Money. Money. Money.

Baseball is one of the best indicator of things to come, particularly when it comes to television. While football may have been made for television, television has made baseball unequally equal. This year there will be more money pumped into the game than ever before. Why? It was decided a few years ago, that ‘LIVE’ television was the key to survival for television networks, whether they are broadcast or cable, to fill the 24/7 programming blocks while the world waits for the next resting place for the millions of eyeballs who are moving through the Millennial stage. Traditionally, television was THE place to reach people. And advertisers, as they always do, flock to wherever the opportunity presents itself to get in front of those who would, could or should buy.

Now, television, especially cable network television, is betting on sports, particularly baseball, to attract the eyeballs of the constantly moving population both via legacy standards at home and most importantly digital/mobile platforms. From April through September, for six solid months, baseball will be front and center. No other sport has the completeness of dominant and ever-changing information as does baseball for this length of time. It is every day news and information. And when you throw in March as Spring Training gets underway, television finds itself gearing up. Take October when the World Series is the ultimate goal, you now have eight months of solid baseball.

Baseball has just finished one of its best hauls in its history. Consider this:
Los Angeles Dodgers $150 million annual rights fees (thru 2038)
Philadelphia Phillies $129 million annual rights fees ($2.5-$3.0B 20-25yrs) +25% SSN Philadelphia
Houston Astros $ 60 million annual rights fees
Texas Rangers $ 80 million annual rights fees +10% FOX Sports Southwest (thru 2034)
Arizona Diamondbacks $ 75 million annual rights fees (2016 to 2036) + %of FOX Sports Arizona
Chicago White Sox $ 72.9 million annual (@$450,000/gm. + 40% of Comcast SportsNet Chicago
Chicago Cubs $ 72.9 million annual (@$450,000/gm +20% of Comcast SportsNet Chicago (thru 2019)
LA Angeles Anaheim $147 million annual rights fees + 25% FOX Sports West (thru 2028)
San Diego Padres $ 60 million annual rights fees +20% FOX Sports San Diego (thru 2031)
New York Yankees $100 million annual rights fees ($367 million in 2042 for 49% of YES)
New York Mets $ 83 million annual rights fees +65% of SNY -25 year contract) (thru 3032)
Boston Red Sox $ 60 million annual rights fees +80% NESN
San Francisco Giants $ 30 million annual rights fees (+ percentage of SCNBA. + 30-33% ownership Comcast SportsNet Bay Area)
Seattle Mariners $115 million annual rights fees (purchased ROOT NW worth $100 million/yrx20 yrs) (thru 2030)
Cleveland Indians $ 40 million annual from sale of SportsTime Ohio ($400 million over 10 years)
Detroit Tigers $ 40 million annual rights fees (thru 2017) FS Detroit
Toronto Blue Jays $ 36 million (adjusted annually) Owned by Rogers SportsNet. No expiration.
St. Louis Cardinals $ 14 million (2016) + $35 million (2017) $55 million (2018-2033)
Baltimore Orioles* $ 29 million annual rights fees +87% of MASN
Washington Nationals $ 29 million annual rights fees +13% of MASN fee reset every 5 years
Minnesota Twins $ 29 million annual
Colorado Rockies $ 20 million (expires in 2020)
Tampa Bay Rays $ 20 million (thru 2016)
Cincinnati Reds $ 20 million (Thru 2016)
Kansas City Royals $ 19 million (thru 2019)
Miami Marlins $ 18 million (thru 2020)
Pittsburgh Pirates $ 18 million (thru 2019)
Milwaukee Brewers $ 21 million (thru 2019)
Oakland A’s $ 43 million (opt out after 2023)
Atlanta Braves $ 20-30 million annual rights fees (through 2031) FS Sports South

In 2013, each team also received $25.53 million as part of the National TV Revenue.

In 2014, each team also received $51.67 million as part of the National TV Revenue.

