Local TV Ratings Are Good But Also Can’t Get Better
In recent years, Major League Baseball has taken steps to make its product available by means of multiple platforms. A daily broadcast, for example, is offered both on ESPN+ and MLB.TV. A weekly one is carried by Facebook. MLB Network is accessible as part of basic packages available through streaming providers like DirecTVNow, Playstation Vue, and YoutubeTV, while the league broadcasts national games on its own network, at ESPN, FOX, FS1, and TBS. The game is out there for consumers who are interested.
That said, there is still a transition to be made before baseball can fully introduce itself to a younger generation of fans. The presence of Regional Sports Networks (RSNs), however, remains an impediment to evolution. RSNs generate massive revenues for MLB teams, either through contracts or ownership, but also require exclusivity. The reason for that arrangement is pretty clear when examining the viewership numbers and ratings (recently published at Forbes) for all teams except the Blue Jays. The graph below shows the average household numbers (HH) per team.

The numbers look how you might except, with New York, Boston, and Chicago (Cubs) drawing the most viewers, while smaller markets and bad teams occupy the lower ranks. The Dodgers’ audience should hypothetically be a lot larger, but the club still hasn’t been able to reach an agreement to get on DirecTV in Los Angeles. Despite that, more than two million people are watching baseball on an almost daily basis for six months out of the year. That’s incredibly valuable.
For networks, those loyal customers help RSNs secure large carriage deals with cable providers and to appear among standard cable packages, charging several dollars per subscriber. Advertising is nice, but RSNs make a vast majority of their money from per-subscriber fees. In turn, the networks dole out large guarantees to teams. The continued high ratings tend to justify these deals. The graph below shows the ratings, which are based on viewers within a market, as opposed to the total household figures.

