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Bally Sports regional networks go dark for Comcast cable customers

1 month ago 46

A Bally Sports display is shown in the eighth inning of the game between the Houston Astros and Minnesota Twins at Target Field on April 9, 2023 in Minneapolis, Minnesota. The Astros defeated the Twins 5-1.

David Berding | Getty Images Sport | Getty Images

Comcast customers on Wednesday lost access to Bally Sports' regional networks a month into MLB's regular season.

Fans of 11 MLB teams, including the Detroit Tigers and Minnesota Twins, lost access to the networks that air local games early Wednesday. With the NBA and NHL postseasons in full swing, fans of teams in those leagues won't feel the effect until next season if the blackout continues until then.

Negotiations between Comcast and Bally Sports' operator Diamond Sports Group, which has been under bankruptcy protection since last year, broke down following a dispute over terms. Comcast provides cable and internet services under the Xfinity brand.

The blackout marks another pain point for the regional sports network business, which has faced pressure as consumers cut pay-TV subscriptions in favor of streaming.

MLB teams no longer available to Comcast customers

Detroit Tigers

Miami Marlins

Cincinnati Reds

St. Louis Cardinals

Tampa Bay Rays

Texas Rangers

Atlanta Braves

Los Angeles Angels

Kansas City Royals

Minnesota Twins

Milwaukee Brewers

*Note: Comcast is not a provider in all of these teams' markets.

A Diamond spokesperson said in a statement on Tuesday that Comcast "refused to engage in substantive discussions" despite Diamond offering terms similar to those reached with other distributors.

"We are a fans-first company and will continue to seek an agreement with Comcast to restore broadcasts, and at this critical juncture for Diamond, we hope that Comcast will recognize the important and mutually beneficial role Diamond and RSNs play in the media ecosystem," a Diamond spokesperson said in the statement.

Diamond's agreement with Comcast expired in the fall, but the two companies agreed to a six-month extension at the time. A Comcast spokesperson said in a statement that Diamond had the right to extend the deal by another year, "which they opted not to exercise."

"We'd like to continue carrying their networks, but they have declined multiple offers and now we no longer have the rights to this programming," the statement said. Comcast said it will provide affected customers with $8 to $10 per month in credits.

Late Tuesday, Diamond said Comcast "rejected a proposed extension that would have kept our channels on the air." The offer would have been open-ended and kept the networks on the air while negotiations continued with the aim of inking a multiyear agreement, a person familiar with the matter said.

Conversations broke down primarily over how quickly Comcast could shift the Bally Sports networks into a tiered model, meaning customers would have to opt into packages that include the channels at a higher rate rather than having them included in broader cable packages.

Pay-TV distributors have been losing customers at a fast clip in recent years as customers opt for cheaper streaming options. Comcast had more than 13.6 million pay-TV customers as of March 31, after losing 487,000 subscribers during the first quarter.

Some regional sports networks have begun offering streaming options to customers at a price point that doesn't upend the pay-TV model. Diamond has the streaming rights to five of the MLB teams that lost service on Comcast.

Carriage deals with distributors are considered key to ensuring a viable business plan and future for Diamond. In addition to Comcast, Diamond has held negotiations in recent weeks with Charter Communications — which provides pay-TV services under the Spectrum brand — DirecTV and Cox Communications.

Diamond has so far signed multiyear deals with Charter and Cox. On Wednesday, DirecTV said it also reached a deal with Diamond to continue carrying the networks. The deals extend the terms of the current agreements, with a shift to a tiered model over time, people close to the situations said.

While Diamond and internet-TV bundle FuboTV also signed a multiyear deal in December, the Bally Sports networks are absent from other major internet-TV providers, such as Google's YouTube TV and Disney's Hulu+ Live TV.

Diamond filed for bankruptcy last March. In the time since, it has rejected rights agreements with some teams, including MLB's San Diego Padres and the NBA's Phoenix Suns, which signed a deal to air games through local broadcast stations.

The largest operator of regional sports networks is looking to emerge from bankruptcy in the coming months under the ownership of its creditors and has a hearing to confirm its reorganization plan scheduled in June.

Disclosure: Comcast is the parent company of NBCUniversal and CNBC.

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