old TV

The Dodgers are gonna get big media money soon, but let’s not go crazy

17 Comments

The answer to any question about a baseball team’s increased spending these days is “well, they have a new local TV deal in the offing, and that will bring big money.”  It’s why the Angels could easily afford C.J. Wilson and Albert Pujols in one offseason. It’s why the Phillies, despite a big payroll already, could afford to go big on Cole Hamels.  Local TV money is all the rage these days, so anyone getting a new infusion of it will be flying high.

But one definitely gets the sense that people are overstating this a bit. For one thing, it strikes me that there’s the possibility of a bubble situation here, with the “TV money is HUGE” mantra sounding an awful lot like the “Real estate only goes up!” mantra of a few years ago.  Maybe that’s just my gut talking, but it’s very possible that changes in the industry — direct-to-consumer broadcasting, a la carte cable channel pricing, online streaming — could alter the financial calculus one day soon.

Maybe that means revenues grow even bigger. Maybe it means they crater. Maybe it means they flatten out. Maybe it just shifts. But it has always been the case that the business model for broadcasting never stays static for five years, let alone the 20 years or more that some of these crazy TV deals are supposed to last.

Which brings us to the Dodgers, about whom Patrick Rishe of Forbes writes this today, putting the $271 million in new salary obligations in perspective:

Unquestionably, new ownership in L.A. is a big part of the increased willingness to spend on payroll over the last few months. But when Dodgers chairman Mark Walter said earlier this week that the team could still take on significant money, his inspiration not only stemmed from a combination of his deep pockets, Magic Johnson’s infectious passion for success, and Stan Kasten’s savvy baseball acumen.

Mr. Walter’s penchant for spending is also being fueled by the comfort of knowing that the Dodgers will soon see an explosive increase in their local/regional TV revenues when their current deal expires in 2013 that could reach as high as $8.5 billion over the next 20 years.

$8.5 billion?  That breaks down to $425 million a year in TV revenue. Which is multiple times higher than any other team out there, including that of the Angels, who signed a $3 billion TV deal. And it’s multiples higher than what experts have projected for some other popular teams with deals in the future like the Phillies and the Tigers.

That’s profoundly optimistic, and that’s before you figure in the fact that the Dodgers owners are probably already counting on that financial windfall to finance what still appears to be a massive overpay for the franchise itself, which they bought for around $2 billion. And, of course, before you figure in the possibility that the TV landscape may look very different in 2022 than it does in 2012 and that it may be totally unrecognizable in 2032.

None of which is to say that the Dodgers will go broke having to pay for Josh Beckett and Carl Crawford. I’m sure they can swing it.  It is the case, however, that there is no investment in recorded history that has been such a sure thing that one can responsibly talk about it as if it were a never-ending source of cash.

As such, to the extent there are people around major league baseball who are staking the entire financial future of the sport on the assumption that, eventually, every team is going to land a multi-billion dollar television deal, they had better not be the only ones with voices at the table.

Diamondbacks sign Jorge De La Rosa to minor league deal

ARLINGTON, TX - AUGUST 10:  Jorge De La Rosa #29 of the Colorado Rockies throws against the Texas Rangers in the first inning at Globe Life Park in Arlington on August 10, 2016 in Arlington, Texas.  (Photo by Ronald Martinez/Getty Images)
Getty Images
Leave a comment

The Diamondbacks have signed free agent left-hander Jorge De La Rosa to a minor league deal, per a team announcement on Sunday. The contract includes an invitation to spring training. Nick Piecoro of AZCentral.com adds that De La Rosa stands to make $2.25 million if he secures a spot on the major league roster, with up to $600,000 in incentives if he pitches out of the bullpen and up to $1 million in incentives if he pitches out of the starting rotation.

The 35-year-old is expected to compete for a bullpen role after spending the better part of a decade in the Rockies’ rotation. He capped a nine-year run with Colorado in 2016, finishing the year with a 5.51 ERA, 4.2 BB/9 and 7.3 SO/9 over 134 innings. Despite his struggles out of the rotation, he found limited success in a three-game stint in the bullpen, striking out 10 of 26 batters and holding the opposition to just three hits and one earned run in eight innings.

The veteran lefty is set to join a bullpen comprised of right-handers Randall Delgado, Jake Barrett and Fernando Rodney, along with a number of unproven candidates on similar minor league contracts. His age and command issues may be off-putting, but the promise he showed as a reliever should give the Diamondbacks some upside as they attempt to redeem a league-worst bullpen in 2017.

Josh Donaldson out 2-3 weeks with calf injury

TORONTO, CANADA - SEPTEMBER 13: Josh Donaldson #20 of the Toronto Blue Jays looks on from the top step of the dugout as he sits out his second straight game during MLB game action against the Tampa Bay Rays on September 13, 2016 at Rogers Centre in Toronto, Ontario, Canada. (Photo by Tom Szczerbowski/Getty Images)
Getty Images
Leave a comment

Blue Jays’ third baseman Josh Donaldson is expected to miss up to three weeks with a right calf strain, reports John Lott. Donaldson reportedly felt some discomfort in his calf during sprinting drills on Friday and was diagnosed with what looked like a mild strain after undergoing an MRI on Saturday. According to Lott, the 31-year-old is on crutches for the next few days and will likely miss 2-3 weeks of spring training.

Donaldson had a similar scare at the start of the 2016 season, when he limped out of the batter’s box during the Blue Jays’ first regular season road trip with a right calf strain. He returned to DH two days later, however, and was back on the field in less than a week’s time. Blue Jays’ GM Ross Atkins told MLB.com’s Corey Long that the two calf injuries are unrelated, and expects that Donaldson will recover in similar fashion this spring — well before Opening Day comes around.