Bankrupt regional sports network operator Diamond Sports Group and Major League Baseball’s Arizona Diamondbacks issued a joint statement late Wednesday, declaring that the two sides have made progress on negotiations to keep the National League West Division leaders on RSN Bally Sports Arizona.
Also read: Bankrupt Diamond Moves To Cut MLB’s Diamondbacks Loose From Bally Sports Arizona
The Houston bankruptcy court overseeing the Chapter 11 restructuring of Diamond, a subsidiary of broadcast giant Sinclair, had been scheduled to conduct a hearing Thursday, which would determine if Diamond could walk away from the Diamondbacks’ money-losing local TV rights contract.
“Diamond Sports Group and the Arizona Diamondbacks have decided to postpone tomorrow’s hearing due to ongoing and positive discussions toward finding a solution,” the joint statement read. “During this time, Bally Sports Arizona will continue to broadcast D-backs games and fans will have the same televised access they have been able to enjoy from the beginning of the season.”
Judge Christopher Lopez, who is overseeing Diamond's bankruptcy proceedings, postponed the hearing until July 17.
Diamond entered bankruptcy back in March, aiming to shed around $8 billion in debt. Part of that relief comes from leveraging the contractual flexibility provided by Chapter 11 laws, which allow Diamond to tear up unprofitable multiyear deals amid the 41 MLB, NBA and NHL teams tied to the 19-channel Bally Sports universe.
Diamond already walked away last month from baseball’s San Diego Padres, the team unwilling to trim its linear TV rights rate or surrender its DTC streaming rights. The subsidiary filed a brief last week with the court suggesting it was about to do the same with the Diamondbacks.
Under the direction of MLB commissioner Rob Manfred, who in recent court testimony has expressed his displeasure with how Sinclair chairman David Smith conducts business, to put it mildly, pro baseball has shown a strong willingness to work with clubs under Bally Sports contracts and find alternative broadcast mechanisms around Diamond should it stop paying the teams.
Perhaps Diamondbacks management is looking at the Padres’ financials and is having second thoughts as to whether do-it-yourself local TV broadcasting with league support can replace the lost Bally Sports revenue.
