Fox, Turner Poised To Pay Double To Renew Baseball Rights (Reports)

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New eight-year deal will increase Major League Baseball’s annual take from Fox, Turner and ESPN from $750 million to $1.55 billion, leaving NBC and CBS empty-handed.

The unchecked inflation of major sports rights continues with a deal between Major League Baseball and its current broadcast partners, Fox and Turner, to renew for eight years with deals valued at nearly $7 billion – about twice what they got for the same rights under the last contract, according to reports by Sports Business Daily, the New York Times and USA Today.

Fox has been paying about $275 million a year under its current contract with Major League Baseball. Instead, Fox will pay about $500 million per year for rights to the World Series and the right to share the League Championship Series. Coverage of the League Championship Series had been carried exclusively by Turner under the old contract.

Some of those games are expected to land on a new Fox national sports channel, tentatively called Fox Sports One, which reportedly will be a re-invention and re-branding of the existing Speed Channel.

The Fox deal is valued at $4 billion.

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Turner Broadcasting, a division of Time Warner, will pay about $2.8 billion under the contract running through 2021, or more than $300 million per year.

Under the new deal, Turner will air 13 games on Sunday afternoons, half the 26 such games it has aired since 2007. It had four division series under the old deal but will have only two under the new contract. The Sunday games will no longer be blacked out in markets where the two teams involved play.  Turner also has one wild card game per season.

Turner did acquire more digital rights that will help it feed the Bleacher Report, a web site it acquired earlier this year.

It is possible Fox may sell some of the League Championship Series games to the MLB cable channel as part of the pact.

Major League Baseball has declined comment but it was known that talks had been going on in recent months. There had been other combinations and other bidders mentioned but in the end it appears baseball will stick with its current partners.

The New York Times did the math and MLB’s annual broadcast rights from all three networks (Fox, Turner and ESPN) will grow from the current $750 million to about $1.55 billion.

Turner had reportedly made a bid that involved CBS Sports, which is its partner in the coverage of college basketball’s March Madness. There were also reports that Fox wanted to take both packages itself at a higher price.

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Sources also say that NBC Sports, which recently launched its own sports channel on what used to be called the Versus cable platform, was a bidder. One of the rights NBC does have is hockey, but that could be impacted this winter as there is currently a labor lockout which could mean a strike by players and as a result no games to air on the network.

The rights to baseball are valuable despite traditionallyu low ratings during the regular season and inconsistent viewing during the playoffs because there are no other big time sports rights to bid on, with both pro football, basketball and hockey all tied up in long term deals.

Sports and a handful of live events have become much more important to advertisers because they are among the very few things people still want to watch live, which means they are a captive audience when the commercials air – at a time many people record on a DVR and then skip the commercials.

The latest deals come only weeks after the Walt Disney Company and ABC network’s ESPN closed an eight-year deal worth $5.6 billion, or about $700 million a year, double what those same  right had gone for in the past.

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