*[MASN] was created as part of the deal that moved the Expos from Montreal to Washington, D.C. to become the Nationals. Orioles owner Peter Angelos opposed the move as an encroachment on the Orioles’ exclusive broadcast and commercial region. [This is different from the dispute between the Giants and the A’s over the territorial rights to San Jose and Santa Clara County.] As part of the negotiated settlement between MLB (which then owned the Expos) and Angelos, MASN was created with the Orioles to own 90 percent and the Nationals to own ten percent. The deal also called for the Nationals to be paid $20 million/year in broadcast rights, although that figure would increase by $1 million every season. In 2011, MASN reportedly paid the Nationals $29 million in broadcast fees and $7 million for its now 13 percent share of the network. No matter. Attorneys for the two teams and MASN have continued to launch attacks and counter-attacks. The Orioles think the MLB-sponsored panel was predisposed to rule for the Nationals because the league stands to gain financially the more the Nationals receive as a rights fee. For their part, the Nationals have threatened to terminate MASN’s license to broadcast their games if the panel’s ruling isn’t confirmed.

The MASN mess may shed some light on Selig’s unwillingness to make a final decision on the Oakland Athletics’ proposal to move to San Jose. He might have feared that any resolution of the territory dispute between the A’s and the San Francisco Giants that involves the A’s compensating the Giants could lead to in-fighting for years down the road.

The MASN agreement also includes a re-set provision by which the Nationals can re-negotiate the broadcast fee structure every five years. Early in 2012, the Nationals proposed that MASN pay between $100 million and $120 million per year in broadcast fees. The Orioles countered at $34 million per year. The two sides have been in protracted negotiations ever since. Former Commissioner Selig asked representatives from the Pirates, Rays, and Mets to mediate the dispute. A resolution was expected over the summer but never materialized and the parties reportedly remain far apart.

But all of this is minuscule to the real power of baseball today.

The power is BAM…short for Major League Baseball Advanced Media. In 2000, Bud Selig, then baseball’s commissioner, created BAM as an in-house IT department for baseball which would be in charge of creating websites for each of the teams and consolidated MLB’s digital rights. His feeling was that by pooling resources, he would prevent the bigger teams from outpacing their smaller market rivals. To keep the division honest and efficient, BAM would operate its own company. All of the MLB teams agreed to contribute a combined $120 million, $1 million each over the first four years, with each taking an equal ownership stake. And this is the hidden gem of baseball…and baseball ownership.

Forget the amount of money a team makes from its attendance, concessions, broadcast TV and radio rights, Regional Sports Network rights or any other form of income,. Today, whether it is ‘Magic’ Johnson as one of the owners of the Dodgers or Mark Attanasio, owner of the Milwaukee Brewers, they both are equal owners of BAM. What is that worth? Fifteen years after it was founded, BAM will have a profit this year in excess of $900 million. Any idea how much that is worth today as an asset on the balance sheet? When you figure it out, just divide it by 30 and you will have figured out how much the owner of a small city franchise in Milwaukee is worth today.

One could say it is all due to Ichiro. When he came over to play from Japan for the Seattle mariners, he was an icon in his country. If you can remember, in those days a corps of press came along each and every day to cover Ichiro. BAM decided to experiment with streaming live audio of his games, giving his followers a way to keep up to speed with all-Ichiro all the time. This led to the league consolidating all of their digital rights within BAM. To secure more funding, BAM made a deal with TicketMaster to provide all of their ticketing functions for a $10 million advance so they could push not only audio but video.

A small company called eCommercial had created and implemented compressed video packages used as attachments for email. This small start-up was at the forefront of video delivery as CBS bought one of the first packages from Lance Hanish (LBC Advertising, now CNA|SOPHIS) who presented the technology to Kelly Kahl (CBS) to promote its first reality program, ‘Survivor’. With Les Moonves approval, on May 24, 2000, the first eCom packages were sent out to a list of email users consisting of editors, reporters, publishers and potential viewers. ‘Survivor’ debuted on 30 May 2000 and finished as the #2 program that season. That opened the eyes for video delivery and changed the world of mass communications.

Before YouTube, on August 26, 2002 BAM produced a broadcast of a Texas Rangers/New York Yankees game. It was streamed to 30,000 fans at only 280 kilobytes per second. To those who do not know, this is like dial-up speed. Broadband was not yet happening. But it allowed, later that Fall, to offer a post-season package for $19.95 which was successful and led to MLBtv in 2003. This provided a most unique opportunity. Because FOX held the rights, the first post season video delivery was only to Europe. This allowed for advancements in geofencing and multi-application delivery at scale. BAM obviously had already leaned of high-compression from the eCommercial technology.

