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Salary Perspective


DrungoHazewood

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From Joe Sheehan's recent column:

A few weeks ago, Bud Selig proudly announced that MLB’s revenues exceeded $6 billion in 2007. This is a watershed moment, a sign that the game, no matter its problems on a micro level, is as healthy and successful as it has ever been. (My extensive disagreements with his decisions and his approach aside, Selig’s reign has to be considered successful for this reason.) Not long after, Yahoo’s Jeff Passan ran the numbers and found that player salaries (calculated from Opening Day payrolls) amounted to just 41 percent of that figure.

Now, I’m not sure what that number should be, but just to pull one data point, the NFL’s Collective Bargaining Agreement, negotiated by the weakest union in sports, allots 53 percent of revenue for players.

Still think ballplayers are overpaid? MLB players get a smaller slice of the pie than their NFL counterparts who're represented by a union that can't even get them guaranteed contracts.

If MLB matched the NFL's share of revenues going to payroll each team would have to bump up their outlays by about $20M a year.

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Does that 41% figure include minor league players?

If not, than I would certainly expect the NFL to allocate more money towards players.

55 man rosters X 32 = 1760 NFL players

25 man rosters x 30 = 750 MLB players

No, but I don't think it changes a whole lot. Let's say the O's have 30 players on each of their seven minor league affiliates. That's 210 players. I'd be surprised if their average take was $20k a year. I'd guess it's really half that, since I know a lot of A or AA players make a couple grand a month and don't get paid in the offseason. But even at $20k x 210 that's $4.2M a year for the entire minor league system. Or about what they pay one Jay Payton or Jay Gibbons, or less than 1/4 of the difference between 41% of revenues and 53%.

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No, but I don't think it changes a whole lot. Let's say the O's have 30 players on each of their seven minor league affiliates. That's 210 players. I'd be surprised if their average take was $20k a year. I'd guess it's really half that, since I know a lot of A or AA players make a couple grand a month and don't get paid in the offseason. But even at $20k x 210 that's $4.2M a year for the entire minor league system. Or about what they pay one Jay Payton or Jay Gibbons, or less than 1/4 of the difference between 41% of revenues and 53%.

What about the top draft picks we spend lots of dough on?

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What about the top draft picks we spend lots of dough on?

Not sure if that was included or not. If not that would probably make up about half the gap, I'm guessing. Weiters signed for, what, about $6M? So the whole draft budget can't be much more than $10M. Bonuses decline exponentially as the draft goes on.

Even including minor league salaries and draft bonuses I'd guess an average MLB team is still under 50% of revenues going to salary and bonuses. With the MLBPA's strength I'd think they'd at least outdo the NFL and be in the 55%-60% range.

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Even including minor league salaries and draft bonuses I'd guess an average MLB team is still under 50% of revenues going to salary and bonuses. With the MLBPA's strength I'd think they'd at least outdo the NFL and be in the 55%-60% range.

Does that huge number for MLB money include all the local/regional TV money that the teams are hiding? If it does, that explains why the players can't get it. If it doesn't, then the players' % is really lower than it looks.

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From Joe Sheehan's recent column:

Still think ballplayers are overpaid? MLB players get a smaller slice of the pie than their NFL counterparts who're represented by a union that can't even get them guaranteed contracts.

If MLB matched the NFL's share of revenues going to payroll each team would have to bump up their outlays by about $20M a year.

I've mentioned this point about baseball's soaring revenues about a dozen times recently. However, when comparing MLB to the NFL, it may not be as simple as comparing the percentage of gross revenues allocated to payroll. I would suspect (though I don't know for sure) that MLB teams have a much higher cost structure outside of payroll. The non-payroll costs associated with fielding a team, moving it around and renting a stadium facility for 162 games has to be higher than for 16 games. The cost of a major league scouting/minor league organization has to be higher than letting college football do all your development for you. The cost of having to look for talent in Latin America, around the world and in high schools all over the U.S. has to be higher than going to college FB games 3-4 months a year.

Also, NFL teams are spreading their payroll around to more players -- 47 on and NFL team compared to 25 in MLB.

None of this totally undercuts your point. After all, MLB revenues have grown 100% in 7 years and 50% in 3 years. Costs (payroll or otherwise) have not grown by nearly as much.

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From Joe Sheehan's recent column:

Still think ballplayers are overpaid? MLB players get a smaller slice of the pie than their NFL counterparts who're represented by a union that can't even get them guaranteed contracts.

If MLB matched the NFL's share of revenues going to payroll each team would have to bump up their outlays by about $20M a year.

YES ! Of course they are.

And tickets, hot dogs, beer, souveniers, ec..... are waaay more expensive than they should be.

The NFL doesn't have guaranteed contracts, but the players get a higher percentage of the pie ? You mean they have to actually perform for their money ? (Horrors !) What a concept ?

