By David Everett Fisher
1911 American League owners
Baseball, beyond all of its majesty and grace, is a business. Owners of baseball teams, and some of them love baseball, are trying to make money, and players are trying to get paid money. We have found ourselves in a duel between owner billionaires and player millionaires on how much a player is worth and for how long.
A baseball player on average is in the big show only for a few years. While they were in the minors they make less than a teacher. Some players got a nice signing bonus, but others struggle to make ends meet or quit baseball. Some players, mostly pitchers, stay up in the big leagues for 10 to 15 years, while others might never see a full season.
The big news is that spring training has started and there are many free agents left unsigned. The big headliners are Bryce Harper and Manny Machado. They want, and were led to believe, that they would get big bang buster contracts nearing 10 years and 300 million dollars, but yet here we are, and teams aren’t offering that kind of money from what other more professional journalists lead me to believe.
The problem with labor in baseball has started rumblings of a player strike or even an owner lockout if things don’t get resolved. Major League Baseball will not survive a strike. They had to inject their players with steroids and tarnish the great game with controversy to survive the last strike, and I know people who loved baseball that threw their arms up and will not enjoy a baseball game. I know I, who is writing a blog for a podcast website that is solely about baseball, would have a hard time wanting to support the MLB’s product.
Baseball is an interesting business model. Each team makes different amounts of money. The Yankees, Houston, Boston, New York, and Los Angeles make huge amounts of cash from being in these large market cities. Then you have teams like Oakland, Kansas City, and Tampa Bay which don’t make a lot of money but have to compete with teams that have gigantic payrolls. Baseball does the communist thing and redistributes the wealth from the rich teams and spread it around to the poorer teams. Before you get your libertarian panties in a bunch, this helps the rich teams make more money because then there is fairer competition.
Baseball teams have only a luxury tax after 206-million-dollar payroll this year. This means if you try and buy a bunch of great players for a lot of money and you exceed the payroll limit, you have to pay 20% tax on the extra money spent. The more you exceed the threshold, the more you pay in taxes. The Los Angeles Dodgers have done this a few years in a row to become second place.
Where does all these millions of dollars come from? Ticket prices, merchandise and licensing, and TV contracts. Just about 31% come from ticket prices and premium seating. Almost 40% comes from local and national TV and Radio contracts, and this might be changing with streaming services getting into the fun. Just short of 15% is in sponsorships and licensing, which is video games and using MLB’s likenesses in movies and other media. Companies like Bank of America, MasterCard, Apple, and Amazon Web Services have given close to 900 million dollars in 2017. The MLB Advanced Media (MLBAM) arm of the MLB brought in another 900 million bucks with its MLB online services. And before you throw hot dogs at me, concessions bring in 1% of MLB’s income. The postseason will bring in more money as well.
Ticket prices are on the decline, but TV contracts are on the rise, and the MLBAM has added a lot of money to the league that just didn’t exist before. Baseball is making record breaking money. Before the more modern version of analytics, a free agent was guaranteed a huge pay day, but now that the math shows that that a player was more productive before free agency, so front offices aren’t willing to pay the top dollar. Think about all the record-breaking contracts that yielded little to nothing.
While it is hard to root for a millionaire standing up to a billionaire about getting paid, I do have to say that this is the exact same fight that is happening all over the US. The labor is not making more money and the management is making impossible money. Just like the traffic controllers who ended the government shutdown, the players will want to strike if they don’t see growth in their salaries, and the owners will want to lock out the players to make them mind their Ps and Qs.
I do have some solutions though. I have taken no business classes in college and my economic knowledge is pretty limited, but I have a good gut for fixing broken things. Here are a few of my ideas:
Major League Baseball: Employee Owned
Joey Votto, owner and first baseman of the Cincinnati Reds
The players become the owners of the teams and the leagues. They would have a lot more at stake when it comes to the business of baseball. As players they would get a salary, but as owners they would get stock incentives, so that the more money the MLB makes, the more money they make.
