Understanding the Cardinals' Regional Sports Network situation

It's complicated, and it's important

Image: DALL-E

This has been and continues to be an offseason of abundant subplots, and perhaps the most important of those is the ongoing uncertainty surrounding the Cardinals’ regional broadcast situation. Look, I don’t really want to talk about this, either, but it’s important, as it has material bearing on the team’s future. So let’s talk about it in plain language. 

First, some background. MLB teams broadcast games at the local level via Regional Sports Networks, or RSNs, and they’ve made a great deal of money doing so via agreements with those providers or, in some instances, team ownership of those networks. The model, however, is dependent upon carriage fees and cable subscriptions, which makes it very much a dying one thanks largely to widespread cord-cutting. Those realities led Diamond Sports, which through Bally’s had long-term commitments to almost half of MLB’s teams – including the Cardinals – to file for bankruptcy. The ongoing Chapter 11 court proceedings have imperiled those commitments and in a couple of cases has led to Diamond/Bally’s dropping team broadcasts altogether. 

All of this matters quite a bit because MLB teams are, to varying degrees, highly dependent upon local-television revenues, and it’s also a leading source of financial disparity within the game. For instance, in 2022 the colossus Dodgers and their populous broadcast territory centered in Southern California took in almost $200 million in local-tv monies, while the wee Royals clocked $45 million for that same year. Teams pool almost half of their local revenues, and that total is then shared equally among those 30 clubs. This, however, isn’t enough to eliminate those above-noted disparities. (Aside: This isn’t necessarily a bad thing, as smaller-market teams still need incentives to get better, particularly given the uncompetitive proclivities of the current generation of team owners.)

As for the RSN situation, the latest twist is Amazon’s broad-shouldered presence. After an earlier and larger-in-scale bid was rejected by MLB, Amazon regrouped and successfully negotiated with Diamond on the handful of teams for which they own full digital rights (not including the Cardinals – more on that in a moment) with an eye toward streaming their games on the Prime platform. The inflow of Amazon cash plus some from other creditors will allow Diamond to halt bankruptcy proceedings and continue operations, pending district-court approval in Texas. That broader seeming certainty comes after the Cardinals received assurances that all of their games for the 2024 season will be broadcast on Bally Sports Midwest, albeit possibly under different network branding, and that the team would receive their full rights payment of more than $70 million for 2024. Prior to Amazon’s purchase of that minority stake, the working assumption had been that Diamond would cease operations after 2024.  

This all amounts to a bit of clarity, but the long-term situation remains one of the most pressing unknowns facing the sport at the highest level, particularly in light of how reliant MLB is on local-media revenues. Broadly, we don’t know how all of this is going to look after the 2024 season, but we can examine the Cardinals’ place in all of this and how their future might look. Let’s do that now with some key current takeaways as the future of local broadcasts plays out before us.