Mobile sports gaming titan FanDuel is approaching a deal to assume operations over 18 regional Bally Sports TV channels, currently owned by Diamond Sports Group.
Bankruptcy Requirement
FanDuel is nearing an opportunity to obtain naming rights and access regional sports rights for 18 Diamond Sports Group (DSG) networks while acquiring an equity stake in the company. Bally’s is the gaming company that currently owns those rights but agreed to not renew its agreement with the broadcasting entity at the end of the year as part of DSG’s bankruptcy hearing last year.
However, before FanDuel or any other interested party can complete the sale, DSG must first resolve its ongoing bankruptcy case. The company cited higher broadcasting costs and a shrinking cable subscriber base as the primary drivers leading to bankruptcy.
In order to extricate itself from its financial woes, DSG will receive $450 million in financing from a creditor group, $495 million from its parent company Sinclair Broadcasting Group, and $115 million from Amazon as part of a streaming deal.
“Any company looking to get involved with Diamond and the network rights would want to ensure it doesn’t become liable for their debts,” an industry source with knowledge of the situation said.
Why Amazon?
Nevertheless, Amazon has its reasons for getting involved with DSG according to Insider Intelligence senior analyst Ross Benes, who said it would allow the e-commerce behemoth to “quickly expand its sports streaming options and to develop relationships with local TV advertisers that support regional sports networks,”
DSG’s bankruptcy confirmation hearing is slated for July 29 and July 30.
Strategic Media Expansion for FanDuel
This acquisition would represent a significant media expansion for FanDuel, which launched the industry’s first linear U.S. sports betting television network in 2022, FanDuelTV, thereby entering the daily sports TV market. This acquisition would add another layer to FanDuel’s television broadcasting content.
The deal would extend the FanDuel brand into major markets that are currently without regulated sports betting, such as Atlanta, Dallas and Los Angeles. Establishing name recognition in those barren sports betting markets would be critical to market dominance should they allow online sports betting at some point in the future.
Broadcasting Rights and Challenges
Diamond Sports Group’s broadcasting rights for 15 NBA teams, 11 NHL teams, and 11 MLB clubs are currently operational but many are set to expire at the end of each league’s respective season. FanDuel-branded channels would still be accessible to subscribers of league streaming services like MLBTV or NBA League Pass but stalled negotiations with Comcast, its third-largest distributor, have delayed extension talks.
FanDuel replacing Bally’s is a seismic shift from the latter’s optimism shortly after acquiring the naming rights for $85 million in 2020. Bally’s Chairman Soo Kim described it as “an opportunity to revolutionize the U.S. sports betting, gaming, and media industries.”
“Sinclair, with its extensive network of stations, channels, and RSNs, offers immediate, national brand recognition that will bolster the development of Bally’s player database for both our traditional casinos and future online offerings, ultimately delivering significant shareholder value,” Kim stated at the time.
