Interesting Fortune article on the economy and baseball

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It looks like season ticket sales are down about 15-20% throughout baseball.

Not even pro sports' richest franchise, the Yankees, seems immune. General Motors (GM, Fortune 500) - once baseball's biggest corporate sponsor - has canceled its sponsorship deal with the team. And even before superstar third baseman Alex Rodriguez was caught up in a steroid scandal, the Yanks were having trouble selling premium seats in their new stadium - so much so that they hired a Manhattan realty firm to market unsold club seats and luxury boxes.

The Pittsburgh Pirates, another team that recently lost GM as a sponsor, have resorted to selling some season tickets at a 25% discount to 2008 prices. In Arizona the Diamondbacks' season ticket renewal rate has fallen to 83% - still respectable, but down from 94% heading into the 2008 season. Hall says he knows of other MLB teams - though he won't name them - with renewal rates as low as 60%. And as bad as 2009 looks, Chicago White Sox owner Jerry Reinsdorf thinks 2010 could be worse if corporations keep cutting back. "Virtually every team is losing sponsors," Reinsdorf says.

The impact of all this is most visible in baseball's free-agent market. In early February there were still nearly 100 unsigned players, including stars like Manny Ramirez and Orlando Hudson. Others, such as Andy Pettitte and Jason Varitek, had to take big pay cuts.

"I used to think that we were pretty recession-proof, and now I'm not so sure," Major League Baseball commissioner Bud Selig tells Fortune. "This is the most significant downturn I've seen in my 40 years in baseball." In years past, such a soft free-agent market might have sparked collusion charges from the MLB Players Association, but so far union boss Donald Fehr is holding his tongue. "Right now I'm not prepared to make any accusation or suggestion of improper activity," Fehr says.

Some of the article talks about the Arizona Diamondbacks and their CEO Derrick Hall. The Diamondbacks seem to be a creative group when it comes to their fans. It talks about how Hall got his job in baseball, and how respected he is around major league baseball.

Worried about losing the lower- and middle-income fan, the Diamondbacks now sell upper-deck tickets for as little as $5. Hall also instituted "kids' pricing" for concessions - $1.50 for a hot dog or popcorn or milk, etc. And in the Diamondbacks' pro shops, fans can buy caps for $7 and T-shirts for $8 - about a third of what some other teams charge.

As focused as Hall is on keeping existing fans happy, he's even more obsessive about cultivating the next generation. If he's out to dinner and sees a youngster wearing a D-backs hat, he'll pick up the family's tab. He chums the under-18 fan base by giving away loads of free tickets to local schools. And he implores Diamondbacks players to sign as many autographs for kids as possible. Hall sends handwritten thank-you notes to the clubhouse whenever he sees a player diligently working the rails before a game. "I sent Randy Johnson a note last year telling him what an honor - what an experience! - it must be for these fans to have a future Hall of Famer signing for them," Hall says. "The kid whose ball he signs will be a fan for life."

The article also discusses how Josh Byrnes, the Diamondbacks GM, uses statistical analysis to identify low-cost, high-production players, which includes having a 24-year-old statistics whiz with an engineering degree from the Massachusetts Institute of Technology on his staff.

http://money.cnn.com/2009/02/18/magazines/fortune/birger_baseball.fortune/index.htm