Sinclair's Diamond Sports Group subsidiary has paid the Cincinnati Reds the initial payment for the team's 2023 local TV rights, within a mandated 15-day grace period after the April 17 due date, keeping the MLB club on regional sports network (RSN) Bally Sports Ohio.
The Reds, which own a portion of the RSN, had made arrangements with distributors Charter Communications and DirecTV, and the team was prepared to self-produce its own games on a new channel, starting Saturday, if bankrupt Diamond hadn't made the payment.
News of the payment was confirmed by ESPN and Sports Business Journal.
Sinclair Broadcast Group paid $10.6 billion for 19 Fox Sports RSNs in 2019, and formed a subsidiary, Diamond, to manage the channels, which were rebranded as "Bally Sports." That was when margins on the channels averaged around 50%.
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Now, with cord-cutting and spiraling team TV licensing costs, margins are well below 20% ... and Diamond is in Chapter 11 restructuring, trying to trade equity to its secondary creditors to relieve about $8 billion of debt, and also also seeking to restructure deals with individual teams for which its losing money.
In fact, Diamond didn't make its 2023 rights payments to the Reds, Arizona Diamondbacks, Cleveland Guardians, Texas Rangers and Minnesota Twins, aiming to cough up the coin after a Texas bankruptcy court reconfigured Diamond's deals with those individual teams.
Last week, the judge thwarted Major League Baseball's attempt to break the Diamondbacks, Guardians, Rangers and Twins free from their Bally Sports contracts so the league could assist the clubs in broadcasting their own games. The judge ruled that Diamond could pay half of what it owed each team, and that would keep the clubs under the Bally Sports umbrella, at least for now.
The Reds case was different, however, since the club owns a portion of Bally Sports Ohio. The Reds also contracted their own production crew and hired their own announcers.
It was believed the new channel would kick off Saturday for a game between the Reds and the visiting Chicago White Sox.
