Major League Baseball will begin producing and distributing San Diego Padres games on Wednesday after Diamond Sports Group, which operates the Bally Sports regional networks, skipped a rights fee payment, reports the Sports Business Journal. Diamond missed the payment two weeks ago and Tuesday is the final day of a two-week grace period.
The team’s media rights revert back to the Padres on Wednesday. Here are more details from the Sports Business Journal:
MLB will produce the Padres’ Wednesday game in Miami, with the same announcers — who are employed by the team — and many of the same producers and directors and camera operators, who work as freelancers. A source says MLB will stream the team’s games for free through Sunday. The league also plans to make the games available via outlets like Fubo, DirecTV, Cox and Charter. Station numbers will be released tomorrow.
This afternoon, the Diamond board elected not to provide funding for the joint venture between the Padres and the San Diego RSN. Bally Sports San Diego is not part of Diamond’s bankruptcy filing because the team has an ownership stake in the RSN. The team, in turn, informed Diamond that it would take its rights back.
MLB will stream Padres games on MLB.tv, MLB.com, and Padres.com for free through the end of the weekend, and the league already has broadcast deals in place with local cable providers, according to the San Diego Union-Tribune. Channel lineups and additional details will be announced soon. Local blackouts will be lifted in San Diego as part of the arrangement.
Diamond filed for Chapter 11 bankruptcy in March and has been negotiating with MLB with its teams over streaming rights. Those talks have not progressed, and Diamond is now looking to shed television contracts that are not profitable. The Padres and Diamond were in the middle of a 20-year contract worth $1.2 billion through 2032.
“While DSG had significant liquidity and had been making rights payments to teams, the economics of the Padres’ contract were not aligned with market realities,” Diamond told the Sports Business Journal in a statement. “MLB has forced our hand by its continued refusal to negotiate direct-to-consumer (DTC) streaming rights for all teams in our portfolio despite our proposal to pay every team in full in exchange for those rights. We are continuing to broadcast games for teams under our contracts.”
The Padres were one of 14 MLB teams broadcast on Bally Sports. The other 13: Arizona Diamondbacks, Atlanta Braves, Cincinnati Reds, Cleveland Guardians, Detroit Tigers, Kansas City Royals, Los Angeles Angels, Miami Marlins, Milwaukee Brewers, Minnesota Twins, St. Louis. Louis Cardinals, Tampa Bay Rays, and Texas Rangers. Those teams have not yet been impacted.
MLB recently created a local media department as it prepares to navigate broadcasting rights in the post-Diamond streaming world.