In a stunning announcement from a Texas courtroom on Wednesday that could be immediately costly for clubs like the Cardinals but ultimately better for fans eager to watch games, Diamond ÁñÁ«ÊÓƵ Group, parent company of Bally ÁñÁ«ÊÓƵ Midwest, signaled it could drop broadcasts for the Cardinals and several other MLB teams if unable to renegotiate deals for 2025.
An attorney for Diamond ÁñÁ«ÊÓƵ said in a hearing that a revised plan to emerge from bankruptcy could include keeping the broadcast deal with one club, the Atlanta Braves, while dropping others. Diamond ÁñÁ«ÊÓƵ has approached the Cardinals about renegotiating the current broadcast rights agreement to continue carrying games in 2025, and the implication made in court Wednesday was what could happen if those discussions falter.
While other teams have been unplugged, the Cardinals, for now, are on time delay, still potentially on Bally ÁñÁ«ÊÓƵ but awaiting a clear signal on their broadcast options.
“Our situation remains unchanged despite news from Diamond ÁñÁ«ÊÓƵ today,†said Anuk Karunaratne, the Cardinals’ senior vice president of business operations. “We remain focused on our alternatives, including a renegotiated agreement with Diamond ÁñÁ«ÊÓƵ. The good news is fans will be able to access our games next season, and we’re hopeful this will include an option for in-market streaming.â€
While the hearing Wednesday in Houston was the latest curveball in the cable chaos — especially when initial statements by Diamond ÁñÁ«ÊÓƵ lawyer suggested they would reject deals with 11 teams — it did also provide some clarity. A revised plan to emerge from bankruptcy will be voted by creditors ahead of a confirmation hearing in mid-November. The Cardinals are not involved in that case, but if the plan is rejected and Diamond ÁñÁ«ÊÓƵ liquidates, they would be part of the unwinding.
Diamond ÁñÁ«ÊÓƵ has an agreement in place to broadcast its local NBA and NHL teams through the 2024-25 season, and the Blues will remain on Bally as part of that deal.
The Cardinals are in the midst of a 15-year, $1.1 billion rights deal that extends through 2032 and included an ownership stake in Bally ÁñÁ«ÊÓƵ Midwest.
As part owner, the Cardinals are considered a “joint-venture partner†and are outside of the bankruptcy case. They have been firewalled from much of the turbulence in the cratering Regional ÁñÁ«ÊÓƵ Network model due to their ratings, their revenues, and that partnership, but they’ve been preparing for it to reach them. The Cardinals received all of their scheduled payment for the 2024 season, and they only recently acknowledged increasing concern that they would not receive full payment from their broadcast partner for 2025. They are owed around $76 million or slightly more in 2025 according to the existing deal, per Post-Dispatch reporting and research.
The Cardinals confirmed this week that they expect to lower major-league payroll for 2025, and the uncertain broadcast fees along with reduced ticket sales are part of that calculus.
“The real challenge for us revenue-wise is on the local media situation,†club president Bill DeWitt III said. “As you know there is a whole trend where there is a lot of cutting of the cord, of the cable bundle, and we’ve had our distribution challenges. The good news is it appears as though under every scenario we’re looking at fans will hopefully have a direct-to-consumer product to get our games. Basically an app where they can stream games for a fee.
“I am really optimistic … we’re going to uncover every stone on the revenue side.â€
A few MLB teams already have that app.
That model would do something DeWitt has advocated before — erase what he called the “antiquated†blackout rules and allow for streamed games to reach a broader and local audience.
When entering into the current broadcast deal with then-Fox ÁñÁ«ÊÓƵ Midwest the Cardinals separated their streaming rights from that agreement to maintain a hold on them. That has helped them explore options for them individually rather than being bundled into deals discussed during bankruptcy court on the broader Major League Baseball level.
Post-Dispatch media columnist Dan Caesar previously reported how several local networks were eager to engage the Cardinals about their broadcasts.
