Bally Sports Plus hasn’t even fully launched across all of its markets yet – that’s set to happen on September 26. But there’s now a report from the New York Post, that the MLB, NBA and NHL are looking to purchase the regional sports networks from Diamond Sports (the division in Sinclair that owns Bally Sports). And this is all due to the fact that Diamond Sports may be forced into bankruptcy.
The report also notes that the Diamond Sports business is “hemorrhaging cash and could be headed for a possible bankruptcy filing if it doesn’t find a white knight in the coming months”.
That’s honestly not surprising. Given Diamond Sports did not renew deals with YouTube TV, Hulu + Live TV and Fubo TV for Bally Sports. And instead left users with no way to watch regional sports in these markets, until Bally Sports Plus launched, over two years later.
Bankruptcy could happen in the next 3 to 6 months
A source within Diamond Sports has said that hedge funds that have scooped up the debt from Bally Sports, could force Diamond into bankruptcy in the next three to six months.
Diamond has also been telling the leagues in recent days that if Bally Sports were to go bankrupt, it would be able to keep broadcasting games, but it would not need to pay teams their rights fees. That is because they would have protection from creditors.
Leagues are preparing for this possible bankruptcy. MLB, for example, is prepared to broadcast games in local markets, and charge cable companies the usual fees while passing the proceeds to team owners until Diamond emerges from bankruptcy. That’s where this could really affect teams. Some teams get about 30% of their revenue from regional sports networks.
The MLB has also been considering launching its own streaming service that would carry local games. And it could launch as early as next year. Now that we’re hearing about this possibly bankruptcy, this move by the MLB makes a lot more sense.