MASN has gobs of money but they don’t want to give any of it to the Nationals

June 12, 2012 | Drew Forrester

MASN has gobs of money but they don’t want to give any of it to the Nationals

You would think the prospect of the Orioles getting $75 million or more annually via TV rights fees would make the ballclub happy.

It might also make them better.

But that’s not the case.

It’s not the case because the same guy who owns the Orioles also happens to own the TV network that pays that rights fee to the team.  Confused?  Conflict-of-interest, you say?  Perhaps it is, but that’s what the story involving MASN and the Washington Nationals has become — one giant conflict of interest.

Sadly, it’s the Orioles on-field product that could suffer the most during this time of uncertainty.

THE REALITY OF WHAT’S GOING ON

The short version of the story is this:  The Washington Nationals currently receive $29 million a year from MASN for a rights fee.  They are allowed to “challenge” that rights fee figure every 5 years.  The Nationals believe they should receive somewhere in the neighborhood of $100 million per-year in exchange for MASN televising their home and away games.  MASN feels like $35 million is a fair number.  Therein lies the conflict, one that has remained unresolved for so long that Major League Baseball had to step in to arbitrate the situation and award a new rights fee figure to the Nationals.

Oh, yeah, the Orioles also receive $29 million annually from MASN.

Peter Angelos owns MASN.

And he also is the majority stockholder of the Orioles.

You get it, now?

MASN receives roughly $14 million a month (yes, a MONTH) from Xfinity (nee Comcast) according to a source familiar with the financial agreement between those two.  That $168 million alone would be more than enough for MASN to generate nearly a $70 million profit according to the source.  Add in payments from Verizon, DirectTV and other cable carriers in the Mid-Atlantic and the sports network could be pocketing more than $100 million in annual profits.

So what’s the issue at hand?

Money.

The Nationals  - currently receiving $29 million – think their fair value is more like $100 million a year.

MASN doesn’t want to give it to them.  In fact, they’d rather just hand over $35 million annually to the DC franchise.

Wrapping this up and making it into a real barnburner is the added situation involving the Orioles and their rights fee.  When Peter Angelos (MASN) negotiated with Peter Angelos (Orioles), Peter made Peter agree to a clause that stipulates the Orioles will always receive the same amount of annual rights money as the Nationals receive from MASN.  Pretty tricky, huh?

Now, though, Peter doesn’t want to pay the Nationals $50 million or $75 million or $100 million because…yep…he’d also have to pay the Orioles the same amount.

It’s not quite as intriguing as “50 Shades of Grey” but it’s a helluva story.

MORE MONEY MEANS SPENDING MORE ON PLAYERS 

When the TV network originated back in 2006, it was done so almost purely to provide the Orioles with enough additional revenue to compete with big market teams like the Yankees and Red Sox.  There’s the still-legendary story that Angelos handed to then-fledgling “Press Box” in which the owner claimed the only way to compete with the beasts of the AL East would be to spend with them for free agents using a RSN (Regional Sports Network) as the catalyst for such spending.

Interestingly enough, it’s the Nationals – not the Orioles – who have become players in the free agent market over the last few years.  Whether or not you like Jayson Werth as a player, one thing is for sure:  the Nationals weren’t afraid to put money on the table for him a few years ago.  They made a legitimate effort for Mark Teixeira in 2009 and reportedly made overtures to Prince Fielder before he signed on in Detroit.

That Washington is in first place right now isn’t really part of this story.  That the Nationals aren’t afraid to spend money – lots of it – on baseball players most certainly is, though.

Therein lies another reason that MASN (Angelos) doesn’t want to inflate the rights fee paid out to the Nationals.  He knows the Nats will spend it on players.  He knows, in stark contrast to what his club has done since MASN hit the scene in 2006, the Nationals will improve their team with his money.

And if Washington spends their (just for for argument sake) $70 million on players and ups their annual payroll to the $125 million or so mark, what will the Orioles do with the $70 million THEY receive from MASN?  Will they spend that extra money (roughly $45 million more than they receive right now) on players, too?

(Please see next page) 

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15 Comments For This Post

  1. over40 DON Says:

    Kinda like the walk up fee for O’s games. Nobody hardly knows anything about all this. Imagine if Espn or CBS Sports took this story and ran with it.

  2. John West Says:

    MASN
    Mr.
    Angelos
    Screws
    Nationals

  3. Highlandtown Hank Says:

    Is this 100% truth? Your resentment and anger towards Pete is well documented. Nestor, your job is to provide both sides of the story. Please do so because you are sounding very whiny. Thank you. (DF: Nestor didn’t write this piece. Drew did. It’s all true. Thanks for checking in.)

  4. Steve from Sandpoint Says:

    Drew, you watch and see, Angelos will try to pass a increase on to the Comcast viewers and other cable companies. So the fans will end up paying the freight as always, forget your 3 dollar a month fee it might go to 5 dollars, Angelos will find a way to get around this without costing him any money.

