Garber vs. MLB Lawsuit Still Bears Some Fruit for Fans

A little over a year ago, Major League Baseball settled a class-action suit against fans who contended that blackout rules violate antitrust laws. The ramifications for not settling could have been massive, as ending the current blackout rules would prevent regional sports networks (RSNs) from claiming exclusivity over territories to air baseball games. This, in turn, would have prevented them from charging cable providers large amounts of money per subscriber to place them in the basic-cable tier — amounts that cable providers still seem (mostly) willing to pay. Instead of risking that potential financial catastrophe, MLB settled. In the process, they lowered the price of MLB.TV and offered single-team solutions. In a less notable development, the deal also included stipulations regarding in-market streaming of baseball games.

As Nathaniel Grow discussed at the time of the settlement, the lawsuit provided incentives for in-market streaming.

Finally, although not mentioned in the plaintiffs’ attorneys’ statement, Eric Fisher of the Sports Business Journal is reporting that the settlement could also pave the way towards allowing subscribers of RSNs owned by Comcast and DirecTV to stream in-market games via MLB.TV. In particular, the settlement agreement will reportedly specify that MLB cannot raise the price of its MLB.TV service until both Comcast and DirecTV reach an in-market streaming deal with MLB for their RSN subscribers.

For a few reasons, this provision wasn’t a big deal at the time at the time of the settlement. For one, preserving blackouts was probably the most important objective the settlement accomplished for MLB. Lowering the price of MLB.TV by 15% and securing lower fees for viewing just a single club’s games was also a bigger priority. Also, MLB had already agreed at the time to in-market streaming for half of the league’s RSNs — namely, those operated by FOX. For all of last season, half the league plus the Toronto Blue Jays had access to in-market streaming. The final reason the provision wasn’t that big of a deal at the time was due to when it would actually matter — i.e. one year later. Of course, that happens to be now.

Characterized briefly, in-market streaming is the ability, with login credentials received by means of a cable subscription, to watch local games on mobile devices. This is hardly a novel idea, of course. But MLB.TV has now been around for years, and local fans had been denied the ability to watch locally streaming games until last season. Half the fans were added last year, and almost the entire remainder will be added this season. Comcast made their announcement in January that their RSNs would offer in-market streaming of live games. This applies to the Chicago Cubs, Chicago White Sox, San Francisco Giants, Oakland A’s, and Philadelphia Phillies. Fans will be able to watch games, including pre- and post-game shows, via NBC’s online app.

That brings the total of teams with in-market streaming to 21. The New York Mets have an agreement in place, as do the Boston Red Sox, which brings the total up to 23 teams. There are three teams that do not have an agreement. One network, MASN — which controls the rights to both the Baltimore Orioles and the Washington Nationals — does not yet have an agreement, which is interesting because that network is owned entirely by the Nationals and Orioles. It was reported in the FOX deal that MLB was going to receive 4% of the local television contract, and it’s possible that those negotiations are holding things up as the parties also have an ongoing lawsuit on how to split the rights fees between teams. The other team without a deal is the Los Angeles Dodgers, and their local revenue for the season is still very much in the air as the team continues to negotiate with local cable providers to carry SportsNet LA.

That leaves four other teams: the Colorado Rockies, Houston Astros, Pittsburgh Pirates, and Seattle Mariners. All four of those teams broadcast on Root Sports, owned by AT&T. While a deal hasn’t yet been announced, commissioner Rob Manfred has indicated that the parties are close on an in-market streaming arrangement. At this point, it’s probably fair to say that they are really, really close. How do we know? Because the league has recently announced that MLB.TV is available for the coming year, setting the price for the product at $112.99. Last season, MLB.TV cost $109.99. Per the terms of the Garber settlement, MLB couldn’t raise the rate unless in-market streaming was made available on the Comcast- and AT&T-owned stations. Those raises were capped at 3%. A $3 raise amounts to just less than 3% while still preserving the aesthetics of a price that ends in 99.

Back in 2015, I called in-market streaming a small step for consumers, and that sentiment still applies.

In-market streaming is a small victory for those who already subscribe to cable and have a local team broadcasted by a FOX-owned cable channel. They will have expanded options to view games, and the games will be much more accessible outside of the home. The move could be a precursor to a direct subscription model, combining the best of HBO Now and MLB.tv, but due to the current cable model, this move is more of a small step than a drastic change for baseball fans.

In part due to the Garber settlement, this small step has now been expanded to include nearly every MLB team. In a few years, it will likely seem a bit ridiculous that local fans didn’t have the option of watching games on their mobile devices when they were already paying for cable, but many advances which seem logical in hindsight were once viewed as unlikely. Indeed, there will almost certainly be a time at some point in the future when it will seem quaint that, in the past, people had to purchase an entire bundle of cable channels whether they wanted to or not in order to watch their favorite baseball team. That time might still be a ways off, but these small steps we see now are still steps in the right direction, providing more direct access so fans can watch the game they love.