I simply do not believe direct to consumer streaming package would not make more money than RSNs. Just keep saying they'll never make metal boats because you prefer wooden boats. They have no vision. It would work. ps The metal boat argument is VERY OLD and proven wrong. But wood because wood floats and metals don't really was the consensus of experts.
So far, I don't think anyone has made streaming a profitable venture - not Amazon, not Disney, not Peacock, etc. Maybe Netflix, though I'm not positive given their ongoing spend on development The problem here is that the middleman was the one eating the losses.
Middlemen take a piece of the pie. One less mouth to feed is more money for others. Maybe some loss still is incurred, but it is still likely more profitable for Astros to take some loss at owning RSN to get a lot of money from providers versus other models.
Middleman also pays the team the rights fees that are guaranteed/set. The RSN could no longer afford to be profitable by paying out such rights fees, hence why they’re all going under despite getting money from cable/satellite providers. Everyone (myself included) thought live sports was a can’t lose investment since people still “tune in” to watch, rather than DVR or binge, and advertisers pay a premium for those spots. And yet big congolmerations that own all the RSN’s are reporting record-setting losses. I also worry about team-owned RSN’s in the off-seasons… when many (yourself included) cancel the channel. The only thing going for this current RSN is that they don’t have to negotiate any carriage deals… but the number of subscribers amongst those systems continues to decline each/every year (while those systems continue to raise the rates on long-time subscribers to try and off-set some of those losses). Hell, even DirecTV had to abandon NFL sunday ticket due to the price the NFL was charging them vs. declining subscribers. The NFL is the most bullet-proof league when it comes to viewership and even their product causes the companies to draw a financial line.
I see it more as teams wanting things to be how they were 10 years ago… and basing financia/media decisions on that vs. what seems to inevitably be happening to all RSN’s who are in bed with cable/satellite companies that are also seeing steady declines. 15 years from now, there is no way any RSN is going to be as profitable from a carriage/subscriber rate than it was in their heyday. Teams that are in position to pivot or expand their streaming platforms will be able to absorb this wave of change much easier than the ones dependent on how things used to be. As far as to why streaming doesn’t seem to be profitable… there are just too many options out there now for one singular entity to carry the majority of the market. However, this is how modern day consumers consume media… and does anybody honestly expect streaming to go away as we go forward?
$10 a month from everyone who has cable or $20 a month from people who want to watch baseball…I’ll bet on the former until proven otherwise.
The magic of the RSN is you can’t cancel the channel. Sunday Ticket was an option..a plan you could pay for or not…but if you want cable, you have no choice…you pay the RSN fee with your basic package. That’s the magic of it for these teams…because people who don’t even care to watch are still paying for it. Until that changes, streaming can’t begin to compete with that in terms of revenues for teams…which is a huge part of why player salaries look the way they do.
The solution here is for the teams to significantly reduce expenses. They have been living on paper profits that have actually been losses and it is not going to improve. The only way to cut expenses enough to make baseball work again is to cut payroll. Pay TV is dying fast and streaming is a loser. The problem with cutting payroll is that nobody wants to be first. It is a conundrum.
There is a reason people are cutting the chord. Paying for crap they don't want.Thus the cable companies are facing the wrath of consumers along with their suppliers like RSNs. It is necessary to look ahead rather than behind. You cannot sustain this failing model at which time the direct to consumer streaming takes the lead financially.
This is the idea that works when people are willing to buy the store when all they want is eggs. It's not working anymore as more and more people either don't want or can't afford such frivolity.
And yet one of the biggest reasons people cut the cord are these “hidden” fees or the arbitrary rate hikes when your “promotional” deal runs out, which they’re willing to extend if you sign a 2 year contract which also rubs people the wrong way! Until the cable/satellite companies stop the practice of all of the above, they will continue to lose subscribers every year. Their latest racket has been selling cell phone plans… they’re one step away from pivoting to life insurance.
In the past year, three major sports conglomerations/networks have either filed for bankruptcy, stated they will file for bankruptcy, or simply got out of the business all together. Every other long standing cable channel has spent a ton either developing a streaming platform or offering it as a stand alone service. I think the channels know what the future of television consumption will be in 10-15 years… we aren’t there yet, but a lot has changed from since when this website went online.
Yeah, I won’t begin to guess what will be profitable in 10-15 years, so I won’t argue with that. I know a lot less about this than the guy quoted in the article who said streaming isn’t profitable and that it’s getting worse, not better. Doesn’t seem to me we are moving out of the RSN model anytime soon.
It also doesn’t seem like streaming is going away. It’s a necessity because nobody is relying upon tvs with cable boxes/satellites tethered to them. It also doesn’t help that the guy quoted was from fox sports who got out of the RSN business awhile ago and have had the least amount of success with their streaming platform, compared to ESPN, peacock, paramount, even cbs sports. There’s going to be some sort of change. The bubble already burst on both the cord and the cord cutting, with live sports being one of the only reasons to stick with the former.
Yeah, I’m not sure if the guy has other motives…but I think it’s instructive to see that what’s happening is mirroring what he’s saying. The teams absolutely have the ability to gobble up their rights and deliver them via streaming, but instead they’re going to buy back their rights and form a new entity to run directly as an RSN. I’m not suggesting streaming can’t be a part of that, I just don’t think we’re all that close in time to the idea where that’s how these games are being broadcast, direct from team to view.
You are right. Buying back their rights just form a new RSN (a failing business model) rather than looking to the future would be foolish. The key is eliminating exclusivity which is what attracts the cable companies with their accompanying blackouts.
I'm not making an assertion to be right or wrong about other than I'm not going to pretend to know their business better than they do.
