. For now. 

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