MSG Networks is struggling with debt and facing potential bankruptcy, which could impact the New York Knicks' media revenue and future broadcasts.
MSG Networks is at risk of disappearing, as written in a recent article by Mike Vorkunov of The Athletic.
The company reported an 11.5% drop in subscribers last quarter, including in its streaming app. While still profitable, it is struggling with debt, including an $829.5 million loan due in October.
So far, it has only repaid $25 million and is in a forbearance period while negotiating with creditors. If talks fail, MSG Networks warned in an SEC filing that bankruptcy or foreclosure is likely, per the report.
Analysts speculate that MSG Networks may file for bankruptcy or merge with YES Network, which already partners with it on a streaming service.
A bankruptcy could impact the New York Knicks' revenue, and MSG Networks has already asked the Knicks and Rangers to accept lower rights fees.
Knicks owner James Dolan has criticized the NBA's new media deal, arguing it undermines the RSN model by giving national broadcasters more games. Commissioner Adam Silver acknowledged the deal would affect local networks but insisted that teams would ultimately benefit.
The RSN industry has been in turmoil, with Diamond Sports Group filing for bankruptcy and teams like the Utah Jazz and Dallas Mavericks leaving cable for direct-to-consumer models.
MSG Networks, owned by Sphere Entertainment, airs Knicks, Rangers, Islanders, Devils, Sabres, and Gotham FC games across the Mid-Atlantic.
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