MLB Owners Support Thread

[pewe]

Originally Posted by Skipscards

I have trouble sympathizing with billionaires living the dream of owning a baseball team or multi-millionaires living the dream of getting paid to play a game.

In 2004, franchises in Major League Baseball had an estimated average value of $295 million. In 2020, the average franchise value is $1.85 billion. That’s an increase of over 600%. While player salaries have skyrocketed, they have not increased nearly that much. (Closer to 40-50%)

The only potential loser in any of this is us. But to suggest the poor, poor owners are victims is inane.

Players’ salaries have remained relatively consistent proportion of league revenue since 1994 - most commonly between 55-60% of total (ie why they flatly rejected the 50/50 COVID split offered by owners). https://www.google.com/amp/s/www.for...s-in-2018/amp/

The appreciation of sports clubs enterprise value is substantially attributable to non-sports related revenue and business interest on the back of new stadiums and development of the business and economic core around their stadiums. Also, you’ve cherry picked a period that extends back to the late 90s where team valuations were pretty flat. They mostly accelerated after the 2004 time you mentioned. Here is a detailed economic analysis of sources for the drivers underlying the Forbes published franchise value numbers each year: https://www.greenberglawoffice.com/m...-skyrocketing/

The players are frustrated that they don’t get a cut of those other business interests that are at best loosely affiliated with baseball. Ie they see owners finding avenues to grow their value outside baseball operations, and want a cut.


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[miscus555]

i agree with both sides. a contract is a contract and unless there is literature inside the contract regarding stoppage of play for any reason other than strike, it should be binding. stinks for the owners because its a huge loss for them on many levels but they should have inserted that clause into all players contracts.

for the players side, all started playing for the love of the game and sadly for some or most, its become for the love of huge contracts. right now there are players who will take the loss just to get on the field because they love to compete while others will stomp their feet over the last million they are trying to take away from them.

as someone said, the fans will get hurt out of all of this and what they don't realize is they will all get hurt also. i hope fans don't come back and say screw them all because you all know the owners will raise prices on everything to get there losses back and if there is no money, the player don't get paid big guaranteed contracts anymore.

i would love to see empty ballparks for the next year because the entire sport needs a spanking and a market correction.

[pewe]

Originally Posted by miscus555

i agree with both sides. a contract is a contract and unless there is literature inside the contract regarding stoppage of play for any reason other than strike, it should be binding. stinks for the owners because its a huge loss for them on many levels but they should have inserted that clause into all players contracts.

for the players side, all started playing for the love of the game and sadly for some or most, its become for the love of huge contracts. right now there are players who will take the loss just to get on the field because they love to compete while others will stomp their feet over the last million they are trying to take away from them.

as someone said, the fans will get hurt out of all of this and what they don't realize is they will all get hurt also. i hope fans don't come back and say screw them all because you all know the owners will raise prices on everything to get there losses back and if there is no money, the player don't get paid big guaranteed contracts anymore.

i would love to see empty ballparks for the next year because the entire sport needs a spanking and a market correction.

This is a standard contract from the 2011 season (“championship season” in the contract parlance).

https://www.mlbtraderumors.com/files/mlb-contract.pdf


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[Triple B]

This guy is why the 1% will always rule the world.

Bezos for trillionaire!

[brewtown107]

Originally Posted by pewe

The players are frustrated that they don’t get a cut of those other business interests that are at best loosely affiliated with baseball. Ie they see owners finding avenues to grow their value outside baseball operations, and want a cut.


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If players think they should get more of the revenue pie based upon owners' baseball related revenue streams outside of direct baseball operations, then I wonder why owners don't counter with a request for like concessions from players based upon their individual marketing and spokesperson deals with athletic companies, local businesses, etc.? Outside revenue is outside revenue, no?

[Stech36]

Originally Posted by brewtown107

If players think they should get more of the revenue pie based upon owners' baseball related revenue streams outside of direct baseball operations, then I wonder why owners don't counter with a request for like concessions from players based upon their individual marketing and spokesperson deals with athletic companies, local businesses, etc.? Outside revenue is outside revenue, no?

Yep, it’s pretty silly. How much should the team get from The Player for autograph signings? Glove and bat sponsorships? The same amount that the players get for a team owner buying a parking lot 3 blocks away from the stadium.

[eye4talent]

Originally Posted by pewe

Players’ salaries have remained relatively consistent proportion of league revenue since 1994 - most commonly between 55-60% of total (ie why they flatly rejected the 50/50 COVID split offered by owners). https://www.google.com/amp/s/www.for...s-in-2018/amp/

The appreciation of sports clubs enterprise value is substantially attributable to non-sports related revenue and business interest on the back of new stadiums and development of the business and economic core around their stadiums. Also, you’ve cherry picked a period that extends back to the late 90s where team valuations were pretty flat. They mostly accelerated after the 2004 time you mentioned. Here is a detailed economic analysis of sources for the drivers underlying the Forbes published franchise value numbers each year: https://www.greenberglawoffice.com/m...-skyrocketing/

The players are frustrated that they don’t get a cut of those other business interests that are at best loosely affiliated with baseball. Ie they see owners finding avenues to grow their value outside baseball operations, and want a cut.


