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Washington Nationals: MASN/TV Revenue Argument Update From The Washington Post's James Wagner

According to a report by the Washington Post's James Wagner tonight, Major League Baseball is seeking buyers to acquire the Baltimore Orioles and Washington Nationals' tv rights from MASN and O's owner Peter Angelos.

Rob Carr

There were a few lines in Sports Business Journal writer John Ourand's December 3, 2012 article on FOX Sports' "aggressive interest in local sports rights" and their successful and in-progress attempts to acquire regional sports networks that stood out for anyone who has been following the Washington Nationals' continued efforts to renegotiate the deal MLB made with Baltimore Orioles' owner Peter Angelos as part of the agreement that allowed the Montreal Expos to relocate to the nation's capital in 2005. Forbes' team evaluation of the D.C. franchise succinctly explains the deal Major League Baseball reached with the O's owner for anyone unfamiliar with the part of the agreement dealing with tv rights:

"To convince Angelos to allow the Montreal Expos to move to D.C. for the 2005 season, MLB gave Angelos 90% of MASN and the Nationals 10%. The National's stake increases by about 1% a year until their stake reaches 33% as part of the agreement. The Nationals in 2011 had the smallest average TV audience in baseball, 29,000, for games aired on MASN and MASN2."

As part of the agreement, "... an automatic 'reset' was included every five years to make sure that the deal still [fell] within market value," as the Sports Business Journals' Mr. Ourand reported in October 2011. Having reached that point, Washington hired a well-regarded media consultant last winter, Chris Belavacqua, whose job it was to argue that the Nationals deserved to, "... get a bigger television rights fee from the Mid-Atlantic Sports Network." When the two sides failed to agree on a deal, it was sent to arbitration.'s Ken Rosenthal reported in April 2012 that, "The matter went to arbitration after talks between the Orioles and Nationals sputtered," and quoted sources who told him a decision was made to have, "... a panel of baseball officials... decide what the two teams could not resolve in negotiations — the annual rights fee that the Nationals will receive from MASN."

Mr. Rosenthal's sources speculated that the Nationals, "... could double or even triple," the estimated $29M the team was currently receiving, which would be important in the near-future since, "Local TV money is the Nationals’ second-largest source of revenue after ticket sales," and the team would also, "... be ineligible to receive revenue sharing by 2016, according to the new collective-bargaining agreement," since they ranked as one of MLB's 15 largest markets, and under the new CBA as's Jayson Stark explained it last winter, "... teams in the 15 largest markets will no longer be allowed to receive revenue-sharing welfare, no matter how lousy their TV contract or attendance may be."

The Nationals,'s Mr. Rosenthal wrote last winter, "... already are at a severe disadvantage in their co-ownership of MASN," and it would only get worse they lost the revenue sharing dollars they'd previously received. The arbitration process dragged on, however, with MLB commissioner Bud Selig expressing some frustration with the process when he spoke to reporters at a Baseball Writers' Association of America Q&A during the 2012 All-Star break.

Mr. Selig told BBWAA reporters, as quoted in a article, "'We are in the midst of very intense discussions. That's all I can tell you. Very intense.'" Pressed for an estimate of a possible date for a resolution of the matter, Mr. Selig said, "'Yeah, about a month ago. But we'll keep moving that ahead until we get a resolution, as quickly as possible.'"

As the process played out over the last season, the Nationals made a run for the postseason for the first time since baseball returned to D.C. and for the first time by a team based in the nation's capital in 79 years and the Nats saw what the Sports Business Journal's John Ourand and David Broughton reported was a corresponding 74% rise in the television ratings which was, "... higher than any other team," in baseball. Earlier this month, the SBJ's Mr. Ourand's report on the continuing process noted that Fox had, "... conducted on-and-off talks for the past several months to pick up Orioles and Nationals rights in the Baltimore-Washington, D.C., market," but added that, "... sources say those talks have cooled considerably."

Fox's efforts, Mr. Ourand wrote, though successful in other markets around the country, were, "... not moving as smoothly," in the DC/Baltimore area where they were trying to, "... acquire all or part of MASN," at the "urging" of Major League Baseball:

"Fox’s involvement in talks with MASN came at MLB’s urging, sources said. MASN still is involved in a rights fee dispute with the Nationals. That dispute hasn’t been resolved, though both parties met at MLB’s New York offices last week. MLB hoped that a deal with Fox would solve the dispute. MASN and Fox have not met for several weeks, and no further talks are scheduled."

According to a report by Washington Post reporter James Wagner tonight, MLB is now getting "creative" as the WaPost writer put it in the article's title, and, "... has asked a private investment bank to seek potential new owners for the rights that are now held by the regional sports network controlled by Orioles owner Peter Angelos.":

"Allen & Co., a New York-based investment bank, is seeking buyers to acquire the two franchises’ broadcast rights from the Mid-Atlantic Sports Network, according to two people with direct knowledge of the matter who spoke on condition of anonymity."

Fox Sports and Comcast are mentioned as two potential suitors by the WaPost writer's sources. None of the parties involved in the discussions (Allen & Co.; the Nationals; MLB or MASN) was willing to comment on the record for the Washington Post article.