Major League Baseball's owners and the MLB Players Association opened collective bargaining negotiations this week, 6.5 months before the current labor agreement expires in December 2026. The league hasn't started formal talks this far ahead of a deadline since 1996, when the parties were repairing relationships after the 1994-95 strike canceled the World Series.
The current five-year CBA, ratified in March 2022 after a 99-day lockout, runs through the end of next season. Both sides declined to specify which economic issues were discussed in the initial session, but people briefed on the meeting said local broadcast revenue—specifically, how teams share the risk of regional sports network insolvency—dominated the agenda. Diamond Sports Group, which holds the local rights to 14 MLB clubs, is scheduled to exit Chapter 11 protection by June. The bankruptcy wiped out roughly $8 billion in enterprise value; clubs that had budgeted on long-term rights fees now face annual renewals and streaming-only distribution in some markets.
The early start matters because uncertainty around local media money cascades into every other bargaining item. The league's revenue-sharing formula, which redistributes 48% of local revenue from high-earning clubs to a central pool, assumes stable regional deals. When those deals disappear or reset at half their prior value—as happened with the San Diego Padres, whose Diamond payment dropped from $60 million annually to a year-by-year arrangement worth roughly $30 million—small-market owners argue they cannot meet salary-floor requirements without adjusting the sharing mechanism. The union, meanwhile, wants certainty that payrolls won't fall if a few more Bally Sports channels go dark. Resolving that requires modeling out three or four different revenue scenarios, then embedding the sharing formula into contract language that doesn't reopen every time a network folds. That takes months, not weeks.
The other reason to start now: both sides want a deal done before the next franchise sale closes. The Baltimore Orioles are expected to fetch north of $2 billion when controlling owner Peter Angelos's estate completes its sale process, likely in early 2026. If a CBA is still being negotiated when that transaction papers, the buyer's lenders will price in labor-stoppage risk, tightening debt terms and lowering the headline bid. Sellers hate that. The NBA saw the same dynamic in 2023, when the Phoenix Suns sold for $4 billion only after the league and its players agreed to a new media deal and locked in labor peace through 2030. MLB's owners would prefer the same clean sale environment, and the union knows a high Orioles price supports higher valuations leaguewide, which makes revenue-sharing checks larger and gives the union more to redistribute.
Three items to track over the next four months. First, whether the league proposes a minimum team payroll expressed as a percentage of revenue rather than a fixed dollar figure—$210 million was the soft floor under the old system—so that if local TV money falls, the floor adjusts automatically. Second, whether the union pushes for expanded playoff shares to offset weaker regular-season gate in low-revenue markets; the union floated this in 2022 but traded it away for earlier free agency. Third, watch which outside advisors join the talks. If the union brings in a media economist from Octagon or WME Sports, they're modeling streaming-only scenarios seriously. If the owners bring in a restructuring attorney from Weil Gotshal, they're planning for another RSN to file before June.
The next bargaining session is scheduled for late February, two weeks before spring training camps open in Arizona and Florida.