Every MLB team will get an extra $50 million from Disney purchase

[caulfield12]

of "Bam Tech," which is part of MLB Advanced Media.

 

https://www.royalsreview.com/2017/8/15/1615...illion-windfall

 

 

In 2000, MLB was wise to this “internet” thing everyone was talking about, and created “MLB Advanced Media” (MLBAM) to standardize their team websites and online ticket purchasing. Each team plunged $1 million per year for four years to fund the venture, giving them each an ownership stake. In addition to ticket services, MLBAM branched out to video streaming and the very popular app “MLB At-Bat” providing scores and highlights on-demand.

 

Before long, MLBAM was an industry leader in providing digital sports content. Eventually, the NHL signed a deal with MLBAM to run their digital properties. And it wasn’t just sports leagues - HBO worked with MLBAM to create “HBO Now” to provide their content through streaming services. MLB had stumbled upon a very successful venture that was changing the industry.

 

"Before anyone el

s

e wa

s

even thin

k

ing about the

s

e i

s

s

ue

s

, BAM figured out compre

s

s

ion, geofencing, and multi-application delivery at

s

cale,"

s

ay

s

Ric

k

Heitzman, a venture capitali

s

t who ha

s

wor

k

ed with BAM over the year.

 

In 2015, MLBAM spun off “BAM Tech” into its own company, that would focus on the non-baseball business of providing streaming content, such as the work with the NHL and HBO, and new ventures with ESPN, WWE, and the PGA. In 2016, Disney purchased a $1 billion stake into BAM Tech, which valued the entire company at $3.5 billion, which all 30 teams still owned a stake.

 

This week, Disney announced it was purchasing another $1.58 billion stake in BAM Tech, giving it a majority share of 75%. MLB owners collectively will still own 15% of the company, but will receive $50 million per team, from the acquisition. That’s right, a $4 million investment back in 2000 has turned into at least a $50 million payout.

 

Part of the deal includes Disney getting the right to air one game per night on its streaming service through ESPN for a “significant sum” to MLB. The game will be behind a paywall, but will not be exclusive to ESPN and can still air on regional sports networks.

Edited August 28, 2017 by raBBit

[hi8is]

Wow - great post. I believe Boyer was / is on the board of advanced media

[Chicago White Sox]

That should pay a big chunk of Luis Robert's bonus.

[bmags]

If I had guessed prior to this I would have imagined them getting a crap ton more. That thing has been a straight up cash cow in a time when people are paying a ton of money for content and are waiting for the returns.

 

But, hope the sox put that $50 million into getting these prospects as good as possible.

[southsider2k5]

If I had guessed prior to this I would have imagined them getting a crap ton more. That thing has been a straight up cash cow in a time when people are paying a ton of money for content and are waiting for the returns.

 

But, hope the sox put that $50 million into getting these prospects as good as possible.

 

It is a 1250% ROI. I'd be cool with that.

[bmags]

It is a 1250% ROI. I'd be cool with that.

 

Oh most definitely.

 

But Disney is about to get into streaming. That is just the tip of the iceberg. And all of the new entrants are going to go to MLBAM for technology and expertise, or would have. Disney is about to drop a billion in content, I'm just surprised they didn't get more.

[Wanne]

That should pay a big chunk of Luis Robert's bonus.

 

that's what immediately came to my mind....

[Balta1701]

MLB's streaming services were the gold standard of streaming before everyone else caught on.

[ewokpelts]

The crazy thing is that Bam tech was a SPINOFF of mlb advanced media. the 30 clubs still own the mothership, plus the 25% of bamtech not owned by the nhl or Disney.

 

There was a lot of pressure from outside forces for mlb to take on outside investors or IPO mlbam. And even then it would have been massive windfall for the 30 clubs. holding pat until bamtech spun off was a smart move.

 

As for the money, since the sox really only have operating losses and don't carry long term debt, they have a huge wad of money that can be used for ANYTHING, but yeah, likely it'll cover Robert's signing bonus and fees. I imagine quite a few clubs will use it for debt service.

