FOX Sports purchases STO for an estimated $230 million; will pay Indians $400 million in rights fees over next 10 years
Published: Friday, December 28, 2012, 10:27 AM Updated: Friday, December 28, 2012, 10:55 AM
Paul Hoynes
CLEVELAND, Ohio -- FOX Sports has purchased SportsTime Ohio for an estimated $230 million. The purchase gives Fox an estimated 10-year deal to broadcast Indians games worth an estimated $400 million.
FOX will pay the Indians about $40 million in rights fees per season to broadcast their games. STO was paying the Indians an estimated $30 million a year in right fees.
The Dolan family, which owns the Indians, created STO to carry Indians games in 2006. Before that, Indians games had been broadcast on Fox Sports networks from 1998 through 2005.
The influx of money is part of the reason that Indians were able to come to terms last week with free agent outfielder Nick Swisher on a four-year, $56 million deal. All MLB teams will receive an estimated $24 million to $25 million a year in national cable TV revenue in 2014 through 2021.
Whether or not FOX will operate in Ohio with two regional sports networks or one will be determined in the new year.
The Indians rights fees are expected to increase from $30 million to $40 million.
It was important for the deal to get done before the new year become of impending changes in the tax laws.
The purchase would make Fox the dominant sports programmer in Ohio. Fox Sports Ohio currently carries the Cavs, Cincinnati Reds, NHL Columbus Blue Jackets, Columbus Crew soccer, Lake Erie Monsters and the University of Cincinnati and Dayton.