Fanatics will take over exclusive rights to produce MLB trading cards by 2026.

What We Know

The sports card market is on fire.  Over the last few years, sales of new packs and boxes have skyrocketed.  The trading card segment on eBay is setting new records, and other secondary markets such as COMC.com and Sportlots.com are seeing strong results as well.

Based on reports from the Wall Street Journal and the Action Network, The MLB and MLBPA have granted Fanatics the exclusive rights to create trading cards once the agreements currently in place expire.  The deal Topps has with the MLB goes through 2025.  The MLBPA currently has agreements with multiple trading card companies including Topps and Panini America. The new agreement Fanatics has with the MLBPA begins in 2023.

Initial reports on the terms of the deal are unclear on how this impacts Topps ability to create cards between the window where the new MLBPA deal goes in and the expiration of the the deal with the League in 2025.  

This deal has the potential to end a long standing relationship between Topps and the MLB.  2021 marked the 70th year of Topps baseball cards and it looks like 2025 could be the last.  The financial fallout was immediate.  The plans for Topps to go public via a SPAC Merger with Mudrick Capital was terminated the day following the announcement. 

While Topps was the primary focus of the initial reports, Panini America also looks to be impacted.  The WSJ article indicates the NBPA and NFLPA will have ownership interest in the new Fanatics Trading card entity, and it appears the NBA is also onboard.  The current exclusive deals Panini has with those two player’s associations run through 2025 for the NBA and 2026 for the NFL.  The specifics around the future of NBA and NFL cards are not clearly outlined, but it would seem to reason that Fanatics will become the exclusive producer of cards once the current deals expire.

Sportico reports Josh Luber, the founder and CEO of StockX has been tapped to run the new entity.

So Where Do We Go From Here?

As the news broke, Twitter, Facebook, and the message boards lit up and users shared pretty much every emotion possible.  From joy to anger to despair, collectors were having all the feels.  It didn’t take long for the speculation to start.  Assumptions were being made, some based on “facts” that were in no way factual.

I want to share my thoughts on how this may play out over the next several years.  Maybe some of my thoughts will turn out to be pretty accurate, or maybe I’ll be completely wrong.  These are my hunches, I’m not saying they are all going to come true.

Fanatics will acquire one or both of Topps and Panini between now and 2025.

At this point, Fanatics pretty much has no experience producing trading cards.   With no license to produce cards, the value of Topps and Panini America is a fraction of the “pre-announcement” value.  However, there is still value to the industry knowledge the employees have and the brands owned by those companies. It seems possible that Fanatics purchases one or both of them (or maybe even Upper Deck), and we still end up with many of the trading card brands we love in 2025 and beyond. 

The remaining manufacturers consolidate.

Depending on how my first prediction plays out, I could see some of the remaining manufacturers merging to strengthen their position to compete for everything that is left.  NCAA, Soccer, WWE, AEW, Racing, Marvel, Star Wars, and Hockey have not yet been tied to the Fanatics announcement and licensing is currently split between Topps, Panini, and Upper Deck.  

Without MLB, NBA, and the NFL, it would seem difficult for Topps and Panini to continue to operate independently, at least at the same level.  I could envision a scenario where Fanatics acquires one of them and the remaining players join forces.

The small players will also have to step up their game.

My first take was that the small players like Leaf, Onyx, and Parkside were sitting pretty.  No league licenses to worry about.  New trademarks potentially becoming available.  Potentially strengthened position with distributors and retailers.

But then someone pointed out that the big companies might need to make a big push in this new world of NIL.  That could create some headwinds for those smaller players.  

Distributors, Blowout, DA Card World, and Steel City take a big hit.

Fanatics doesn’t currently have experience producing cards.  What they do have is a distribution network and knowledge on how to run a direct to consumer website.  

Will new wax be sold through distributors in this new world?  I doubt it.  When you already have relationships with retailers (both large corporations and hobby shops), why go through a middle man to get cards into the hands of retailers?  Also, I can’t imagine Blowout and DA Card World being the go to source for online wax purchases anymore.  

Collectors will still collect.

In the hours that followed the announcement, there was a lot of hand wringing about the end of the hobby and proclamations of how people were going to quit collecting once Fanatics takes over.  

I call BS.

I’m sure there will be some individuals who move on to other things or change how or what they collect, but I’m not convinced not having Topps will create the max exodus that some are predicting.  People were saying the same thing when Topps and Upper Deck lost the football and basketball licenses, yet today Panini has taken those products to new heights and new collectors more than made up for any who lost interest. 

In fact, if my first prediction plays out, we may once again have Topps Chrome basketball and football in the not too distant future.  I think that would be fantastic.

Hobby shops will be just fine (at least some of them).

The demise of the LCS was another hot topic for some.  This was all based on the assumption that Fanatics would no longer sell to hobby shops and would only sell direct to consumer via their online platform.  

I don’t see that happening.  The industry grows as the base of collectors grow.  The base of collectors grows with the growth of community.  Local card shops can play a big role in building community and interest in cards.  I think Fanatics will want to continue to support the success of the LCS through the availability of sealed wax.

But what if they don’t?  Well, when you get down to it, that is a scenario we see playing out in many card shops today.  With current allocations, many shops are getting a pittance of what they were able to get a few years ago, yet we see more and more shops popping up across the country.  

In addition, shops sell more than just sealed wax.  Yes, new wax can drive traffic, but so can other things.  Singles, sets, supplies, board games, food/drink, memorabilia, apparel, and creating an experience are all things a LCS should be doing and can continue to drive traffic.

When cards started being sold on the internet, some said it killed the LCS.  Well, it only killed the shops that weren’t willing to adapt.  Others took advantage of the opportunity and started creating content which built a following to drive traffic to both their physical store and online sales platforms.  Some shops get it, some shops don’t.  The ones who are actually good at business will be fine.

Wrapping it up

We’ve got a couple years before the first of the new deals become effective, and we have yet to hear directly from Fanatics, Topps, or Panini.  At this point we’re really just guessing.  Yes, they may be educated guesses, but at the end of the day we’re just speculating until we actually hear from the companies themselves.  

There is no doubt that change is coming, but that doesn’t necessarily mean it is a bad thing.  People have been complaining about Topps and Panini for years.  They’ve been clamoring for the return of certain brands with certain sports.  They’ve complained about distribution models, website performance, and boring designs.  These will all have the opportunity to change.

Will this be good?  Will it be bad?  Who knows.  

At the end of the day, even if the worst fears play out I will still have over 100 years of trading cards to buy, sell, and collect, and I’ll still have a ton of fun doing it.

Oh, and if you are convinced the end is near and want to sell everything, hit me up.  

I’m in this for the long run.

I’m buying.

Also, if you haven’t heard, I started a new Podcast called the WaxPackHero Sports Card Minute!  It’s available here directly on the site at the Podcast link at the top of the page, or on Apple Podcasts, Spotify, Google Play, and TuneIn!  Check it out, let me know what you think, and tell your friends!