The Washington Nationals are currently negotiating new annual cable TV fees with MASN, which is owned by Peter Angelos, the owner of the Baltimore Orioles.

Their current deal (part of the package that allowed the Montreal Expos to relocate within the O’s territorial rights) gives the Nationals $29 million per year. However, language in the deal allowed the Nationals to “reset” the fee based on new deals in similar markets.

And in recent years, those deals have been huge. According to Thomas Boswell of the Washington Post, the Nationals now want $110 million. MASN disagrees.

Here’s where the Tampa Bay Rays come in.

The two sides have argued their cases to an MLB committee consisting of representatives from the Pirates, the Mets, and yes, the Rays. And their recommendation will likely determine if the Nationals are making “$60 million or $100 million or likely a number in between,” beginning next season.

What’s the right price? Recent average annual rights fees for regional sports networks have ranged from more than $60 million for the Houston Astros and $75 million for the Texas Rangers — in metro areas usually used as rough comparables to the Washington area — to $150 million for the Angels. The Astros and Rangers fees skew high because they are based on multi-decade deals that grow over time — an argument that favors MASN. Conversely, every new RSN deal blows away the previous one. The Astros and Rangers comparables are already, to a degree, obsolete.

The Rays current deal pays them approximately $20 million per season and is set to expire in 2016.  And whatever the Nationals make in 2013 for their television rights will likely impact what the Rays make when their current deal expires or is renegotiated.

And while the Tampa-St. Pete market is about 20% smaller than Washington D.C., the Rays do very well in terms of percentage of households watching the games.

Let’s speculate and say the committee takes the middle road, giving the Nationals $80 million per season. It would not be hard to imagine that the Rays’ TV rights would be worth $70 million per year.

That would be an additional $50 million in revenue for the Rays each year without having to sell one additional ticket. And that number could go even higher if the Nationals get what they are asking for.

The Rays will never have a payroll on the level of the Yankees or Red Sox. But a new TV deal will go a long ways to keeping this team contenders well into the next decade.

 
 

10 Comments

  1. Gus says:

    The Rays current TV deal is to other MLB TV deal what Longoria’s long-term deal is to other 3b salaries. Both bad deals signed going for the short run confirmed money.

    It may be any hope to re-sign Longoria would be linked to the Rays regional deal getting re-done. (Signing that deal, however, weakens the Rays position to negotiate a new home in or beyond Tampa Bay).

    • Beth says:

      With the difference being — Longoria signed the deal knowing that there was the chance he could fail miserably at the MLB level; he could get hit by a car; he could have chronic injuries — and still get this money. It was a calculated risk taken by someone who, if my memory serves correctly, had about a week of MLB experience.

      On the other hand, there was really no similar downside that the Rays might have been concerned with that would justify such a lowball TV contract. Even middling ratings ought to be worth more than they agreed to here.

      • Machdraught says:

        Longoria appeared to be coerced into such a terrible deal. “Either you sign here or you stay in the minors another year.”
        Rays play hardball in the executive level.

    • Dave L says:

      i think what you are discussing here is a rising tide which will float all franchise boats in the mid term and certainly in the long term.

      Unfortunately it wont change the Rays model of running a sustainable franchise with regards to Longo’s expected free agency. If some big
      spending team decides he is worth a max long term contract, $18 to 26 million, (and they will) he is gone and we would never match that (nor should we)

      Just forget about keeping him once the craziness starts, nobody is worth those max contracts, unless you have money to burn and we never will regardless of TV money as if ours goes up, the big baseball/corporate supported teams go up even more.

  2. Burg says:

    The Rays bet against themselves when they made the current deal, that’s on Stu and the gang, but they plead poverty because of attendance, I call B.S.

    • YoBuc says:

      So true. They got snookered big time by the Foxies. That’s because broadcasting contracts aren’t covered by Stratomatic. By the time their new TV deal comes through, Longo will be sniffing toward the exit door.

  3. CA says:

    The prospective TV deal would set the stage for a new stadium in downtown Tampa around 2016. A new stadium in downtown Tampa would enable the Rays to retain Longo. That story played out in Minnesota with resigning Mauer.

    Longo’s current deal is an example of an excellent and reasonable contract. Longo had never played a game, but received a guaranteed contract. He was smart enough to recognize the guaranteed component, which was a marginal risk for the Rays at the time (no success at that point).

    • Bulls says:

      would you rather keep Longo and Price but be the worst team in the AL? because fancy stadium or not, that is the case with the M&M twins in Minnesota

      • CA says:

        Not sure what your comment has to do with mine….but, I’d rather have Longo and a fancy stadium and be an AL contender. All are very possible and likely to occurr.

  4. beazy says:

    LOL, MLB doesn’t want to give JoeMa mo’money to play with, the Stanks and Sux will never win the East again…

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