Regional Sports Network Chaos Creates Team Payroll Problems

After a full season of uncertainty for MLB thanks to Diamond Sports Group’s ongoing bankruptcy, the other shoe is dropping for clubs planning for the 2024 season.

The embattled Bally Sports parent told a U.S. bankruptcy court in Texas on Wednesday that it no longer has any ties to the Minnesota Twins, as the company’s rights deal with the club expired with the end of the 2023 season. 

As a result, the AL Central champions said they are planning to retreat — at least to some degree — from this year’s franchise record payroll of $156 million.

“We’ve pushed our payroll to heights that we had never pushed it before with the support, certainty, of ownership,” Twins GM Derek Falvey said at this week’s MLB GM meetings. “We know there is some natural ebb and flow to that. Will it be where it was last year? I don’t expect that.”

Broad Impact

The Twins are not alone. Even as DSG said earlier this week it intends to keep 10 of the 12 MLB teams it aired throughout the 2023 season, the economics surrounding those decisions are murky, and the company still left open the possibility that more MLB club rights could be rejected before the end of the year. 

DSG itself continues to face challenges from its creditors, distributors, pro teams in other sports — even its own parent company, Sinclair Inc. — and it isn’t certain that the company will survive Chapter 11 reorganization. 

As MLB prepares to handle the local rights for as many as 16 teams, as of last year, commissioner Rob Manfred acknowledged teams will suffer at least a short-term revenue hit during this transition period.

“It’s certainly daunting,” Brewers GM Matt Arnold told The Athletic. “We just have to make sure we, as an industry, are aligned with the best ways to generate revenue … It’s certainly a challenge in our industry for sure, especially in the smallest market in the league.”

DSG’s reorganization bid was aided earlier this week by a deal with the NBA, which will regain local rights currently held by Bally Sports at the end of this season.