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Regional sports network (RSN) operator Diamond Sports Group (DSG) has officially exited Chapter 11 bankruptcy protection in the US after nearly two years
The company, which will now be known as Main Street Sports Group, operates 16 RSNs under the FanDuel Sports Network banner.
The decision to adopt a new corporate brand is an attempt to draw some distance from the now-tarnished DSG moniker, while a naming rights deal with betting firm FanDuel replaces a previous agreement with Bally Sports.
Main Street Sports first filed for Chapter 11 in March 2023, hoping to strike a deal with creditors and negotiate “unsustainable” local rights deals it inherited as part of the US$10.6 billion acquisition of the former Fox Sports RSNs from Disney in 2019.
Over the past 18 months, Main Street Sports has restructured its finances, reducing its debt pile to around US$200 million, and renegotiated contracts with the National Basketball Association (NBA) and National Hockey League (NHL), as well as carriage deals with key cable distributors. DSG has also added new capabilities to its direct-to-consumer (DTC) streaming service, such as single game passes, and secured a major distribution deal with Amazon Prime Video Channels.
Main Street Sports has a much-reduced rights portfolio of 13 NBA teams, eight NHL franchises and eight Major League Baseball (MLB) clubs. During the process, DSG terminated deals with several teams that it views as unprofitable, whilst other franchises have opted not to renew their arrangements with the company.
Its NBA roster now includes the Atlanta Hawks, Charlotte Hornets, Cleveland Cavaliers, Detroit Pistons, Indiana Pacers, Los Angeles Clippers, Memphis Grizzlies, Miami Heat, Milwaukee Bucks, Minnesota Timberwolves, Oklahoma City Thunder, Orlando Magic and San Antonio Spurs.
Its NHL teams are the Carolina Hurricanes, Columbus Blue Jackets, Detroit Red Wings, Los Angeles Kings, Minnesota Wild, Nashville Predators, St Louis Blues and Tampa Bay Lightning and its eight MLB partners are the Kansas City Royals, Milwaukee Brewers, Tampa Bay Rays, Detroit Tigers, Atlanta Braves, Los Angeles Angels, Miami Marlins, and the St. Louis Cardinals.
Indeed, the Brewers and Royals only opted to renew with DSG in the past month.
That the newly christened Main Street Sports has exited bankruptcy protection was not a foregone conclusion. The company had spent big money on assets that weren’t futureproof, inherited huge contracts designed for a different era of broadcasting, and didn’t have a viable plan to cope with the way that cord cutting had dramatically undermined the economics of a business model that was once hugely lucrative.
Accordingly, few had given the traditional RSN much hope of survival in the digital era, with several teams opting for a combination of DTC and free-to-air (FTA) coverage as an alternative. Some leagues have even considered bundling local rights with national deals or adding them to first-party streaming deals.
However, despite all these factors, Main Street Sports has survived. Of course, to get to this point, it has had to rework its entire business and the company that has emerged from chapter 11 is much smaller than the one that began the process. But the truth is that local rights are still hugely attractive to fans and an important source of revenue to any league that isn’t the National Football League (NFL)
The newly christened Main Street Sports, and its three major league partners, will be happy to finally put this saga behind them. However, the question now is what does the future hold for local broadcasts? Will the RSN thrive in a streaming era, or will the rights be integrated into all-consuming DTC services? And will major league teams look to identify a new model that doesn’t leave them so reliant on rights fees?
But, for now, Main Street Sports’ NBA, NHL and MLB partners will just be happy at the end of the uncertainty. While some teams opted to pursue a new path, those with the option of staying put did just that, preferring predictability. However, the leagues and teams will undoubtedly be working on a plan B… just in case.
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