The blackout is one of the best things to happen to baseball fans in the last 20 years. Although conventional wisdom regards MLB’s blackout policy as a scourge, the truth is much different. Blackouts, which are based on territorial exclusivity, are the foundation of the sport’s economic system, and, it’s because of them that most fans today have access to an unprecedented number of games at an extremely affordable price.
Television territories that cause these blackouts are integral to the economics of the game. They’re a foundation of the very structure of the league.” – MLB Commissioner Rob Manfred, quoted by Forbes.com
Railing against MLB’s blackout policy is old hat, but new Commissioner Rob Manfred’s recent defense of the system has elicited fresh condemnation. At the heart of these criticisms is the premise that major league baseball is being greedy and short sighted by denying fans an opportunity to watch the game they love. However, when you boil down these arguments, the motive is much more self-centered. What those who call for the abolishment of blackouts really seem to be saying is: “give me what I want when I want it and at a price I want to pay.”
Before addressing some of the specific arguments against MLB’s blackout policy, it’s important to understand how it works. Basically, MLB allows teams to sell television rights in a particular market. These rights come with a guarantee of exclusivity, which enhances their value to the regional sports networks (RSNs) bidding for the contract. With exclusivity in hand, RSNs can demand larger carriage fees from cable operators, who in turn pass along sports surcharges to their customers. Everyone gets paid in the process, which is why the contract values keep increasing exponentially. This system can be extremely unfair to the consumer…unless you are a sports fan.
Because cable operators spread the RSN carriage fees broadly across their customer base, non-sports fans wind up subsidizing the cost. Of course, turnabout is fair play, and sports fans with no other TV viewing interests wind up paying the freight for other channels they don’t watch. Still, because athletic events have become such a coveted TV programming asset (i.e., it is one of the few things most people exclusively watch live), sports fans wind up coming out ahead.
Another way baseball fans have benefited from the sport’s economic framework is access…the very point of contention raised by those who oppose the imposition of blackouts. For about $120/year, baseball fans all around the country can watch just about every game on MLB.TV. However, it’s important to remember that MLB.TV is not a self-sustaining service; it is a provider of streaming broadcasts that are produced by RSNs. Without blackouts, there would be much less incentive for RSNs to bid for rights and produce games. And, without those games, there would be no MLB.TV.
Eliminating blackouts would be like removing the link in a strong chain, the consequences of which would not only be detrimental to each team’s economic health, but also limit the number of games available for viewing. The potential for such irony, like the complexity of baseball’s economic system, seems to be lost on so many who ardently oppose blackouts. So, below are three of the most common arguments followed by a more specific rebutal.
1. I am a cord cutter. Why should I pay for cable just so I can see my home team play?
Cord cutters are people who have canceled their cable contracts in favor of subscription-based streaming services like MLB.TV. The only problem is home team games are blacked out on MLB.TV. So, why won’t baseball let cord cutters root, root, root for the home team? Because, if they did, the entire system could collapse.
Sports programming is arguably the cable industry’s best defense against cord cutters. Because most people watch sporting events live, and the live games of home teams are only available on cable, sports fans are still beholden to the operators. If MLB decided to eliminate this protection, and a significant number of fans canceled their cable subscriptions as a result, the impact would ripple throughout the system. Cable operators would lose subs; RSNs would lose per-subscriber carriage fees; and eventually teams would see shrinking rights payments. How would they make up the difference? Probably by raising the price of an MLB.TV subscription.
Not only would fans face a price increase for MLB.TV under this scenario, but fewer games could also be the result. Remember, without RSNs, there is no MLB.TV, so if these regional channels were squeezed out of the mix, it’s likely that the number of available games would begin to shrink. Granted, MLB could decide to pick up the slack by producing its own broadcasts, but the cost of doing so would also be reflected in the subscription price.
It seems obvious that if everyone cuts the cord, the cost of watching baseball games on a subscription basis would go up significantly. That’s the only way to replace approximately $1.75 billion in annual revenue from regional cable television contracts, a figure that is expected to continue growing exponentially. For perspective, if MLB tried to replace that amount of money with an MLB.TV price increase, an annual subscription would skyrocket to about $800. Clearly, having a broader subscriber base subsidize sports programming works pretty well for baseball fans, so those who advocate ala carte programming should be prepared to replace the cord with a significant cost.
Hypothetical MLB.TV Revenue Replacement Model
Note: Average cost of 2014 MLB.TV assumed to be $120 (average of premium and basic subscription). MLB.TV revenue estimates based on 2013 comments from then MLBAM CEO (and current President, Business & Media) Bob Bowman. MLB.TV subs based on that estimate divided by a $120 subscription fee.
Source: Royalsreview.com and upperdeckchatter.com
2. I am from out of town and enjoy watching my favorite team play on MLB.TV, except for when a national broadcast blacks me out. I paid my subscription. Why can’t I watch every game?
With last year’s contract extension, FOX agreed to limit the breadth of its exclusivity. Instead of blacking out all games in FOX’ designated window, MLB.TV now only restricts access to the game being aired in each network affiliate’s local market. ESPN’s Sunday night broadcast is also restricted. So, unless a fan doesn’t have access to ESPN or a local FOX affiliate, they should still be able to see every game played by their favorite team.
Those without ESPN and FOX will be left in the dark when their favorite team plays on national TV, but missing out on 10 games or so is hardly cause for outrage or worthy of sympathy, especially considering the cord cutting dynamic explained above. Using the same assumptions, the price of an MLB.TV subscription would need to climb to almost $700 to replace the annual revenue from baseball’s national TV contracts. Being blacked out of a few games seems like a small price to pay for avoiding such a sharp increase in the cost of MLB.TV.