Today BAM has as customers, ESPN (it handled the 2014 World Cup), HBO (it developed HBONow), WWE (Yup. It does the streaming of wrestling), SONY (PlayStation) and the NHL (National Hockey League). It not only handles their streaming but distributes the content.

BAM in 2014 contributed $5 million to each team or $150 million in additional revenue.

Now perhaps major acquisition of talent by several of the ball clubs is understandable. The Arizona Diamondbacks threw open their coffers as their windfall from BAM and their new television contract provided them with the flexibility of bringing in Zach Greinke ($34,416,667/year). San Francisco Giants added Jeff Samardzija ($18 million/yr) and Johnny Cueto ($21,666,667/yr) with the same revenue income. Kansas City Royals resigned Alex Gordon ($18 million/yr) and Joacim Soria (8,333,333/yr). Washington Nationals signed Stephen Drew ($3 million/yr) and Daniel Murphy ($12,500,000/yr). Cleveland Indians signed Mike Napoli. Boston Red Sox signed David Price ($31 million/yr). Chicago Cubs signed Jason Hayward ($23 million/year), Ben Zobrist ($14 million /yr) and John Lackey ($16 million/yr). Detroit signed Jordan Zimmerman ($22 million/yr). St. Louis signed Mike Leake ($16 million/yr). Los Angeles Dodgers signed Scott Kazmir ($16 million/yr) and Japanese pitcher, Kenta Maeda (3.125 million/yr-8yrs). Toronto Blue Jays signed J.A. Happ ($12 million/yr) and resigned Marco Estrada ($13 million/yr). Baltimore signed Darren O’Day ($7,750,000/yr). Seattle signed Hisashi Iwakuma ($12 million/yr).

So, what have the Milwaukee Brewers done? They have signed Eric Young Jr. ($1 million/yr), Will Middlebrows ($1.2 million/yr) and Chris Carter ($2.5 million/yr).

That’s called banking it. With a projected revenue in excess of the 2014 figure of $91.68 million in TV & estimated 2015 BAM revenue coming in the door BEFORE attendance gate receipts, concessions et all, their payroll at present is estimated at $98,089,079. With gate receipts of approximately $65 million (per Mar 2015 Forbes numbers), The Cream City Nine has an opportunity to bring in more than the 2015 estimated operating income of $11.3 million. With an attendance in excess of 2.5 million in 2015 (ranking 13th in MLB) or 31,389, with another hapless season, the average dropped from 34,536 in 2014. With few stars in 2016, the drop of another 10%-20% could be expected. Regardless, the value of the team will be approximately $850 million, should someone want to purchased the club and stop #watchingattanasio.

Today, as it has been since the days of Ban Johnson, John Taylor, Charles Somers, George Vanderbeck, Connie Mack and Charles Comiskey, baseball is not about the players or the fans. It’s all about money.

Play ball!

The Yankees Are In Town.

Photo by Lance Hanish © 2014 all right reserved

It felt like post season play. The small market Cream City Nine was taking on the mighty New York Yankees…the Bronx Bombers…the Gotham Nine…the biggest of the big major league baseball teams in the world. Arguably one of the best know sports brands on the planet, the Yanks stride into a city, heads held high, looking smart and comfortable within their skins as the legends they represent on today’s playing fields are. No team has won more World Series Championships than the men in pinstripes. They are so great they may have invented pinstripes.

When they come out before the game, there are no pinstripes on the grey traveling uniforms and no names on their jerseys. ‘You can’t tell a player without a program was not invented by the Yanks because everyone knows who the players are. There are way more people than normal in the stands, showing up for BP. These are not the Pittsburgh Pirates. These are the real deal, honest to God, Yankees. They don’t even need a city locater in front of their name on their website (www.yankees.com). Everywhere you look there is a story: Mark Teixeira, 34-year-old big first baseman and former All-Star who is back after missing most of last season. He’s bigger than you think. Out jogs Ichiro. At 40 years old, he doesn’t need a last name as he is one of the greatest baseball players of this generation who was in every All Star game for a decade. Batting .373 this season and fewer than 300 hits away from 3,000,  strangely he is relegated to pinch running roles which give a whole new meaning to steal a base when he is on, or an occasional Sunday start. There’s Jacoby Ellsbury, the 29-year-old former Boston center fielder and All-Star, jogging in the outfield. Isn’t that Alfonso Soriano, a former seven-time All-Star, taking ground balls? CC Sabathia, 33-year-old former hero of Milwaukee and a six-time All-Star, is taking BP. Welcome back to the Senior Circuit, CC. Brian McCann, 30-year-old former Braves’ All-Star, walking out, swinging a bat ready to go into the cage. Walking back to the dugout is Carlos Beltran, 37-year-old, 8 time All-Star, now playing right field for his fourth team. Then, last out of the dugout comes The Captain…Derek Jeter. In his farewell trip, and always a crowd favorite, he comes out just as he always has with his head held up high, jogging out to short to take a few grounders. He is the man. Even coming into the dugout to grab his bat, there is a regal kind of presence.

