The business of baseball is very good. The business of Major League Baseball’s media company is skyrocketing.
As Spring Training gets underway, and the 2016 regular season not far behind, MLB Advanced Media, the digital media company of Major League Baseball is projected to eclipse the $1 billion mark by the end of the year, with estimates coming in at $1.1-$1.2 billion. That’s significant as last year MLB President, Business & Media, Bob Bowman said that revenues for MLBAM were $800 million for 2015. Based upon projections, revenue would increase by between 38-50% year-over-year, should the numbers be reached.
MLBAM has become an ever-lucrative cash cow for baseball and its 30 owners who collectively invested $1 million a year over four years in 2000 for the fledgling MLB.com. The cost was targeted at $120 million. In its second year it began generating excess revenue allowing them to invest only $70-$75 million before beginning to see a return on their investment.
The digital media company of MLB has become far more than just baseball related. With MLBAM working under agile conditions that allowed them to provide 8.4 billion minutes of content last year alone, others have turned to the company for live streaming infrastructure support. Currently MLBAM powers HBO Now, the cable network’s OTT platform, as well as WWE, and many others. Last year MLBAM became the first league-owned media company to purchase the rights to another league’s content in the NHL.
MLB was approaching the $9.5 billion gross revenue mark at the end of last year. Given the rosy outlook for MLB Advanced Media, it’s possible baseball could be precariously close to the $10 billion gross revenue mark when the new year approaches in December.