With less than three weeks to go until Opening Day, the Washington Nationals remain without a local television deal.
The control of broadcast rights to the Baltimore-Washington region is at the center of talks between Major League Baseball and Baltimore Orioles owner Peter Angelos, according to sources familiar with the negotiations. The issue is holding up final agreement on the compensation package that baseball will give Angelos for the financial impact that the Nationals would have on his team.
Until the compensation package is agreed upon, the Nationals cannot make a deal with a local television outlet, forcing Nationals President Tony Tavares to lose valuable marketing and promotional opportunities.
"While we understand what a difficult issue this is, we are highly frustrated at the amount of time it has taken to bring this to a resolution," Tavares said.
Angelos assumed the broadcast rights to the Baltimore-Washington region, extending from the Pennsylvania border to North Carolina and from West Virginia to Delaware, when he bought the Baltimore club for $173 million in 1993. After moving the Expos from Montreal to Washington last fall, baseball wants to recast the Orioles' broadcast region to accommodate the Nationals.
"We are presently in good faith negotiations and it would be inappropriate for me to comment at this particular time," Angelos said yesterday.
The Orioles and Angelos oppose any redistricting of the team's broadcast rights, saying they paid for those rights and need the financial revenues from viewers to stay competitive in the challenging American League East Division, which includes the New York Yankees and Boston Red Sox.
Angelos has proposed an Orioles-owned regional sports network that would pay the Nationals, collectively owned by Major League Baseball's 29 other teams, fair market value for televising their games on the Orioles network. That number, presumed to be in the $25 million range, would likely increase over time as the Nationals grow more popular and their television rights grow with it, according to sources familiar with the proposal.
Baseball has been reluctant to cede control of the Nationals' television rights to any broadcast entity controlled by a rival team. The league said that it told Angelos when he purchased the Orioles that a team might someday play in Washington and that the Orioles would not control that area's broadcast rights forever.
The television deal is the only loose end in a six-month negotiation between baseball and Angelos that is designed to compensate the Orioles.
The Orioles said they expect to lose $30 million in ticket sales, advertising, parking and concessions due to the Nationals' arrival in the Washington market.
Baseball has guaranteed that the Orioles would fetch at least $365 million if Angelos chose to sell the team, or it would make up the difference.
Under the Orioles' proposal, the regional sports network would also pay the Orioles a fair market value for its rights, which would be in the same $25 million range as the Nationals'. The Orioles would assume the risk of operating the regional sports network and would be able to keep the vast majority of net profits, if there are any, as compensation for the Nationals being in Washington.
The league fears that the sale price of the Nationals could be dramatically reduced if a would-be buyer had to negotiate with the Orioles and Angelos every few years to get the Washington team's games televised.