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Around SBN: Headlines: BC Beats BU 4-3 in 58th Beanpot Championship

As much as I hate to link to a Jayson Stark page, I thought it was interesting that this idea he presents on a salary "basement" where teams have to spend a certain minimum amount is pretty much identical to a conversation we had here a while back. Wonder if he read it.

2 months ago Tiny KeithsMoustache 19 comments 0 recs  | 

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I can't agree

Something like that definitely would stimulate “small-market” teams, to some degree. “Smaller-market” teams being more active in the free agent market, though, in turn, would raise competition and thus, contract salaries, effectively pricing those very teams out of the free agent market. What I mean is, you got Free Agent A available, and the Marlins try to give him a $10 million dollar contract. Some other team, one that has a higher payroll, sees that and, believing they need him badly, overpays for him. A lot like Lowe with the Braves, and Burnett with the Yankees, and how that threw the pitchers market out of whack last year.

Baseball is a business, and if whatever team’s ownership doesn’t want to invest in a competitive team, and is content with scraping whatever revenue they can from the bottom and pocketing as much as possible, that’s their prerogative. It’s up to the fans, then, or whoever buys their product- goes to games, buys merchandise- to “register” their dissatisfaction by not giving the organization their money.

"Blinding ignorance does mislead us. O! Wretched mortals, open your eyes!"

by Brooklyn Dodgers Mets Fan on Nov 19, 2009 9:46 PM EST reply actions   0 recs

The problem is with revenue sharing

Fans don’t have to give an owner like Loria a dime for him to make a profit. Not to mention he gets the rights to stadiums he doesn’t pay a dime to build and even if no one goes to Marlins games he gets to keep the profits from every other use of that stadium.

by Gina on Nov 19, 2009 10:18 PM EST up reply actions   0 recs

Right, but even with the 'Luxary Tax', and money that these teams get from revenue sharing, eventually the costs, weighed aganinst the net profits, don't balance out

And, that’s a horrible business model, relying solely on that source of revenue, when even some minor reinvestments can yield huge dividends. Owners who do that, I really wonder what the hell they are thinking.

"Blinding ignorance does mislead us. O! Wretched mortals, open your eyes!"

by Brooklyn Dodgers Mets Fan on Nov 19, 2009 10:50 PM EST up reply actions   0 recs

It's really not a horrible buisness strategy if you dont want to take a risk

Just owning a baseball team is lucrative in itself it gives you a lot of political power in the city. You never have to invest a dime in them and still get paid dividends in a sense. Like Keith’s Moustache said there’s really just no way Miami could see a major return on their investment because their market is essientially capped. So rather than investing the money, which for the first few years would likely be at a loss since it takes a while for fans to come around usually especially when a team has a history like the marlins of being cheap, Loria basically just keeps the team for the other benefits, which still bring in a huge profit for him.

by Gina on Nov 19, 2009 11:17 PM EST up reply actions   0 recs

Also I could be remembering the situation wrong

But wasn’t Loria basically gifted the team from mlb after the expos folded? So it’s not even like he made an investment to begin with.

by Gina on Nov 19, 2009 11:18 PM EST up reply actions   0 recs

Oakland works around that. Usually.

"Blinding ignorance does mislead us. O! Wretched mortals, open your eyes!"

by Brooklyn Dodgers Mets Fan on Nov 20, 2009 10:35 AM EST up reply actions   0 recs

I agree, they make a profit for owning the team regardless of whether or not they actually try to improve it

they need to set some sort of limit to how much these small market team owners can pocket or they’ll continue to take the easier route and just pocket the money instead of trying to build teams.

The arguement that its the fans job to let the owners know they want better players doesnt make much sense. In a small market area, even if the owner does exactly what their fanbase wants, they’ll make less net money than a team that has a large fan base such as NY, Bos, or LA teams. Surrounding population density has a large effect on the amount of revenue a team can pull in. Because of this, even if they did everything in their power to make their team as fan-friendly as possible they will make less money than these other teams, and they take the path of least resistance, and put a team out that will keep their fan level constant and pocket the difference.. This is because it IS a business, and they’re doing the most profitable thing, which is to not bother signing big name free agents who cost a significant portion of their total revenue (which at its best will be less than other tems in better markets) because regardless of their performance they will not be able to compete with teams that have fanbases many times larger than theirs as far as total revenue goes. They need to do something to force the owners hands to try to improve their teams to the point where they are competitive, or the parity in many of the divisions will only grow more pronounced as time goes on.

by KeithsMoustache on Nov 19, 2009 10:51 PM EST up reply actions   0 recs

It's entertainment, and a game, but it's also a business.

If, say, UPS knows that it’s trucks are really old, and falling apart, but they don’t use their revenue to replace/fix them, they’re going to start decreasing their profits because of it- their trucks fall apart, causing the company to use funds to repair them. Because they fall apart, there are less drivers who are willing to work for UPS, because they don’t want to have to deal with break downs. Because they have crappy trucks, and is a shortage of drivers, people are less willing to let their goods be shipped via UPS, because they don’t want their packages to disappear, arrive late, be damaged, whatever else. If you don’t reinvest your money into your business, your profits, even if steady for a time, will eventually tail off, when you don’t meet market demands. Or some phrase like that; it’s been a while since I took any kind of class related to business or management.

