Monumental Sports & Entertainment, which owns the NBA’s Washington Wizards and the NHL’s Washington Capitals, has agreed to acquire full control of regional TV network NBC Sports Washington.
Founded by former AOL exec Ted Leonsis, Monumental has owned 33% of the networks since 2016. Pending regulatory approval, it intends to buy the rest from NBCUniversal and its parent, Comcast, which also owns six other RSNs and a stake in New York’s SNY.
Financial terms were not disclosed.
As part of the transaction, NBCU will continue to help run the network, providing corporate and shared services such as distribution, technical resources and production facilities for up to 18 months. The network, which has exclusive rights to Wizards and Capitals games, is part of the NBC Sports Regional Networks division within NBCUniversal Local.
As streaming has gained traction and the pay-TV bundle has shrunk at an accelerating pace, the traditional RSN model has come under significant pressure. Born during the go-go cable TV era of the 1990s and 2000s, the networks exploded in popularity and threw off massive amounts of revenue both from carriage fees and advertising. Major League Baseball broadcasts can still pull large ratings in many markets and generate significant cash flow, but the profit margins are not what they used to be and the financial viability of streaming is still coming into focus.
Another layer to the situation is the ongoing escalation of rights fees, as evidenced this month by the multi-billion-dollar set of media agreements announced by the Big Ten Conference, a record-smashing milestone for college sports. Against this backdrop, a few RSN operators, among them Sinclair Broadcast Group subsidiary Diamond Sports, have started to explore direct-to-consumer streaming options. Diamond’s Bally Sports+ is launching nationwide next month as a stand-alone offering.
The Wall Street Journal last year reported that NBCU was evaluating a range of options for its regional sports nets. The company had already decided to end NBC Sports Network’s run as a cable network at the end of 2021, shifting its programming mainly to to USA Network and general-entertainment streaming service Peacock. By early 2022, an NBCU press release indicated that the company planned to roll out direct-consumer streaming versions of the RSNs by the end of 2022. But that message was soon retracted, with a spokesperson explaining that it had been released “inadvertently” and clarifying that there were no formal plans for streaming launches in the near term.
In today’s announcement, NBC Sports Regional Networks president Bill Bridgen described the deal with Monumental as a “unique opportunity.” He said both companies “value local sports media and are committed to serving fans now and investing in the future.”
NBC Sports Washington is available throughout the District of Columbia, Maryland and Virginia, as well as parts of Pennsylvania, Delaware and West Virginia. Launched as Home Team Sports in 1984, the network has carried Wizards and Capitals games since its first days on the air. Baseball’s Washington Nationals have a stake in the Mid-Atlantic Sports Network, a joint venture with the Baltimore Orioles unaffiliated with the NBC Sports network.
Teams often have sizable stakes in RSNs. The New York Yankees’ YES Network set that framework, and the New England Sports Network, SportsNet LA and Chicago’s Marquee Network are other prominent examples.
NBC Sports Washington is “an important business for our current and future core business operations,” said Zach Leonsis, president of media and new enterprises for Monumental. “We look forward to further enhancing and innovating on the already best-in-class experience that our fanbase enjoys of watching live sports, for years to come.”
Along with the Wizards and Capitals, Monumental also owns the WNBA’s Washington Mystics, the NBA G League’s Capital City Go-Go and the NBA 2K League’s Wizards District Gaming. The company also owns and operates Capital One Arena and runs several other venues.
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