MLB panel slashes Orioles and Nationals TV rights fees by 20%

In late 2023, the Revenue Sharing Definitions Committee of Major League Baseball made a significant decision that affected the Washington Nationals and Baltimore Orioles. Due to a deteriorating cable television market, the committee reduced the rights fees owed to the Nationals by the Mid-Atlantic Sports Network by 20% for each of the last three seasons of their current five-year period through 2026. The new fee structure, announced in a decision made public when the Nationals filed a petition in New York Supreme Court, shows that the Nationals will receive approximately $58.3 million annually from 2024 to 2026, down from about $72.8 million for 2022 and 2023. The decision was driven largely by an expected decline in revenue from subscriber losses and the inability to raise fees per subscriber. The committee, which included prominent team owners such as Milwaukee Brewers Chairman Mark Attanasio and Boston Red Sox Chairman Tom Werner, stated that such a reduction was anticipated in view of the industry conditions. They noted that this 20% cut was consistent with market expectations, emphasizing the financial struggles facing the network that broadcasts both teams. The context of this ruling reflects broader trends in sports broadcasting, particularly within the realm of cable television, where subscriber numbers have been dwindling. The panel indicated that MASN, the network in question, would continue to face these declines, creating a significant risk of bankruptcy unless such measures were taken. The legal history between the Nationals and MASN has been contentious and complex, with multiple disputes over rights fees occurring since the Nationals relocated from Montreal. Past litigations and settlements regarding the rights fees for the 2012-2016 period have highlighted how these financial agreements can change over time due to external market pressures. The Royalty Sharing Revenue Definitions Committee has played a pivotal role in mediating these disputes, and this latest decision marks the continuation of a trend that has seen rights fees for Major League Baseball teams fluctuate based on market realities. As these financial adjustments unfold, both the Nationals and Orioles must navigate this challenging landscape to ensure their financial stability and future success.