Would the Orioles’ owner sell MASN?


Over the past couple of days some interesting news started to leak out to the effect that Baltimore Orioles’ and MASN majority owner Peter Angelos was considering selling the network. According to the Baltimore Sun (by way of Sports Business Journal), Angelos has had talks with both FOX and Comcast at the pushing of MLB. That’s the part that really interesting to me. The league is trying to suggest to Angelos that he sell the network? MASN is of course owned jointly by Angelos and Ted Lerner, the owner of the Washington Nationals (Lerner owns a minority share which will eventually max out at 33%). Washington’s franchise also had the right to renegotiate their TV deal last off season, however they’re marred in a contentious debate with MASN about how much their TV rights should go up.

MLB has tried to mediate this situation, however it’s currently in the arbitration process. In effect, there are parameters in the deal that stipulate how much the Nationals’ TV rights can go up when reset. The Nationals are arguing that they should get more of a bump given that the market for TV rights has skyrocketed since the deal was signed. MASN is countering with the idea that “a deal is a deal.” That aside, the contract also stipulates that the Orioles are to receive the same amount in rights fees as the Nats. So if the rights fees are too much for the network to handle, it could go into bankruptcy. The Nats will get a raise in their fees (as will the O’s), that’s for sure. They’re just trying to get $100 million plus as opposed to $40 million.

I find it interesting that the league would suggest that the network be sold. The reason that MASN owns the Nationals’ TV rights was a compromise in that Peter Angelos dropped his legal challenges to a team relocating to Washington DC. That compromise worked well for Angelos, however it has also created a situation whereby the two teams have become strange bed fellows. Now with the Nats claiming what they’re claiming in rights fees, they have to know that it would put a huge constraint on the network financially. Bearing that in mind, odds are they’re trying to get out of the deal so as to bring their rights onto the open market (so as to separate themselves from MASN and to a lesser extent the Orioles). Regardless of that, I would agree with the “a deal is a deal” point. If you sign a contract with someone you should honor your commitment.

Courtesy of Andrew Weber-USA TODAY Sports

But why would MLB suggest that Angelos sell the network? That would allow the league and the commissioner to get out from between two ownership groups of separate franchises. If another entity owned MASN, they would then own the broadcast rights to both teams. Therefore given that MASN is owned separately from the two franchises, the commissioner would cease to be forced to show favoritism one way or the other. It would give him a convenient out in terms of this situation. However again, it seems to me that this should be an open-and-shut type of deal. A deal is a deal…right?

I suppose that you can get out of any deal if both sides are willing. However in this case MASN isn’t willing to allow that, and I can’t say I blame them. The fact is that there’s a lot more than meets the eye involved in the MASN deal. From the perspective of the Nationals and their fans, their TV rights are owned by another team. That’s technically not the case; their rights are owned by MASN, of which the majority stake is owned by Peter Angelos…who also happens to own the Orioles. There’s certainly a conflict of interest there, however to argue that MASN plays a favorite between one team or the other would be a total falsehood. Both teams get equal coverage. It’s really just a financial boom for Angelos, which is probably what ticks people off more so than anything else.

All of that aside, I still keep coming back to the point about it being interesting that the league urged Angelos to sell the network. Here’s another point: would the Lerners then be selling their stake as well? It would make very little sense for Angelos to sell MASN because it makes him money. For the record, MASN spokespeople have discredited the reports that the network was or is for sale. As the son of a small business owner myself, I can tell you that every business is perpetually for sale. If someone walked into my Dad’s auto repair shop and made an offer that blew him away, he’d probably sell. The same I suspect would be true of MASN or the Orioles themselves (and the Nationals for that matter). I don’t see Angelos selling the network now or at any other time in the near future. But that’s my view…