Lengthy quotes from Elias - 12/7

[geschinger]

1 hour ago, tabletop said:

Well, that's up to the community as a whole. If you aren't interested turn it off and eventually if enough people do maybe it'll change. I don't think it's a good goal either. Look at the Padres their media market is 27th and they are spending around 250m this year while Baltimore is 28th and is spending (as of now) around 50m while they tell you it's just the way it is for a team in their market going against teams from bigger markets. They can tell you that they're being smart and this is how smart teams operate all they want but the fact is the Orioles owners aren't in it for championships they're in it to make money. Maybe they were chasing titles in the past, maybe they will be chasing them again in the future, but as of right now that's not what they're after.

What the Padres have that the Orioles don't is that they are in the middle of a > $1bn TV rights deal where their money is locked in despite RSNs hemorrhaging subscribers at an alarming rate.  They were able to get a favorable TV deal as their market also includes and brings in revenue from the Las Vegas as well.  

The Orioles can certainly spend a lot more than they are now - even as much as 3x should be doable.  But their media $ situation is nowhere near as good as what SD has.

[Frobby]

3 minutes ago, geschinger said:

What the Padres have that the Orioles don't is that they are in the middle of a > $1bn TV rights deal where their money is locked in despite RSNs hemorrhaging subscribers at an alarming rate.  They were able to get a favorable TV deal as their market also includes and brings in revenue from the Las Vegas as well.  

The Orioles can certainly spend a lot more than they are now - even as much as 3x should be doable.  But their media $ situation is nowhere near as good as what SD has.

Funny, I remember when people thought the O’s had it so great because they had their own RSN.   Turns out to be disadvantageous in a lot of ways because the team bears the risk of a drop in the subscriber base.  I’d be willing to bet that, even considering that the O’s own the majority of a two-team network, they earn less in local TV revenues than most teams.  

[PepeSylvia]

I agree with a lot of what he said but none of it precludes him from giving short term deals to free agents that would make a difference now without hamstringing the future of the organization.

 

Could have signed Verlander to the deal he got (2 years with vesting 3rd) and Josh Bell (2 years with player opt out in 2nd year), trade for Lopez, made a couple smaller moves, and still had a bottom third payroll. Our chances for this year would have increased tremendously with two front line starters and a power hitting switch hitter with a career .810 OPS and our payroll would still be low relative the rest of the league with no long term commitment. 

 

Something tells me ownership is handcuffing Elias (who I still believe is a phenomenal GM). 

[Roll Tide]

1 hour ago, Frobby said:

No it’s not.  Teams have a lot of expenses other than payroll.  In 2021 on $251 mm in revenue they had operating income of $83 mm.   That’s before interest payments and taxes, among other things.  

Now, they are still pocketing plenty of money.  But it’s not on the order of $220 mm, even with the increase in TV revenue and the BAMTech money.   

Again, I’m not disputing that the O’s could spend significantly more on payroll.   It’s just not $220 mm.

 

BOULDERDASH! The majority of expenses disproportionately is player salaries in any professional sport. There is nothing that you can say to convince me that their operational expenses are anywhere near what is reported on that site. I’ve owned a business and tried to hide every dollar as every business does. The Orioles have a sweetheart lease deal from the stadium authority. They could have a $200 million payroll and plenty left over. And that’s not counting the extra $30 million this season from the Disney deal.

FYI….The Yankees Forbes report show operating expenses of -40 million and that’s before they gave Judge $40 million dollars. So they are clearly playing hide the potato 

 

https://www.forbes.com/teams/new-york-yankees/?sh=55ea6bc4e6e0

Edited December 8, 2022 by Roll Tide

[RZNJ]

1 minute ago, Roll Tide said:

BOULDERDASH! The majority of expenses disproportionately is player salaries in any professional sport. There is nothing that you can say to convince me that their operational expenses are anywhere near what is reported on that site. I’ve owned a business and tried to hide every dollar as every business does. The Orioles have a sweetheart lease deal from the stadium authority. They could have a $200 million payroll and plenty left over. And that’s not counting the extra $30 million this season from the Disney deal.

FYI….The Yankees Forbes report show operating expenses of -40 million and that’s before they gave Judge $40 million dollars to Judge. So they are clearly playing hide the potato 

 

https://www.forbes.com/teams/new-york-yankees/?sh=55ea6bc4e6e0

Discussion over.   You aren't even willing to listen to the Frobster?     That's usually a bad sign.

[Roll Tide]

1 minute ago, RZNJ said:

Discussion over.   You aren't even willing to listen to the Frobster?     That's usually a bad sign.

I’m telling you these reports aren’t accurate! -40M in operation income? They wouldn’t be in business.

 

[Roll Tide]

@Frobby

 

Quote

Revenue and operating income are for 2021 season and net of revenue sharing and stadium debt service.

So let’s not count $110 million dollars! Does it count the National tv deal $100 million? Is it only based on the 48% amount that isn’t counted in revenue sharing. I suspect it is…MASN revenues, payments from etc? We know the Orioles are treating it separate, to hide the values from the courts, the Gnats, etc. 

