Can the Lakers and Dodgers, two of the nation’s most popular and successful sports franchises, who dominate fandom in the nation’s second biggest market, solve one of the thorniest sports TV headaches of the past decade? With the move of more and more high-profile sports programming to streaming, it just might be time.
The Los Angeles Times reported over the weekend that co-owners of Major League Baseball’s Los Angeles Dodgers, Mark Walter and Todd Boehly, are buying the 27-percent share of the NBA’s Los Angeles Lakers from billionaire Philip Anschutz.
Walter, with an estimated personal wealth of $4.9 billion, is CEO of the vast private-equity fund Guggenheim Partners. He also owns a stake in the WNBA’s Los Angeles Sparks team. Boehly, who also has long Guggenheim ties, founded and runs private investment firm Eldridge Industries.
While still with Guggenheim, Boehly spearheaded the last mega deal in local sports TV cable wars, an $8.35 billion agreement with what was then Time Warner Cable (now Charter Spectrum). Time Warner agreed to create a Dodgers channel and give the team ownership of the channel, in exchange for broadcast rights on the new regional sports network.
At the time, it seemed like a great deal, underpinning Dodgers’ finances as the team went on a remarkable eight-year run of division championships culminating in last fall’s World Series victory. The lucrative deal ensured the Dodgers could buy whatever talent the team needed to compete.
The only catch: providers other than Spectrum weren’t interested in adding another expensive regional sports network to their basic offerings as cord-cutting started pinching their pricing. In the years since, that antipathy by other distributors has only grown.
The deal left Dodgers fans in the dark if they lived outside of Spectrum’s Southern California footprint (its checkerboard of local operations reaches more than 1 million people between Santa Barbara, Palm Springs and San Diego).
Now, there’s a possibility that the Lakers and Dodgers might find a way to reach their huge and ardent fan bases online without depending on the fading cable business. Spectrum also runs a Lakers regional sports network.
A joint regional sports network/streaming service involving the two teams would provide pretty much year-round programming about the two most popular franchises in Southern California and among the most valuable in America, according to valuations by Forbes. The $1.35 billion proposed Anschutz sale values the Lakers at $5 billion, and also would remove Anschutz’s first-look purchase option should the Buss family ever look to sell.
And going streaming is absolutely the hot trend for sports networks locked into deals with declining cable providers.
The biggest such operator, Sinclair Broadcasting Group, is partnering with LionTree to raise $250 million to bring its own regional cable networks in Los Angeles, San Diego and 17 other national markets to the streaming world. Its Bally’s Sports West channels carry MLB’s Angels, the NHL’s Ducks and Kings, and the NBA’s Clippers.
Recent reports suggest that the Sinclair national streaming service would cost $23 a month, be available only within its networks’ current footprint, and launch next April, in time for baseball season.
The NFL recently renewed its TV rights deals with the Big Four broadcasters and their cable arms. The league, still the most popular programming on traditional TV, extracted about double the previous contracts’ fees in exchange for streaming rights. An Amazon added another $10 billion to the till in exchange for a decade’s worth of Thursday night games.
With a more unified ownership for the Lakers and Dodgers, a joint streaming service could result sooner than later. For long-suffering Dodgers fans in particular, it might be an even bigger home run than Kirk Gibson’s game winner in the 1988 World Series.