The Chicago Cubs have exercised an option to get out of their broadcast contract with WGN-TV after the 2014 season, sources close to the situation said Wednesday.
On Tuesday, the team notified the Tribune Co.-owned station it had 30 days to meet a higher assessed fair market value for the broadcast rights, or they would be opened up for negotiation with other media. A third-party consultant hired by the Cubs and WGN-TV determined the increased valuation, according to sources.
After 30 days, the team would be free to explore other broadcast options for about 70 games televised each season by WGN, opening the door to a potentially more lucrative contract or perhaps its own cable sports network.
The Cubs and WGN-TV have a broadcast partnership that dates to 1948. With baseball rights fees soaring, there is much at stake for both. In January, the Los Angeles Dodgers launched their own cable sports network, striking a deal with Time Warner Cable that will pay the team a reported $7 billion to broadcast its games over 25 years.
Currently, Cubs games are split between Comcast SportsNet Chicago and WGN-TV, netting the club about $60 million in annual broadcast rights fees combined, according to sources. The CSN deal runs through 2019 and includes the White Sox, Bulls and Blackhawks as partners. Comcast owns about 30 percent of the network.
The Cubs get about $20 million to air 70 games each year on WGN. If the team didn’t give notice to opt out at this point in the contract, the deal would run through 2022 at the current rate, and the Cubs would lose any leverage for renegotiating the broadcast rights, according to sources.
The Ricketts family inherited the broadcast agreements as part of their 2009 purchase of the Cubs from Tribune Co., owner of the Chicago Tribune and WGN-TV. The $845 million deal — then the highest in Major League Baseball history — included Wrigley Field and a 25 percent stake in Comcast SportsNet Chicago.