One thing that’s held up the LHR market that wasn’t mentioned was Matt Strahm. According to Ken Rosenthal, Strahm’s 2 yr/$15 mil deal set higher expectations for guys like Chafin, Moore, and Britton (and I’d assume the same for guys like Smith and Hand).
“The Reds can point to market size, their crappy TV deal, etc. But every team pulled in $65MM from national TV and streaming deals last year before even considering gate revenue, local TV deals, and other revenue streams. Every team got $30MM from the most recent sale of the remaining stake in BAMTech.”
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It’s always a problem when sports reporters talk about finances.
OK, so the Reds pulled in $95m from national TV and a sale of BAMTech. As for their local TV deal – their broadcaster is restructuring to avoid bankruptcy. The Reds were 24th in home attendance in 2022.
A few years ago they spent quite a bit on FA’s and everyone at MLBTR (and most posters) cheered them on. But the team didn’t win much, the attendance didn’t spike, the franchise lost money, and they still had outrageous contracts on the books that literally would have put the franchise into bankruptcy (the Pirates were in Bankruptcy Court maybe 15-20 years ago). Instead the Reds traded off those contracts which people here also criticized them for. Turned out that the real losers were the teams that took those contracts on – they got very little in on-the-field-production for the salaries they took on.
Looking at one side of the balance sheet – revenues taken in – and only looking at player payroll for the other side is something my Business teacher in the 7th grade would make fun of. Fact is that the cost of running a major league franchise is quite expensive – before we even get to player payroll. A few weeks ago Dorothy_Mantooth broke down the some of the Braves financials from years ago (see link below) – the only franchise that has a public reporting system in place. While revenue has grown since then, so have expenses other than payroll.
MLBTR tends to see one side of a issue and quote selected statistics to validate it. Both successful baseball played on the field and finances have a balance to them, I’m not the only one on here tired of pointing that out.
It is an extremely complicated matter to guess at the complexity of any MLB team ledger, based on pieces assembled from one team. We have to work on assumptions in many cases, as we don’t know specifics on city/state tax deals for stadiums, marketing deals with media and such, and the idiosyncrasies each team operates under at the end of the day. That assumption is that the better the product each team fields is good for baseball generally, as competition should drive viewership, interest and therefore revenue whether on the field, streaming, or even fringe businesses like MLBTR or the local taverns that make money from the entertainment value. Another assumption is that smaller market teams have a much more difficult time generating profits because they have a smaller piece of the pie to begin with.
Left unchecked, large market teams have an unfair competitive advantage on smaller market teams. That is not good for the overall product of the MLB. It’s a fascinating ongoing conversation with no simple answers.
Samuel you’re didactic, pedantic, repetitive and boring. Please site specific examples. Nobody benefited from the players the Reds traded away? Eugenio Suarez had a nice season with the Mariners.
One thing that’s held up the LHR market that wasn’t mentioned was Matt Strahm. According to Ken Rosenthal, Strahm’s 2 yr/$15 mil deal set higher expectations for guys like Chafin, Moore, and Britton (and I’d assume the same for guys like Smith and Hand).
“The Reds can point to market size, their crappy TV deal, etc. But every team pulled in $65MM from national TV and streaming deals last year before even considering gate revenue, local TV deals, and other revenue streams. Every team got $30MM from the most recent sale of the remaining stake in BAMTech.”
–
It’s always a problem when sports reporters talk about finances.
OK, so the Reds pulled in $95m from national TV and a sale of BAMTech. As for their local TV deal – their broadcaster is restructuring to avoid bankruptcy. The Reds were 24th in home attendance in 2022.
A few years ago they spent quite a bit on FA’s and everyone at MLBTR (and most posters) cheered them on. But the team didn’t win much, the attendance didn’t spike, the franchise lost money, and they still had outrageous contracts on the books that literally would have put the franchise into bankruptcy (the Pirates were in Bankruptcy Court maybe 15-20 years ago). Instead the Reds traded off those contracts which people here also criticized them for. Turned out that the real losers were the teams that took those contracts on – they got very little in on-the-field-production for the salaries they took on.
Looking at one side of the balance sheet – revenues taken in – and only looking at player payroll for the other side is something my Business teacher in the 7th grade would make fun of. Fact is that the cost of running a major league franchise is quite expensive – before we even get to player payroll. A few weeks ago Dorothy_Mantooth broke down the some of the Braves financials from years ago (see link below) – the only franchise that has a public reporting system in place. While revenue has grown since then, so have expenses other than payroll.
MLBTR tends to see one side of a issue and quote selected statistics to validate it. Both successful baseball played on the field and finances have a balance to them, I’m not the only one on here tired of pointing that out.
mlbtraderumors.com/2023/01/quick-hits-wacha-hendri…
It is an extremely complicated matter to guess at the complexity of any MLB team ledger, based on pieces assembled from one team. We have to work on assumptions in many cases, as we don’t know specifics on city/state tax deals for stadiums, marketing deals with media and such, and the idiosyncrasies each team operates under at the end of the day. That assumption is that the better the product each team fields is good for baseball generally, as competition should drive viewership, interest and therefore revenue whether on the field, streaming, or even fringe businesses like MLBTR or the local taverns that make money from the entertainment value. Another assumption is that smaller market teams have a much more difficult time generating profits because they have a smaller piece of the pie to begin with.
Left unchecked, large market teams have an unfair competitive advantage on smaller market teams. That is not good for the overall product of the MLB. It’s a fascinating ongoing conversation with no simple answers.
Samuel you’re didactic, pedantic, repetitive and boring. Please site specific examples. Nobody benefited from the players the Reds traded away? Eugenio Suarez had a nice season with the Mariners.
Good chat Steve – thanks for the time!