3. I live in a city that falls within the territory of my favorite team, but their games aren’t available on cable. Why is baseball preventing me from watching on line when there is no other alternative?
This argument deserves sympathy, although the claim is often exaggerated. For example, North Carolina is often cited as a market where baseball fans are victimized by MLB’s blackout policy, which restricts live streaming of games played by the Nationals, Orioles, Reds and Braves. However, each of those teams is available on cable in blacked-out North Carolina markets (MASN, which airs Orioles and Nationals games, is available on various cable systems in the state; Fox Sports Carolina airs Reds games from Fox Sports Ohio and Braves games from Fox Sports South). Unfortunately, when cable operators and RSNs can’t come to an agreement on terms, as was the case in North Carolina, fans in blacked-out markets get exposed, but that’s no different from what happens when there are contract disputes within a home territory.
If there are parts of the country in which a team’s rights holder isn’t making a reasonable effort to provide games on cable, MLB should consider ways to temporarily lift blackout restrictions. However, if the RSN is making an effort, MLB shouldn’t get involved. Otherwise, the league runs the risk of undercutting its broadcast partner in a local market, which will ultimately lead back to the team.
The number of fans who legitimately have no way of watching their favorite team is small, especially when compared to the millions who now have nearly unlimited to access the sport. Although MLB shouldn’t abandon these fans, it would be foolish to overturn a system that has served so many well.
I understand there are economics at play here, but I live in NC and pay for MLB.tv to watch the Yankees. When they play in Baltimore, I am blacked out (no cable). Not everyone is going to cut cable or pay for MLB.tv premium service, it’s not convenient for many people to go through the steps to do so. I cannot believe that there are enough of us to cripple the system and bring down the economics of baseball on TV.
I would argue that there are so many people who subscribe to cable and subsidize this system and don’t watch baseball that treating those of us who are the premium customers fairly would be better for baseball. Instead of the complaints they might get ambassadors for the sport. This isn’t about overturning a system that works well, it’s about actually being fair to those who go out of their way to pay extra to watch the sport!
I understand the desire to be able to watch every Yankee game for only $120, but that doesn’t mean the system is unfair, especially when Yankee fans in market have to subscribe to cable to watch their team. At least out-of-towners have the option of cutting the cord and only missing a small percentage of the games.
Are there enough eager cord cutters to bring down the economics of baseball? Maybe not now, but it’s easy to imagine meaningful erosion that will absolutely impact team negotiations with RSNs. Besides, if potential cord cutters are so few, then why is this even an issue?
Also, cord cutters are not “premium customers”. The premiums are the ones who pay for MLB.TV in addition to cable. They are the ones who “pay extra” for the sport. As the chart above shows, MLB.TV sub revenue is a fraction of RSN/National rights fees, so if MLB is going to cater to segment of the fan base, it would be those who have both subscriptions.
Finally, your notion of fair seems to be skewed toward your best interest. 15 years ago, you’d be lucky to see 10 Yankee games in North Carolina. Now, because of the TV system in place, you can watch 140 (plus hundreds of other teams’ games) for $120. That seems like a pretty fair deal to me.
I completely disagree. Premium customers should be viewed as the ones who make the effort and pay for the service, which MLB.tv subscribers do. Those who purchase extra innings should be complaining as well.
It’s great that I have this and NHL center ice, I love them both. I’m frustrated though that billionaires are squeezing every dime out of me when they could show some good will and make customers happy. It’s all about greed, plain and simple.
I’d be open to paying more for the service, just not cable. Hell, I can’t even watch the Yankees play in Baltimore via the Orioles feed. Baltimore is over six hours away. How is that my “local” market?
Premium implies the customers who spend the most money. MLB.TV only customers do not fall into the group.Those with extra innings aren’t complaining because it requires a cable package to purchase that product (they are premium customers), so they also get in-home market games.
If greedy billionaires were squeezing every last dime out of fans, MLB.TV would cost more than $120. Instead of being content that MLB is providing an extraordinary service at a very reasonable price, many complain about its relatively minor limitations. That’s an example of “give me what I want when I want it and at a price I want to pay.” Critics of MLB’s blackout policy need to realize that just because something isn’t in THEIR best interest doesn’t make it unfair.
Actually I just said I’d pay more for it. I’d pay a reasonable amount ($150, $175), I just think that living in a market where the closest team is 5 hours away shouldn’t trap me in a local market.
And premium is not always who pays the most. It may evoke ideas of service, effort, care, AND money. The question is of value. The people who just happen to get local baseball via their cable are not premium, they may be the most valuable, but I would think baseball would care about those who go out of there way to throw money at the league too.
You would, but how many others? And what you think is reasonable wouldn’t come close to making up the difference from RSN rights fees. MLB can’t make one-off exemptions, so the policy has to work within the framework of the economic system in place.
I’ve defined premium as customers who “go out of their way to throw money at the league” AND “get local baseball via their cable”. These people are more willing customers than cord cutters because they are full engaged.
Premium or not, the label is semantics. What counts is MLB has created a very valuable service at a reasonable price. Blackouts are what help make that service possible. The idea that it is unfair to impose them completely ignores the fundamental economics of the game. “What’s good for me” isn’t the definition of fair, even if, in this case, the current blackout system is good for fans in a situation like yours.
Try living in Oklahoma City. I am in the home territory for Houston, Texas, Kansas City, and St. Louis. And, regarding your point 2 above, those games were blacked out on MLB.TV even when the game wasn’t being broadcast on Fox Sports.
I live in Iowa, so that means the Cubs, White Sox, Twins, Royals, Brewers and Cardinals games are blacked out. It’s why kids in Iowa don’t watch or play Baseball much, and it’s why I stopped watching several years ago. MLB doesn’t care about fans in Iowa, Hawaii or Alaska. Best thing to do is turn off the tv.