The general feeling among local executives was that Diamond would keep the team’s rights, at least for next season, prompting KMOV (Channel 4) general manager JD Sosnoff to say Wednesday that he was “absolutely†surprised about the developments.
“You could see it headed in that direction, but I don’t think that the expectation was that it was imminent here in St. Louis,†he said.
KMOV is owned by Gray Media, as is over-the-air station Matrix Midwest (Channel 32), which Sosnoff oversees and could be a landing spot for live game telecasts.
“If the opportunity exists, we would be extremely interested to see what it takes to bring free Cardinals TV to the market,†he said.
Two former Cardinals TV homes — KSDK (Channel 5) and KPLR (Channel 11) — also could be possibilities, albeit likely on an ancillary channel of KSDK because of NBC network commitments. Station general manager Alicia Elsner said Wednesday that “KSDK remains interested in pursuing†the rights.
KPLR general manager Kurt Krueger previously told the Post-Dispatch that his station could bump CW network programming to make room for the Cardinals if it gained the rights.
In Houston, a lawyer for Diamond ÁñÁ«ÊÓƵ, Andrew Goldman, said the company would continue with “a single telecast rights agreement, that of the Atlanta Braves. All of the other teams, all of Major League Baseball’s other agreements, will be rejected under the plan.†This prompted news that 11 of 12 teams would be dropped. The statement lacked needed context.
In 2024, Diamond ÁñÁ«ÊÓƵ broadcast a dozen teams. Four of those teams had their contracts expire at the end of this regular season: the Milwaukee Brewers, Minnesota Twins, Texas Rangers, and Cleveland Guardians. In addition to those teams, Diamond ÁñÁ«ÊÓƵ seeks to reject existing contracts with the Tampa Bay Rays and Detroit Tigers, whose late-season surge continued with a sweep Wednesday of the Astros to advance in the American League playoffs.
Diamond’s plan to maintain the Braves, leaves the Cardinals and five other teams: the Kansas City Royals, Miami Marlins, Los Angeles Angeles, and Cincinnati Reds.
In court, Goldman said an “active dialog†is happening with those teams “who are aware of the implications of not being able to reach a deal,†as quoted in The Athletic.
“Today marks an important step forward for Diamond with the filing of a baseline plan to enable us to emerge from bankruptcy as a viable, go-forward business before year-end,†a spokesman for Diamond ÁñÁ«ÊÓƵ Group wrote in a statement. “We have delivered proposals to and remain in discussions with our MLB team partners around go-forward plans. We firmly believe that through our linear and digital offerings we have created the best economic and fan-friendly engine for all of our team partners.â€
MLB’s lawyer described the announcements as being “sandbagged.â€
Diamond ÁñÁ«ÊÓƵ filed for Chapter 11 protection in March 2023, claiming it needed to restructure so it could “eliminate $8 billion (in) outstanding debt.â€
The heyday of blockbuster broadcast deals and live sports’ DVR-proof reign as a revenue titan started to tumble, and fast, when viewers began “cord cutting.†The previous model assured sports networks and news networks alike a subscription fee bundled into cable bills. Regardless if the subscriber watched the Cardinals or cable news, they were paying for that within the subscriptions. As consumers switched to streaming and a la carte options, the bubble burst and Diamond ÁñÁ«ÊÓƵ was dealing with a dramatic reduction in subscribers and massive rights deals.
When negotiating their current deal with then-Fox ÁñÁ«ÊÓƵ Midwest, the Cardinals considered starting their own network and even partnering with the Blues to do so. They opted for a partial ownership instead after seeing other teams, like the Cubs and Dodgers, have difficulty with distribution.
In the past two years, the Cardinals have been researching their options should they regain their rights, recognizing it would be an initial reduction in revenue but carry the potential for greater growth and a greater ability to reach more fans.
While the situation for fans and teams remains fuzzy, the hearing Wednesday at least accelerates resolution.
Staff writer Dan Caesar contributed to this article.
