In 1969, a revolution in sports broadcasting began with the establishment of the first sports-oriented TV channel dedicated to a local market, sparked by a groundbreaking deal involving the New York Knicks and the New York Rangers. This innovation laid the groundwork for what would become known as Regional Sports Networks (RSNs). These networks proliferated through the 1980s and 1990s, ultimately reaching their zenith in 2010 when they connected to over 100 million households, riding high on the wave of cable television's dominance. However, since then, the landscape of sports broadcasting has undergone seismic shifts, heralding a period of decline for RSNs.
The Decline of Cable and the Challenge for RSNs
One of the major factors contributing to the decline of RSNs has been the steady decrease in cable subscriptions. This trend, often referred to as cord-cutting, is propelled by a generational shift in viewing habits, with younger audiences showing less interest in traditional cable offerings and more enthusiasm for streaming services. While most cable, satellite, and live TV streaming services continue to offer RSNs, the fragmentation of the market means not all RSNs are available on all platforms. For instance, fuboTV includes a variety of RSNs in its package, yet availability varies by region. Complicating matters further, some major RSN groups like AT&T SportsNet and Bally Sports are not accessible through popular platforms such as Hulu, YouTube, and Sling TV.
The Troubles of Bally Sports
A telling example of the troubles facing RSNs is the plight of Bally Sports Regional Network. Owned by Diamond Sports Group, Bally Sports is responsible for covering an impressive roster of 42 teams across the NBA, NHL, and MLB. However, the network's fortunes have diminished severely in recent years. From a projection of $1.5 billion in cash flow in April 2019, the figure was halved to $750 million by July 2020. Matters came to a head when Diamond Sports Group filed for Chapter 11 bankruptcy and initiated legal proceedings against Sinclair Broadcast Group for offloading what it termed "insolvent" assets onto them. This turn of events has pushed several teams to seek alternative broadcasting avenues, either by creating their own networks or forming local partnerships, further eroding the traditional RSN model.
The Streaming Era and Its Impact on Sports Broadcasting
While the NBA and NFL have continued to thrive, thanks in part to global interest and innovative offerings like NFL RedZone and NBA+, leagues that have traditionally relied on RSNs for revenue face unprecedented challenges. The shift from traditional cable broadcasting to streaming services could have profound implications for team valuations, player salaries, and the very structure of leagues, posing an existential threat to those heavily dependent on RSN revenue.
The Case of Pittsburgh's Sports Broadcasting Evolution
Examining the evolution of sports broadcasting in Pittsburgh offers insightful context into the broader challenges faced by RSNs. The city's sports broadcasting landscape has transitioned significantly from the formation of the Pirates Cable Network in 1986 to the establishment of SportsNet Pittsburgh in 2023. Amid this journey, AT&T's unsuccessful attempts to sell its regional sports networks and its disputes with providers like Dish Network underscore the growing instability within the RSN sector. This instability was further highlighted by Warner Bros. Discovery's move towards Chapter 7 bankruptcy. Despite these challenges, SportsNet Pittsburgh continues to broadcast Pirates baseball and Penguins hockey, alongside a wealth of local sports content, navigating a path through an era of uncertainty.
Looking Forward: The Future of Regional Sports Networks
The ongoing decline of RSNs reflects a broader shift in consumer preferences away from traditional cable towards more flexible and user-friendly streaming models. While team-owned RSNs in major markets may continue to cling on, their long-term viability is far from certain, especially as the number of cable households dwindles. With over 36 teams tied to the now-bankrupt Bally Sports network facing an uncertain future as of October 27, 2023, the sports broadcasting industry stands at a crucial crossroads. Stakeholders are watching closely to see what new models and opportunities might emerge from these formidable challenges, ready to adapt to the evolving landscape of sports media consumption.