These new TV deals are undeniably a big story in Major League Baseball right now. Some feel it might be a “TV Bubble” of sorts while others see a long-term impact on teams’ finances and, in turn, their ability to spend big on players.
Tonight the Philadelphia Phillies signed a new TV deal with Comcast Sportsnet. David Murphy of the Philadelphia Daily News reported the deal. As for the terms, Kevin Cooney of the Bucks County Courier Times reports that the deal is large indeed:
Calkins Media has learned those terms include a contract believed to be in the 20- to 25-year range. Financial terms have been kept secret, but one source referred to the deal as ‘massive.’ That would fall in line with some of the other deals around the country that MLB franchises have agreed to for local rights fees.”
The current deal is worth roughly $35 million annually, so one can only imagine what the definition of “massive” is in this case. Matt Polishuk of MLBTradeRumors notes that this might push the Phillies over a significant threshold, but that does not necessarily translate to an inflated payroll:
Given the length of the new deal, the Phillies seem set to be the latest team to earn over $1 billion from their TV rights. As Murphy notes, however, it’s too soon to know how the extra revenue will impact the club’s player payroll, as the Phils have (if anything) seemingly been looking to trim payroll though they knew this TV windfall was in the offing.”
Some time ago (like in the 1960s and 1970s) baseball gave way to football in terms of popularity in part because football was better suited for TV. That’s actually still probably true in 2014, but it is nevertheless interesting that TV contracts will be such a central story for Major League Baseball in coming years. And as those developments take shape, it will be deals like this one that come into consideration, for better or for worse.