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


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.

Report: Yasiel Puig started a fight at a Miami nightclub

Yasiel Puig

When last we posted about Yasiel Puig it was to pass along a rumor that the best player on his team wants him off of it. If that was true — and if this report is true — then expect that sentiment to remain unchanged:

Obviously this report is vague and there has not been, say, a police report or other details to fill it in. Perhaps we’ll learn more, perhaps Puig was misbehaving perhaps he wasn’t.

As we wait for details, however, it’s probably worth reminding ourselves that Puig is coming off of a lost season in which he couldn’t stay healthy, so trading him for any sort of decent return at the moment isn’t super likely. Which leads us to some often overlooked but undeniable baseball wisdom: you can be a distraction if you’re effective and you can be ineffective if you’re a good guy. You really can’t be an ineffective distraction, however, and expect to hang around very long.

Are the Padres adding some yellow to their color scheme for 2016?

Tony Gwynn

We’ve written several times about how boring the Padres’ uniforms and color scheme is. And how that’s an even greater shame given how colorful they used to be. No, not all of their mustard and brown ensembles were great looking, but some were and at some point it’s better to miss boldly than to endure blandness.

Now comes a hint that the Padres may step a toe back into the world of bright colors. At least a little bit. A picture of a new Padres cap is making the rounds in which a new “sunshine yellow” color has been added to the blue and white:

This story from the Union-Tribune notes that the yellow also appears on the recently-unveiled 2016 All-Star Game logo, suggesting that the yellow in the cap could either be part of some  special All-Star-related gear or a new color to the normal Padres livery.

I still strongly advocate for the Padres to bring back the brown — and there are a multitude of design ideas which could do that in tasteful fashion — but for now any addition of some color would be a good thing.

Brett Lawrie “likely to be traded” by the A’s

Brett Lawrie

Oakland’s re-acquisition of infielder Jed Lowrie from Houston makes it “likely” that the A’s will now trade infielder Brett Lawrie, according to Susan Slusser of the San Francisco Chronicle.

Slusser says Lowrie’s arrival “all but ensures” both Lawrie and Danny Valencia are on the trading block, adding that Lawrie “is considered the better bet to be traded.”

Acquired last offseason from the Blue Jays in the Josh Donaldson trade, Lawrie hit .260 with 16 homers and a .706 OPS in 149 games while playing second base and third base. At age 25 he’s a solid player, but Lawrie has failed to live up to his perceived potential while hitting .263 with a .736 OPS in 494 career games.

At this point it sounds like the A’s plan to start Marcus Semien at shortstop and Lowrie at second base.

Gammons: The Red Sox could go $30-40 million higher on David Price than anyone else


Peter Gammons reports that the Red Sox are on a mission to sign David Price and that they will pay some serious money to get him. Gammons quotes one anonymous GM who says that he expects the Sox to “go $30-40 million above anyone else.”

The man calling the shots for the Sox is Dave Dombrowski and he knows Price well, of course, having traded for him in Detroit. But there is going to be serious competition for Price’s services with the Jays and Cubs, among many others, bidding for his services. It would be unusual for a team to outbid the competition by tens of millions as Gammons’ source suggests, but the dollars will be considerable regardless.