Those teams are all available on RSNs with either a cable or satellite subscription, just like they where before MLB.TV was conceived, when, presumably, kids in Iowa did want to watch and play baseball.
That may be true, but not in the same area. For example, I grew up in Dubuque where they now have Comcast. This means you can watch the Cubs/White Sox on cable. Since we have that regional sports channel, our local cable doesn’t offer Fox Sports Wisconsin, Fox Sports Midwest, or whatever the Royals and Twins play on. Could you find these channels on a premium satellite package? Maybe? I’m honestly not sure how that works with the blackouts, but if that’s the case, what’s the point of MLB.tv?
And I actually think baseball is pretty strong in Iowa. It’s more the short-season with weather that make basketball/football more popular.
I agree with your premise, that for out-of-market fans, this is an amazing offer. I just think in some cases the local markets are spread out further than they should be.
I think there might be a leak in your hypothetical, needlessly alarmist replacement revenue boat.
You maintain, or at least imply, that getting rid of blackout restrictions will completely torpedo the entire current $3.57B combined cable, national and MLB.TV rights fee structure, and that that additional cost would have to be borne by the current 2,625,000 MLB.TV subscribers of today, resulting in an annual cost of, using your numbers, roughly $1,350 per year. But for that argument to work, we would have to assume the following:
– None of the people displaced by cable and national TV deals would ever subscribe to MLB.TV to replace it. You’re assuming that number would stay fixed at 2,625,000, and that everyone else would give up baseball on TV completely. This would certainly not be the case. This number would go up, and sharply; how much depends on the pricing issue contemplated in the next point. But if MLB.TV became the only game in town, the number of people subscribing to it would increase by a factor of multiples, thus keeping down the pressure to price the product too highly.
– MLB.TV would never actually try to charge customers $1,350 per year to make up every penny of the lost revenue. This would also certainly not happen. Sure, MLB.TV might raise the cost of MLB.TV to compensate, but it would be more to something like $149.99 or $199.99, maybe $249.99, but almost certainly not higher than this. Because they can only charge what the market will bear, not force the market to pay something most cannot afford. They would do just as well charging 18,000,000 subscribers $199.99 per year as they do under the current structure, and could deliver every single one of the majors’ 2,430 game in the process.
– This assumes that entire $3.57B nut is an immutable figure that can only go up and up, and never go down in response to a changed marketplace. But the only reason the number keeps going up and up is because the market supports it, albeit a rigged market that makes people pay for programming they don’t want to get programming they do.
– This assumes MLB Extra Innings broadcast option goes out of business, and that only the MLB.TV streaming option will be available. This seems pretty unlikely to me. Between MLB.TV and Extra Innings, you could obtain 18,000,000 subscribers at $199.99 per month and keep the current revenue levels.
– Finally, this assume that baseball is incapable of coming up with other strategies to make up the difference, e.g., charging local viewers who cut the cord a reasonable amount of money, e.g. $49.99, to subscribe to all 162 games broadcast by the local team, in addition to a fee of like $149.99 per subscribe to a package of only out of town games. That way you get the best of both worlds: you get a direct revenue stream from an engaged local audience with skin in the game, which is good for advertisers, and you would continue to get revenue from those people who still want to subscribe to out of town games.
You make some excellent points about the relationship between RSNs and Baseball and why any of this is unlikely to come to pass on its own. It would have to be forced on Baseball and the broadcasters by a Supreme Court ruling. But I also think you are woefully underestimating MLB’s ability to generate revenue in such a changed marketplace, while making the (again) alarmist assumption that they will simply go out of business. Nobody capable of critical thinking would ever believe anything like that.
The replacement revenue analysis above is for illustrative purposes, the point being to show what it would take to make every current MLB.TV subscriber blackout free by eliminating the rights that create them. Nonetheless, a few responses:
MLB would NOT do just as well charging 18,000,000 people $199 because they would then bear the burden of producing all of the games, so costs would eat into the revenue. Also, instead of having guaranteed contracts with percentage increases, MLB’s annual TV revenue would be subject to yearly fluctuations. Also, customers would be more elastic because the service provided would be more narrow.
MLB’s current TV revenues are not immutable, but they are most assuredly going to keep rising because many teams either have or are about to have very long-term deals with built-in escalators.
If MLB decided to directly sell games via MLB.TV, it would greatly disadvantage fans who only want to watch their own team, especially if they intend to keep their cable. Although MLB Extra Innings might not go away (MLB could still sell the package), local fans who now be forced to buy it in addition to their cable package. That, more than the blackouts, is unfair.
It is much easier and stable for teams MLB teams to sell rights to RSNs, who bear the market place risks and cost, then try to sell direct to fans. Take YES for example. Last year, the network had $468.5 million in annual affiliate revenue and average 223,000 households per Yankee game. If you divide the Yankees amortized rights payment of $108,716,666.67 from 2014, they would need to charge each household about $487.50 to make the same amount, and that’s before covering the cost of producing the broadcast. The reason the Yankees can get so much from YES is because YES can make so much from cable operators. That’s a much better system for MLB teams than direct selling.
Look, the point a lot of us are making is that the blackout rule is not fan friendly, regardless of the economics of it. I’m not going to weep for a bunch of rich guys. I feel like I pay more for services that I used to get for free and it keeps getting worse. Is it so bad for the fan who goes out of their way to buy your service to ask to be treated a little better? That’s what it comes down to, it’s not a purely economic analysis done on spreadsheets.
