I Don't Like the Direction of Baseball

[Camden_yardbird]

This off season is punctuating some very negative trends in baseball.  Super teams (largely big market teams) are becoming more commonplace as large market teams have begun to figure out the economics of the current rules, teams are having to trade the face of their franchises, free agents aren't signing and when they do it's for too much money.  None of these are unique to now, certainly these things have happened in the past, but with every new CBA the metagame has to be figured out, and there seems to me to be a short period of relative parity.

I'm not just talking about parity, although I see NBAesque trends that are alarming, but other aspects as well in the ballpark experiences, the quality of product  (tanking), and other places.

Some of it is teams getting smarter, hoarding prospects, and not making stupid decisions.  But with the current prices for super stars you are seeing home teams pay too much and big market teams take advantage of those economics (Stanton) or small market teams with their backs against the wall on impending free agents and accepting what looks like trivial pieces in return (Cole).

Overall, this off season and the past few years is really putting a bad taste in my mouth for the future of the game.

[Can_of_corn]

But smaller market teams, like the Indians, can be smart and still compete.  You can extend your young players early instead of waiting until they are well into the arbitration process.

The Dodgers and the Yankees are putting together strong teams while staying under the luxury tax.  I'm fine with that.

I have no sympathy for a mid-tier team that is killing their chances at contention through obvious blunders.

[Redskins Rick]

I haven't like the direction MLB has been heading for several years. Salaries are way out of hand, owners are making a killing, and the cost is passed down to us the consumers.

I know for decades, each generation complains about the salary cost and how crazy it is. Seams like just yesterday, my father, grandfather and I was deep in a heated discussion about the life of baseball and how in their opinion free agency would ruin baseball. Of course dad likes to point out granddad said Mays getting 100K a year would ruin the game, and it didn't. When Ryan got the first 1 million dollar contract, they were both up in arms. (Gosh, what memories )

You can't have these high ticket prices and concession prices, and not impact the gate revenue, its not possible. Sadly, owners don't have to worry about gate revenue, since most of their money is coming from Cable TV.

 

[Can_of_corn]

8 minutes ago, Redskins Rick said:

I haven't like the direction MLB has been heading for several years. Salaries are way out of hand, owners are making a killing, and the cost is passed down to us the consumers.

I know for decades, each generation complains about the salary cost and how crazy it is. Seams like just yesterday, my father, grandfather and I was deep in a heated discussion about the life of baseball and how in their opinion free agency would ruin baseball. Of course dad likes to point out granddad said Mays getting 100K a year would ruin the game, and it didn't. When Ryan got the first 1 million dollar contract, they were both up in arms. (Gosh, what memories )

You can't have these high ticket prices and concession prices, and not impact the gate revenue, its not possible. Sadly, owners don't have to worry about gate revenue, since most of their money is coming from Cable TV.

 

It depends on the market.

The Red Sox are the most expensive team patronize, yet they finished 9th in attendance despite having a very small ballpark.

The Cubs were second most expensive and yet had the sixth highest attendance.

Yankees, third most expensive fourth highest attendance.

Pittsburgh on the other hand was in the bottom third in both price and attendance.

[Redskins Rick]

Just now, Can_of_corn said:

It depends on the market.

The Red Sox are the most expensive team patronize, yet they finished 9th in attendance despite having a very small ballpark.

The Cubs were second most expensive and yet had the sixth highest attendance.

Yankees, third most expensive fourth highest attendance.

Pittsburgh on the other hand was in the bottom third in both price and attendance.

Red Sox just prove that its not about gate revenue, its how deep the owner pocket is.

King George didn't care about running a negative balance as the baseball was his hobby and not a business for him to make money, of course having their own cable channel helps them these days. Heck, they dont even worry about selling out playoff games.

The Cubs are in a very large metropolitan city (#3 in USA) which helps ensure their seats are packed, they were 5th place for 5 years, and didnt impact them much in attendance.

Pittsburgh is a very small city, half the population of Baltimore and very blue collar, with average yearly income just barely above Baltimore.

MLB isnt dying in every city.

But, the MLB brand itself is not healthy, IMO and needs to make changes to get back to being the #1 sport in the USA.

[Can_of_corn]

You know George is dead right?  Has been for a while now?

You said that prices negatively impact attendance and I gave numerous examples of teams that had higher prices and higher attendance.  Honestly things like market size and team performance have as much or more impact on attendance than prices.

Baseball isn't expensive compared to the other major sports in this country.

 

And yea, baseball is never going to be the #1 sport in the US again.  Too hard to bet on it.

[Camden_yardbird]

Higher Prices, Higher Payrolls, Higher Attendance, Bigger Cities.

You said mid market teams making mistakes doesn't bother you, and yet larger market teams hide those mistakes (cough), and mid market teams who don't make mistakes simply lose their windows (Royals) and eventually Twins in 3 years.

I disagree that baseball can't be #1 again.  I believe it has done a poor job of reacting to the new pop culture, one that happens in 140 characters at lightning speed.  But football is balancing dangerously on a precipice where we are one catastrophic injury on the field away from it having to make very drastic safety changes.  The NBA and NHL will never appeal to large parts of America.

[MDtransplant757]

1 hour ago, Redskins Rick said:

I haven't like the direction MLB has been heading for several years. Salaries are way out of hand, owners are making a killing, and the cost is passed down to us the consumers.