Then, out in the bullpen, there is the Master of Hyogo, Masahiro Tanaka, who was 24-0 in his homeland, and is still perfect in the Bigs too, throwing bullets. There is a reason he hasn’t lost sometime since 2012. His control is perfect. His demeanor is perfect. His presence is perfect. Imagining him anywhere else in major league baseball is imaginable. He is a Yankee.

It is that kind of night. The Yankees are in The Keg.

When Jeter comes to the plate, as will happen when CC Sabathia comes to the pate the next day, these Midwestern folks who know their baseball and understand the moment like few others in the game, rise and give him a standing ovation. A STANDING OVATION for an opposing player. In all of baseball, that is unheard of. But there is a reason. Derek Jeter is one of the great baseball players that has ever lived. And, he has represented his sport like few other professionals in the history of the game.  Here is a guy who even warns some guy who runs out to short during the game to ask for a hug and Derek Jeter just says to the fan near his idol, “You’re going to get in trouble. “And then he repeated that the fan wanted a hug, and Jeter said, ‘Look out.’, just before security guards grabbed the guy and took him out of the ballpark. What kind of a guy is Derek Jeter?

He is the Lou Gehrig of our day.

He is the Captain of the Yankees.

Play Ball!

Watching Attanasio

Baseball is never ending. There is a rhythm and flow that predates rock and roll. It is part of past, present and future. It is there for us, on demand, as regular as running water. We know it is there and when we want it, it comes out. It is, after all, our heritage. It is an American legacy.

The temples where the game is played of green grass has a look all its own. There, the gods of the sport, now and before, play the game. Their ghosts are everywhere. Aaron and Banks. Williams and Mantle. Spahn and Mathews, Musial and Koufax. Jackie and Robin. Through the turnstiles, past the concession stands, into the venue itself, the opening is there and passing through, there it is…it is the place where magic will happen today.

Hope for the season ahead is ever present. This is the season when the heavens will open up and victory in the form of a World Series pennant will be ours.

For many of us, it is a way of life, passed down to us from our grandparents, parents or relatives. It is our legacy. When remembering the past, it is the time we spent with our grandfather and grandmother, Mom and Dad at the ballpark. For those who grew up in Wisconsin, the home team, our home team is the Milwaukee Brewers. So much had been seen there; the great players like Roger … ‘The Rocket’, perhaps the greatest pitcher the game has ever seen, or Reggie and Yaz, Cal and Randy Johnson, as well as Griffey, Jr. and Ichiro, the greatest hitter the game has seen in our lifetime. ‘The Brewers Win The Pennant’ with Simba, Robin, Pauly, Gimby, Stormin, Rollie, Vuch, Coop, Benji and the Harvey were all witnessed with family and friends, Moms and Dads, brothers and sisters, sons and daughters. CC and Sheets, Prince and Braun, Greinke, Weeks and Nyjer, K-Rod and AxMan, brought the feeling back but fell ever so short.

This was a team that was brought to Wisconsin after the first great heartbreak of our sporting life, on a loan from the Schlitz Brewing Co. family to a car dealer’s son who would become the Commissioner of Baseball (after he was involved and found guilty in the collusion between the owners to keep players from earning their fair share through free agency) to fill the void left by the carpetbagger who moved the beloved Braves to that city down south.

We live in a world of globalization. We live in a world where the game is played by athletes everywhere. Milwaukee is a community that has diversified over the past half century as well. Today 39% of Milwaukee County is made up of Black Americans, 13% Latinos, 5% Asian Americans. It became a majority minority dominated city in 2000.