In general, that kind of MBA thinking is what is destroying businesses and entertainment in America. Instead of focusing on maximizing every cent of profit, MLB would go far to create some good will with fans by saying, “hey, you shelled out your hard earned money for our product, as a result we’re going to treat you well.”
What it comes down to isn’t that they’re doing us a favor selling us cheap MLB.tv, it’s that everyone is trying to squeeze the consumers like a lemon for every drop: cable providers, regional sports networks, the teams, and MLB.
The connection I think your missing is that the reason MLB.TV exists is BECAUSE of this system. What wasn’t fan friendly was years ago when out of town fans had NO access to their favorite teams, and many in-town fans couldn’t watch every game because all 162 weren’t broadcast.
Providing a good service at a good price should create goodwill, but apparently, it just creates increasingly unfair expectations. It’s like when people complain about the price of a stamp going up. The USPS will pick up a letter from near your house and bring it 3,000 miles across the country in a few days for $0.46, yet people complain when incremental increases occur. That’s what’s happening here. Fans are being given access to unprecedented number of games, thanks to blackouts, but some are still complaining about the relatively smaller portion they can’t watch. If anything, that’s trying to squeeze a lemon for every drop.
This is where we disagree. I don’t see me expecting MLB.tv to keep up with the promise of technology brings power and choice as squeezing the lemon for every drop. Tech solutions all end up falling under an expectation like Moore’s Law: it should continue to get more powerful, easier, and cheaper as time goes on.
This isn’t a technology issue. It’s an issue of creating an incentive to produce a product people want. In order for you to watch Yankee games, which is in your best interest, it has to be in someone else’s best interest to televise them. You are only looking at your side of the equation. I am looking at both, and concluding that having access to almost every game is a pretty good compromise from a fan’s standpoint (and, if it’s not clear, that’s what I am…a fan…not an employee of the a team, RSN or cable operator).
You’re right, it’s a great deal. But it is a tech issue too. MLB.tv is competing with the all you can eat options of Netflix or Amazon Prime. Expectations for the product, for better or worse, aren’t set by an economic analysis of the owners and TV rights, they’re set by how fans are able to view other programming.
I’m not saying the teams or leagues should be losing money in this, I just don’t agree that the cable companies can keep driving the bus. Eventually the economic model will break because people won’t want to keep paying.
There are a lot of consumers who don’t watch sports and are saying “why am I paying for that crap I don’t like or watch?” It’s in MLB’s interest (and the NHL and NBA) to get ahead of this and find a way to give the fans what they want. The cable model is dying, maybe slowly, but it’s not going to last forever.
Try living in Oklahoma City, I am in the home territory for 4 different teams (Houston, Texas, Kansas City, and St, Louis.) I couldn’t watch way more than 22 games. And, contra your point 2 above, those games were blacked out regardless of whether the games were broadcast or not.
But, you can watch if you’re willing to pay for cable or satellite (in which case, you’d have access to the games of four teams without having to buy a separate subscription to MLB.TV).
As noted in point #2, the FOX blackouts were reigned in last year. The rules are verifiable on MLB.com and countless articles about the subject.
My problem is much more simple than all of this. Major League Baseball is privileging one format over the another (cable tv over online streaming). There is no complexity in this situation; it’s unfair no matter how you look at it. Because streaming is a newer format, is it somehow not a “valid” or “appropriate” way of watching tv. I am not a “cable cutter.” I reject that term. I have never paid for cable tv., canceled a subscription, or “cut” anything. I simply choose to watch tv through a format that I can afford. I watch everything streaming. I feel like the assumption in this dialogue is that I am automatically a bad person, or not an “authentic baseball fan” for not giving an absurd amount of money to comcast every month, just to watch baseball. Should I be blacked out from being a fan of any sport, just because of economics. Is all this “blackout” bullshit really about loving a sport and wanting to support a local team, or is it about protecting corporate profits. The entire blackout system is a farce, it’s like Jean Paul Sartre’s idea of “bad faith.” I honestly think that people should be ashamed of supporting a system that openly discriminates against the working class or working poor.
Here’s what your argument boils down to: I should be free to consume entertainment in any manner I choose, but those who provide that entertainment should not be accorded similar freedoms. Unfortunately, that sense of entitlement pervades our culture.
You are under no obligation to watch major league baseball. If you want to watch TV via internet streaming, the market place gives you that opportunity. However, MLB has no obligation to provide its content via your preferred source. Of course, the fact that MLB does provide an unprecedented amount of content via streaming further invalidates your arguments.
As I stated above, and which your comments imply, the argument against blackouts is basically” “give me what I want when I want it and at a price I want to pay.”
Actually, Mr. Juliano, it is all about greed. Listen, my friend. We are the working class. The blue collar. The lower and middle class. And we do not throw and catch baseballs for a living…we are soldiers, paramedics, police officers, truckers, plumbers, secretaries, laborers, etc. And none of us will earn in our lifetime what these “boys of summer” earn in a single year. So here is what you do. Please sit down and put your seat belt on….
CUT THE PROFITS!!! CUT THE SALARIES!!! CUT EVERY DAMN THING!!!
Because without us, they are all playing the game in a cornfield with only scarecrows and cattle watching.
Get it?
I say play all the games, broadcast all the games and you will get paid whatever a fair amount is from all of us who are willing to shell out our hard earned money to watch grown men “play baseball.” Here is a hypothetical that is brain-dead easy to grasp; No player makes more than one million a year. (now we know what your starting ace will make…Every time. Every team. Every year. Yep, you got it…one cool million.)
CONSIDER THIS…
18 million viewers times a 162 local games ($1.5 per game…thats $243 a year. and 250 is our limit…sorry.)…EQUALS……
wait for it, wait for it…
FOUR BILLION THREE HUNDRED AND SEVENTY FOUR MILLION DOLLARS!