If, let’s say, the Marlins make $10 million dollars because of revenue sharing, and pocket all of it, not reinvesting in their team, they aren’t meeting market demands (put a good team on the field [regardless of the payroll, but as we all know, the better players cost more money]). When they don’t meet their market demands, over the ‘long haul’- whatever that set period of monitoring is- revenues drop. Pocketing things is just shooting themselves in the foot. When their other source of revenue- fans attending games, gear, etc.- begins dropping, their revenue from those mediums dry. When that starts happening, and interest in the team tails off, big business contracts, like the media and commercials, and whatever else, also tail off, and again, the team is losing money by not reinvesting.

I agree that there are huge disparities, but that’s the nature of businesses- not everyone is rich and successful. If you willingly do things that, ultimately, lower the value of your business, you’re following a bad business model. Owners shouldn’t go broke investing in their team, either, but you get what you put into it, like anything else. Like any other business, if they put out a bad product, and people aren’t interested in it, the ownership needs to eventually figure things out, or be removed.

Maybe changing the rules so that the money obtained from revenue sharing luxury taxes has to be spent on players by some arbitrary date, otherwise it gets reappropriated and distributed back across the other 29 teams might help things, or something similar.

Did most of that make sense? To me, on painkillers right now, it did, but I just want to make sure, lol

"Blinding ignorance does mislead us. O! Wretched mortals, open your eyes!"

by Brooklyn Dodgers Mets Fan on Nov 19, 2009 11:13 PM EST up reply actions   0 recs

The Marlins spent money in route to getting 2 championships

But they still lost money both years, and so ownership gave up on trying to have anything but a very low payroll. Can’t really blame them.

by DoghouseBlues on Nov 19, 2009 11:26 PM EST up reply actions   0 recs

Meh

There’s some questions around whether they actually lost money after that second championship, apparently Loria has some funny book keeping methods. I remember reading about some of the things he didn’t count as part of the marlins profits, despite being directly related to the marlins brand name, in an econ book.

by Gina on Nov 19, 2009 11:50 PM EST up reply actions   0 recs

whether they lost money or not

those championship teams just weren’t as profitable as championship teams in other markets. You’d almost never see a big market team shed payroll right after a World Series.

by KeithsMoustache on Nov 20, 2009 11:19 AM EST up reply actions   0 recs

Oh I agree they weren't as profitable as in other markets

But there’s a big difference between we didn’t make huge sums of money so we’re going to shed payroll and we lost money so we’re going to shed payroll. What I read didn’t have them making that much money but Loria claimed to have lost a huge sum of money.

by Gina on Nov 20, 2009 11:24 AM EST up reply actions   0 recs

oh i agree, i can't verify the loss of money part

I’m just supporting my previous statement that small market teams are going to struggle to keep up under even the best of circumstances because there just arent enough people around to put the kind of money into the franchise that it needs.

by KeithsMoustache on Nov 20, 2009 1:09 PM EST up reply actions   0 recs

I still like my idea

instead of the luxury tax going directly to the owners, it should go to the players – any player who could enter free agency who re-ups with his original team gets a percentage of the money based on his contract. It would help teams keep home grown players at more competitive rates – they could offer, say, 10% less than the Yankees, but b/c of the luxury tax benefit, the player would get the same amount of money. Essentially, the Yankees (and anyone else over the tax) would be screwing themselves over twice.

"[The Giants] beat us down. We were beat by a grown-man team, a team we want to be like one day. They came in here and took it to us. Out-manned us, out-gunned us. ... It wasn't even close." - Raheem Morris, 9/27/09

by cjmulrain on Nov 20, 2009 12:41 AM EST reply actions   0 recs

its an interesting plan

have to be careful how you define “original team” though. Otherwise teams with money will go out and overpay for guys on short contracts so when they go to sign them long term at the end of these initial contracts they get the 10% discount and the high revenue teams become even stronger. I like the idea, they would just have to be very careful about how they set up the system to make sure nobody breaks it.

by KeithsMoustache on Nov 20, 2009 11:18 AM EST up reply actions   0 recs

yea

I mean, I would define it as the team you break into the major leagues with – it might also decrease some of the incentive for trading your homegrown talent right before they become free agents. Whether that would be a good thing or not is up for debate

"[The Giants] beat us down. We were beat by a grown-man team, a team we want to be like one day. They came in here and took it to us. Out-manned us, out-gunned us. ... It wasn't even close." - Raheem Morris, 9/27/09

by cjmulrain on Nov 20, 2009 3:16 PM EST up reply actions   0 recs

Could work but I see one other potential flaw in the system

This would encourage the small market teams that don’t want to spend to make teams entirely of homegrown players regardless of skill level because they cost 10% less. Its a coin toss as to whether this would get them spending more or just make a team of homegrowns and only have to pay 90% of their salary (which will likely be low because in general you don’t raise too many multi million dollar players all at once.)

by KeithsMoustache on Nov 20, 2009 4:00 PM EST up reply actions   0 recs

true

it’s only one suggestion – I think there would have to be a few other things implemented along with it (I do like the idea of a salary floor).

"[The Giants] beat us down. We were beat by a grown-man team, a team we want to be like one day. They came in here and took it to us. Out-manned us, out-gunned us. ... It wasn't even close." - Raheem Morris, 9/27/09

by cjmulrain on Nov 20, 2009 4:31 PM EST up reply actions   0 recs

i think a mixture of the two ideas could help decrease the amount of parity around the league

I mean its fine when some teams are clearly better than the others, but when its the same few teams almost every year it starts to get old.

by KeithsMoustache on Nov 20, 2009 4:47 PM EST up reply actions   0 recs

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