Today’s baseball team in the Cream City no longer reflects that diversity. Of the 40 man roster, there are only two Black Americans, one an aging Weeks nearing the end of his career and Davis, a young man just beginning his career. The Latino contingent is well represented, with some sixteen team members. There is one Asian, a Taiwanese pitcher who is yet to make it to the Bigs.

We no longer live in a Jim Crow era. Yet the team that is in Milwaukee has just two Black Americans. When they made a run for the pennant, the starting first baseman, second baseman and center fielder were black. Prince was beloved since he came up through the minors and would, fans thought, forever be an All-Star Brewer. Rickie was the college educated, All-Star second baseman. Nyjer was the center of joy. And he did get THE HIT. Together with Braun, Hart, Lucroy, Grienke, Vonnie, K-Rod and Axford they made their run which would be only the first of many to come. Today there is no Prince, no Nyjer, no Grienke, no K-Rod nor Axford. And there is no Hart. Rickie is waning, Vonnie is struggling and Braun is coming back from the unknown.

The team has no minority manager or coaches with the single exception of John Shelby who begins his third season on the coaching staff after joining the organization as outfield coach/eye in the sky, whatever that is; no upper management who are minority. Yet this is the governing body of the team that represents a majority minority city in the great Midwest. ‘A team is a reflection of the community it represents.’

The owner is from Los Angeles. There is little that is the same on Wilshire Boulevard or Pacific Palisades as compared to Pigsville or Lincoln at Kinnikinnick. In the City of Angels, Brats (with Secret Stadium Sauce) and beer are as foreign as sushi and wine are in Bayview. Brookfield is not Beverly Hills and Racine has kringle. Try finding that at Gilsons. This is a town where there are bubblers and kids wear rubbers on their feet when it rains. There is a separation here. It is not just distance, but a cultural misunderstanding that Milwaukee is the same as it was or the same as everywhere else. It is not. The Packers and Brewers, Badgers,  Bucks and Marquette belong to Wisconsinites, not Californians. Curley, Uecker, Crazylegs and Chones are our guys. Spencer Tracy, Fred MacMurray and Gene Wilder are our guys. They all, uncommon individuals and brilliant in their craft, who have all played at one time or another in California, are Wisconsinites through and through. The Brewers, every last one of them who ever played in the Cream City, belong to us.

If there is one thing a person from Los Angeles knows, it is star-power. They know that if you have a star for your program or movie or team, people will come and fans will pay in record numbers to see them. It is as eternal as Cary Grant, Bob Hope or Babe Ruth. They don’t call Yankee Stadium ‘The House That Ruth Built’ for nothing. Mark Attanasio lives and works in Los Angeles. He occasionally shows up in Milwaukee as the owner. He should know more than most what a star does to propel a team and make money. The present team looks like a fragment of their former self. Yes, the payroll is manageable and the team will make money…a lot of money. What is our VORP? Who gives a crap. Enough with Keith Wollner. We want a PENNANT. We want to be competitive. We want it NOW.

A former owner of the Milwaukee Brewers in the old American Association, Bill Veeck, said, “Baseball must be a great game because the owners haven’t been able to kill it.” The fans will fill the stands. And records will be broken. But we need a Prince or a Price, a Tanaka or, hell, a first baseman who can play first base. It is time for change. It is time for an owner to get in touch with the city his team represents and a management who represents a constant path to victory. We are watching Attanasio.

We will be heading to Maryvale in February and again the gates will open and warm, brilliant sunshine will illuminate the field. The lines will be chalked and fans will press for autographs. The smell of brats and beer will fill the air and the boys from the team representing Milwaukee will take the field. Will this team have a chance to win the pennant or will this owner be like so many before him, make money on a fan base who will support them regardless of the outcome. He will earn it on the millions who will go through Miller Park. He will earn it from broadcast and telecast, mobile and digital rights. He will earn it from the advertising in the stands and on merchandise that is sold. He will make it from those over the limit teams who will spend monies to try to win the pennant and pay the  tax. He will earn it by paying for mediocrity on the field, in the dugout and in upper management. Can you spell Masahiro? David? Or, even Prince?

It is time to …

Play Ball!

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Where Has All The Hitting Gone? Mendoza Lives!