I know for decades, each generation complains about the salary cost and how crazy it is. Seams like just yesterday, my father, grandfather and I was deep in a heated discussion about the life of baseball and how in their opinion free agency would ruin baseball. Of course dad likes to point out granddad said Mays getting 100K a year would ruin the game, and it didn't. When Ryan got the first 1 million dollar contract, they were both up in arms. (Gosh, what memories )

You can't have these high ticket prices and concession prices, and not impact the gate revenue, its not possible. Sadly, owners don't have to worry about gate revenue, since most of their money is coming from Cable TV.

 

There are a few reasons for the bolded statement. 

1. Cities build the stadiums and are mostly responsible for upkeep of the ballpark without team input financially. This allows salaries to go up and for owners to pocket more money. Some of the more horrendous deals being the Bengals stadium and NYC with the mets and the Yankees. Renovations have team input, but with the state or city paying for half of to most of it (Orioles with the recent renovations to OPACY, and Chicago with the Cubs' $500 million facelift of Wrigley field)

http://www.businessinsider.com/worst-stadium-deal-cincinnati-2011-7

Article posted is of the Bengals stadium deal. They've built both the reds and Bengals stadiums, and now they're building an MLS team (IN THE US, MIND YOU) a stadium. The stadiums themselves now make up around 25% of Hamilton county's budget. 

2. Inflation has been rising since the late 60's when the dollar came off of the gold standard. This is why everything costs so much now, with it really coming to a head now with the advent of crypto currencies (Bitcoin)

3. TV contracts are a bubble waiting to burst with the advent of streaming. This is a blessing and a curse for MLB and its fans. The blessing is that I can (hypothectially) watch the O's on my laptop or phone at work and MLB can charge per individual for streaming rights on websites like MASN.com if the team decides to stream in house or use MLB tv with the rest of MLB. A good chunk of revenue can be made this way, along with traditional advertisers during the breaks. The curse however is that teams will ultimately start losing money on cable providers because why would they pay so much to broadcast games when people can stream the games? Advertisers will also decrease rates because of this as well. The NFL is taking to streaming very slowly, but with Amazon, twitter, etc. 

 

With the rest of your statement, half of it is my first two points with the other half being that teams make a ton of money on gameday itself. That stuff pays for itself, and brings more money to a team. Gate revenue has been lost due to the economic booms and busts in states and across the US in 2008, which we're now just starting to really get back to normal 8 years later. TV contracts rose steadily since the 90's, with it really rising since the mid 2000's to the present. TV contracts bowie the team due to lost gate revenue. The owners still worry about it, because this suppliments the team's incomes. Gate revenue is still a big part of the money teams make, including PSL's, season tix, ticket packages, etc. However, gate revenue for most of MLB is still very affordable oustide of Boston, NYC and LA. 

[Frobby]

7 hours ago, Redskins Rick said:

You can't have these high ticket prices and concession prices, and not impact the gate revenue, its not possible. Sadly, owners don't have to worry about gate revenue, since most of their money is coming from Cable TV.

 

I think the ticket and concession prices are set at whatever level the decision makers think will maximize the revenue.    Let’s say a team can draw 2.5 million fans if tickets average $20, and attendance will drop to 2 million if prices are raised to an average of $26.    Well, then the tickets are going to be sold for $26, because $26 x 2 million is greater than $20 times 2.5 million.   TV revenues don’t have a thing to do with that decision.    The team will maximize revenue wherever it can, unless it thinks there is some long-term reason not to maximize short-term gain.

I have to say, it looks to me like we’re heading into a long stretch where the Yankees and Dodgers will be in the playoffs every year, and where the Orioles are going to be hard-pressed to claw their way into contention.    I’m not going to enjoy that at all.   

[Redskins Rick]

15 hours ago, Frobby said:

I think the ticket and concession prices are set at whatever level the decision makers think will maximize the revenue.    Let’s say a team can draw 2.5 million fans if tickets average $20, and attendance will drop to 2 million if prices are raised to an average of $26.    Well, then the tickets are going to be sold for $26, because $26 x 2 million is greater than $20 times 2.5 million.   TV revenues don’t have a thing to do with that decision.    The team will maximize revenue wherever it can, unless it thinks there is some long-term reason not to maximize short-term gain.

I have to say, it looks to me like we’re heading into a long stretch where the Yankees and Dodgers will be in the playoffs every year, and where the Orioles are going to be hard-pressed to claw their way into contention.    I’m not going to enjoy that at all.   

Me neither, reminds me a bit of the Old Dodgers and Yankees wars, where they were usually the top two teams every season, at least from the history books. A bit before my time.

[byrdz]

The Free Agent Market is Frozen Because the Players Bargained for Luxury, not Labor

https://www.si.com/mlb/2018/02/02/brodie-van-wagenen-agent-free-agency-market

 

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Here’s the problem that players and especially agents have trouble accepting: they are working in a disrupted industry. A rise in intellect and information has fundamentally changed the economics of baseball, just as they have changed many industries.

 

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You don’t hear much about the Boras binding business now because even the most analytically-challenged club has a firm, well-educated grasp of value. Thanks to sites such as Fangraphs and MLB Trade Rumors, the average fan has a better idea of value than what some clubs had in 2008 when Perez was on the market.