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Disney must sell Fox RSNs



The US Department of Justice has provisionally approved the $ 71.3 billion purchase of 21st Century Fox entertainment assets on Wednesday. The news is a win for Disney, though the deal is not done until Fox Comcast (CMCSA) Fox can make another bid, raising stakes and forcing Disney (DIS) to pay more.

When Disney Lands The Winner Will Get Fox (FOX) a valuable library of original television, including "Modern Family" and "The Simpsons". It will get lucrative Fox movie franchises like the "X-Men", "Deadpool" and "Avatar". "It will get the FX and National Geographic networks, it will get Fox ownership of the Hulu joint venture, making Disney the majority owner of Hulu.

But it will not get Fox's 22 regional sports networks (RSNs) .

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The DOJ, in his approval, gave a condition by giving a civil antitrust lawsuit to block the acquisition while submitting a proposed settlement to this lawsuit: Disney must sell these networks within 90 days of the acquisition. Disney has accepted the condition. "data-reactid =" 18 "> The DOJ has issued a conditional approval by filing a civil antitrust suit to block the acquisition and at the same time submit a proposed ruling on this claim: Disney must do so Sell ​​networks within 90 days of purchase Disney accepted the condition.

<p class = "Canvas Atom Canvas Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text "Content =" "American Consumers have benefited from direct competition between Disney and Fox's cable sports programs, which has ultimately led to cable TV subscription prices not rising any further," said DOJ official Makan Delrahim in the DOJ's press release "W Without the necessary divestitures, the proposed acquisition would likely result in higher prices for cable sports programs, which will be for multi-channel l Video Programming Distributors ("MVPDs") are licensed in each of the local markets serving the RSNs. "" data-reactid = "19"> "American consumers have benefited from direct competition between Disney and Fox's cable sports program, which has ultimately prevented cable TV subscription prices from rising even further," DOJ official Makan said Delrahim in the DOJ News Release "Without the necessary divestitures, the proposed acquisition would likely result in higher pricing for cable sports programs licensed to multi-channel video program distributors (" MVPDs ") in each of the local markets serving the RSNs." [19659004] Much has been written about all the things that Disney could do with these regional sports networks and how they could strengthen the ESPN ecosystem.

Nevermind. Now the question arises: Who buys the RSNs?

A reporter airs for YES Network before the Los Angeles Lakers played Brooklyn Nets in Los Angeles on November 20, 2012. (REUTERS / Danny Moloshok)

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = Fox's 22 regional sports networks are spread throughout the country but concentrated in the Midwest: Fox Sports Kansas City, Fox Sports Oklahoma, SportsTime Ohio and Fox Sports Midwest are among them, showing live games of more as 44 MLB, NBA and NHL teams (no NFL) and produce more than 5,500 live games per year. "data-reactid =" 33 "> Fox 22 regional sports networks are spread throughout the country, but concentrated Midwestern: Fox Sports Kansas City, Fox Sports Oklahoma, SportsTime Ohio and Fox Sports Midwest are among them. They feature live games from more than 44 MLB, NBA and NHL teams (no NFL) and produce more than 5,500 live games per year.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " The best known of the portfolio, probably the jewel in the crown is YES Network, co-owned by Fox and the New York Yankees and broadcasting the games of the Yankees and the Brooklyn Nets. "data-reactid =" 34 "> The best known of the portfolio, arguably the Crown Jewel, is YES Network, co-owned by Fox and the New York Yankees and broadcasting the games of the Yankees and the Brooklyn Nets.

The Yankees could simply buy JA back from Fox, an option that the team has been considering prior to the DOJ requirement for Disney.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "By the way, Comcast is an obvious possibility Acquiring 21 regional sports networks could be a consolation prize after missing the other Fox's larger prize assets and Comcast where As a buyer, it makes sense: It already owns a portfolio of RSNs, originally named, that begin with Comcast SportsNet and this year they have all been renamed as NBC Sports Comcast knows what to do with RSNs Disney and ESPN have none "data-reactid =" 36 "> By the way Comcast is an obvious possibility. The purchase of 21 regional sports networks could be a consolation prize, given the bigger price of the other Fox assets. And Comcast would make sense as a buyer: it already owns a portfolio of RSNs, originally with names beginning with Comcast SportsNet, and this year has renamed them all as NBC Sports . Comcast knows what to do with RSNs. Disney and ESPN have none.

Or Charter Communications (CHTR) could buy the networks. John Malone, the cable pioneer who has a significant interest in chartering, said in an interview with the Wall Street Journal earlier this month that Charter has an interest in buying regional sports networks.

The question mark surrounding the 22 RSNs certainly adds a new fold to the larger Fox-Disney-Comcast bidding war Kansas City Star, for example, h As his readers have already warned in a headline, "The future of FSKK is now in Question." A further 21 sports markets will now be watching the situation more closely due to the uncertain future of their home networks.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Daniel Roberts is the sports business writer at Yahoo Finance, follow him on Twitter at @readDanwrite . "data-reactid =" 40 "> Daniel Roberts is the sportswriting journalist at Yahoo Finance. Follow him on Twitter at @readDanwrite .

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