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Q. I know Sinclair is changing the name of its Fox sports channels to Bally and they plan to offer betting and other things. Don’t you think this will push Sinclair to end its blackouts with Hulu and the other TV services? They need them now more than ever, right? — Tom, Mesa, Arizona.
Tom, Sinclair owns 21 Fox-named regional sports channels which have the TV rights to scores of NBA, NHL and MLB games in the regions they are based. But the company has announced it will rename the channels to Bally Sports. For example, Fox Sports Arizona, which offers Arizona Diamondbacks, Arizona Coyotes and Phoenix Suns games where you live in Mesa, will become Bally Sports Arizona.
At some point, Sinclair will also incorporate a betting feature during the games. (Bally is a casino) that will enable viewers to wager on everything from who wins the game to which player gets the most hits or scores the points.
“Our ultimate goal here is to make watching sports as entertaining as playing a videogame,” Sinclair CEO Chris Ripley recently told The Wall Street Journal.
The introduction of in-game betting could revolutionize the way we watch sports, and the way companies such as Sinclair generate revenue. Bally is paying Sinclair $88 million over 10 years for the naming rights, and the waging feature could add much more.
So it’s logical to assume that Sinclair will modify its carriage terms and do whatever is necessary to persuade YouTube TV, Hulu Live, Fubo TV, and Dish (which owns Sling TV) to start carrying the regional sports channels. (The five TV services do not offer the Fox regionals due to separate carriage disputes with Sinclair.) With Bally on board, and betting coming, Sinclair needs the biggest audience it can get to generate the most revenue, right?
Well, not quite, at least not yet. For starters, Sinclair has not said exactly when the channels will be renamed to Bally nor when in-game wagering will be added. The company has simply said it will be “in the coming months.” That could be this spring, summer, or even the fall. Consequently, Sinclair is not under greater pressure now to expand its audience. It has some time to play with, so to speak.
(Sinclair has also said it plans to launch its own app this spring that will include regional broadcasts and betting, although it has not offered an exact launch date. The standalone app could further complicate its negotiations with the five TV services.)
Second, Sinclair has established the current carriage terms for a reason: They make economic sense for the company.
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Don’t forget Sinclair has to pay the leagues an exorbitant amount of money for those regional TV rights. The carriage fees help offset those expenditures. If Sinclair lowers them now, it would eventually have to lower them for everyone. Although the company expects to generate more revenue “in the coming months,” it doesn’t want to leave money on the table now. It would be wiser to keep their current rates and hope that the popularity of in-game wagering will ultimately compel all TV services to pay up.
Bottom line: I don’t see Sinclair’s partnership with Bally changing the dynamic here anytime soon. If the live streaming services add the regional sports channels in the coming days, or even weeks, it will be because of pressure from subscribers who want to watch their home town teams, not Bally and betting.
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