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I wouldn't call that cherry-picking. It is indisputably a period of time in which values were a certain level, which was higher than at any time previously on the time continuum, while present-day values are exponentially higher. If anything, I would say that using 1994 data doesn't do enough to illustrate the point.

If the data point were a decade later, that compresses the exponential increase in franchise valuation and would make it appear even more drastic. For example, the Oakland A's sold for $180 million in 2005. Now, 15 years later, the franchise is valued at $1.1 billion. And this is despite the franchise not owning or playing in a state-of-the-art stadium (I know first-hand, having covered both the A's and the Giants, that the Oakland Coliseum is severely dilapidated), and the fact that the franchise only has marketing rights in two of seven Bay Area counties (due to a bizarre agreement between the franchises in 1993). And it must also be considered that the A's do not invest long-term in any of their players, which, because the fans are not able to connect with a franchise player, is a major contributing factor to the franchise's woefully low attendance. Having gone to the games on a regular basis, I can tell you: the A's do not draw well.

So the value of the A's has multiplied by 6 in 15 years, even though there has been virtually no investment in the franchise.

(Now, I acknowledge that asset value and revenue do not necessarily lend to an apples-to-apples comparison. However, the franchise valuation does certainly reflect a financial might that largely reflects an explosion in TV revenue.)

This is just one lowly franchise we're talking about here; at $1.1 billion, the A's rank 26th in value, according to Forbes. The Marlins franchise, at $980 million, is the only MLB franchise to fall short of the $1 billion mark. Five franchise are value at $3 billion or more, with the Yankees topping the list at $5 billion.

The players know all this. And they aren't forgetting that they have already renegotiated to accept prorated salaries--which was an entirely reasonable amendment to the agreement. I don't know if they are pumping this idea, but they could argue that MLB stands to benefit long-term from resuming play and making the 2020 season about giving the American (and Canadian) people an outlet during these difficult times--and would gain TV/online viewership from people spending more time at home, which could, ultimately, help the league gain some fans.

But this discussion is likely moot, since the franchises and players are one step closer to an agreement after today's announced counter-proposal from the league. But more to the point, there is just no way that the 2020 season will be scrapped, as it would be financial suicide all around for the game.

The owners would have to be especially wary of the consequences of no season, as they know the loss of momentum suffered from a lost season could do irreparable long-term damage to their assets. Why would a mid-level franchise bicker over $25 million in salary savings now, when a lost season could means hundreds of millions of dollars in lost value later, when they go to sell the team years after a fraction of fed-up fans gave up on the sport? To take it a step further, it could be argued that an upper-tier franchise could lose more value in the long-term than the entire league savings from last week's proposal.

What we had seen up until today was just blustery negotiating that didn't substantively reflect the owner's acceptable final agreement. The players, I assume, meant it when they said they wanted full, prorated pay over 82 or so games. (They didn't mean it when they countered the owners with a 114-game schedule.) The owners are just trying to save as much money as possible before the final bell rings, because that is what they are wired to do.

[Eckstein197]

Originally Posted by Zauron

I honestly wonder though what turned the tides in getting him suspended?

Guy came off overly elitist and was annoying, yeah, but eh.

I like how there is zero proof that owners will lose loads of money this year playing with no fans, but people insist on it and the players need to drastically reduce their pay to make sure the owners pockets are filled up still.

Probably the name calling and overall rudeness. Blowout has the discretion to suspend anyone they want

Also Trolling is banned and enough people have outed him as a troll which could be another reason why he’s suspended

Could also be they found he has another account as well

[Eckstein197]

This problem is on both the players and the owners.

The one gripe I have is the owners, when things are going well, rake in the profit. There’s never a time when a player who’s on a small contract is doing incredible at the all star break and the owner comes to him and pays him more for the second half. As soon as things are bad though, the owners want to spread out the losses to everyone.

Owning a team is a business, some years you lose money. These owners can’t seem to understand that taking a loss this year could lead to expanded growth in future years by acquiring a whole bunch of new fans which they would’ve if they were the first sport back/had gotten things figured out. When you’re the only sport in town after months of quarantine and having no sports, you’d attract new fans. The tiger/Phil/brady/manning gold match drew over 6 million eyes. If they had been proactive and ready to roll for a June start or even an early July start, it would’ve benefitted them so much in the long run

Over the past decade, the MLB has experienced massive growth. If you have 1 bad year out of 10, that’s pretty good for a business. They treat sports teams like it’s a no lose business, which is impossible.

