- The NBA and NHL expressed concerns about the viability of Diamond Sports' business during a bankruptcy court status conference on Tuesday.
- Diamond Sports, which owns the largest portfolio of regional sports networks, has been under bankruptcy protection since last year.
- The leagues are hoping for a resolution regarding the future of diamond sports ahead of the upcoming NBA and NHL seasons.
The National Basketball Association and National Hockey League are concerned about the future of Diamond Sports and whether owners of the region's sports networks can put together a viable business plan for this fall's season.
Diamond Sports, which operates the network under the Bally Sports brand, has been under bankruptcy protection since last March. The league is concerned that the company, which owns the largest portfolio of regional sports networks, will not be able to develop a viable business plan ahead of the 2024-25 season.
Lawyers for the leagues expressed concerns at a status conference in bankruptcy court on Tuesday after the Diamondbacks announced they were postponing a hearing to confirm their restructuring plan from mid-June to late July.
“I want to reiterate why timing is so important to the NBA. The start of the 2024-2025 season is rapidly approaching,” NBA lawyer Vincent Indelicato said in court on Tuesday. “Much must be done ahead of the season in order to properly produce and distribute games.”
NHL lawyers expressed similar concerns, suggesting that if Diamond Sports can't come up with a viable business plan in the coming months, the league may be forced to desperately search for options to produce and broadcast games in local markets. Several major league teams are already moving forward without the Bally Sports network.
Meanwhile, many NBA and NHL teams have deals with local broadcasting groups to air local games.
Diamond Sports must put together a restructuring plan outlining its future outside bankruptcy protection and get court approval to put it into action. Approval would pave the way for the company to emerge from bankruptcy protection.
The NBA has asked Diamond to develop a “very clear business plan” by July at the latest, Indelicato said Tuesday.
It's been a long road for Diamond to draw up a restructuring plan that involved negotiations with lenders to restructure the league's huge debt, with the league and teams over television rights and with pay-TV distributors to show games.
The recent breakdown in talks between Diamond and Comcast Corp. has put a damper on progress for the sports network operator, lawyers for the company said Tuesday.
Last month, Comcast customers lost access to the Bally Sports Network, affecting fans of 11 MLB teams. However, fans of the NBA and NHL are not yet affected by the outage as both leagues are in the postseason. Regional sports networks broadcast local games during the regular season.
Diamond's lawyers said Tuesday that the company is still negotiating with various interested parties, but that talks with Comcast have stalled, leaving the company with little choice but to “explore alternatives.”
Comcast and other distribution companies have been rapidly losing pay-TV customers in recent years as people opt for streaming, with regional sports networks being among the channels most affected. On top of this, Diamond was saddled with more than $8 billion in debt from Sinclair's acquisition of the networks in 2019.
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.
