The e-commerce giant is in talks to invest in the owner of Bally Sports networks
Amazon is reportedly in talks to invest in Diamond Sports Group, the owner of 21 regional sports networks that broadcast games for 42 teams across MLB, NBA and NHL. The deal could help Diamond Sports avoid bankruptcy and give Amazon a bigger foothold in the sports media market.
According to sources close to the situation, Diamond Sports is facing financial difficulties due to the decline in cable TV subscribers and the loss of carriage fees from Dish Network, which dropped out of regional sports networks altogether. Diamond Sports, which is owned by Sinclair Broadcast Group, bought the networks from 21st Century Fox for $10.6 billion in 2019, but now they might be worth only $3 billion including debt.
Amazon, which already has the exclusive rights to stream Thursday Night Football on Prime Video, is interested in acquiring a stake in Diamond Sports and possibly gaining access to its live sports content. Amazon has also launched a lineup of daily sports talk shows on Prime Video, featuring hosts such as Cari Champion, Master Tesfatsion and Rennae Stubbs.
The deal could benefit both parties and the leagues
If Amazon and Diamond Sports reach an agreement, it could benefit both parties and the leagues that depend on the regional sports networks for their revenue. Diamond Sports could get a cash infusion and a strategic partner that could help it reach more viewers and advertisers. Amazon could expand its sports portfolio and offer more value to its Prime members and advertisers.
The deal could also appease the leagues, which are concerned about the financial stability of Diamond Sports and the impact on their teams. MLB, NBA and NHL have the option to buy out Diamond Sports if it defaults on its payments or goes bankrupt, but they may not want to take on the burden of running the networks themselves. By partnering with Amazon, Diamond Sports could assure the leagues that it can fulfill its obligations and deliver quality broadcasts.
The deal faces challenges and uncertainties
However, the deal is not a done deal and faces several challenges and uncertainties. For one, Diamond Sports may have to negotiate with its creditors, who are mostly hedge funds that have bought its distressed debt at a discount. The creditors could demand a higher price or a larger stake in the business, or they could push for a bankruptcy filing that could give them more control.
Another challenge is the regulatory approval, which could take time and face scrutiny from the authorities. The deal could raise antitrust concerns, as Amazon already dominates the e-commerce and cloud computing markets and has a growing presence in the entertainment and media sectors. The deal could also face opposition from some cable and satellite providers, who may fear losing customers to Amazon’s streaming service.
Finally, the deal could face competition from other potential buyers, who may also see value in Diamond Sports and its live sports content. Some of the possible contenders include Disney, Comcast, AT&T, Discovery and ViacomCBS, who all have their own streaming platforms and sports networks. The deal could also spark a bidding war among the tech giants, such as Apple, Google and Facebook, who may want to challenge Amazon’s dominance in the online space.
The deal could reshape the sports media landscape
The deal between Amazon and Diamond Sports, if it happens, could reshape the sports media landscape and have implications for the future of sports consumption and distribution. The deal could signal a shift from the traditional cable and satellite model to the streaming and online model, where viewers can access live sports content on demand and across devices. The deal could also create new opportunities and challenges for the leagues, teams, players, fans, advertisers and other stakeholders in the sports industry.
