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Next Level Technology has been serving the Hunt Valley area since 1997, providing IT Support such as technical helpdesk support, computer support, and consulting to small and medium-sized businesses.

Baseball's Blackout Rule and What it Means for Streaming Orioles' Games on Your Devices

Fotolia 1402938 XSIt’s hard to believe just how far along streaming media has come in a relatively short period of time. It has been twenty years since Internet Service Providers began offering affordable broadband services, but today, organizations offer consumers the ability to choose to stream media from vast media libraries over the web. While there have been some speed bumps in the progress of this technology, today’s consumer literally has the world as his/her fingertips.

Nowadays, streaming media is a must-have for content distribution services. It wasn’t enough that Netflix (and others) allowed its users to select the DVD or Blu Ray copies of movies and shipped them to the customer’s door. No, the future was always in the dissemination of content over the web. Over the past few years, some of the biggest players in media have created applications that allow consumers to stream their content over the Internet to all types of computing devices. This has opened up new streams of revenue for advertisers, for content producers and distributors, and for the immense amount of legal work that goes into managing and maintaining the relationships between the advertisers, content creators, and content distributors.

In this new landscape, one organization that has more than embraced this streaming revolution is Major League Baseball. The creation of MLB Advanced Media has put MLB front and center of sports content dissemination. Created in 2000. it is actually owned by Major League Baseball (split 30 ways between all MLB franchises). Known as “BAM” throughout the industry, MLB Advanced Media has helped HBO develop their streaming services, Turner Broadcasting with NCAA Tournament coverage, and Sony to bring users their revolutionary Vue streaming television service. MLB.TV, the predominant force in sports streaming applications, is in its second decade, but their success hasn’t come without its fair share of hurdles.

One of those hurdles is the blackout rule. For decades there have been television blackout rules in place to protect baseball franchises from losing money on the product they deliver. The most simple explanation is that a sports franchise makes more money when fans go to the stadium, arena, or ballpark than if the fans simply stay home and watch the games on their television; but, since it’s good business to diversify, each team sells the rights to broadcasters to sell the game. These broadcasting companies (sometimes the team itself if they own the television platform) sells advertising space on their local broadcasts. The blackout of games was a response to more nationally televised games that would decrease the value of those ad positions, thus cutting into a team’s revenue if the games were to be broadcast by another company inside of their market.

For an example, let’s say that the Orioles are playing the Yankees at Oriole Park and the game is being broadcast on MASN and on ESPN. Since the O’s have secured ad revenue some time before the game, the ESPN broadcast will be blacked out to ensure that local advertisers, and the Orioles, don’t lose money on their investment. Seems pretty cut and dry, until you bring MLB.TV into the mix.

Make no mistake about it, Major League Baseball owns the rights to disseminate the game anyway they so choose, and for the past several years have been adhering to these blackout rules to protect team’s revenue streams. After all, MASN pays the Orioles (and the Nationals) millions of dollars every year for the rights to show their games on television. If MLB were to begin allowing in-market streaming through their own platform, it effectively cuts out advertisers within that market; and, in some markets those broadcast deals and that ad revenue are much more lucrative than a 1/30 share of any increase in MLB.TV subscribers. It would also set a precedent that media distributors could conceivably offer alternate broadcasts of a game within each market, a nightmare scenario for advertisers and MLB, which is known to keep a pretty tight handle on their property.

There has been some movement by MLB to solve the in-market streaming problem. By settling a class action suit, MLB has set up in-market streaming for the 2017 season. They use the existing cable distributors to stream games through MLB.TV. As of this writing, 27 of the 30 teams now offer a separate in-market streaming package that shows the games streaming from the contracted broadcaster, to ensure the advertising deals struck by the teams are not being ignored. The three teams that haven’t ironed it out are the Dodgers, and the two teams on the beltway. The official statement from MLBAM was, “There are ongoing conversations in an effort to make sure fans of all teams will have access to in-market streaming as part of the commissioner's directive.”

While O’s fans need to be more patient until MASN and MLB can come to an agreement about the nature of in-market streaming, those talks are being had, and it looks as if they will be resolved soon. Until then, you can catch the O’s on MASN, or you can get around the blackout restriction altogether by using a VPN to reroute your Internet Connection through a server not located in the US or Canada. Baseball season is here! If you live in Maryland and want to avoid paying for dozens of channels to watch your beloved Orioles, it may be worth it to look into subscribing to MLB.TV with a VPN.

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