Now, take your 4 1/2 billion dollars and go play ball. Broadcast all the games, and if things get rough on you, really really rough, we will all get together and whip up some sort of charity event for you…good day.
Mr. Byrd, you’ve done a good job cutting industry revenue in half. I am sure if your employer asked you to take a 50% pay cut you would be equally gracious. Over in the real world, we understand that people get paid based upon the marketability of their talents.
As much as you would like sports leagues and media companies to televise baseball games solely to meet your needs, that’s not how things work. If we relied on your system, there would likely be fewer games to watch, which I am sure you would also complain about.
Again, I understand the convenience of wanting everything done your way, but that’s not really the basis of a sound argument.
The pure economics of the situation is that the cord cutters like me will always be a small number. Consumers are too lazy to cobble together their own channels. So, the sports networks are going to continue to be subsidized by the masses.
On the other hand, there is a core group of fans/consumers who are paying a premium (many of them still have cable so they’re essentially paying the subsidy AND for their team) for baseball (and hockey or other sports). Those of us paying a premium (and I’m defining that as paying an additional fee for the product) should be given special treatment. Period. This is no different than paying for a higher class of travel, for subscribing to the print edition of a newspaper, etc.
It’s not a matter of just wanting it the way I want it. If I pay for MLB.tv or NHL Center Ice, I’m paying a premium and I expect to get treated accordingly. Corporations have eroded everything over the past 25 years, why is it so bad to expect them to treat their customers well again?
If you are a cord cutter, MLB.TV is not a premium service…it is a standalone product that you purchase with the understanding that certain teams are blacked out. The fee you pay for MLB.TV doesn’t come close to the fees that team get from RSNs, which, by the way, make it possible for you to subscribe to MLB.TV in the first place.
The way the system works now is consumers pay the cable company. The cable company pays the RSN. And, the RSN pays the team. This setup encourages the team to sell rights to an RSN to broadcast every game. Younger fans don’t realize this, but before there was big money in TV, not every game was televised. The reason we have full saturation now is because all parties have an economic incentive to provide it.
I also don’t quite understand what you mean by “corporations have eroded everything over the past 25 years”. That seems naively wistful. After all, corporations are the ones that have invested in all the technology that has made products like MLB.TV possible. Are you really saying you’d like to go back to 25 years ago? As for me, I much prefer the current setup, which provides access to every game.
Cutting their “industry revenue” in half has nothing to do with cutting my salary in half. Cut mine in half and I cannot afford to pay for basic needs such as food, gas for my car, clothes, etc. Cut theirs in half, and what? An Audi instead of a Mercedes? 2 weeks in Cancun instead of 4? Give me a frickin’ break. And this crap about “solely to meet my needs”? seriously?
BASEBALL IS NOT A NEED!… I “WANT “, not “NEED” to watch baseball.
You, baseball players and everyone “needs” me to do what I do for a living…trust me on that one. And as for marketability of talent! Where is the “marketability of talent” and it’s ensuing millions in salary for the guy cleaning the crap out of our sewers? Or the “marketability of talent” for the firefighters that lose their lives pulling our children out of “our” burning homes? It’s become a joke. You damn right it should fit “my needs”. “Our needs”.
IT IS ABOUT US!!! Do you really not get that?
I guarantee you that mr. “ace pitcher” does not “need” an added 10 million on his contract as much as i “need” another buck or two in wages. That I have to pay another thousand dollars a year in cable bills to watch ANY of my local baseball teams games is an outright crime. Plain and simple. I reject your “marketability of talent” term and replace it with my “sensibility of budget” term. I LOVE baseball! But it should fit the budget of the minimum wage earning crossing guard, (making sure our kids don’t get splattered by traffic), more than capitalize on the marketable talent of some young prospect with a mean slider.
You know, Ol’ Scully landed a jet airliner in the Hudson river and saved hundreds of lives. I’m just curious. Where is his contract? His millions? what’s the “marketability” of that kind of “talent”?
I REPEAT…take your 4 1/2 billion dollars and go play ball. Broadcast all the games, and if things get rough on you, really really rough, we will all get together and whip up some sort of charity event for you.
Exactly what gives you the authority to determine how much money other people make? Again, people get paid based on the value they provide and the scarcity of their talents. If you want to make more money, tryout for a baseball team. When you see how hard it is to make the major leagues, maybe you’ll understand why they get paid so much.
I am glad you think you’re essential. I think my job is too. The same goes for sewer cleaners, police, firefighters, etc. What’s the difference? There are a lot more people capable of doing these jobs. The jobs themselves may be important, but the pool of people capable of doing them is vast.
If you truly believe athletes are overpaid, then my only advice to you is to stop watching. As long as you and millions of others keep tuning in, revenue and salaries will increase. Personally, I have no problem with that. For what I think is a very affordable price, I am able to watch every MLB game, which is something I could have only dreamed about as recently as 10 years ago. I don’t begrudge baseball players their high salaries. On the contrary, I am glad they are compensated so well because they provide me with tremendous amounts of entertainment.
