The Orioles and Washington Nationals have feuded for nearly two decades over the 2005 television rights agreement that created the Mid-Atlantic Sports Network, and, according to language in the agreement itself, it is designed to continue indefinitely. Even in the event of a sale — which the Orioles are in the midst of — parties are “unconditionally bound” to the deal, it states.
But when asked recently about that MASN deal, Major League Baseball Commissioner Rob Manfred didn’t point to the permanence of the document. Instead, he hinted toward something new.
“Change always produces an opportunity,” he said earlier this month at the owners meetings in Orlando, Florida. “We’ll see.”
For the first time since the Lerner family purchased the Nationals in 2006, there will soon be new decision-makers at the table that has long conjoined the Nationals and Orioles by television revenue. David Rubenstein, the Baltimore native and billionaire co-founder of the Carlyle Group, is heading a new ownership group that has an agreement to take over control of the team from the Angelos family, the club’s owners since 1993.
First, some background: When the Montreal Expos moved from afar to play just 35 miles, as the oriole flies, from Camden Yards in 2005, Orioles owner Peter Angelos cut a deal. As a consolation for MLB encroaching into Baltimore’s media territory, the Orioles would receive a lucrative revenue stream: a portion of the Nationals’ television profits. Since then, the Orioles have annually received at least 70% of profits from MASN, which airs both Orioles and Nationals games.
It was a unique arrangement and immediately contentious. One rival owner said in 2004, even before it was formally agreed to, MLB “is being taken advantage of.”
The deal was crucial for the Orioles, though, who’d gone from being the only MLB show in town from Philadelphia to Atlanta to sharing their TV territory — with a team based in a larger city, at that. The Orioles would now have competition within their market, but they’d receive a supermajority of profits from the regional sports network.
But that was in 2005, during the heyday of cable revenue, and now, in 2024, there’s less hay to make. Gone are the cash-cow days of cable as cord-cutters have changed how TV is watched.
MASN annually pays the Orioles and Nationals for the rights to broadcast their games. After those rights fees are paid, the profits are split unevenly between the teams, with the Orioles getting the bulk. If rights fees are higher, it behooves the Nationals, if they are lower, it benefits the Orioles.
For 11 years, the teams argued in court over how much those rights fees should be. MASN paid, for the period from 2012 to 2016, about $40 million per team, per year. The Nationals contested that figure should’ve been about $95 million; ultimately, MLB decided that those fees would be $60 million, a decision courts upheld last year. MLB then ruled on a similar figure for the next five-year period, from 2017 to 2021: MASN owed each team $61 million in rights fees.
That amount is crucial. As Orioles’ attorneys argued in a 2022 court filing, it would mostly eliminate MASN’s profits — making the Orioles’ supermajority on profits moot.
“This new amount was so high that it would erase virtually all of MASN’s profits,” the attorneys wrote, “eliminating the Orioles’ annual compensation under the Settlement Agreement for the Nationals’ continued presence and threatening MASN’s economic viability.”
If MASN’s profitability is in question, could that prove to be fertile ground for change? Might MLB use the sale as a moment to pressure the teams into a new arrangement, one in which the Nationals, for the first time, control their own television rights?
Perhaps, but much remains unknown as the sale is reviewed by MLB owners. Rubenstein has declined to comment on specifics of the sale until after it is approved, and the Orioles, Nationals or MASN have not commented on what might happen.
Aside from the status quo, several possibilities exist. MLB and the teams could agree to renegotiate the deal, with an eye toward the current market, or a third party could purchase MASN. The network might also offer a direct-to-consumer package, allowing fans to subscribe without cable, as Monumental Sports has done with Washington Wizards, Capitals and Mystics games.
On a larger scale, MLB is seeking to create a digital bundle for fans to watch in-market games in 2025. The Orioles and Nationals, with the right deal in place, could potentially be part of that.
Dennis Deninger, a sports communications professor at Syracuse University’s Falk College of Sport and Human Dynamics, said MLB “may very well be interested in bundling all of the local packages” in a direct-to-consumer package.
“If they did that, then there’d be a chance that they could even out or more equally share revenues from regional TV,” said Deninger, who spent 25 years as a production executive for ESPN. “And that would be a benefit for smaller market teams.”
More urgently, MASN and Comcast — which provides Xfinity cable — are negotiating a deal for the TV provider to continue to air MASN. Their current agreement expires Feb. 29.
“Comcast’s agreements with programmers expire from time to time,” a Comcast spokesperson wrote in a statement. “We are currently negotiating with MASN to reach a fair deal that makes sense for our customers before the current one expires.”
In other markets, recent deals with Comcast have meant that cable subscribers who want to watch their local pro sports teams have to subscribe to premium, more expensive packages. Root Sports Northwest, which airs Seattle Mariners games, and SportsNet Pittsburgh, which airs Pirates games, were recently moved from the most basic cable package to Xfinity’s “Ultimate TV” tier.
If a similar move is made in the Baltimore area, it would likely mean a slight decrease in costs for the bulk of subscribers — who do not watch MASN and would no longer pay the associated fees for it — but a more substantial increase in costs for baseball fans who would have to subscribe to the elevated package.
Many have already cut the cord in recent years. Juan Velazquez, a 36-year-old Oriole fan who lives in Hagerstown, “got rid of cable like everybody else three years ago.”
He often simply listens to Orioles games on the radio or logs into a friend’s cable account to watch MASN games online.
“Most [of my] memories are of them being awful,” he said, listing 90-plus loss seasons in the 2000s. “Now the team is going to be good again and it’s like, I gotta borrow somebody’s MASN login to watch.”
Hypothetically, he said, he’d pay $150 a year to watch every Orioles game online. However, that direct-to-consumer model doesn’t yet exist.
Shelby Gore, 21, of Bel Air, comes from a long line of Orioles fans — starting with her great-grandfather, who was a Baltimore City firefighter. When she moved to college at the University of Maryland, she could no longer watch on her parents’ cable at home and instead streamed games on the MASN app. Games often lag or are delayed by a minute-and-a-half (a complaint Velazquez had, too), which has prompted her to find less-than-legal streams of games online.
“It started becoming more of a chore,” Gore said. “[Rather than,] ‘Oh boy, let’s watch the Orioles,’ it started becoming, ‘Oh, my God, I gotta find a place to watch the Orioles.’”
Fans can stream every out-of-market game via MLB.tv for $150 a year — but local games are blacked out, requiring fans to have cable if they want to regularly watch the Orioles.
The future — for MASN and MLB’s plans — is unclear.
“There are some people, including Rob Manfred, who will be clutching that cable remote until I die,” Manfred said recently. “I do, however, recognize that there are a lot of people for reasons completely unrelated to baseball or any kind of program, to tell you the truth, for fundamentally economic reasons, opt out of that cable bundle.”
It goes beyond direct revenue, Manfred noted, saying that kids who don’t grow up in a house with cable are unlikely to become MLB fans — which creates a larger sustainability issue. A digital option looks to be on the horizon.
“We have, already, significant interests from major partners that would alter the economic proposition of that digital offering in a significant way,” Manfred said.
For MASN, clarity could be coming. The Nationals’ owners, the Lerner family, are not selling the team, The Washington Post reported Monday, a change in tune from the past couple of years. And the Orioles are expected to officially have new ownership by opening day.
Maybe that will lead to a change in the MASN situation. Until then, the agreement will live on, in perpetuity, as envisioned: Orioles and Nationals games will air on MASN and the Baltimore club will retain the bulk of the network’s profits — if there are any to share.