MSG Networks plans direct-to-consumer streaming app for Knicks, Rangers games

MSG Entertainment, the parent company of MSG Networks, is working on a direct-to-consumer app that will give New York City sports fans access to events from some of their favorite teams, according to a report.

On Monday, the New York Post said the new MSG Networks regional sports streaming app will cost between $20 and $25 per month. That price point puts it on par with similar regional sports app, including Bally Sports+.

The Post said the app is being developed by James Dolan, the owner of MSG Entertainment and two sports franchises: The New York Knicks basketball team and the New York Rangers hockey team. The app will purportedly make Knicks and Rangers games as well as other events carried on MSG Networks available over the Internet without a traditional cable or satellite subscription.

Reached by e-mail, a spokesperson for MSG Networks did not confirm or deny the Post's report, instead referring Fierce Video to comments made by MSG Networks President Andrea Greenberg on a recent conference call with investors.

"We are progressing in the design and development of our direct-to-consumer offering, and remain on track to launch in the second half of the current NBA and NHL Seasons," Greenberg said. "So while the media landscape is certainly evolving, we continue to believe in the value of our premium content and our ability to innovate, to drive value for partners, advertisers and viewers alike."

The NBA season begins around October and ends with the Finals Game in early June. The NHL season takes a similar track. Greenberg's comments suggest the direct-to-consumer app is slated to launch sometime in the first half of 2023, though it doesn't officially have a name and no specific pricing details have been released beyond what the Post has reported.

Earlier this month, MSG Entertainment said its regional sports cable networks MSG and MSG Plus took in $122.5 million in revenue during its most recent financial quarter, a decrease of 13%. The company said its lower revenue was due to a carriage dispute with Comcast that started last year. Comcast doesn't provide cable television or broadband service in New York City itself, but does offer some service in areas around the metropolitan city, including parts of New Jersey and Connecticut.

Cord-cutting has also impacted MSG Networks' bottom line, the Post reported, with a subscriber erosion of 9% attributed to that trend. Cable and satellite companies have raised subscription prices over the last few years to offset higher carriage fees that are imposed by programmers. In some cases, distributors like Comcast have refused to carry some channels if they feel the viewership doesn't justify the cost.

That appears to be the case with MSG Networks: A Comcast spokesperson told NJ Advance media that they tried to negotiate a fair agreement with MSG Networks for the channels, but those efforts fell flat.

"We don’t believe that our customers should have to pay the millions of dollars in fees that MSG is demanding for some of the most expensive sports content in the country with extremely low viewership in our markets," the Comcast spokesperson said. "We have successfully negotiated thousands of agreements with programmers and reached agreements in almost every instance, and are disappointed that MSG decided to pull their content rather than reach a fair agreement."

MSG Networks says it has "reached out to Comcast to attempt to restore our programming many times since last year’s disruption, including just before the start of the NBA and NHL seasons, only to have been rebuffed by Comcast each and every time."

Entertainment programmers have for years address cord-cutting by launching streaming services like Disney+, AMC+ and HBO Max that reach customers who move away from cable or satellite. But complex sports licensing agreements — which often involve team owners and the professional sports leagues themselves — have made similar streaming efforts difficult until recently.

This year, the National Football League launched its first standalone streaming service, NFL+, that offered live access to pre-season football games for about $5 a month. NFL+ also offers live access to regular season games on CBS and Fox in a subscriber's local market, as well as some national games telecast by NBC and ESPN. Access to live out-of-market games are still exclusive to DirecTV for its NFL Sunday Ticket package — an arrangement that is scheduled to lapse next year — but replays of those games are available within the NFL+ app if a subscriber upgrades to a higher tier of service.

Similar moves have been made in the worlds of baseball hockey and soccer, with Disney's ESPN+ grabbing out-of-market rights to National Hockey League games for its $10 a month service. Apple TV Plus began broadcasting some Friday evening Major League Baseball games earlier this year, and will become the global distributor of most Major League Soccer games starting in 2023.

"Sports on these different streaming services is a mess," Jason Cohen, a financial analyst and the founder of streaming TV marketplace MyBundle.TV, told Fierce Video in a recent interview. "When we look back 10 years from now and wonder why there are so few people watching sports in this country relative to what there once was, it'll be because the leagues and the industry made it so hard for casual fans to keep up."

Article updated with MSG Networks comment on Comcast dispute.