old TV

Could the Dodgers’ giant TV deal be the beginning of the end for giant TV deals?


We talk a lot about the skyrocketing TV deals baseball teams are getting from cable operators these days. One wonders, though, whether or not we’re witnessing a bubble that’s going to soon burst. If it does, we may look at the Dodgers’ new TV deal as the beginning of the end.

The Dodgers TV deal with Time Warner is reported to be upwards of $8 billion. To pay for that, Time Warner is going to charge other carriers (Direct TV, Dish Network, other cable systems) $4 or $5 per subscriber for the right to carry the new Los Angeles Dodgers network they’re operating, with those costs passed on to the other carriers’ customers. This is how all sports TV rights deals go. It’s just way bigger with the Dodgers and Time Warner.

Many — probably most — of the customers who are seeing their cable bill go up are not Dodgers fans. They just want to watch Nick Jr. or History Channel or BBC America or any number of other channels. But, because you can’t (for the most part anyway) pick and choose which channels you get, the non-sports watchers are helping subsidize the sports watchers. Again, this is how it always works, but this time the rate hikes in question are going to be quite large.

Joe Flint and Bill Shaikin of the L.A. Times write about this today, and they talk to one former TV executive who thinks that such a pattern is unsustainable:

But non-sports fans and pay TV companies are increasingly frustrated at having to pick up the tab for big sports deals. There have been calls to sell sports channels “a la carte,” or separately from other programming.

The Dodger agreement with Time Warner Cable may be a tipping point.

“That is the solution everyone should be looking at seriously,” said Derek Chang, a former senior executive at satellite broadcaster DirecTV. Such a move, he added, may be the only way to lower the cost of TV sports. “Ultimately the market for fees would then reset.”

All it takes is a political groundswell — and someone talking about how we should think of the children who just want to watch “Spongebob” is a great way to get that going — for Congress to wade in and either begin legislating or begin threatening to legislate with respect to cable TV in such a way that a la carte pricing becomes available.  If it does, companies in Time Warner’s position won’t be able to demand across-the-board rights fees like they are now and, in turn, they won’t be able to offer sports teams like the Dodgers the billions of dollars in rights fees like they’re currently doing.

If that bubble bursts, down with it comes the TV money. Then down go the franchise values, which are escalating due to the TV money sports teams are attracting. If team values go down, team payrolls will eventually come down too.  No aspect of baseball finances would be untouched by it.

Will it happen? I don’t know. And if it does, I don’t know when. But I also know that no bubble in history has ever failed to burst, and that when they do burst, the bubbles tend to take down just about everyone.

Alex Rodriguez credits Tom Ricketts and Theo Epstein with Cubs’ turnaround

CHICAGO, IL - OCTOBER 13:  Tom Ricketts, owner of the Chicago Cubs, celebrates after the Chicago Cubs defeat the St. Louis Cardinals in game four of the National League Division Series to win the NLDS 3-1 at Wrigley Field on October 13, 2015 in Chicago, Illinois. The Chicago Cubs defeat the St. Louis Cardinals with a score of 6 to 4.  (Photo by David Banks/Getty Images)
Getty Images

It isn’t difficult to see the fingerprints left by Cubs’ president Tom Ricketts and general manager Theo Epstein on the club’s remarkable 2016 season. In a piece for FOXSports.com, former Yankee Alex Rodriguez highlighted the duo’s effectiveness in liberating the Cubs from a five-year losing streak and six-year postseason drought, citing both the unrelenting work ethic and passion that Ricketts and Epstein brought to the club as major factors in their success.

Rodriguez’s first brush with sabermetric savant and all-around baseball wizard Theo Epstein came in 2003, when the then- 27-year-old All-Star was eyeing a deal with the Red Sox. The Major League Baseball Players Association eventually nixed the trade, and the Rangers’ young shortstop was sent to the Yankees shortly thereafter, but not before Rodriguez glimpsed the inner workings of Epstein’s mind.

What I remember best about that time was watching Theo furiously scribbling out the Red Sox lineup for the upcoming season on a room-service napkin. That’s when I saw Theo’s baseball mind at work. I saw he had a passion for the game, a depth of knowledge, and a thirst to be great. Theo’s passion was contagious. We were three 20-somethings convinced we were about to turn baseball upside down together. Though I never got a chance to work with Theo, I knew then that he was going to be a force.

A-Rod also referenced Ricketts’ thorough approach to rebuilding the organization. Ricketts, who purchased the franchise for $875 million in 2009, first made it his mission to transform Wrigley Field into a comfortable and enticing playing environment, then targeted top-tier management to run the show behind the scenes. With Ricketts fully backing Epstein’s transformative approaches — including an overhaul of the Cubs’ farm system, investments in international player development, and a comprehensive understanding and practical application of sabermetric advances — the Cubs’ path to a 97-win season in 2015 seemed a natural consequence of the pair’s hard work.

This year, the attention has been even more intensely focused on the Cubs’ elusive third World Series title. Rodriguez, however, believes that winning a championship is secondary to the strides Ricketts and Epstein have taken with the club.

Together, Ricketts and Epstein have built one of the greatest franchises in baseball and transformed 1060 W. Addison St. It’s a task that no one could quite get right for a hundred years. While four more wins would put a giant exclamation point on five years of focused work and determination, I won’t worry if this team doesn’t win the World Series in the next nine days.

Mets expected to pick up 2017 option for Jose Reyes

NEW YORK, NEW YORK - SEPTEMBER 22:  Jose Reyes #7 of the New York Mets celebrates after hitting a game tying two-run home run in the bottom of the ninth inning against the Philadelphia Phillies Citi Field on September 22, 2016 in the Flushing neighborhood of the Queens borough of New York City.  (Photo by Mike Stobe/Getty Images)
Mike Stobe/Getty Images

Kristie Ackert of the New York Daily News reports that the Mets are expected to pick up the 2017 option for Reyes, but they haven’t done it yet. The option will be worth the major league minimum salary ($507,500), as the Rockies will continue to pay down the remainder of Reyes’ $41 million remaining on his contract.

The Mets signed Reyes after the Rockies released him in June. He had a .659 OPS in Colorado but improved to a .769 OPS in 279 plate appearances with the Mets, mostly playing third base in place of the injured David Wright. Bringing Reyes back next season will provide them more insurance at the hot corner.

Reyes, 33, served a 51-game suspension due to an offseason domestic violence incident while on vacation in Hawaii with his wife. As a result, he didn’t make his season debut until July 5, having spent some additional time in the minor leagues to get into game shape.