Sinclair Broadcasting Group’s Bally Sports has gone through a lot of changes over the course of the year. The regional sports networks rebranded from Fox Sports to Bally Sports earlier this year with a future focus on allowing in-game sports betting. Bally Sports has also announced plans to revolutionize sports viewing by launching a Direct-To-Consumer option for their RSNs for $23/month. When Sinclair CEO Chris Ripley was discussing the idea of offering a DTC service after negotiating with the leagues, teams, and distributors, the idea sounded promising, though too expensive according to consumers.
However, two executives of major cable distributors have now told Sports Business Journal’s John Ourand that they’ve been “in the dark” about Bally Sports DTC plans. On Monday, Ourand detailed his conversations with the executives with the following:
“Execs from two big distributors, both of whom asked to remain anonymous, told me that they haven’t had meaningful contact with Sinclair and are in the dark about the company’s DTC plans.
The distribution execs warned that they would consider dropping the RSNs — either through contractual provisions or through expirations of contracts, which typically last three years — if Sinclair moves forward with plans to launch an unauthenticated DTC service that allows people to watch MLB, NBA and NHL games without the need for a pay-TV subscription.
They both said they feel emboldened by Dish Network, which dropped the RSNs in 2019 and does not look likely to carry them any time soon. Dish Net’s deal with Sinclair’s local broadcast stations is believed to be expiring this summer. Sinclair may try to use the local station negotiations to get Dish to carry the RSNs. But the distribution execs believe Sinclair’s DTC announcement makes it less likely that Dish will agree to an RSN deal.”
This is interesting news because it does not align with Ripley’s earlier comments as these distributors may end up dropping RSNs. As of today, the only streaming provider that currently offers Bally Sports RSNs is AT&T TV. Other popular streaming providers such as YouTube TV, Sling TV, and Hulu with Live TV have discontinued the Bally Sports RSNs at various times over the last three years due to not being able to reach an agreement with Sinclair over carriage fees.
If cable distributors discontinue carrying the RSNs due to offering a DTC option then Sinclair may not be able to accomplish their goal of a $23/month price point. Plus with the low price of streaming content from Peacock, Netflix, Hulu, and more, Sinclair may be facing an uphill battle due to being nearly double the price of other services. There will have to be a market of customers that see the value of nearly double the monthly costs for live sports.
The caveat is that the executives Ourand spoke to are anonymous so we don’t know who these distributors are. They may have already had plans on dropping RSNs, but this could lead to a delay in Sinclair’s plans of launching the service in 2022.