Texas Rangers’ future on TV may have just been spelled out by another local team
Rather than wait even longer to see how the catastrophe that is Bally Sports continues to play out in bankruptcy court, the Dallas Stars elected to do their own thing and that is the lay out the future of pro sports on your TV.
Their future will ultimately affect how you watch not just the Stars but likely the Texas Rangers and the Dallas Mavericks’ regular season games as well. This new plan could also have a dramatic affect on a team’s ability to spend money.
A few days after the Stars ended their long-standing agreement with Bally Sports one year earlier than expected, the team announced a seven-year partnership A Parent Media Co. (APMC).
The team said in a statement, “(APMC will) stream all regional Dallas Stars games free of charge beginning with the 2024-25 season. The games will be broadcast on newly formed “VICTORY+”, a free direct to consumer streaming service created for fans by APMC with the Dallas Stars.”
Basically, if you have a device where you can download an app, you can add “VICTORY +” and watch the Stars games if you live in the regional market (Texas, Oklahoma, Louisiana, Arkansas). This is a first-of-its-kind in major pro sports.
The Stars will be the first sports product for APMC; the company, which is based in Alberta, is expected to add another NHL team soon.
This is a risk the team had to take. A risk the Rangers will monitor closely.
“Sure, it’s a risk. Staying with Bally would have been a risk,” Dallas Stars president Brad Alberts said Monday morning in a phone interview. “This is something no one else has done. Other teams have gone (“free” games) over the air, but we are going direct to consumer. It will be an interesting year for me regarding expectations.”
If this works, or comes even close, expect a lot of teams all over North America to follow the direct-to-consumer model.
The risk is multi tiered.
1.) Will people take the time to download the app to watch the games?
Most likely. Every day the consumer is more conditioned for the streaming world. This will not be complicated, but it does require the consumer to watch the games on streaming.
Unlike adding a “Peacock,” “Prime” or “Netflix” to watch select NFL games, this will require no additional fee.
2.) Will this deal make as much money for the Stars as the previous contract with Bally?
That’s a 50-inch headline, Not For a While
The Stars were paid $25 million a year under their previous agreement with Bally Sports. The new deal with APMC will be entirely ad based; people familiar with these contracts said Monday they don’t see how the Stars will make anything close to their previous figures.
“The risk of us going backwards financially has been eliminated,” Alberts said. “I feel very good where we are financially on this. (Broadcast rights) has been an important financial stream, to be able to pay players and to make it all function the way we want. No one wants to put our team in a financialy bad situation, and we feel strongly this won’t.”
Local television broadcasting distribution has become a crisis all over North America as teams remain hostages to contracts signed by media companies that got into protracted fights with cable carriers; in a cord-cutting, streaming world the end result is often a growing number of fans who can’t watch the games.
Along with the Stars, the Rangers and Mavericks are both also stuck in this TV hell that has no end.
This has all been compounded exponentially when the Bally Sports’ parent company, Diamond Sports Group, got into financial trouble that ended up in bankruptcy court. This trickle down will eventually hit the teams, and their bottom line.
For more than 20 years, one of the biggest sources of revenue for sports franchises have been local media rights contracts, specifically with companies that pay big money to televise games. With the exception of the NFL, regional sports networks have been the fuel to pro sports teams all over North America.
For a media company, an MLB team’s schedule of 162 games to televise during a regular season is a bonanza of advertising revenue. Teams, such as the Rangers, made a small fortune in broadcast rights deals which has allowed franchises to shower players with record-breaking contracts every year.
One of the bigger reasons why the Rangers were able to go on a laving spending spree on free agent players such as Corey Seager and Marcus Semien, among others, was the security of the contract with Bally Sports.
You may have noticed, over the years, similar spending patterns by other teams in MLB, NBA and the NHL.
The Stars’ payroll in 2023-’24 of $104 million ranked 20th in the 32-team NHL. The Rangers’ payroll in $223 million ranks sixth in MLB.
Amid their celebration of their first ever World Series win in 2023, you may have missed that the team deliberately did not make any attempt to do much in free agency after the season. A big reason is the concern over the future of local broadcast revenue.
When Mark Cuban sold the Dallas Mavericks last November, he expressed concerns over the future of local broadcast rights rights fees; that it no longer was going to serve as the limitless source of money for franchises.
For the last several years, teams have explored different options in a streaming-world to provide the games to fans, and to generate money.
“(Stars owner Tom Gaglardi) felt strongly we needed to figure out another solution,” Alberts said. “We were trying to figure out where television is going. We kept asking, ‘What happens if Bally goes away?’ They’ve been in bankruptcy forever, and I don’t know if they’ll come out of it.
“There was no clear cut answer. The more we looked into this, the more we felt comfortable with it, as was the league. I feel very good where we are.”
The Dallas Stars were the first team to take this risk, and expect more to follow soon, because it may be the only option that exists.
This story was originally published July 8, 2024 at 1:27 PM.
