An image of a Bally Sports display from the eighth inning of a game between MLB’s Houston Astros and Minnesota Twins at Target Field in Minneapolis, Minnesota, is shown. The date of the game was April 9, 2023.
Photograph by David Berding | Getty Images Sport | Getty Images
The future of Diamond Sports, the owner of the largest network of regional sports networks, which operates under the Bally Sports brand, is causing concern for the National Basketball Association and National Hockey League. There are worries about whether Diamond Sports can develop a sustainable business plan before the upcoming fall seasons.
Diamond Sports has been in bankruptcy protection since March of the previous year. The leagues are anxious that Diamond Sports may not have a feasible business plan ready before the start of the 2024-25 season.
These concerns were voiced by league attorneys during a status conference in bankruptcy court. This came after Diamond Sports announced a delay to its hearing to confirm its reorganization plan from mid-June to late July.
“I wish to underscore the importance of timing for the NBA. The 2024-2025 season is fast approaching,” said NBA attorney Vincent Indelicato in court on Tuesday. “A considerable amount of work needs to be done well in advance of the season to properly produce and distribute games.”
The NHL attorney expressed similar anxieties, suggesting that if Diamond Sports cannot develop a sustainable business plan soon, the leagues may have to scramble to find alternatives to produce and broadcast games in local markets. Some Major League Baseball teams have already moved forward without their Bally Sports network.
Several NBA and NHL teams have already secured deals with local broadcast station groups to air local games.
Diamond Sports needs to formulate a reorganization plan that outlines its future post-bankruptcy protection, and this plan needs to be approved by the court. This approval allows a company to exit bankruptcy protection.
The NBA is pushing for Diamond Sports to present a well-defined business plan by July, according to Indelicato.
Diamond Sports has been on a long journey to create a reorganization plan, involving various negotiations – with lenders to restructure its significant debt, with leagues and teams for streaming TV rights, and with pay-TV distributors who broadcast the games.
The recent breakdown of negotiations between Diamond Sports and Comcast Corp. has disrupted the progress of the sports network operator, according to its lawyers.
Comcast customers lost access to Bally Sports networks last month, which impacted fans of 11 MLB teams. However, this has not yet affected NBA and NHL fans as both leagues are currently in their postseason. Regional sports networks usually broadcast regular season local games.
On Tuesday, the Diamond Sports attorney stated that the company is still negotiating with various stakeholders, but it has reached a deadlock with Comcast, leaving it with no other option but to “explore alternatives.”
Comcast, among other distributors, has seen a rapid decrease in pay-TV customers in recent years as people switch to streaming alternatives. Regional sports networks have been hit hardest. Additionally, Diamond Sports is burdened with a debt of over $8 billion from Sinclair‘s acquisition of these networks in 2019.
Disclosure: NBCUniversal and CNBC are subsidiaries of Comcast.
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