After all that, not only is ESPN poised to continue airing Major League Baseball games after this season, it will reportedly do so for the same rights fee it currently pays.
ESPN and Major League Baseball are close to a three-year media rights deal worth $550 million/year, according to Joe Flint and Isabella Simonetti of The Wall Street Journal. As has been reported throughout the week, the new deal would consist of rights to the digital out-of-market MLB.tv service, local in-market rights to five clubs, and a new package of exclusive regular season games.
WSJ also reported that the deal includes the right for ESPN to include MLB Network in its new direct-to-subscriber service, which launched Thursday. Andrew Marchand of The Athletic also mentioned an MLB Network component in his prior report on ESPN’s new deal.
The $550 million rights fee matches that of the seven-year contract ESPN opted out of in February, though given the escalators in media rights deals, it is likely that ESPN was set to pay more in the final three years of the expiring deal. It should be noted that from the very beginning of this saga in February, it was reported by John Ourand of Puck that ESPN was willing to continue paying its current rights fee if it was able to acquire local and weeknight rights. (Of course, there were no indications then that ESPN would be willing to do so while also giving up the rest of its rights, including “Sunday Night Baseball,” the Home Run Derby and Wild Card playoff games.)
WSJ previously reported that NBCUniversal is in line to acquire “Sunday Night Baseball” for $200 million/year and Netflix the Home Run Derby for $35 million/year. Between those three deals, MLB would come out of negotiations with at least $785 million/year. It was unclear whether the $200 million total for NBC includes the Wild Card round, or if the network would pay more to acquire those games.
While it is true that MLB had to sweeten the package with additional rights in order to secure that figure — and it is worth wondering what price tag MLB.tv and local rights to five teams could have commanded in the 2021 media rights negotiations — it is also pretty common for leagues to have to add more rights in order to secure higher rights fees.
When ESPN opted out of its deal in February, MLB commissioner Rob Manfred immediately pronounced the sides’ relationship over in a memo to owners that was quickly publicized. But the MLB-ESPN relationship has endured through worse conflicts. In 1999, MLB terminated its agreement with ESPN three years early after the network preempted “Sunday Night Baseball” in favor of “Sunday Night Football,” ultimately resulting in dueling lawsuits. But the eventual outcome was a new deal with ESPN that tacked an additional three years onto the network’s old contract.
For its part, ESPN always maintained its interest in continuing a relationship with MLB, either the same rights for less money or the same money for more rights. Ultimately, both outcomes seem to have been reached. ESPN, per a previous WSJ report, valued its existing rights at around $200 million/year. That is close to what NBCU and Netflix are set to pay. By contrast, ESPN was willing to continue paying $550 million if it got local and weeknight rights, and that is now on the doorstep of occurring.