  5. john angelos Says:

    Mr. Angelos is a great man who has done so much for Baltimore. You all should be honored that he is our owner. Think about all the great he has done — taking the first 15 years of his ownership to find a spring training home, prior to which he told Disney to stuff it on the Orioles having spring training where the Braves are now in Disney World…. keeping Spring Training in sexy FT Lauderdale so his sons Johnny and Louie
    could be playboys all night, despite the aging facility, being 4 hours from the minor league complex, and 1 hour from the closest opposing team (so nothing but long bus rides). Makes total sense. And the, Mr Angelos has given you the last 14 years of greatness. Amazing players, amazing memories for these 14 years. We’ve fought the evil MD Stadium Authority, We’ve fought the evil Ravens, and we wouldnt let the the Super Bowel XXXV champs throw out the first pitch bc we hate them. We fought the evil Ravens again when their horrible owner Biscotti wouldnt meet with Mr Angelos to
    renew the MASN/Ravens deal LIKE A MAN. FACE TO FACE. Mr Angelos fought and continues to fight that evil owner of WNST radio with dellusions of grandeur and will work hard to keep him out of our stadium. Mr Angelos also will continue to fight you, the fans, doing his best to screw you unmercifully. Being shady with student night $6 tickets. Charging you MORE to come out on game night and buy tickets. And on and on. FIGHTS FIGHTS AND MORE FIGHTS. MR ANGELOS LOVES WHAT HE DOES. I gotta run. Have another BAR exam to fail
    continuesto fight that evil pipsqueek radio host Nestor, and we’ll continue to fight you the fans screwing you at every regard including

  6. Gerald Says:

    Would have been a good story if you didn’t bring your personal squabble with the O’s into it. It take away your credability. (DF: It doesn’t take away anything since it’s all true. And it’s credibility, with an “i”, not an “a”. Not being able to spell credibility the right way takes away from yours.)

  7. bob Says:

    Highlandtown Hank… I would need to read the article again to see if Nestor made any mention of the recent Texas Rangers TV rights deal (among other recent big money deals). Angelos offering $35 million is at least 100% BELOW what the Nats rights are worth, when compared to these other recent deals. Perhaps Nestor needs to delve into these comparable deals more. But overall, there really isnt a side of the story that helps Peter at all.

  8. Unitastoberry Says:

    My guess is all your cable and satalite bills are going up folks ! Ah for the good old days with Chuck Thompson,Bill ODonnell,Charlie Eckman,and thirty or so free Os games on free TV!

  9. Eric Says:

    Very well written and provides the fan base, those intelligent enough to understand this, with a great understanding as to why the ownership isn’t willing to field a competitive team.

  10. T Nelson Says:

    Maybe Angelos should check the standings because the Nats are in first place without spending “extra money” on new players…i understand business is business but when your own greed gets in the way of your own greed thats just a little overboard

  11. Tom Says:

    Drew, do you really believe Angeloser cares whether or not the Nats spend their increased revenue on players? His only incentive is $$$$$$ so it really makes no difference to him. Playing second fiddle to the “little brother” shouldn’t matter. The diehard baseball fans will continue to go (as they have the last 14 years). He will only lose the win – starved fans who are just beginning to come back.

  12. Chuck Says:

    Just do what lawyers do and wait it out. The man will be 83 years old shortly so the clock is quickly ticking.

    By the way, it’s kind of childish to mock Gerald for making a spelling mistake. That’s a level of silly pettiness we expect from the team’s owner. (DF: Come on bro, you have to get mocked if you question someone’s credibility and can’t spell credibility right…)

  13. BmoreBobRob Says:

    What a racket. Even when Angelos loses, he wins. The sad part is that the Nats will put the money into their team and Angelos will put the money in his pocket. He is basically holding this team hostage. It is incredible how much he makes with MASN. Imagine if he had put his money behind You Pon? Whatever happened to You Pon? (DF: You keep asking what happened to You Pon. I don’t know what you’re talking about. What is You Pon? You keep referencing it over and over and over. Is it some sort of feminine product?)

  14. Chris Says:

    I have to say that this is one of the best articles i have read in a long time…not just on this site but nationally or locally. It is an absolute JOKE that the Nationals only get paid $29 Million a year for rights fees (or whatever they are called). I believe the Rangers and Dodgers (and Astros although I’m not 100% sure about them) just signed TV deals worth over $1 Billion over the course of the next decade. i had no idea this is how Angelos was able to cry the blues over not enough revenue coming into the Orioles by keeping their rights fees so low. This is DISGUSTING. Once again, a great article with outstanding facts backing up your strong opinions. would it be possible to interview your source or sources on your radio show? i would love to hear more on this.

  15. aaron manfra Says:

    hey drew, quick question. could the nats just say screw masn and start thier own network that would focus on just d.c. teams (caps,wiz,g-town,etc.) or is there some sort of clause built in by angelos when the expos were moved here? just wondering.

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