TV rights ruling means more for Fox than it does for Dodgers

So, today’s federal bankruptcy court ruling in favor of the Dodgers against Fox, allowing the Dodgers to accelerate the sale of their post-2013 TV rights, doesn’t mean much in the grand scheme of things for Dodger fans. Ultimately, the Dodgers will get what they can get for the rights, whether it comes from Fox or Time Warner Cable. (Here’s more in my latest Variety story.)

I’m going to be perfectly honest with you.  I’m not predisposed to have any sympathy for Fox, but I have tried over and over again to wrap my head around today’s decision and I haven’t figured out how it helps the Dodgers’ maximize their sale value, and therefore why it served the court any purpose to nullify Fox’s right to keep exclusivity on the Dodgers’ post-2013 rights until next fall.

McCourt can’t negotiate a binding deal with Fox before the sale, so there’s no incentive for Fox to make a real offer. Any valuations of the Dodgers’ TV rights that come before the team is sold will more accurately come from independent sources.

But like I said, whatever damage is done by today’s ruling is done to Fox, not the Dodgers or their fans.

However, something else is brewing that I think could be more significant. Fox is preparing to argue that Time Warner Cable is legally prohibited from getting into a deal for the Dodgers. If Fox prevailed, that could potentially lower the Dodgers’ future TV revenue if it reduces Time Warner Cable’s viability as a bidder.

Here’s what Bill Shaikin wrote in the Times:

… Under a previously undisclosed provision, the contract also hampers the Dodgers’ ability to form a regional sports network after the contract expires so long as Time Warner , Comcast or ESPN is an equity partner, according to the people familiar with the agreement.

Dodgers owner Frank McCourt had wanted to launch his own cable channel — dubbed “DTV: Dodger Television” — once the Fox contract expired in 2013, according to documents filed in his divorce trial. Fox would have had no recourse had McCourt partnered with any party beyond Time Warner, Comcast or ESPN.

The contract would not absolutely prohibit those Fox competitors from partnering in some form in a Dodgers cable channel, but what could be costly hurdles would in theory give the team an incentive to stick with Fox. …

Will Fox prevail in this dispute? That I don’t know.

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