ESPN’s longstanding media rights deal with MLB comes to an end following the 2025 season. (Photo by … [+]
On Thursday, an opt-out clause in the national broadcast deal between ESPN and Major League Baseball was exercised, ending the current contract between the two that had been inked to go through the 2028 season.
The contract between the two had the ability for either side to opt out at the end of the 2025 season. ESPN informed Major League Baseball verbally on Thursday morning and formalized the opt-out in a letter to the league in the afternoon. In a statement by the league, they portrayed the opt-out as mutual.
Both sides had been seeking more from the other. ESPN has made it clear that they have an interest in a local media rights package to go with a national deal that would bolster their direct-to-consumer offering. MLB commissioner Rob Manfred has said on numerous occasions that a bundle of local rights that would see revenues shared across the owners is something they have examined.
Irrespective of the local media rights, ESPN has been seeking a new package that would cost less than in the current agreement which is reportedly $550 million annually. ESPN has cited the deals with Roku – who look over the streaming deal with Peacock — and Apple which pay significantly less, as reasons for seeking a new deal with lower costs.
“We are grateful for our longstanding relationship with Major League Baseball and proud of how ESPN’s coverage super-serves fans,” ESPN said in a statement Thursday evening. “In making this decision, we applied the same discipline and fiscal responsibility that has built ESPN’s industry-leading live events portfolio as we continue to grow our audience across linear, digital and social platforms. As we have been throughout the process, we remain open to exploring new ways to serve MLB fans across our platforms beyond 2025.”
In a memo sent to the 30 owners in Major League Baseball on Thursday afternoon, Manfred cited several reasons to dispute ESPN’s claim that deals with Roku and Apple should be applied with ESPN.
“First, the inventory involved in the Apple and Roku deals is very different from the ESPN inventory,” Manfred said. “The ESPN deal contains the only truly exclusive regular season windows on Sunday nights, the exclusive right to an entire round of playoffs, and the Home Run Derby, one of the most exciting events of the summer. In contrast, Apple and Roku have games that compete against a complete slate of other games broadcast in local markets. In fact, in the last round of bargaining with ESPN, they declined to purchase the inventory we subsequently sold to Apple and Roku. Second, given the strength of our product we do not believe a reduction in fees is warranted. Sunday Night Baseball ratings were up 6% in 2024 over 2023, which is notable given that 2024 was a summer Olympics year. The 2024 MLB Wild Card Series was the most watched ever, averaging over 2.8M viewers per game, up 25 percent from 2023. Our Home Run Derby is the highest rated skills competition in any professional league. In addition, our demographics are extremely attractive. The overall male/female ratio on ESPN is 73/27 while MLB on ESPN is 68/32, with growth among women outpacing men this year. In addition, our Hispanic audience on ESPN is ~10%, significantly above most other sports on their platform.”
Beyond the disagreement with comparing Roku and Apple to ESPN’s MLB media content, Manfred mentioned a decline in subscribers as another reason ESPN was not as favorable as it once was.
“[We]
do not believe that Pay TV, ESPN’s primary distribution platform, is the future of video distribution or the best platform for our content,” added Manfred. “As of December 2024, ESPN was available in 53.6M homes, down from its peak of over 100M homes in 2011 and 69M homes when we struck the current deal in 2021.
“Furthermore, we have not been pleased with the minimal coverage that MLB has received on ESPN’s platforms over the past several years outside of the actual live game coverage.
The league released a statement late Thursday which highlighted why the see MLB as a valuable property for media rights partners.
“Entering the 2025 season, MLB is enjoying tremendous momentum led by generational talent on the field and an entertaining brand of baseball due to rule changes which have improved the pace of play and action on the field,” part of the statement said. “The results have generated increases in attendance, viewership, streaming, international growth and overall fan engagement. The positive energy around the sport has also led to significant interest from both traditional media companies and streaming services who would like to obtain rights to MLB games. We will be exploring those opportunities for a new agreement which would start in the 2026 season following the conclusion of ESPN’s agreement at the end of this year.”
As for the end of the broadcast deal beginning in 2026, MLB and ESPN still have the upcoming season to partner through, the league made note of it in their statement.
“The MLB-ESPN partnership has been an important and long-lasting relationship that has helped both organizations achieve great success. As we get ready for the 36th season of Sunday Night Baseball, we look forward to a successful final year of MLB on ESPN in 2025.”
Beyond ESPN, Major League Baseball also has national broadcast deals with FOX and TBS that run through 2028. FOX pays $228.6 million annually, while TBS pays $470 million a year. For the 2025 season, MLB will see revenues from ESPN, FOX, and TBS of $1.76 billion.
