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April 3, 2007

Major League Baseball loves ads

Posted by Kim Peterson at 11:00 AM

Major League Baseball is going to sell online video advertisements and charge people subscription fees to view live games over the Internet. Usually, companies pick one or the other, offering ad-free subscription models or showing free content subsidized by advertisements. It's rare to make customers pay a subscription and then show advertising on top of that.

"I think it's being greedy," digital media analyst Phil Leigh told Investors Business Daily. "But the professional leagues are pretty accustomed to getting what they want."

MLB has a not-so-pretty history with local companies when it comes to showing games online. The league and Microsoft's MSN cut short a multimillion dollar contract in 2005 to show games on personal computers. Microsoft had reportedly agreed to pay a hefty $40 billion over two years in the deal.

RealNetworks ended its three-year contract with the league in 2003, saying that less than 2 percent of the company's revenue that year was from Major League Baseball sales, and that getting out of the business would save the company $5 million in 2004.

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