In 13 major league games on Monday, 11 teams had 6 hits or fewer. If you were in Las Vegas, you would have made a bundle on the over and under by picking the under when it came to hits for a game.

Here is a look at the limited amount of hitting last night: Seattle got 5 hits; Texas 6 hits; Milwaukee 6 hits; Diamondback 6 hits; Angels 5 hits; A’s 6 hits; Tampa Bay 5 hits; Rockies 5 hits; the Braves 2 hits; National’s 5 hits and the Phillies 6 hits. You can’t do a lot with 6 or fewer hits in a game.

Pitching certainly is a key to limiting hits. Darvish was on the mound for the Rangers at Seattle and the Mariners had King Felix on the mound. Understood. But the Mariners had Ichiro (he got two hits and drove in 2 runs in a 6-1 victory). Milwaukee struggled against Bumgarner who was masterful before Braun hit a game tieing home run off of him in the bottom of the 8th inning. Each team used 6 pitchers before the Giants won on the road 4-3. The D’Back’s had nothing against Capuano as the Dodgers also won on the road. The Angels, who are disappearing in the American League West, had a total of 5 hits. The good news: Pujols had one of them. The bad news: it was their 3rd straight loss. Milone was the winner for the A’s, his 6th victory this season. For the A’s, a win is a win even if you only get 6 hits. Tampa Bay had no excuses. They just didn’t hit in their home loss to the Blue Jays. The Rockies? They never hit, but they were up against Buehrle. The Braves had no excuses for only getting 2 hits. They faced a previously winless pitcher, Leake for the Reds. Now he isn’t winless anymore. As for the Nat’s at the Fightin’s, Gonzalez won on the road for Washington and is now 6-1. Kendrick lost for the 4th time this season for Philadelphia and is now 0-4.

I don’t mind great pitching. Bumgarner, Darvish, King Felix and Gonzalez looked sharp. But do we have to have 11 teams that can’t muster up enough hits to rise above the Mendoza Line during a single day? The Brewers, Phillies and Angels are all in big trouble unless they begin hitting.

By the way, the guy who makes $25 million a year for the Los Angeles Angels of Anaheim, who at 6’3″ tall and weighs 230 lbs. is now hitting .212 with 3 home runs. This is the very definition of The Mendoza Line.

The Mendoza Line is an expression in baseball, deriving from the name of shortstop Mario Mendoza, who’s lifetime batting average is taken to define the threshold of incompetent hitting. Mendoza’s career batting average over nine seasons (1974–1982) was .215. For purists this is the deciding line for lack of achievement in major league baseball. However, many use the cutoff point of .200, and, when a position player’s batting average falls below that level, the player is said to be below the Mendoza Line.

It was supposedly originated by Hall of Fame player George Brett. Thanks, George.

The good thing about baseball? There is another game today. Let’s have some hitting.

Play Ball!

They Faced Each Other As The World Watched

It finally happened. At approximately 7:10PM, in Arlington, TX, Yu Darvish faced Ichiro Suzuki. A zillion members of the Japanese press corp were all over the home of the American League champions. Batting third in the Seattle line-up, Ichiro, in typical form, slapped a single into shallow left field and pushed the runner up a base. Darvish, clearly excited about his Major League pitching debut after a successful career in the Pacific League in Japan, was rocked with four runs in the first and one in the second before he began to settle down.

In the end, the Texas Rangers beat the Seattle Mariners 11-5.

In the end, Ichiro went 3 for 5.

In the end, Darvish gained his first win in The Show.

The magnetic pitcher worked 5 2/3rds innings giving up 8 hits, 5 earned runs, walked four, struck out 5 while throwing 110 pitches. Perhaps not great by his lofty standards, but it was his debut.

The big story was the media coverage. 100 Japanese media members were in Arizona for Darvish’s first spring training workout in February. There were 80 assigned to Darvish at Rangers Ballpark in Arlington on Monday night. There were six Japanese radio and television networks, two wire services and 15 newspapers covering the game. 

Ichiro Suzuki, the Mariners’ outfielder in his 12th season, brought a similar four score of media members.

What other sport from what other country would cover a single season event to this magnitude?

That question will probably never be answered. But for a bright moment in Arlington, Texas, baseball was covered and brought back to Japan, Dallas and Seattle like nothing else.