News Corp.’s blockbuster deal to buy 49% of the Yankees Entertainment and Sports (YES) Network is the latest confirmation that televised sports has become one of the hottest areas in the media world. With newspapers, magazines and even Hollywood facing continued disruption thanks to the relentless rise of Internet-based alternatives, good ol’ fashioned TV sports remains a massive and highly lucrative market. News Corp., the giant media conglomerate run by billionaire mogul Rupert Murdoch, has made sports a key component of the company’s portfolio. But this deal, which values YES at a whopping $3 billion, takes the company’s sports position to a new level, for three reasons. First, News Corp., which also owns cable news leader Fox News Channel, Hollywood stalwart 20th Century Fox and 20 regional sports networks, gains a nearly 50% stake in YES, the country’s most valuable regional sports network. Second, the deal puts the media giant firmly in bed (so to speak) with the New York Yankees, arguably the most valuable professional sports franchise in the world. Third, and perhaps most important, the deal significantly bolsters News Corp.’s strategic negotiating position as it lays the groundwork for a new national sports network to compete with cable sports leader ESPN. (MORE: News Corp. Split Signals Twilight for Megamogul Rupert Murdoch) Under the terms of the deal, which were announced last week, News Corp. will pay about $1.5 billion for a 49% stake in YES, which broadcasts live Yankees baseball and Brooklyn Nets basketball games. (That amounts to little more than chump change for News Corp., which has a market value of $58 billion, and is currently sitting on $12 billion in cash.) After three years, News Corp. has the right to increase its stake to 80%, according to a statement released by the company and Yankee Global Enterprises, which owns the Yankees and also a stake in YES, along with Goldman Sachs and other investors. The deal, which will keep Yankees baseball on YES through 2042, allows Goldman Sachs, which was an early investor in YES and owns 30% of the network, to … Continue reading Murdoch Says ‘YES’ to the Yankees: Why the Deal Could Help Fox Take On ESPN