Three regional sports channels find new owners

The shifting landscape of regional sports networks will settle in three markets after their soon-to-be former owner made deals to sell them to teams.

Warner Bros. Discovery (WBD) Sports will sell AT&T SportsNet Pittsburgh to Fenway Sports Group and is negotiating to sell AT&T SportsNet Southwest to the Houston Astros and Houston Rockets, according to John Ourand at Sports Business Journal. 

The Pittsburgh channel is the cable home for the NHL's Penguins and the Pirates of Major League Baseball. The Boston-based Fenway Sports Group owns the Penguins and already has a regional channel in its portfolio, New England Sports Network (NESN), as the owner of the Red Sox. Houston's channel is being sold to its primary content providers, with the aim of completing the sale before the Rockets start their 2023-24 NBA season.

A third regional sports network (RSN), AT&T SportsNet Rocky Mountain, is likely to sunset, according to Ourand. This would make the Colorado Rockies free agents of sorts, and the baseball team has spoke with the other RSN in the Denver region, Altitude Sports. Ourand explains how the end of Rocky Mountain could help Altitude:

Altitude is hoping that a deal with the Rockies — and its 162-game season during the summer — will help it resolve its dispute with Comcast, which owns the market’s dominant cable system in Xfinity. Comcast has not carried Altitude since September 2019, and no agreement appears to be on the horizon.

In February, WBD announced that it planned to get out of the RSN business and began exploring the sale of the channels it held stakes in. The decision is a part of WBD's continued strategy to cut costs just over a year after its still-controversial founding where AT&T spun off WarnerMedia (formerly Time Warner), clearing the way for a merger with Discovery Communications. WBD has laid off thousands of employees, written down several completed films and TV shows for tax purposes, and has returned to licensing its content with streaming services such as Netflix to generate revenue.

However, the decision to sell the channels also came as the largest owner of RSNs in the United States, Diamond Sports Group, prepared to file for Chapter 11 bankruptcy. Regional sports networks, like their nationwide counterparts, have been greatly impacted by declining cable and satellite subscriptions as well as the corresponding cord-cutting by sports fans. Diamond Sports Group's issues run deep as it was challenged by a massive debt load, management shuffles and the inability to gain streaming rights to MLB games, which have value due to the season's length.

For the teams acquiring the channels, little may change in terms of production and staffing. In fact, those who work for the channels may feel some relief in knowing that their owners have even more investment than WBD. Ourand reports that the Pirates may negotiate with Fenway to remain on the channel but may also allow MLB to retain its broadcasting rights, which is something that happened when the San Diego Padres and Arizona Diamondbacks split from Diamond Sports earlier this year.