If Comcast decides to sell regional sports networks, these buyers make the most sense

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Give legendary sports owner Ed Snider credit – he was one of the first to see the business opportunities surrounding regional sports networks.

Snider combined a regional sports network and movie channel in 1976 when he launched PRISM. If you’ve been in Philadelphia for a long time, you remember the network well. PRISM was an additional cable fare. The channel broadcast the Flyers franchise of the National Hockey League and the 76ers of the National Basketball Association.

Major League Baseball’s Phillies games were also shown on the network, which eventually morphed into NBC Sports Philadelphia, one of the few RSNs operated by NBCUniversal parent company, Comcast.

“For me, Ed Snider is definitely in the top 10 pure sports visionaries of all time,” said former sports director Andy Dolich. “Has he seen everything 100 percent? Probably not. But he saw the buildings. He saw the teams. He saw the fan bases, especially in Philadelphia, and he saw the crazy DNA fans have for the teams. And he could organize it on a strategic way.”

Last week the Wall Street Journal reported that Comcast is investigating the sale of its interests and exit from the RSN business, which it has gotten into with the help of Snider, the former chairman of Comcast-Spectator. The speculation shouldn’t be too much of a surprise, as cable cutting continues and RSNs depend on cable subscribers. AT&T has been trying to sell also are stock RSNs.

Dolich said RSNs were once “the best sports microscopes — meaning you could find out everything, tune in during the day, and get information about the local franchise. Now it’s flipped and become a telescope where fans want to see the big picture. “

“They don’t need the small picture,” he added. “It’s who won, who lost, and seeing Steph Curry highlights go for 49 points. That’s all they care about. Everything else they can get in many different forms on their phone, laptop, iPad, etc. “

When NBCUniversal decides to auction some of its RSNs, a few names and companies are circulating as intriguing buyers in the sports world. And they include sports owners who were able to expand what Snider helped build.

Owning the railroad

In 1976, Snider bet that local fanbases would pay to watch teams. He died in 2016, but not before he and Comcast won that bet. Fans no longer have to rely solely on RSNs to reach sports leagues, now that there are many streaming options.

While the WSJ report noted that sports owners were not interested in owning RSNs in the past, that could change. The RSN traditionists suggest that the model is not dead, but that it needs innovation.

Apollo Global Management co-founder Josh Harris is an interesting name that linked to the NBC Sports Philly operation. For those familiar with his business dealings, Harris likes to explore and take risks. NBC Sports Philly could make perfect sense.

He owns the 76ers, which he bought from Comcast Spectator in 2011, and although separate from his personal balance sheet, Apollo bought Verizon properties, including Yahoo, for $5 billion earlier this month.

Whether Comcast will sell the property is open to question. When reached on Tuesday, a spokesperson for NBC affiliate stations declined to comment on the WSJ report, but said the company is in a strong position with profitable RSNs.

In Washington, Ted Leonsis, the Wizards and Capitals owner, has set up a digital RSN on the Monumental Sports Network and seems well positioned for the future with sports betting and esports. Since he already owns a 30% stake in NBC Sports Washington property, he agrees as a suitor to fully own the network.

Dolich suggested team owners should look into buying RSN properties to prepare for what’s to come, like virtual reality and augmented reality. He linked it to owning the railroad.

“If you look at the railroad billionaires 100 years ago, what did they control? They controlled the railroads,” Dolich said. “So in this circumstance, what do the owners of a sports team have? They have the property, the athletes and the games.

“Fans want control,” Dolich added. “They want to be in the game. And how many ways can you follow your team? It’s hundreds. Owners, they can set the kind of tracks they want so people can watch the game.”

Octagon media manager Dan Cohen added: “You get synergy between the team and content production and fan engagement. If you can merge the data you have on people coming to the arena with your viewership, that’s a really strong currency to trade on. There’s value in that.”

RedBird Capital Might Consider Boston RSN

Investment firm RedBird Capital has a minority stake in Fenway Sports Group (FSG), the ownership group of the Red Sox and Liverpool FC. RedBird also has a stake in the media industry as an investor in YES Network, the RSN that broadcasts Yankees games.

RedBird might consider buying NBC Sports Boston, consolidating and transforming the station to align with New England Sports Network (NESN), which already broadcasts Red Sox and Bruins games.

“It’s a very strong market with a strong fan base and it’s profitable,” Cohen said of the Boston RSN.

RedBird declined to comment on the matter when reached by CNBC on Tuesday.

Is Sinclair an option?

Sinclair made a huge bet on RSNs when it bought 21 networks from Disney in 2019 for $10.6 billion, making it the largest RSN provider. Media pundits are still unsure about the move, and Sinclair had to write it down $4 billion in debt associated with the acquisition.

In March, Sinclair official rebranded the networks to Bally Sports under a deal with Bally’s Corporation. That could alienate marketing dollars from competitive sports betting, which still spend huge amounts to grow brands.

But the company is well positioned to take advantage of sports betting and sources, who wish to remain anonymous due to ongoing talks, say it is close to renewing the NBA and NHL’s local streaming rights, benefiting their direct-to-consumer streaming model. will come through the Bally Sports app.

Sinclair has a market cap of $2.5 billion and cannot afford to buy its entire fleet of NBC RSNs. And there would also be antitrust issues, forcing Disney to unload the properties. But acquiring a share in another RSN market wouldn’t hurt.

“It might make sense,” said Lee Berke of LHB Sports, a sports media consultancy. “There may be specific markets that complement the ones they already have and increase their national footprint.”

Keep an eye on Amazon

In the San Francisco Bay Area, another profitable NBC RSN has rights to the Golden State Warriors, Giants, Oakland A’s and 49ers shoulder programming. Cohen called tech giant Amazon the perfect candidate if NBC sold the property.

“If I’m Amazon and a taste of the RSN fruit with YES Network, my next step would be to make a splash in Silicon Valley,” Cohen said. “They’d have Steph Curry for a few more years, and the Giants, who has a good fan base. It’s a good market.”

It’s down, but the RSN business isn’t dead yet, and if NBC leaves, there should be buyers willing to invest and experiment, especially with the elite sports markets available.

“As far as you can see in the future, RSNs will still be part of the game,” said former Turner Sports president Dr. Harvey Schiller. “It’s all about the content they bring to the viewer. Regionals need to think of other things they can offer as part of it, and it’s probably going to be gambling and gaming,” he added. “If they match that to their product, that’s the future.”

Disclosure: Comcast owns NBCUniversal, the parent company of CNBC.

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