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Mark Walter, the Dodgers' controlling owner, is chief executive of Guggenheim Partners, which controls Dick Clark Productions. (Robert Gauthier / Los Angeles Times / May 2, 2012) |
Whether the Dodgers keep their television broadcasts on Fox Sports or move them to Time Warner Cable appears to be a "50-50" proposition, according to a person familiar with the team's TV negotiations but not authorized to discuss them.
The Dodgers remain in discussions with Fox and TWC, according to two people familiar with the talks. The Fox exclusive negotiating period expired five weeks ago.
At the time, the Dodgers and Fox were negotiating a deal that could have been worth at least $6 billion over 25 years. However, no deal has been finalized, in part because the Dodgers prefer to avoid a U.S. Bankruptcy Court showdown with Major League Baseball over the structure of the deal.
In the interim, the Dodgers appear increasingly intrigued with the wide latitude TWC might be able to provide for all-day programming -- for the team, and perhaps for other entertainment assets of Guggenheim Partners. Mark Walter, the Dodgers' controlling owner, is chief executive of Guggenheim Partners, which controls Dick Clark Productions.
The initial Fox talks centered on a proposal that reportedly would have provided the Dodgers with at least $184 million a year. Under the Bankruptcy Court settlement between MLB and former owner Frank McCourt, the league agreed that an annual rights fee of $84 million -- plus a yearly increase of 4% -- would represent fair market value, according to people briefed on the settlement terms.
The court -- and not the league -- has the final say over interpretation of the settlement terms. The initial Fox proposal reportedly would have provided an annual guaranteed dividend of $100 million, in addition to the yearly rights fee.
The Dodgers' discussions with MLB center on whether all of their guaranteed television revenue should be subject to baseball's revenue-sharing program. At issue in a $6-billion deal: whether the team's contribution to the program would be about $1 billion or about $2 billion.
The league believes -- and there are indications the court might agree -- that the Dodgers must take some element of risk with any money not subject to revenue sharing.
The Dodgers must contribute 34% of the annual rights fee to baseball's revenue-sharing program. The team plans to launch its own regional sports network, in part to avoid the prospect of Fox or TWC paying a much higher rights fee.
However, in order to get dividends from a regional sports network, the league believes the team should be required to take the accompanying risk of ownership. The Dodgers are looking at other ways to structure a deal that would shield that money from revenue sharing and satisfy MLB as well.
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