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State of the Screens

Sinclair Buys Regional Sports Networks From Disney in $10.6 Billion Deal

By May 7, 2019No Comments

The big deal: Sinclair Broadcast Group (SBG) is buying 21 regional sports networks (RSNs) from Disney for ≈ $10.6B.

The YES Network recently sold in a separate deal for ≈ $3.5B.

Key details for the RSNs:
1) 21
2) 42 teams
3) $3.8B in revenue
4) 74M subscribers
5) $51.35 in revenue per subscriber/year
6) $4.28 in revenue per subscriber/month

Why this matters #1: These RSNs carry 42 different MLB, NBA, and NHL franchises which will provide SBG with a massive distribution footprint to go along with their local TV stations.

Why this matters #2: Local baseball is the most-watched primetime program (broadcast or cable) in 11 of the 29 markets narrowly missing out on the 12th by one-hundredth of a point (New York Yankees).

Why this matters #3: Early estimates had the value at $16–20B and the final sale price ($14.1B) is 21–30% lower. Is this the first sign that sports media rights have peaked or just a blip?

Did someone say profit? The average MLB team generated $40M of profit last year.

MLB team profit by year according to Forbes (YoY growth):
1) 2017 — $29M
2) 2018 — $40M (↑ 27%)

Damn: The average MLB team is now worth $1.8B which is up 8% YoY. It looks like Mrs. Screens, and I are going to be cutting back on eating out to save up the $1.1B for our Reds (still the plan BTW)!

More #1: Sinclair to Acquire Sports Networks From Disney

More #2: Baseball Economics And The Fate Of App-Based TV

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.