It is perfectly logical that less of a percentage would be given to MLB players if it is all guaranteed regardless of performance. Because the entire contract is guaranteed, the owners should get some sort of risk premium.

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YES ! Of course they are.

And tickets, hot dogs, beer, souveniers, ec..... are waaay more expensive than they should be.

How much should those things cost? I always figured that if people continued to buy them at a rate that made the team money they were appropriately priced.

Almost everyone always thinks everything is overpriced. Yet, amazingly, people still buy things.

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How much should those things cost? I always figured that if people continued to buy them at a rate that made the team money they were appropriately priced.

Almost everyone always thinks everything is overpriced. Yet, amazingly, people still buy things.

Of course people pay the prices for hot dogs and beer at ballgames- they are captured. They can't run across the street to a local bar and buy a $2 beer.

Since, you don't think the ballpark food/drink items are overpriced- give me the number of your local favorite bar and we can inform them that he is leaving a lot of money on the table when you come in and drink. :P

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Of course people pay the prices for hot dogs and beer at ballgames- they are captured. They can't run across the street to a local bar and buy a $2 beer.

Since, you don't think the ballpark food/drink items are overpriced- give me the number of your local favorite bar and we can inform them that he is leaving a lot of money on the table when you come in and drink. :P

At OPACY you can bring in food and non-alcoholic drinks. If you really object to the prices they charge (for everything except beer) you could go to your local megamart and buy cases of soda and hot dogs for a tiny fraction of what the Orioles charge. And actually, you can buy food right outside the gate from vendors at a fraction of what they charge inside - I've bought a dog and a soda 100 ft from OPACY for $2. The premium paid inside is only for those who don't care or don't plan ahead.

At both OPACY and my local bars or resturants I'll only buy what I think is reasonably priced. Since I go to ballgames, restaurants and bars infrequently I treat that as a special occasion where I'll pay a premium over what I could get similar items at BJs or Shoppers.

The Orioles are exactly like any smart business. They set prices for tickets, food, and other items to maximize profits. Not to conform to someone's idea of fairness, not to maximize attendance, not to cover payroll.

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At OPACY you can bring in food and non-alcoholic drinks. If you really object to the prices they charge (for everything except beer) you could go to your local megamart and buy cases of soda and hot dogs for a tiny fraction of what the Orioles charge. And actually, you can buy food right outside the gate from vendors at a fraction of what they charge inside - I've bought a dog and a soda 100 ft from OPACY for $2. The premium paid inside is only for those who don't care or don't plan ahead.

At both OPACY and my local bars or resturants I'll only buy what I think is reasonably priced. Since I go to ballgames, restaurants and bars infrequently I treat that as a special occasion where I'll pay a premium over what I could get similar items at BJs or Shoppers.

The Orioles are exactly like any smart business. They set prices for tickets, food, and other items to maximize profits. Not to conform to someone's idea of fairness, not to maximize attendance, not to cover payroll.

So do I.

I overpay for drinks at ballgames, on cruises, at WDW, etc.... I know that is how it is. I don't expect any business to give away any product. I am free to make my choices on whether or not to spend.

But, that doesn't change the fact that ballpark fare is indeed overpriced- regardless of the reasons why.

But, you are dead wrong about the second bolded sentence: the Orioles are NOT "exactly" like any "smart" business. :P LOL. Books can be written on why that is a wrong statement.

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From Joe Sheehan's recent column:

Still think ballplayers are overpaid? MLB players get a smaller slice of the pie than their NFL counterparts who're represented by a union that can't even get them guaranteed contracts.

If MLB matched the NFL's share of revenues going to payroll each team would have to bump up their outlays by about $20M a year.

It's a shame MLB wasn't better able to stand up to the MLBPA... For the fans, the game would be much better without guaranteed contracts.

I think the veteran players are overpaid and the young players are probably underpaid. In aggregate? I don't know.

What I do know is percentage of revenues is nowhere near enough information to compare the two. As Frobby pointed out the expenses inherent in running a baseball franchise are likely a lot higher. I have no idea what the numbers would be but to compare the two that would be necessary information to have. If MLBs expenses are significantly higher then the slice of the revenue pie distributed to players would need to be lower.

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But, you are dead wrong about the second bolded sentence: the Orioles are NOT "exactly" like any "smart" business. :P LOL. Books can be written on why that is a wrong statement.

I probably did go a bit far implying that the O's are (or at least have been in the past) smart. Maybe in pricing hot dogs, but not a lot else.

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For the fans, the game would be much better without guaranteed contracts.

I bet the game would be about the same, pretty much. The main diff is that fans wouldn't have guaranteed contracts to complain about. But I don't think it would change the game much at all. I agree that guaranteed contracts are kinda silly. I think they are Exhibit A in proving the case that the owners are morons.

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