The Los Angeles Dodgers have a key advantage over other Major League Baseball teams because their television contracts include a tax-free clause.
More news: Kyle Tucker sends clear message to Dodgers fans
Because of the structure of their television deal with MLB, the Dodgers are able to retain an additional $66 million per year. When the organization filed for bankruptcy in 2011, the league agreed to lock in the fair market value of the Dodgers baseball rights.
advertise
As a result, a large portion of the $334 million in annual revenue the Dodgers receive from the deal is exempt from MLB’s revenue share as a result of the bankruptcy settlement.
October 17, 2025; Los Angeles, CA, USA; Los Angeles Dodgers owner Mark Walter, president of baseball operations Andrew Friedman and president Stan Kasten react after their game against the Milwaukee Brewers after the fourth round of the 2025 MLB Playoffs NLCS at Dodger Stadium. Mandatory Credit: Kirby Lee-Imagn Images
“The first big turning point came when the Dodgers partnered with Time Warner Cable to launch SportsNet LA, but since the Dodgers had just gone bankrupt and MLB wanted to help one of their historic franchises get better, there was an exception in the contract,” independent sports reporter Joon Lee reports.
“Under Major League Baseball rules, teams are supposed to share a large portion of their local TV dollars with the rest of the league. Think of it like a tax system. Big-market teams help smaller teams so everyone has a chance to compete. This taxes teams on about one-third of their local TV dollars, but when the Dodgers signed their TV deal, it completely shattered expectations.
advertise
“The deal is about $8 billion over the next five years, far more than MLB expected. If MLB followed its typical formula, the Dodgers would owe about $95.2 million per year in revenue share. But here’s the thing: Since the Dodgers had just gone bankrupt, MLB agreed in federal court to lock in the fair market value of the television rights to Dodgers baseball games.”
When will Dodgers TV start dealing with spectrum issues?
In 2013, the Dodgers reached a 25-year, $8.35 billion deal with Time Warner Cable (now known as Spectrum). The partnership is the genesis of SportsNet LA, the regional sports network owned by the Dodgers.
advertise
The Dodgers will be exempt from MLB’s entire 34% revenue share through 2039, which in turn helped the organization build its current baseball dynasty.
All that remains now is a three-peat of back-to-back World Series titles in 2026. Will the Dodgers win it all again?
More news: 2 Dodgers young players vying for Opening Day roster spot