Chicago Cubs President of Business Operations Crane Kenney recently appeared on 670 The Score to discuss, among other things, the state of Marquee Sports Network amid a turbulent few years for Regional Sports Networks in general, and the ongoing Diamond Sports bankruptcy (the Bally Sports RSNs), specifically. The short version: in a world where more and more customers are detaching themselves from traditional cable, and more and more traditional cable providers don’t want to pay steep carriage fees to carry RSN channels … what, uh, is going to happen?
Even more specifically, Marquee’s deal with Comcast – by far the largest single cable provider in the Chicago Cubs’ TV footprint – expires in September, and Comcast has taken a very aggressive stance with respect to not carrying the Bally RSNs at the price Diamond is seeking. So, again … what, uh, is going to happen?
Well, if you’re looking to be put at ease, you won’t find it right now. The situation across the industry is simply that troubled (for everyone except the Dodgers, that is). Some of Kenney’s comments, with the emphasis mine:
“I wish the clock was turned back to 2011 in that regard,” Kenney said on the Bernstein & Holmes Show. “Because the market is in turmoil. You’ve got half the RSNs in bankruptcy, being rejected in their rights agreements. You got wonderful markets like Atlanta – like if you’re a Comcast subscriber in Atlanta, you can’t watch the Braves today. If you’re a Comcast subscriber in Milwaukee, you can’t watch the (Brewers) today. If you’re a Comcast subscriber in Detroit, another great baseball market, you can’t watch the Tigers today. They’ve been dropped. Jerry (Reinsdorf) is parting with Comcast here. They’re dropping those three teams (White Sox, Bulls and Blackhawks). So Comcast has made it pretty clear that they are exiting the sports market. And half of our homes are Comcast homes. And our contract with Comcast ends in September. So trust me, the reason I spend – other than worrying about our batting average with runners in scoring position – the other thing that keeps me up all night is worrying about what’s going to happen with distribution …. They’re doing a great job on the programming side, but I think distribution is going to be a challenge. And I’m sure you’re going to be asking me … in September, you’re going to go, ‘Hey, what’s going on now?’ Because it’s going to be bumpy.”
It’s hard to take that any other way than you, Comcast customers, are being primed to lose Marquee as part of your plan come September. It isn’t a guarantee – live sports are still very important to cable providers, and there are various tiers where you maybe make something work – but that’s the unambiguous warning here.
For Cubs fans who have Comcast, the threat is obvious: you might lose Marquee, and the games exclusively broadcast there (which is the vast majority). Thankfully, we at least now live in an era where you can subscribe directly to a streaming version of Marquee, but I expect not everyone will want to have both a cable package AND a Marquee subscription, and/or will not want to have to choose between the two. It’s going to be a serious problem for a lot of fans.
For the Cubs as an organization, the threat is equally obvious: these carriage deals provided the bulk of value for a team’s broadcast rights over the last couple decades. The cable providers pay the RSN a per-subscriber fee for the right to carry the channel (and thus the games), and they pay it regardless of whether each customer is ACTUALLY watching the channel. If that revenue stream goes away or is dramatically curtailed, it will be very difficult – probably impossible – to replace by way of streaming subscriptions, in-house advertising, and one-off broadcast deals with over-the-air networks.
The good(?) news is that none of this is a surprise. This has been on the horizon for yeeeeeeears. So you’d like to think the Cubs and Marquee have long been prepared for this inevitability, and will stand ready to immediately deploy a plan to (1) maximize the EASY and REASONABLY-PRICED ability of fans to see Cubs games in September and beyond, and (2) maximize the revenues any approach generates so that we don’t have to start worrying about the Cubs tightening their belts further and attributing it to cable losses.
written by
Brett Taylor
Brett Taylor is the Lead Cubs Writer at Bleacher Nation, and you can find him on Twitter at @BleacherNation and on LinkedIn here.Brett is also the founder of Bleacher Nation, which opened up shop in 2008 as an independent blog about the Chicago Cubs. Later growing to incorporate coverage of other Chicago sports, Bleacher Nation is now one of the largest regional sports blogs on the web.
