Shortly after confetti rained down on Times Square in 2025, Optimum withdrew its involvement in MSG, but Knicks and Rangers fans could be left in the dark until the new year, The Post has learned. .
The breakdown in negotiations over a new contract with MSG Networks, which expired late Tuesday night, is part of broader layoffs by the cable operator as it seeks to reduce the high fees demanded by regional sports networks (RSNs). It is.
People close to the situation told The Post that the gap between the two companies remains wide in high-stakes negotiations that will have major implications for both companies.
On Wednesday, Optimum subscribers who watch MSG, which also airs games between the Islanders and Devils, were told on a blue screen that “MSG Networks is no longer available on your TV lineup.”
The Altice-owned cable operator also promoted QR codes and web addresses that offered “options” to watch Knicks, Rangers, Islanders and Devils games.
This option is 30% off if you subscribe to streaming service Fubo, which is operated by MSG Networks, as long as you keep Optimum's internet service.
The outage immediately affected the Devils-Knicks game scheduled for New Year's Day.
Optimum also released a poignant message Wednesday to MSGN, which is led by Knicks and Rangers owner James Dolan.
“MSG Networks demanded that we pay exorbitant fees to deliver the content, and that customers who didn't want the content (the vast majority) would have to pay anyway,” Optima said. Mr. Mu said.
“Nevertheless, Optimum offered to absorb their exorbitant price demands if they could package MSG Networks in a way that gave customers more flexibility and control. … MSG Networks said no, and we worked hard to reach a deal. rejected multiple offers from us.”
MSGN issued a rebuttal in its own New Year's Day statement.
MSG Networks said, “This is a pure and simple price meter offered by Altice.”
“We have provided Altice with a number of fair and reasonable offers seeking to pay less than last year. Altice will continue to broadcast MSG Networks while we continue our efforts to reach an agreement. We remain willing to negotiate in good faith.”
In a strange irony, the Knicks' owner has a feud with the company his father, cable industry pioneer Charles Dolan, founded in 1973 and then called Cablevision. In 2016, it was sold along with the Optimum brand to European telecommunications giant Altice for $17.7 billion. Charles Dolan passed away last weekend at the age of 98.
Meanwhile, Optimum subscribers were furious at losing access to their beloved team.
“I don't really care who's to blame for MSG's disappearance at Optimum,” fumed Lou Panico of Manalapan, New Jersey. “As always, consumers are caught between two greedy and dishonest organizations.”
MSGN intended to move away from the Optimum tier, which pays a base fee of about $10 per subscriber, in 2024, according to people close to the negotiations.
That's about the same rate that national sports giant ESPN charges cable companies.
RSN executives say the move from basic cable to the premier tier could add up to 50% to debt-ridden MSGN's revenue because the majority of Optimum's roughly 1 million subscribers in the New York City area will no longer pay channel fees. He told the Post he works for another network that could be hit.
Optimum also faces the risk of losing subscribers to rival cable companies such as Charter Communications and Verizon-owned Fios, which has a deal to carry MSG over basic cable.
Mr. Dolan recently negotiated a new contract with a major cable company in the New York area, where he accepted a reduction in gross revenue in exchange for being removed from the basic tier and extending the contract, according to two people familiar with the negotiations. people revealed.
But Optimum is the only cable TV option in large areas of the city, and once hardcore sports fans jump ship, they may not be in a hurry to return to the negotiating table, the people said. Ta.
Altice could take strong action and threaten to remove the channel to get better terms from MSGN.
“If we discontinue RSN, we will lose about 5% of our customers, but our revenue will increase by nearly 20% because we no longer have to pay for that channel,” an RSN executive said.
This impasse could further exacerbate the overall cord-cutting trend that has eroded cable's dominance over the past decade.
In 2023, MSGN Networks launched a streaming service that costs $29.99 per month. Last year, the company partnered with YES Network, home of the Yankees and Nets, on the Gotham Sports app (YES and MSG combined for $41.99 per month). Customers can still purchase MSG for $29.99.
However, if the dispute with Optimum drags on, MSGN could be forced into bankruptcy, the people said.
The network, part of publicly traded Sphere Entertainment, has been delinquent on an $830 million loan since October, with a forbearance agreement with its lenders expiring on Jan. 10.
RSN executives said the loan's debt is trading at 5 cents on the dollar.
“A complete decline would ultimately bankrupt MSG Networks,” media analyst Lightshed Partners said in a report this week.
According to public filings, MSGN is at a loss because it is being paid $187 million in 2025 to broadcast Knicks and Rangers games as part of a 20-year deal that runs through 2035. It will be.
But with much shorter-term contracts, MSGN is receiving less revenue from cable providers.
If MSGN is forced into bankruptcy, it will likely renegotiate with the Knicks and Rangers and pay much lower rights fees to reflect the new RSN market, RSN executives said.
MSGN's bankruptcy isn't necessarily bad for Dolan, who controls both Sphere Entertainment and Madison Square Garden Sports, parent company of the Knicks and Rangers and operator of the world's most famous arena. do not have.
He will be hit by reduced rights fees from the Knicks and Rangers.
But separating MSGN will likely give a boost to Sphere Entertainment, a $2.3 billion futuristic music mecca that also includes Las Vegas.
“This should be good news for Sphere shareholders,” Lightshed said. “The removal of $830 million in MSG Networks debt from Sphere's balance sheet should mean a significant increase in Sphere's stock price.
MSG Networks declined to comment on its financial situation.
