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Business

Why the MLB is really after Slingbox

Major League Baseball has given Slingbox a brushback pitch amid fears that time shifting devices could hamper its online television cash cow.As News.
Written by Larry Dignan, Contributor on

Major League Baseball has given Slingbox a brushback pitch amid fears that time shifting devices could hamper its online television cash cow. As News.com's Erica Ogg reports MLB contends that Slingbox is misusing its content. In fact, MLB may even try to sue Slingbox. Charles Cooper argues that MLB would annoy fans.

The spat is out of character for an entity that clearly gets the Web. So what's this really about? When I toured the MLB.com facilities a few weeks back (gallery right) and talked to CTO Joe Choti I filed away these tidbits.

  • MLB Advanced Media, the entity behind MLB.com, is jointly owned by the teams in the MLB. And these owners are borderline nuts.
  • The entire model at MLB depends on geotracking so you can't watch a local team on MLB.com when you should be getting it on cable. In theory, I should be able to watch the Yankees on MLB.com when I catch a train from Philadelphia to New York--until I hit the New York City area.
  • MLB has cooked up some pretty neat IT fixes to accommodate a television model that doesn't make much sense online.

If you add those facts up you get why MLB is going after Slingbox. MLB is trying to protect local television rights that account for a big chunk of team revenue. Knowledge@Wharton illustrates how the television business model is a bit messy.

While the fans could care less about these television rights rest assured the team owners that control MLB.com do. And these owners probably want to bully Slingbox into paying a rights fee.

Now it's completely logical that a fan that subscribes to a cable channel, say the YES Network, should be able to view a game via the Slingbox. But it doesn't add up under the MLB.com model. If you watch it via Slingbox you won't see it on MLB.com. That's a threat--even though you shouldn't pay to see your team twice.

Meanwhile, if you see a game on Slingbox MLB.com can't track you and enforce a bunch of television contracts for each team. Geotracking to MLB.com is the equivalent of DRM in the music industry. Bottom line: Slingbox may threaten geotracking.

And we all know old business models don't die without a fight.

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