A bit more on the distinction between the Wilpons and the McCourts

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In that last post about the difference between the McCourt situation and the Wilpon situation, I said that there was a difference between Wilpon’s ownership interest in SNY and the Dodgers’ ownership of broadcast rights.  That distinction led to a couple of similar reader comments. Like this one:

The situations are identical, just different structures. The major asset of SNY is the rights to Mets games, right? McCourt has Dodgers rights He could create a network and sell the broadcast rights to for $bazillion
He could then sell the network which is his personal asset to pay off his divorce. And that is OK where selling the rights to Fox is not?  SNY is just a shell for the rights that is packaged as an operating company.  No difference at all.

It’s actually even more stark than my reader says.  The Mets — as a team — likely get pennies on the dollar of what their broadcast rights would be worth on the open market because Wilpon is on both sides of the deal with SNY.   By underpaying for Mets rights, SNY is worth more and the money it keeps — as opposed to the money the Mets would have received — is not subject to revenue sharing with the other 29 clubs.  This has been going on for years, by the way. Ted Turner used to do with the Braves and TBS, albeit for some different reasons.

All of that said, I don’t disagree with my reader’s analysis. The point I was trying to make in the last post — and in hindsight utterly failed to make — is not that there is a fundamental difference between broadcast rights and regional sports network ownership interest. It’s that Bud Selig does and will continue to treat such things differently — and thus he will likely treat McCourt and Wilpon differently — even if doing so is disingenuous.

Why?  Because if he acknowledges that straight broadcast rights and the revenues of team-owned cable networks are essentially the same, the economic structure of baseball unravels.  Because it’s not really a structure. It’s an uneasy peace between big market, high revenue teams and the small ones.

That peace is predicated, in part, on the big clubs and the little clubs being allowed their respective excesses.  The big clubs can house their money in enterprises that are not subject to revenue sharing. Think the Red Sox investing in NASCAR teams and, more traditionally, big teams operating RSNs.  For their part, the small clubs are allowed to pocket revenue sharing money rather than invest it in their teams. At least within reason, as Jeff Loria and the Marlins found out last year.  Each type of team chafes at what the other is allowed to get away with, but they mostly keep their powder dry because everyone is getting rich.

Practically speaking, if the Wilpons are forbidden from using SNY money to settle their Madoff problems on a theory that doing so would harm the Mets, the fiction that this money is non-baseball-related is exposed and the Pirates and Royals of the world will demand that they be given a share of the RSN money the big teams are making.

Likewise, if Frank McCourt is allowed to use straight broadcast rights money to pay off his wife, the Pirates and other small teams — who are smaller than the Dodgers but, like the Dodgers, don’t have an RSN —  will feel free to pocket their own rights money and put even less into their teams than they already do, which will be a bridge too far for both the big clubs and the fan bases of the small teams (pocket the gate receipts and the concessions, Mr. Loria, but too many people are watching when you pocket the TV money).

If all of this sounds borderline corrupt to you — if it sounds like, hey, at some point someone should have filed a lawsuit over it — don’t worry! You’re not crazy!  Someone probably should have long ago.  But they didn’t.  Why? Because there are only like three owners in all of baseball who weren’t admitted to the very cozy ownership club before Selig took over. The price of their entry to the club: fealty to Selig and the highly anti-competitive arrangement described above.  Indeed, every year there are a half dozen things that happen that, if baseball teams were run as independent businesses who felt free to vindicate their rights through legal action, would lead to lawsuits.

But the lawsuits never come because no one is willing.  Big city teams are given monopolies over huge media markets so that they can build media empires. Small market owners are given the keys to small teams that, while not as lucrative on a cash flow basis, are almost certain to appreciate nicely and — with a few high profile exceptions like media revenues — they’re allowed to treat as their own private piggy bank.  It’s not ideal and it’s not fair, but it ain’t a bad bargain.

At least if you own a baseball team.

Albert Pujols is eighth on the all-time home run list

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Albert Pujols kicked things off for the Angels in dramatic fashion on Friday night, cranking a two-RBI home run off of the Orioles’ Jeremy Hellickson to give the club an early lead in the first inning. The 350-footer was his 18th home run of the year and No. 609 in his 17-season career, tying Sammy Sosa on the all-time home run list for eighth overall and most home runs hit by a player born outside of the United States.

With the home run, Pujols sits just three homers shy of tying Jim Thome’s 612-home run record for seventh on the all-time list. That figures to be the last major milestone still ahead of the designated hitter this season, with Ken Griffey Jr.’s 630-home run mark still a distant 21 blasts away.

The Angels, meanwhile, ran with Pujols’ lead, collecting home runs from Kole Calhoun, C.J. Cron, Kaleb Cowart and Mike Trout. It wasn’t quite enough to quash the Orioles, however, who surged to a 9-7 finale after Manny Machado went 3-for-5 with three home runs and struck a walk-off grand slam in the bottom of the ninth.

Nationals place Max Scherzer on 10-day disabled list with neck inflammation

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The Nationals placed right-hander Max Scherzer on the 10-day disabled list with left neck inflammation, the team announced Friday. Scherzer was scratched from his scheduled start against the Padres and replaced by left-hander Matt Grace, though an official roster move has yet to be made to fill his spot on the roster. The assignment is retroactive to August 15.

Scherzer experienced a similar pain on the right side of his neck at the start of the month, though this is the first official stint he’ll serve on the disabled list in 2017. While comments from club manager Dusty Baker suggest that the injury wasn’t caused by any particular trauma, it seems likely that the ace right-hander will be sidelined for at least one more start.

It’s a terrible time to lose a star pitcher, especially with the Nationals positioned to make a deep run in the postseason, but their 14-game cushion in the NL East should buy them some time while Scherzer’s on the mend. Prior to his bout of inflammation, the 33-year-old looked remarkably healthy this season. He pitched through his fifth consecutive All-Star campaign and currently boasts a 12-5 record in 24 starts, complete with a 2.25 ERA (good for second-best among qualified starters), 2.2 BB/9 and 12.3 SO/9 in 160 1/3 innings.