Remember that massive Dodgers TV deal with Time Warner that was locked in a few months ago? Looks as if it hit a snag. The plan is to carry all Dodger games on a new regional sports network named SportsNetLA. In the deal, the Dodgers are the product with Time Warner Cable taking care of the business operations side handling advertising, affiliate sales agent, and channel operations manager.
So what’s the problem? The deal hasn’t been submitted to Major League Baseball for approval. The twist to that? The MLB wants to know exactly what its cut of the $7 billion, 25-year television deal will be.
To summarize what’s in dispute, the current collective bargaining agreement’s base portion of the revenue-sharing plan calls on MLB teams to contribute 34% of net local revenue. But the way that figure gets calculated is becoming increasingly blurred by stuff like these regional sports networks and who owns them. The Dodgers’ deal is even blurrier. So now everything from rights fees, naming rights, guaranteed carriage money, and other revenue expected to go into the owner/investment groups’ wallet can be picked by MLB’s revenue-sharing plan.
Yikes! TV rights have been a gold mine for owners. Of course the MLB wants to ensure they get the most out of this scenario that they can. This is a business, never forget that.