Players who retire would get a nice retirement package that would give them incentive to step away if they aren’t playing up to competitive level, and they would remain ambassadors of the game.
I believe that the competition level would be protected because the players would want to put out a good product for the consumers. Without people watching, they wouldn’t make money, so making sure that four to six teams don’t dominate the league would be important.
It would also take away the labor struggles of millionaires whining about billionaires. If baseball isn’t selling, then the players would have to figure out creative ways to change the game that suit the people.
Major League Baseball: Conference
We break up the league into conferences who only play each other. Then the teams are ranked 1 to 30 based on what is believed to be the best team to the worse team. If there are two teams in a conference that are ranked one and two, they play each other to see who plays the highest-ranking team of another conference.
If this sounds familiar, then yes, I am changing the MLB to college football. One of the reasons I believe college football makes so much money is how much time the pundits spend ranking teams and agreeing and disagreeing with the rankings.
Imagine last year if the Yankees were ranked first? Boston people would get so upset, and Houston fans would be screaming on Twitter, and Los Angeles Dodger fans would be calling Colin Cowherd and yelling, and then teams like Tampa Bay, Oakland, and Milwaukee would get all these acolytes of being the sleeper to take down the number ones.
This would also allow for more teams to join. You don’t have to protect the competitive population as much with a ranking system. The number ones would need weak teams to join the league to give them the appearance of strength of schedule, another great sports talk topic, “Yankees had to play Boston, Toronto, and Tampa Bay! Who is in the Pacific Conference that Los Angeles has to worry about?” See? Fun!
Each conference would have its own economy, so yes, some conferences will have bigger TV contracts. Some conferences will always seem like the underdogs.
Then we can talk about bowl games. While there is the championship game, or world series, we can also have big money makers meet in bowls all through September and October. Some of the teams could really suck, but if people spend money to see those two teams meet, then it will be a success.
Imagine if both the Los Angeles Dodgers and the San Francisco Giants were really bad, but every October they had the In n’ Out Burger Bowl where they brought in the most of this storied rivalry, then baseball would make so much money.
I’d also shorten the season to be from June to August for the regular season, September to October to be the conference playoffs, bowls, and championship bowl.
Major League Baseball: National Baseball League
This would be the opposite of the player owned league, and this would be the owner owned league. I’m sure the player union would kill me if anyone ever took me seriously – I mean they would have me assassinated by a hit man named Lorenzo. We take out all weekday games, no one fucking watches those. We only play Friday night, Saturday all day and night, and Sunday day. We place a hard cap on salary, and each team has to spend the exact same amount. We get rid of the DH, all fields must be exactly the same dimensions in the outfield, we have designated positions – so no shifts, assholes, and we take out interleague play.
Scheduling would be your division plus a few special games that people want to see, and then we meet up in conference championship games. All games are best of three except the super world series bowl where it is one game. None of this waiting a bunch of days to see who the winner is, just one game, like a man.
Major League Baseball: X League Baseball
This is kind of like the last one, but the offense and the defense can be different people. All of your batters are designated hitters, your base runners are all pinch runners, all your fielders never hit, and your pitchers can come in and out as you please, so your opener can also be your closer if you want. Cheerleaders, shit talking players, fireworks, crazy uniforms, and the stands are in play.
Also, Performance Enhancing Drugs are not just legal, but encouraged.
Major League Baseball: Las Vegas
Hall of Famer Pete Rose
Gambling. Do I really need to say more? MLB takes a cut, we have huge boards where people can gamble on what pitch is being thrown, if it’s a strike, ball, hit, or foul, if a team is winning by how many points, if Nolan Ryan falls asleep in the stands – there is so much a person can bet on.
MLB just takes a cut of all the gambling and the MLB would be rich. Fuck this fantasy sports in people’s “man caves”, let’s be in bars fanning twenty-dollar bills with drool on our mouths because it is a 3-1 pitch, 2 outs, bottom of the ninth and the score is tied. Yes, it is exciting enough, but imagine if your team strikes out but you won $9,000!?! You’d be fine!