You know Mr. Juliano, I understand everything you are saying. It is American capitalism at it’s finest. But back in the day, there were an awful lot of people who were just fine with the “few” “free” games that aired. We were not all walking around sulking for the lack of more baseball. The only way I’m watching 162 3 hour games is in a hospital room with an unwanted prognosis. (and yes, I know, no one can do that) The problem is that I cannot see ONE single game now without forking over a hundred bucks a month to some cable company. They wont even air the local games on their “basic” package. Its only on their 2nd tier package. Because they “know” it’s the only way baseball fans can see their local games now, so hey, why not capitalize a little more? you know, there are elderly people on limited incomes who just don’t want to deal with a cable box, a 30 button remote and 178 channels of what we consider entertainment today. But they would like to see a couple of their teams baseball games… like they use to. There are college kids on very limited budgets, poor people with very low wage jobs, people with various challenges on fixed incomes, on and on. What would be so wrong with still showing those “few” “free” games ON THE LOCAL CHANNELS? Why do they have to make it to where anyone and everyone for hundreds of miles in all directions has to fork over hundreds of dollars to SEE EVEN ONE LOCAL GAME? There should be a way for a fan to spend let’s say, $20, $30, even $40 a month and watch all their local teams games. If even online. I’m not interested in having those 178 channels and I’m not interested in adding another $100 a month on to my budget. You know as well as I do that the bottom line dictates this simple fact;
“we will collect more money from the masses if we deprive them of any and all local games-barring full cable subscription-, than if we were to diversify the broadcasts and offer them in smaller packages, thru different media, for lesser amounts, to suit any one particular groups specific needs.”
– That was the conclusion that a bunch of filthy rich, fat-cat businessmen came to one day in a well ventilated, marble-laiden boardroom that pisses me off!
And as far as the “scarcity of talent” thing…somewhere out there are those who occupy the top 1% of !% of their respective trades skill levels, Be they janitors, carpenters or firemen. And no one, not even those around them probably even know it. No trophies, no million dollar contracts, no bonuses…Just going to work on a mundane job for a menial wage, day in and day out, until they can hopefully, maybe, one day retire. And ya, I know what the boys of summer go thru in the minors, and it is rough. But I also know of a machinist who lost all 4 fingers and a construction worker who died from exposure to asbestos at 43. But, you know, they could never fill a stadium with paying customers. So no “marketability” or “scarcity of talent” issues there.
Your reply confuses me for a couple of reasons. First off, in most markets, there are the handful of “free games” for which you advocate. In addition to basic channels like ESPN, there are also games on FOX and local stations (like WPIX in New York). Also, I am not sure where you are from, but in NY, YES and SNY are relatively basic tier channels (available in packages that cost $50-$60/mo).
I am sorry, but if you want to watch 162 games of your local team, then it’s not fair to only expect to pay $20/month, or less than $1 a game. That’s practically the price of one movie ticket, or a dinner at a modest restaurant. The $60/month cost of a package cited above seems more than fair, especially when you factor in the other benefits that would accrue to anyone with interests beyond only baseball. You see the current structure as a scheme by fat cats, and I see it as creating incentive for teams to provided increased access and broadcast quality (and to whom should MLB be catering….the casual fan who wants to watch a handful of games, or the diehards who want to watch 162 and out of market)?
Baseball players make a lot of money because their talent is scarce and people greatly enjoy watching them. And, ironically, the very basis of your argument proves that out because it is based on the premise that baseball is a very desirable product. I really don’t get why people are offended by that, other than normal feelings of envy.
Mr. Juliano… May I suggest that you read this entire article and all the responses;
http://www.fool.com/investing/general/2014/01/12/how-the-golden-age-of-television-and-baseball-ends.aspx
The whole thing is a house of cards built on greed. In the end, you and those like you, who believe “scarcity of talent” trumps the average Americans fundamental financial considerations, will be proven wrong. The contracts are getting insane and the baseball audience in America is shrinking. MLB is eating its own tail… It just doesn’t realize it.
The article is based on an false premise (even though it acknowledges, but then ignores, the contradiction): baseball is not suffering from declining popularity. Attendance and local ratings are all very strong. What is declining are national TV ratings, but the same is true for TV across the board, which is exactly why MLB has become such a coveted TV product (it is preventing cord cutting). I realize it’s easy to look at network TV ratings and conclude that MLB is in decline, but that’s the lazy approach. Everyone else with a financial interest in the game realizes otherwise. Finally, even if the dire prediction of a TV rights bubble burst comes true, most teams have signed or are signing deals that range from 10-30 years, so for the industry as whole, it will be several years until the pain is felt (and by that time, it may have subsided).
“give me what I want when I want it and at a price I want to pay.”
Uhh, yeah. Baseball is not some Holy event that we are sometimes granted the great privilege of watching. It’s a business. They need to find a way to provide what people want and at a price people are willing to pay or people will stop watching and they’ll fail.
Exactly…based on revenue figures, RSN ratings, and MLB.TV subs, it seems as if MLB has found a price point that is attractive to fans and good for business. There’s nothing wrong with the “give me what I want” argument as long as fans own it. The portrayal of blackouts as a moral cause is disingenuous and belies the true motive of self interest.
Maybe I have missed a basic premise in the home territory discussion. I am a Dodger fan and recently moved to Albuquerque, NM from Phoenix. When in Phoenix and the Dodgers were playing the Diamondbacks in Phx, I would have to watch the game on direct tv thru the local Fox sports network channel, or attend the game. MLB has designated Alb, NM as a home television territory for both the Rockies and the Diamondbacks. As a result, I am not able to watch the Dodger play either of the two teams which amounts to about 36 games a year. If these games were carried on one of the Fox sports channels on Directv then I would quit crying and watch the game with the other team’s announcer. In this situation, how is the home territory helping the Dbacks or Rockies as people in this town are not driving 7+ hours to attend a game in either ball park and there is no commercial revenue from Directv for either of these teams ??
I neglected to add I am a MLB.tv subscriber.
Although there are some questionable territorial assignments, the markets are based on TV concerns, not attendance.
I checked online and Fox Sports Arizona and Root Sports Rocky Mountain are both available on DirectTV, so you should be able to watch the Dodgers on those channels when they play the Dbacks and Rockies.
