MLB Commissioner Rob Manfred Pulls No Punches on State of RSN Market, Considers League’s Direct-to-Consumer Future
Why friction-less digital access to games is critical and where gambling entities fit in
With ratings up and matchups living up to their billing (see the epic Dodgers-Giants NLDS series), Major League Baseball is enjoying a prosperous postseason so far. But, in a rapidly evolving media landscape, what does the future of America’s Pastime look like?
At SportsBusiness Journal’s World Congress of Sports, Major League Baseball Commissioner Rob Manfred discussed some of those topics, including where the sport stands on the regional-sports-network business, what he would like a direct-to-consumer MLB product to look like, and what production enhancements are making the game a more enjoyable watch?
On this MLB Postseason:
We were due for a little bit of good luck. The last couple of years have been a real challenge with the pandemic. We’ve been very fortunate this year with great teams and great rivalries early in the playoffs, which is important in terms of capturing people’s interest. I think the east-west piece of it has been really good, too. Having Boston, Tampa, San Francisco, L.A. has made this really good for us.
On the future of regional sports networks:
The cord-cutting phenomenon has made the RSN business one that is declining, by definition. Fewer subs makes the business more difficult. I think that the negativity surrounding the RSNs has increased exponentially as a result of the situation with the Sinclair subsidiary, Diamond.
Part of their problem is cord-cutting. The other part of their problem is that there is excessive leverage on that business when you think about what they paid for it, how much debt they have on it. That leverage has produced headlines that are more negative. There are RSNs that may not be thriving or growing, but they are going to survive.
MLB’s future as a result of the RSN decline:
I think the key for us is the development of direct-to-consumer products to increase our reach. The biggest problem for us on the RSN side is that, even within the cable bundle — particularly with the Diamond subsidiary — is that their reach, within the bundle, is not what it used to be. It’s important for us to develop digital products that allow us to get to our fans in a friction-less way. That’s really your future.
On whether MLB’s future is with Sinclair:
Our view of digital rights is that they are our future and it’s something that the league and the clubs should control. We do have a pretty good track record on the digital side. MLB.TV was one of the first over-the-top products and has continued to grow and at a really impressive rate. Who exactly the partners will be I’m not prepared to [discuss], but we see those digital rights as very valuable and crucial to our future.
On what a direct-to-consumer service looks like:
It has to be friction-less: easy for the consumer to get in and buy what they want. It also has to be flexible. I see that flexibility, in the context of baseball, as buying an out-of-market package, buying up into your local rights, buying just your local rights; the consumer gets to decide what he’s buying.
On having an ownership stake in a future direct-to-consumer product:
I think “ownership stake” probably understates it. We believe those digital rights are crucial, and we want to own and control the platform on which they are delivered. We may have partners in that process. This idea that, late in the discussions, we somehow demanded an equity stake is just not accurate. We’ve told [Sinclair] that from day one.
On the remaining package of national games still available:
We‘re fortunate. We have multiple major entities that are interested in that package. That’s great for creating competition from a financial standpoint. More important for us, we want that package to be forward-looking. What does the future look like? How are we going to deliver games digitally in a way that is friction-less. There are two big opportunities there: not only additional revenue but the opportunity to take a step forward in the way we’re delivering games to fans.
On potentially selling those rights to a sports-gambling company:
Our thought, with respect to the gaming entities, is that there is a place for them in the media lineup for Major League Baseball. I think the important thing is that, whatever we do with a gaming company, we’re always going to have that clean, family-friendly broadcast that isn’t going to have a gambling overlay to it. We’re going to have to find a gambling entity with the flexibility to adhere to that larger strategic thought.
I’m not saying you’re never going to see odds on a national broadcast. I’m talking about a gambling-focused feed where it’s not once or twice per game and it’s every inning and every pitch where there’s [betting] material. If we ever go that far, we’re going to have a clean feed as well.
On production enhancements that can be expected in future MLB broadcasts:
I think you’re going to see a continuation of some of the things that we’ve been doing. Microphones and in-game interviews are at the top of that list. We saw that at the All-Star Game, where you were having conversations with players in the field. Fans seemed to love that. We’re going to do more and more of that. I think the opportunity for supplemental information as either a second-screen experience or integrates into the broadcast is really important to us. Statcast is the best example of that. It provides the fan the opportunity to understand the game in a way that they might not otherwise. We have great partners. Fox’s use of drones at Field of Dreams was unbelievable. Those sorts of things make the broadcast more interesting for our fans, and we’re going to continue to push on those technology issues.
On MLB’s current labor agreement:
I think the most important thing, from our perspective, is that we’ve made a commitment with the MLBPA to have these negotiations be non-public, quiet, professional. Both sides have lived up to that. We’re meeting on a regular basis. The best that I can tell you is that the owners’ number-one priority is to get a basic agreement done before the expiration date in early December. It’s crucial, given the circumstances of the pandemic, that we keep the game on the field, and we’re working really hard to get that done.
I am a labor optimist, always have been. I think it’s one of the necessary qualifications for good labor negotiations. So I think we get it done [before December].