The Washington Nationals have hired a high-profile media consultant to increase their share of the rights fees produced by the Mid-Atlantic Sports Network, according to a report by the SportsBusiness Journal. The decision and ensuing negotiation could have a significant and positive impact on the Nationals’ revenue.
The move comes at a critical time for two reasons. The Nationals’ deal with MASN has reached a five-year “reset” point, which means the Nationals can renegotiate with the Baltimore Orioles and MASN majority owner Peter Angelos to fall within market value. Across the league, newly formed deals with regional sports networks are filling the coffers of baseball franchises and creating an important new form of revenue.
The coming negotiation could generate a significant boost to the Nationals’ revenue, which may or may not trickle down to their payroll and on-field product. The Nationals should expect to “at least double or triple” the $29 million they earned last year from MASN, said one individual with knowledge of baseball’s television rights system who spoke on condition of anonymity.
The basis for the evaluation, this person explained, will be the recent television deals with regional sports networks in similar markets. The Texas Rangers recently extended their media rights deal with Fox Sports Southwest for 20 years and $1.6 billion. The Houston Astros signed a massive deal with Comcast that will begin in 2013, and the San Diego Padres are close to finishing a deal Fox Sports that reportedly will roughly double their old TV money.
The Nationals hired a consultant, Chris Bevilacqua, with rich experience in brokering the television rights deals, according to the SBJ report. Bevilacqua negotiated the Rangers’ deal, as well as many others across many sports. “He’s as good as there is,” the source said. “He’s done every deal.”
Bevilacqua will likely look at the recent deals as new benchmarks in his argument that the Nationals deserve a larger financial cut from MASN. Angelos is known for his fierce, confrontational negotiation style. But he is also dealing with turmoil in the Orioles’ operations following the resignation of team president Andy MacPhail, leaving the Orioles without a head for their baseball operations.
The Nationals’ television deal with MASN and the Orioles has been an intriguing subject since the franchise relocated from Montreal in 2005.
To convince Angelos to allow the franchise to infringe on what he deemed his territorial rights, MLB gave Angelos 90 percent of MASN. The Nationals held the other 10 percent, which grows at about one percent per year and now sits at 13 percent. Once the Nationals reach 33 percent ownership of MASN, their ownership stake stops growing.