Gate receipts alone are $20 million. 

[geschinger]

1 hour ago, Frobby said:

Funny, I remember when people thought the O’s had it so great because they had their own RSN.   Turns out to be disadvantageous in a lot of ways because the team bears the risk of a drop in the subscriber base.  I’d be willing to bet that, even considering that the O’s own the majority of a two-team network, they earn less in local TV revenues than most teams.  

I suspect you would easily win that bet.  I think i remembered reading here they lost a couple million subscribers several years ago and.   Subscriber hemorrhages have not slowed down since (and assuming MASN is not an exception) 

I'm really envious of a team like the Dodgers - not for the amount of their deal as I know that would never have been possible for Baltimore - but for the foresight to lock up their best case scenario deal into the late 2030s and offloading almost all of the risk.

Edited December 8, 2022 by geschinger

[eddie83]

12 minutes ago, geschinger said:

I suspect you would easily win that bet.  I think i remembered reading here they lost a couple million subscribers several years ago and.   Subscriber hemorrhages have not slowed down since (and assuming MASN is not an exception) 

I'm really envious of a team like the Dodgers - not for the amount of their deal as I know that would never have been possible for Baltimore - but for the foresight to lock up their best case scenario deal into the late 2030s and offloading almost all of the risk.

Question is have the subscriber fees gone up?  My bill would indicate so. Dodgers weren’t on many TV’s in the LA area due to that contract. Not sure how many have picked up now. 
 

No question the model has changed.  

[geschinger]

2 minutes ago, eddie83 said:

Question is have the subscriber fees gone up?  My bill would indicate so. Dodgers weren’t on many TV’s in the LA area due to that contract. Not sure how many have picked up now. 
 

No question the model has changed.  

It's possible they are trying to offset subscriber losses with higer rates but not sure how well that works.  I know the YES network tried to raise rates in 2021 and they were quickly dropped by all the streaming providers who previously offered it other than DTV.

The great thing about the Dodgers and Padres any everyone else who is locked in for the longer term - is they get their money based on the peak of RSN era no matter what happens with the model going forward.  

Unfortunately the Orioles have the opposite scenario and own all of the risk of a declining offering.

[Roll Tide]

1 hour ago, Frobby said:

Funny, I remember when people thought the O’s had it so great because they had their own RSN.   Turns out to be disadvantageous in a lot of ways because the team bears the risk of a drop in the subscriber base.  I’d be willing to bet that, even considering that the O’s own the majority of a two-team network, they earn less in local TV revenues than most teams.  

So they are collecting subscription fees from Comcast, Direct TV, Verizon etc. plus there are additional opportunities for a number of other options. While it’s hard to determine how many I’m sure it’s still millions of subscribers for each service. Plus these new ways to stream are pay service and possible 

 

https://hotdog.com/tv/channels/masn/

[TonySoprano]

Elias said he views these meetings as more of “an information gathering event, first and foremost.” - This could have been said by Duquette, MacFail....

Only a Charlie Brown believed this Winter Meetings would be different.  Let's face it, the Meetings have been a nothing burger in Baltimore since Teixeira was spotted near Ravens stadium, riding in a limo with Angelos in 2008.  

In fairness, most of the teams, liftoff or not, did as little as Elias did this week.   A few teams threw around stupid money.   After outbidding on Turner and Judge by $40M each, the Padres finally found someone to take their money, with an absurd deal for Bogaerts through age 41.  If in a few years Judge morphs into Chris Davis redux, they'll check under their seat cushions for cash and reload.

 

[geschinger]

17 minutes ago, Roll Tide said:

So they are collecting subscription fees from Comcast, Direct TV, Verizon etc. plus there are additional opportunities for a number of other options. While it’s hard to determine how many I’m sure it’s still millions of subscribers for each service. Plus these new ways to stream are pay service and possible 

 

https://hotdog.com/tv/channels/masn/

Nope - a few million subs for all services combined.

Washington Post reported in June the total number of subs across all carriers is down to 3.6m and it is continually declining.  I'm pretty sure they had more than 9m subs a decade ago.

Add to that the fact that unlike with many of the other clubs despite the carriage fee being no higher it has to support 2 teams instead of 1.  I think it's safe to say the Orioles are worse off than most when it comes to local TV rights revenue.  

[DrungoHazewood]

22 hours ago, Frobby said:

No it’s not.  Teams have a lot of expenses other than payroll.  In 2021 on $251 mm in revenue they had operating income of $83 mm.   That’s before interest payments and taxes, among other things.  

Now, they are still pocketing plenty of money.  But it’s not on the order of $220 mm, even with the increase in TV revenue and the BAMTech money.   

Again, I’m not disputing that the O’s could spend significantly more on payroll.   It’s just not $220 mm.

 

I really, really wish we'd see open financial books.  I know there are a few teams that have had to reveal a lot, but most of the information we have on the Orioles are guesses.  Most teams are like that. I want to see the Padres' ledger.

But we also know in other big professional sports teams spend a lot higher percentage of revenues on player payroll and they have no problem whatsoever getting massive team valuations and value increases.

Edited December 9, 2022 by DrungoHazewood