In case you missed it, last week the Texas Rangers completed negotiations with Fox Sports Southwest on a 20-year television deal worth somewhere between $1.5 billion and $1.6 billion.
That’s correct: about $80 million a year, or roughly a half-million dollars per game. By comparison, the Los Angeles Dodgers take in about $45 million a year for their cable rights. It’s also about 50% more than each NFL team currently gets from their network TV deal. The new deal goes into effect when the current one expires after the 2014 season.
For those critics of the game, who are fond of predicting its imminent demise, it seems to reinforce an entirely contrary view. Apparently, the television audience for the grand old game - even in a region where football is king - is more than sufficient to justify a huge rights payoff. There’s also the real possibility that Fox wanted to make a preemptive strike against any other cable entrepreneur who had designs on starting their own regional sports network with baseball as the centerpiece.
The next question is obviously what impact this deal will have on other regional cable rights fees. Inasmuch as the new Texas deal won’t kick in for a few years, there may be a let’s-wait-and-see approach taken by the teams who have deals coming up for renewal. Or not. But it’s perfectly clear that a deal like this is going to be seen as a game-changer, not totally unlike an earlier Ranger deal that made Alex Rodriguez the highest paid player in history, creating a nationwide bunching-of-shorts in MLB executive suites.
For years the NFL enjoyed a financial status that MLB teams could only dream about: a guaranteed profit whether they won a single game or sold a single ticket. The new Rangers’ cable deal may now explain why there was so much interest in buying the old expansion Senators’ franchise for more than $600 million in August.
There’s nothing like a sure thing.