MLB Media Rights Play a Major Role in Franchise Valuations

MLB franchise values are growing more slowly than those of other major U.S. sports leagues. Over the past five years, NFL teams have risen 87% on average to $5.7 billion, and NBA teams have surged 101% to $4.4 billion, while MLB clubs have increased just 36%.

According to Forbes, the gap stems partly from MLB’s structural issues, including the absence of a hard salary cap and looming labor tensions, with the collective bargaining agreement expiring in 2026 and the players’ union warning of a potential lockout. However, the primary driver is the media rights landscape.

The NFL’s 2021 TV deals secure $126 billion through 2033, and the NBA’s 11-year broadcast contracts, starting next season, are worth $76 billion. MLB’s current agreements with ESPN, Fox, and TBS total $12.9 billion over seven years, but the league recently opted out of the final three years of its ESPN deal ($550 million annually) to pursue new partners. The 2023 collapse of Diamond Sports Group (now Main Street Sports Group), a key regional sports network operator, further complicates matters. Post-bankruptcy, many MLB teams secured new broadcast deals at steep discounts, critical given that local cable accounted for 19% of team revenue last season—far higher than the NBA (13%) or NFL (negligible).

MLB believes it can secure better promotion and revenue by diversifying its broadcast partners. With national TV deals expiring after 2028, alongside a smaller Apple digital agreement, Commissioner Rob Manfred is eyeing a media overhaul. This includes centralizing local media rights, similar to the NFL’s Sunday Ticket, and potentially bundling domestic and international rights, leveraging the global appeal of players like Shohei Ohtani. Ohtani’s 2024 playoff games drew massive Japanese viewership, boosting MLB’s Asian corporate partnerships.

Sponsorship revenue is also rising, with 24 teams now featuring jersey patch logos, generating over $200 million in two seasons. The Washington Nationals aim to join this program, and MLB’s sponsorship growth now outpaces other major U.S. men’s leagues.

Recent rule changes have shortened games and increased on-field action, driving regular-season attendance to 71 million in 2024—the highest since 2017. Team revenues averaged $407 million, up 8% from 2023’s record $378 million.