If the owners can’t afford to run a loss, they could always sell the team. Team value has increased tenfold, they’d make a huge return on their investment. Get your 1-2 billion sale and leave

Also owners can show they haven’t made a ton of profit but that’s because they spend that profit on more things such as real estate. The Cubs owner recently was complaining that they don’t make much money but he spent hundreds of millions on the areas surrounding Wrigley field which he’ll make a crap ton of money on.

Both sides are in a manhood measuring contest right now, neither are acting in good faith negotiations. The players offering 114 games? Ridiculous obviously. Owners offering 48 games? Ridiculous

[Eckstein197]

One last thing, when it comes to comments like “if I made 40 million dollars I’d offer to play for free”. You can’t say that because 1. You’ve never been in the opportunity where your skill set is worth tens of million of dollars and 2. It’s incredibly selfish.

If Mike Trout comes out and says “I’ll play for free”, that absolutely screws over every other player because the owners can use that as a bargaining chip. Do you want every player in your union and your own team hating you because they have to play for free because you’d said you’d play for free?

When you’re one of the highest earners in the league, you have all of the players looking up to you.

Sarahmc or someone else mentions trickle down economics. It also happens in the opposite way. It can hurt the players severely. That’s why it’s annoying when people complain “oh he held out and he’s making 30 million”, that’s because of his skill level, it benefits every player if he’s making 30 million. Because then the next tier of guy makes 25, then 20, etc

If you had all the best players saying “oh we’d play for 5 million that’s enough”, then there’d be no money for pretty much everyone else because the owners would refuse to pay anyone over a couple million max

[Eckstein197]

Originally Posted by CalCub

Right on, you're preaching to the choir with me as I agree with all your points above.

Do you think it's possible for MLB fans across the country who are paying attention to the details & facts, to mobilize & protest in the streets against the players trying to take advantage of us & the owners? Obviously bad timing to be protesting in the streets right now when there's more important social issues we're all dealing with as a country, but I don't like the fact that the players think they can always get a free pass on negotiations & take advantage of us...

The extreme tone deafness in this paragraph is all you need to know that this is just someone trolling. Wanting to protest right now? Just because you say there’s more important social issues, doesn’t mean you can call for a protest about baseball labor talk. How tone deaf do you need to be to think this is something worth protesting over and wanting to do it now during one of the most important times for protesting since the civil rights movement? People are protesting for human rights, the want for racism to end, and you think you should have a protest over labor negotiations in something that at the end of the day is entertainment? Big yikes

[pewe]

Originally Posted by eye4talent

I wouldn't call that cherry-picking. It is indisputably a period of time in which values were a certain level, which was higher than at any time previously on the time continuum, while present-day values are exponentially higher. If anything, I would say that using 1994 data doesn't do enough to illustrate the point.

If the data point were a decade later, that compresses the exponential increase in franchise valuation and would make it appear even more drastic. For example, the Oakland A's sold for $180 million in 2005. Now, 15 years later, the franchise is valued at $1.1 billion. And this is despite the franchise not owning or playing in a state-of-the-art stadium (I know first-hand, having covered both the A's and the Giants, that the Oakland Coliseum is severely dilapidated), and the fact that the franchise only has marketing rights in two of seven Bay Area counties (due to a bizarre agreement between the franchises in 1993). And it must also be considered that the A's do not invest long-term in any of their players, which, because the fans are not able to connect with a franchise player, is a major contributing factor to the franchise's woefully low attendance. Having gone to the games on a regular basis, I can tell you: the A's do not draw well.

So the value of the A's has multiplied by 6 in 15 years, even though there has been virtually no investment in the franchise.

(Now, I acknowledge that asset value and revenue do not necessarily lend to an apples-to-apples comparison. However, the franchise valuation does certainly reflect a financial might that largely reflects an explosion in TV revenue.)

This is just one lowly franchise we're talking about here; at $1.1 billion, the A's rank 26th in value, according to Forbes. The Marlins franchise, at $980 million, is the only MLB franchise to fall short of the $1 billion mark. Five franchise are value at $3 billion or more, with the Yankees topping the list at $5 billion.

The players know all this. And they aren't forgetting that they have already renegotiated to accept prorated salaries--which was an entirely reasonable amendment to the agreement. I don't know if they are pumping this idea, but they could argue that MLB stands to benefit long-term from resuming play and making the 2020 season about giving the American (and Canadian) people an outlet during these difficult times--and would gain TV/online viewership from people spending more time at home, which could, ultimately, help the league gain some fans.

But this discussion is likely moot, since the franchises and players are one step closer to an agreement after today's announced counter-proposal from the league. But more to the point, there is just no way that the 2020 season will be scrapped, as it would be financial suicide all around for the game.

