According to a report from Ed Sherman, Crane Kenney is exploring options for the Cubs’ TV rights that might include multicast outlets. The team is looking for ways to either get a jump-start on its own network or find a new local partner.
Crane Kenney has been discussing the Cubs desire to have its own network for years. The Cubs were locked into TV contracts with WGN TV and Comcast SportsNet when Kenney first mentioned the idea of the Cubs joining the Yankees and Red Sox as teams with their own networks. The Cubs contract with WGN TV ran through the 2014 season and the deal with Comcast SportsNet did not expire until after the 2019 season.
The Cubs opted out of the contract with WGN TV last fall as part of the terms of the contract. If the Cubs had not exercised the option at the time, the contract would have extended through the 2022 season. The team and WGN have reportedly been working on a new deal since last November in order to keep Cubs games on WGN.
The Cubs announced a new radio partnership with CBS Radio Chicago earlier this month that moved the Cubs from 720 WGN to 780 WBBM starting next season. The contract with CBS Radio is believed to be for seven years.
The Cubs were expected to address the team’s TV rights by Opening Day, but that soft deadline came and went. Crane Kenney is looking for an outlet to televise the games currently carried by WGN TV.
According to the report from Ed Sherman, “the team is considering an option that is highly unconventional, if not a bit out there: Launching a version of a Cubs network on a multicast station.”
Ed Sherman explained what a multicast outlet is in his report. “A multicast outlet is a sub-channel for local over-the-air broadcast stations. They became more prevalent with cable and satellite providers converting to digital platforms in the last decade.”
It is understood that the games currently televised on WGN must remain on an open-air network until the team’s contract expires with Comcast SportsNet. The Cubs cannot move those games to CSN even if they wanted to based on CSN’s schedule.
Ed Sherman went onto explain, “The multicast stations aren’t considered cable; they are broadcast because they are transmitted over-the-air.” And using this option would give the team a head start on its own network. “The Cubs would produce the telecasts and sell and keep all the advertising revenue.”
The Cubs are reportedly paid around $250,000 per game from WGN. Sherman reported WGN is “losing as much as $200,000 per telecast because of record low ratings in recent years.” WGN would like to continue its relationship with the Cubs, but with the recent announcement WGN America would likely stop televising Chicago teams’ games on the Superstation, Cubs games would be broadcast only on Ch. 9 as well as on MLB.TV or other MLB packages. Sherman’s sources said “WGN has offered the Cubs a new deal that would include a small rights fee and a revenue sharing component. Fees would remain low for poor ratings during the rebuilding process, but they could be much higher if viewers return in droves for a contending team.”
Crane Kenney “isn’t eager to sign a deal that would give the Cubs considerably less in guaranteed money” and it “would be tough for the Crane to go back to WGN for less than what he originally had” according to the report.
The multicast option would add cost to the team, including production costs to air the games which Sherman estimated in the $25,000-35,000 range per game, not including studio shows, “plus they would have to pay for time on a multicast outlet.”
Sherman added the Cubs would lose viewers as well because multicast outlets are not currently carried on AT & T and both DirecTV and Dish “almost never carry them” plus the team would have “to negotiate deals one-by-one with providers outside of Chicago in Downstate Illinois, Iowa and Indiana, areas that are considered their local territories.”
Ed Sherman reported Crane Kenney and WGN TV “declined comment on the multicast possibility” and a “Cubs source said the team is considering many options and is not close to making a final decision.” Time is running out for Crane Kenney to find the right temporary solution for the team’s games for another five years until the Cubs can have its own television network. As Ed Sherman pointed out, “If the Cubs are going the multicast route, they need to assemble an in-house production and sales team quickly” which is “no small task.”