Southern New Mexico here. Blacked out for any games involving Arizona, Colorado, Texas, and Houston even though it would be a 10 hour drive to watch them play. Being a Diamondback fan is aggravating as there is no reasonable reason to expect me to come fill the seats to avoid the ‘local’ blackout, and being in market means I cannot view the game via MLB.tv.
Isn’t FOX Sports Arizona available in southern New Mexico?
The thing that is wrong with the MLB blackout policy is that in some areas, the cable company does not provide the proper channel needed to watch the game. I live in central VA and am blacked out from both the Orioles and the Nationals. Comcast is the only cable provider that I can get and they do not offer MASN in any of their cable packages. I am an Orioles fan and am unable to watch Orioles games because my local cable provider does not offer the proper channel and MLB TV has a blackout restriction. If a blackout restriction is put in place, MLB needs to be sure that the local cable provider provides the proper channel. Otherwise you will be in my situation which is that you are unable to watch your favorite team altogether.
Can you not get DirectTV or FIOS? If Comcast has been unable to reach a carrier agreement with MASN, then there are usually other options (as is the case in the NY area with Comcast dropping YES).
MLB can not dictate the terms to cable providers and RSNs. That must be negotiated between them.
FIOS in not an option. Direct TV is risky because when renting, not all places allow satellite dishs and you have to sign a 2 year commitment. If you have to move to a place where they do not allow a satellite dish, you are stuck paying the money anyways. There are also places (which is the situation I am in now) where I am unable to receive a direct tv satellite signal do to the location of my apartment. Not to mention, Direct TV is already more expensive than cable and in order to get the proper channel (MASN), you have to move up to the third level channel package. I have no problem with the black outs, but if MLB has a blackout policy for a specific location, they need to be sure that the local cable provider provides the proper channel. If local cable provider does not provide the proper channel, MLB should allow users to be able to watch that team on MLB TV.
MLB can’t do as you’d like because if the local cable company isn’t carrying the RSN, it’s because it is having a dispute over rights fees. If MLB lifts the blackout in such circumstances, than the RSN would have no leverage, and, as a result, the games would have less value. Most places in the country can subscribe to FiOS or a satellite company, as well as use services like Sling Box, so there are alternatives in places where the local cable co. is not carrying to RSN because of a dispute (which is often temporary any way). MLB shouldn’t have to structure its system around the rare instances when the local cable co. is the only option.
The local cable company not having the proper channel is not a rare instance. It is far too common. In addition to central Virginia, North Carolina is also blacked out from Orioles games and Nationals games. MASN is not provided by Time Warner Cable. Some places in North Carolina (Charlotte for example) is blacked out from Reds games (in addition to Orioles, Nationals, and Braves). That is ridiculous. Charlotte does not show the local Cincinnati channel for Reds games. Charlotte probably will never get the local Cincinnati cable channel and why would they? I travel a lot for work and was in Las Vegas last week. While I was there, I discovered that Vegas is blacked out from 6 teams (Giants, Dodgers, Athletics, Padres, Diamondbacks, and Angels). There is no way the local cable provider provides all of those channels (maybe even none of them). Not to mention, on days where those six teams do not play each other, the people of Las Vegas will be blacked out from watching 12 of the 30 MLB teams. That is almost half the league. Those are just a few examples but there are many areas around the US where people are blacked out from watching their favorite team on MLB tv and their cable provider does not provide the local channel. These situations are not often temporary as you say. All of these issues I listed have been like this for years and there is no indication that the local cable provider will provide the proper channel any time soon. If the local cable provider is in dispute, then MLB should lift the blackout restriction until the dispute is resolved and the cable provider has the proper channel. That is not the case for all of these instances however. I do not think Charlotte isn’t showing Reds games due to a dispute, it is because Cincinnati is over 450 miles away and not in any way local. The point is that there are many places around the US where people are unable to watch their favorite team and it has nothing to do with cord cutting. Look at each team and see all of the places they are blacked out. I am a fan who wants to wants to watch my favorite team and I am willing to pay for a subscription to MLB TV or to my local provider, but I am unable to due to the blackout restriction. That is ridiculous.
I agree that there are increasing instances of cable companies refusing to pay up for RSNs. However, there are always alternatives for a vast majority of those affected. For example, I looked at DirectTV’s website, selected a LV zip code, and found at least 4 of the RSNs for the teams you mentioned above. These games are available in the blacked out markets, but you have to shop around.
If some consumers aren’t willing to switch providers to get the games, why should MLB re-structure its system to accommodate them? For the reasons I cited above, the blackout system has helped increase the number of games available to most baseball fans. That is what should define the system…not the small number of people who are physically unable to get a local team’s RSN in a blacked out market.
The thing is that it is not a “small number of people who are physically unable to see their local team.” Look at each team and where their black out area is. Most team’s blackout area extends a lot further than their local area. In addition to my Las Vegas example, Iowa is blacked out from the Twins, Brewers, Cubs, White Sox, Royals, and Cardinals. In Oklahoma you can’t watch the Cardinals, Royals, Astros or Rangers. The Reds blackout area, besides Ohio, extends to Kentucky, West Virginia, North Carolina, Tennessee, Indiana, and Mississippi. Why on earth would the local cable company in Mississippi subscribe to Fox Sports Ohio? There is no reason why MLB TV should block out Reds games from Mississippi. The vast majority of the US is blacked out from at least 2 teams. It is not just the blacked out teams that can cause the problem, it is also who the blackout teams play. Let’s say you are a Rockies fan living in Las Vegas. Because the rest of the division is blacked out, a Rockies fan will miss a minimum of 72 games a season. I’m traveling to Indianapolis this weekend for work and will be unable to watch the Orioles game because they are playing the White Sox which is one of three Indianapolis blackout teams (along with the Cubs and Reds). As I said before, understand why blackout are needed. However, the area in which the blackout extends need to be reduced and MLBTV should allow games where the local cable provider does not provide the channel.