 

[bmags]

The crazy thing is that Bam tech was a SPINOFF of mlb advanced media. the 30 clubs still own the mothership, plus the 25% of bamtech not owned by the nhl or Disney.

 

There was a lot of pressure from outside forces for mlb to take on outside investors or IPO mlbam. And even then it would have been massive windfall for the 30 clubs. holding pat until bamtech spun off was a smart move.

 

As for the money, since the sox really only have operating losses and don't carry long term debt, they have a huge wad of money that can be used for ANYTHING, but yeah, likely it'll cover Robert's signing bonus and fees. I imagine quite a few clubs will use it for debt service.

 

Thanks for this post. Makes sense.

[Thad Bosley]

That should pay a big chunk of Luis Robert's bonus.

The massive revenue the team takes in from its current TV and radio contracts, along with the guaranteed profits courtesy of the sweetheart lease deal, paid for Robert's bonus long before this windfall came along.

[ptatc]

The massive revenue the team takes in from its current TV and radio contracts, along with the guaranteed profits courtesy of the sweetheart lease deal, paid for Robert's bonus long before this windfall came along.

Hostetler was on the radio over the weekend and made a point amount the big increase in the scouting, analytics and minor league budget this past year. He said this priority coincided with the rebuilding philosophy

[Lip Man 1]

Hostetler was on the radio over the weekend and made a point amount the big increase in the scouting, analytics and minor league budget this past year. He said this priority coincided with the rebuilding philosophy

 

That's good to know. Very good news!

[Bananarchy]

MLB's streaming services were the gold standard of streaming before everyone else caught on.

They still kind of are. HBO Now is an MLB Advanced Media product

[ron883]

Hostetler was on the radio over the weekend and made a point amount the big increase in the scouting, analytics and minor league budget this past year. He said this priority coincided with the rebuilding philosophy

It better have. The payroll will be so thin next year and in the upcoming years. Reinsdorf better pony up big bucks for some top. FAs. No excuses. I don't want to see him cheating out. Machado, Harper, or bust.

[southsider2k5]

It better have. The payroll will be so thin next year and in the upcoming years. Reinsdorf better pony up big bucks for some top. FAs. No excuses. I don't want to see him cheating out. Machado, Harper, or bust.

 

You are just setting yourself up to be angry. There is zero chance the Sox sign Machado or Harper.

[ron883]

You are just setting yourself up to be angry. There is zero chance the Sox sign Machado or Harper.

0% chance? That's pretty doubtful. There's a chance they get Machado.

[BlackSox13]

0% chance? That's pretty doubtful. There's a chance they get Machado.

It's going to take alot to go right in '18 to entice either player to sign long term with a rebuilding team like the Sox. Plus, there will be competition from other teams that will have money to spend. The bidding will be ridiculous for both players.

[southsider2k5]

0% chance? That's pretty doubtful. There's a chance they get Machado.

 

Do you really see the White Sox outbidding all of major league baseball to hand out a $250/300/+ million contract? I mean there is a chance I win the powerball. I think our odds are pretty similar.

[yesterday333]

Do you really see the White Sox outbidding all of major league baseball to hand out a $250/300/+ million contract? I mean there is a chance I win the powerball. I think our odds are pretty similar.

With the way things have changed with the Sox I could see us outbidding everyone... I dont see either of those guys going to a team that is a non-contender though. Why would Harper come here if Wash offers close to the same and is still one of the best teams in baseball.

[ron883]

With the way things have changed with the Sox I could see us outbidding everyone... I dont see either of those guys going to a team that is a non-contender though. Why would Harper come here if Wash offers close to the same and is still one of the best teams in baseball.

I think Eloy and Kopech force the Sox hand next year and come up. If these young guns show what they can do, I can see it being an attractive destination for these guys. The Sox can afford to give a massive contract, and these guys get to join a team that Will be a yearly contender. Jon Lester joining cubs is a similar situation.