The owners would have to be especially wary of the consequences of no season, as they know the loss of momentum suffered from a lost season could do irreparable long-term damage to their assets. Why would a mid-level franchise bicker over $25 million in salary savings now, when a lost season could means hundreds of millions of dollars in lost value later, when they go to sell the team years after a fraction of fed-up fans gave up on the sport? To take it a step further, it could be argued that an upper-tier franchise could lose more value in the long-term than the entire league savings from last week's proposal.

What we had seen up until today was just blustery negotiating that didn't substantively reflect the owner's acceptable final agreement. The players, I assume, meant it when they said they wanted full, prorated pay over 82 or so games. (They didn't mean it when they countered the owners with a 114-game schedule.) The owners are just trying to save as much money as possible before the final bell rings, because that is what they are wired to do.

Have you taken a look at how the A’s franchise value saw such an increase? It would be fascinating to know, given my friends who live out there don’t have great things to say about the owners.

Here is the macro-market basics on team valuations, as far as I know them:
— pre ‘94 that valuations increases tended to track increase in ticket sales + broadcast revenue
— from ‘94-06 valuations were pretty flat as more teams added to the league while player salaries outpaced individual team revenues (pre-‘94 player salaries made up ~1/3 of revenues then expanded to the levels we see today at 55-60%).
— Then a new wave of owners after ‘06 tended to diversify their revenue base to include much higher utilization of their venue (other sports, concerts, fan events, etc.) and increase their utilization of surrounding real estate to increase revenues. All of those things significantly impacted growth rates and cash flow from operations. That mixed with an overall market expansion in equity value multiples due to persistent low interest rates allowed the team values to float up faster than in previous periods.


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[pewe]

Fangraphs analysis of the latest proposal: https://blogs.fangraphs.com/mlb-owne...-the-last-one/


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[NYBBFAN]

Originally Posted by pewe

Have you taken a look at how the A’s franchise value saw such an increase?

They shared a parking lot with the Warriors. $$$$$$$$$$

[pewe]

Originally Posted by NYBBFAN

They shared a parking lot with the Warriors. $$$$$$$$$$

Do they also own their land? I guess Bay Area real estate valuations don’t hurt their cause, either


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[Eckstein197]

Athletics are also the same franchise who refuse to pay their minor leaguers 400 bucks. Owner who’s worth 2 billion can’t afford (or just doesn’t want to pay more likely) a million a month to keep a full roster of minor leaguers paid. These type of things can really destroy any good will an owner has with agents. Such a short sighted and terrible decision

[rman112]

Originally Posted by Eckstein197

Athletics are also the same franchise who refuse to pay their minor leaguers 400 bucks. Owner who’s worth 2 billion can’t afford (or just doesn’t want to pay more likely) a million a month to keep a full roster of minor leaguers paid. These type of things can really destroy any good will an owner has with agents. Such a short sighted and terrible decision

I get your point, but how much goodwill do the A's have with agents anyway? Agents' jobs are mostly to find the highest bidder, and it's no secret the A's are cheap, and don't sign expensive free agents.

[Eckstein197]

Originally Posted by rman112

I get your point, but how much goodwill do the A's have with agents anyway? Agents' jobs are mostly to find the highest bidder, and it's no secret the A's are cheap, and don't sign expensive free agents.

Thats true but it also hurts resigning their own stars. Chapman, Olson, etc Wont be cheap to resign

[pewe]

Originally Posted by Eckstein197

Thats true but it also hurts resigning their own stars. Chapman, Olson, etc Wont be cheap to resign

This assumes they plan to try resigning them...


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[chiefsncards275]

The owners aren’t risking catching the virus / their health to play. /thread


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[JustinVerlander07]

What a thread

[ajs213]

Owners aren't risking their health. Owners aren't opening up the books to prove they will actually lose as much as they claim they will. A player making 30 million a year would have to make that much for over 30 years to join the billionaire club. Their clubs aren't losing valuation and just continually gain over the years. How can anyone side when the owners have so much of the power here and have so little to risk is beyond me.

[rman112]

Originally Posted by Eckstein197

Thats true but it also hurts resigning their own stars. Chapman, Olson, etc Wont be cheap to resign

They never sign any of their own expensive players anyway. This doesn't xhange anything. If they're too expensive, they walk. You look at all the exceptional pllayers Oakland has had over the years. How many did they keep? I can only think of Chavez.

[rman112]

Originally Posted by chiefsncards275

The owners aren’t risking catching the virus / their health to play. /thread


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But the players will play.. for 100% of their salaries, as opposed to 75%.

#Health

[chiefsncards275]

Originally Posted by rman112

But the players will play.. for 100% of their salaries, as opposed to 75%.

#Health

Exactly. And as they should.


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