FOX Sports has reportedly closed a deal to purchase SportsTime Ohio, a regional sports network previously owned by Larry and Paul Dolan, who also own the Cleveland Indians. The sale will net the Dolans between $200-250 million and will reportedly include a new agreement to air Indians games within the Fox Sports Ohio family.
According to Scott Sargent of Waiting for Next Year, that agreement will bring an additional $10 million per year to the Indians in local television revenue over the next 10 seasons. Reports had Cleveland’s previous agreement with STO valued at $25-30 million per season.
The addition of the FOX Sports money will almost certainly help the Indians franchise as they attempt to build a competitive team for new manager Terry Francona. The acquision of free agent Nick Swisher has been widely panned because of the price paid by the Tribe. At an average annual value of $14 million for four or five seasons, most around baseball consider the Indians to have overpaid for the switch-hitter. When you consider that the club just got $10 million of that covered each year, the contract is much more digestible.
Cleveland’s new deal with FOX isn’t the behemoth local TV deal that some of the major markets have found in recent years, but it does put the Tribe closer to the middle of the pack when it comes to local television contracts.
The same thing has already been happening across the sport. New national television contracts that kick in for 2014 will more than double what each team has been getting from the national television contracts with FOX, ESPN, and TBS. While contracts across the board this off-season have been inflated, it isn’t because teams suddenly got significantly dumber, it’s that there is suddenly a much larger pool of resources from which to pay players.