ESPN and MLB have reportedly been negotiating a new rights fees agreement. Although the current contract runs through the 2028 season, both parties have a contractual opt out clause that can be exercised this March. Finding a replacement for ESPN may be difficult, in all likelihood, MLB will not be exercising their opt-out clause.

In 2021 Disney negotiated its latest rights fees agreement with MLB. With the new contract, ESPN scaled back the number of nationally televised games and focused more on premier MLB events. Disney’s annual fee dropped from $700 million to $550 million. Currently, each season, ESPN exclusively televises about 30 Sunday Night Baseball games, an opening night game, the “Home Run Derby”, the annual “MLB Little League Classic” game and the opening “Wild Card” round of the postseason games. The new contract covered the 2022 through 2028 seasons with the opt-out clause.

After a leagues ownership meeting, MLB commissioner Rob Manfred, told The Athletic (which broke the story), “We talk to ESPN all the time. They’re one of our big partners. … We both have an out in March of this year. Obviously, ‘25 is set. Yeah, we’ll continue to talk to them. And each side will make a decision whether they want to do anything with that.” Hence, MLB is leaving the door open for opting out.

In 2024, Sunday Night Baseball averaged 1.51 million viewers (excluding streaming audiences), a year-over-year increase of 6% and its highest audience in five seasons. ESPN began televising Sunday Night Baseball in 1990. In addition, last season the wild card round featuring marquee matchups had its highest average audience since the round was created in 2022 with a +25% year-over-year increase.

By comparison, the MLB rights fee for Fox Sports which televises World Series as well as 52 regular season games, the All-Star Game, two Division Series and one League Championship Series is $729 million per annum.

The annual MLB rights fees for Warner Bros Discovery are $535 million. Each year WBD televises games on Tuesday night as well as two division series and one league championship series. The WBD games are broadcast on cable’s TBS. Similar to Disney, the MLB rights fees agreements with Fox Sports and WBD began in 2022 and expire at the end of the 2028 season.

Last year John Ourand of Puck reported ESPN was bothered by the lower rights fees streaming services Apple TV and Roku are paying MLB. In 2024, MLB and Roku struck a deal providing Roku a slate of Sunday afternoon games for the inexpensive fee of $10 million per season. Also, to exclusively stream Friday night doubleheaders throughout the season, Apple TV is paying MLB just $85 million a year.

Hence, MLB’s overall rights fees to televise/stream nationally regular season and postseason games is just under $2 billion, a figure far below what the NFL ($10 billion each year over 11 seasons) and the upcoming NBA ($6.9 billion per annum over 11 seasons). Reportedly, MLB’s total annual revenue in 2024 was $12.1 billion. Hence, losing ESPN would have a financial impact.

In the fall, ESPN plans to launch a flagship direct-to-consumer streaming service. The new service will include all content from all their linear television networks along with ESPN+. In addition, as Regional Sports Networks continue to face financial challenges, ESPN has expressed an interest in streaming local market MLB teams.

Last August, ESPN Chairman, Jimmy Pitaro told Front Office Sports, “We are very interested in continuing to identify partnerships on a team-specific basis. That said, if Major League Baseball is able to put together a group of teams, we would love to be able to … do a larger deal that, quite honestly, would be simpler than having to do individual team deals.”

For the 2025 season, MLB will be producing and distributing local games for five teams that have dropped their RSN; the Arizona Diamondbacks, Cleveland Guardians, Milwaukee Brewers, Minnesota Twins and San Diego Padres. There is the possibility, in the years ahead, MLB will be producing and distributing games for additional MLB franchises.

This is not the first time MLB and ESPN have had a contctual issue. Sports Media Watch reported that in 1999, MLB threatened to terminate their agreement, when ESPN moved Sunday Night Baseball to ESPN2, to make room for Sunday Night Football. The feud was settled in court and a new six-year agreement was reached.