As shaky as the regional sports network (RSN) model has looked during the last few years of accelerated pay-TV contraction, there are a few local sports outlets that aren’t sweating out the great bundle purge. For these handful of RSNs, the combination of generous affiliate fees, sheer market size and consistent on-field excellence suggests they needn’t dive headlong into the relative unknown territory that is a streaming-first business model.
Foremost among the RSNs best positioned to ride out the coming storm—these include the Dodgers’ home base, SportsNet LA, as well as SNY (Mets) and NESN (Red Sox)—is YES Network. The Yankees’ media monolith has been the most-watched RSN in nearly every year since the channel launched way back in March 2002, a show of dominance that can be chalked up to the sprawling expanse that is the New York media market and a hometown team that is nearly always in the playoff hunt. (In the 19 MLB seasons that have been staged since YES first bowed, the Bombers have won the AL East outright on nine separate occasions, while advancing to the postseason 80% of the time.)
And while this current season has been nothing short of schizoid—August’s 13-game winning streak lit a fire under the Yanks, who as recently as July 5 had been mired in fourth place in the division, down 10.5 games to leader Tampa—YES is one of the few RSNs that haven’t suffered ratings declines. Even at the All-Star break, when the local sports pages were writing off the season as a lost cause, YES’ ratings were more or less flat compared to 2019—yet another season in which the RSN beat all comers. Since the Summer Olympics wrapped on NBC, the Yankees have been the hottest show in the NYC DMA; per Nielsen, seven of YES Net’s most recent primetime games out-delivered every other program in the market, including shows airing on the local broadcast affiliates.
Over the course of the last three weeks, YES’ primetime Yankees telecasts have averaged 361,000 viewers per game in the home market, which outstripped the deliveries for a number of recent national sporting events. The coast-to-coast telecasts YES topped in August include no fewer than nine primetime MLB games hosted by the league’s in-house network. In other words, a local telecast beamed to a market of 6.82 million TV homes put up bigger numbers than a host of nationally televised windows that had been made available to 54.3 million households.
All told, this was YES’ most-watched August since 2017—this despite the fact that the New York market in the last four years has lost 524,500 TV homes, or 7% of its base. For the sake of context, Gotham in the past 48 months has lost nearly as many TV households as there are in the Providence market, a designation that effectively includes the entire state of Rhode Island, as well as neighboring New Bedford, Mass.
A similar dynamic has taken hold in Los Angeles, which since 2017 has experienced a 6% contraction in TV homes. With a net loss of 331,480 would-be customers, SportsNet LA has taken a Madison, Wisc.-sized hit, and yet the Dodgers’ local TV ratings are up by more than 50% versus 2019. The hits should keep on coming for the RSN, as the defending champs on Wednesday night moved back into first place in the NL West for the first time in four months. Now the odds-on favorite to win the World Series (+280), the Dodgers face a pivotal series in San Francisco this weekend, the last on the schedule for the two rivals.
If loyal fan bases in sprawling media markets aren’t sufficient to shield YES and SportsNet LA from the coming paradigm shift—in the long run, every TV property will find itself raptured into the streaming realm, regardless of scale—the economics should certainly give the two power RSNs the luxury of mapping out a conversion strategy. YES Network in 2022 is projected to book a towering affiliate fee of $7.27 per sub per month, per Kagan/S&P Global Market Intelligence estimates, while SportsNet will be in similarly rare air with its $6.48 price. Those rates not only tower above the average RSN fee ($3.53 per sub per month), but also dwarf the rates charged by national sports channels such as NFL Network ($1.79) and FS1 ($0.89). As has been the case for the better part of a decade, the only programmer that puts YES in the shade is ESPN, which is on pace to rake in a staggering $9.68 sub fee.
The ESPN figure is something to bear in mind whenever anyone challenges linear TV’s ontological status. Sure, the Trampoline Channel—a catchall for whichever low-status, $0.09 fee curiosity you care to name—is as good as dead, and the imminent shuttering of NBCSN is proof that even established brands with enviable distribution (80.6 million homes, give or take) are going the way of the diplodocus. But with a guaranteed $8 billion coming in every year just for turning the lights on, ESPN has all the time in the world to make the transition to a future in which ESPN+ is its dominant platform.
The same holds true for YES, SportsNet LA and a handful of other top-tier RSNs, which operate like scaled-down ESPNs. Ask a dozen executives how the streaming future will shake out, and you’ll get a dozen different answers. The lone point of consensus boils down to something’s gotta change, and that something had better come along quick. For the Yankees and Dodgers, the extra processing time their RSNs buy them may be the ultimate luxury.