Yes Direct tv is sometime an option, not always due to the circumstances I listed in a previous comment. Is the Rockies fan who lives in Las Vegas supposed to buy MLB TV for all Rockies game that are not blacked out and then buy direct tv with all the channels for the blacked out teams? Direct TV is really expensive (and the price sky rockets during year 2 of the contract) and usually to get those specialized channels you have to get one of their more expensive TV packages. I had direct TV at one point so I could watch Orioles games. I could have spent $50 a month for a tv/internet package with my local cable company but was spending about $103 a month just for Direct TV (plus $30 for internet from my local cable company). That cost me about $1,000 extra a year. Seeing how MLBTV is only $110 (or $85 for one team) for the whole year, having to pay for direct tv because you want to watch Reds games in Mississippi, or in my case, and Orioles game in central VA, is ridiculous.
As mentioned, most of the people in the blackout zones can subscribe to a service that gets their local team. Basically, anyone who can get DirectTV has a viable option. Granted, there are some who can’t use that service, but that number is very small. In all of the market examples you cited, there is at least one provider who offers the RSNs for the covered teams. If a fan decides they do not want to switch providers to get the desired channels, or spend more money to do so, it shouldn’t be baseball’s responsibility to dismantle a system that has benefited the vast majority.
I understand what you are saying and what your argument is. Yes Direct TV is an option for most people and with it you can get channel you need. Fair enough. My point is that MLB has this product (MLB TV) they offer to let people watch their favorite team for $85 a season (or all teams for $110 a season). Then MLB tells a Reds fan, who happens to live in Tupelo Mississippi, that they cannot use MLB TV to watch their favorite team because the Cincinnati Reds say that this person, living in Mississippi, is in the local area Cincinnati Ohio. Despite what the Reds say, Tupelo is not in the local area of Cincinnati. It is over 480 miles way with 2 states in between. That example (and there are many others I could have used) is a ridiculous blackout restriction. It is ridiculous to ask a fan to buy an expensive, 2 year commitment, Driect TV package (far different from a basic cable package) which would cost them more in one month than the entire season of MLB TV would cost. I just can’t agree with the title of your article when you say “There is nothing wrong with MLB’s territorial rights.” I think that there is something wrong when as many at 6 teams can claim the same local area when that local area can me more than 700 miles away. I understand having blackout areas, but the blackout areas need to be in the actual local area (maybe 50 to 100 miles around the city).
MLB’s territorial rights are a total joke.
I’m currently living in Fort Wayne, Indiana for work. Generally, Chicago Cubs and Chicago White Sox games are available locally on CSN Chicago.
But one problem is this: Some Cubs games are broadcasted on WGN, WLS, and WPWR. Luckily, a local TV station in Fort Wayne carries most games that air on WGN, but not WLS or WPWR. Today’s Cubs/Rangers game was broadcasted on both WLS and TBS, but the game was blacked out on TBS and WLS is not available in Fort Wayne.
So I didn’t get to watch today’s Cubs game.
One other thing about the blackout rules. Cubs/White Sox and Cincinnati Reds games are available locally usually through CSN Chicago and Fox Sports Midwest (or FSN Indiana or FSN Ohio, whichever.) But today’s Tigers/Royals game was blacked out on MLB Extra Innings. Yet no Tigers games are ever offered through cable or satellite. Fox Sports Detroit is not available in Fort Wayne, even though Detroit is much closer than Cincinnati. And Tigers fans in Fort Wayne will never get to see their team.
What a joke.
This week Comcast is offering a free MLB Extra Innings preview. Great, now I can watch the Cleveland Indians, a team I grew up watching in Ohio. But the problem there is that the game was available in Standard Definition -only, and I had to listen to the Twins’ mind-numbingly boring announcers for all 9 innings.
Who would pay $100’s of that crap?
I understand the frustration, but you’re basically calling the entire system a joke because you don’t have access to a handful of games without acknowledging, as I outlined above, how the current system has made it economically feasible to provide you with access to the rest of the games at a relatively low cost.
Alternatives to the blackout system would either be a much higher cost to stream games on demand or a more limited distribution arrangement directly between teams and region channels willing to pay for games. The result of that will be less access and higher cost for the typical fan.
Braves and Reds, particularly, are blacked out HOURS away from the cities in which they play. How does this make sense? My father coached the father of a Braves player. He really wants to watch Braves games. He lives in Brookhaven, MS, about 7 hours one way from Atlanta. He is not, nor ever will be, attending games. Why is it that he is not allowed to follow his team? Makes no sense. As far as I am concerned, as a non-baseball fan, let the blackouts continue, and let the most boring game in all of sports go ahead and die. Screw the Braves. If baseball dies completely, as it should, ESPN and other networks can focus on true sports. Maybe we need another baseball strike, along with these slap-in-the-face blackouts to finally rid America of this so-called sport. As for this article, it is idiotic. You cannot rationalize blocking fans of teams from being able to watch their teams.
If your father subscribes to CableOne in Brookhaven he can watch every Braves game. This is the same requirement for every other fan in a local market. Not sure why you think your dad should be different, though your inability to articulate a reason supports the premise of the article. Luckily for baseball, it is doing extremely well without you.
[…] MLB could relax the television blackout restrictions in the remotest parts of the country. Although the current system of blackouts is often unfairly maligned, making exceptions for areas not served well by providers would seem to be a prudent way for MLB to […]