Local Rights For NBA, NHL, MLB Games Up For Grabs

Broadcast station owners including E.W. Scripps Co., Gray Television, Nexstar Media Group and Sinclair have been in discussions with leagues and teams about potential deals to carry games on free over-the-air channels, according to people familiar with the matter, as long-held media rights for teams on regional sports networks unravel.

CNBC reports regional sports networks have owned almost all local sports rights for decades, but their viability is in doubt after tens of millions of Americans have been canceling cable TV in recent years. A shift to a model revolving around broadcast stations and direct-to-consumer streaming would upend the business that saw teams and leagues reap hefty fees. It would also boost broadcast station owners leverage in carriage negotiations — and potentially accelerate cord-cutting.

The discussions come soon after Diamond Sports Group, which owns the largest portfolio of RSNs, filed for bankruptcy protection and stopped paying rights fees for some of the teams on its channels. Warner Bros. Discovery, which owns a slate of networks, said it would exit the business by year-end, putting another handful of teams on the table.

The leagues and teams began contingency planning in March when Diamond filed for bankruptcy, the people said.

Broadcasters are viewing the opportunity to carry local NBA, NHL and MLB games as an unexpected pathway to boost the fees they receive from pay TV operators like Comcast, Charter or DirecTV for the right to carry their stations.

Broadcast companies typically tie all of their stations together when they renegotiate contracts with pay TV carriers. That makes local sports unusually valuable.

If companies like Gray or Nexstar can land sports rights in several markets, they can likely use those rights as leverage to boost fees for all of their stations. If pay TV operators push back on price increases, the station groups can threaten to black out the games. Leagues typically want to avoid local blackouts which disappoint sports fans.

That dynamic has led distributors, which have also shown interest in short-term deals to carry games, to express concern to the leagues about more games going to local broadcast stations being provided free to viewers with a TV antenna and no paid package, the people said. They fear local sports moving to broadcasting could further accelerate cord-cutting.