Latest / Foul Territory / Maury Brown’s report on Dodgers revenue-sharing shelter & CBA battles

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Maury Brown’s report on Dodgers revenue-sharing shelter & CBA battles · Foul Territory

0:03
Speaker 1: Senior contributor to Forbes, Mary brown Back on the show, Maury.
0:06
Speaker 1: It's great to see you, and we love the work
0:08
Speaker 1: that you're doing overall covering the business at baseball, but
0:11
Speaker 1: we wanted to focus at least for a few minutes
0:12
Speaker 1: here on the Dodgers, So thanks for joining us. And
0:16
Speaker 1: I think a big story that actually broke on the
0:17
Speaker 1: business side of baseball this week was how the Dodgers
0:21
Speaker 1: are somewhat unfairly keeping more of the revenue sharing money.
0:25
Speaker 1: Not legally unfairly, but when you look at the scope
0:28
Speaker 1: of the league. I'll let you take it away because
0:30
Speaker 1: you're smarter than me at explaining this stuff.
0:33
Speaker 2: Yeah.
0:34
Speaker 3: So this is a bit of a back to the
0:35
Speaker 3: future story. I mean, it's actually something that's been around
0:38
Speaker 3: since twenty twelve. It's resurfaced recently. But basically what happened,
0:43
Speaker 3: guys was that when the Dodgers were involved in bankruptcy,
0:47
Speaker 3: which is when you think about that now, it's shocking
0:50
Speaker 3: in and of itself, But the Dodgers weren't a bankruptcy case, right,
0:53
Speaker 3: But when Scott when Frank McCourt owned the club, he
0:57
Speaker 3: tried to sell the media rights to be part of
1:01
Speaker 3: his divorce settlement.
1:02
Speaker 2: Bud Selig stepped in and said.
1:04
Speaker 3: No way, do not do that, and we're not going
1:06
Speaker 3: to allow that in the best interests of baseball. And
1:08
Speaker 3: it went into a court appointed sale. And when that happened,
1:13
Speaker 3: there was no regional sports network to speak of yet
1:16
Speaker 3: for the Dodgers, right, so we have no situation which
1:21
Speaker 3: we have now.
1:22
Speaker 2: So at the time what.
1:23
Speaker 3: They did was they said, the court said, well, what
1:25
Speaker 3: do you think when you guys go into this regional
1:27
Speaker 3: sports network thing, what do you think the fair market
1:30
Speaker 3: value is going to be? So they projected that out
1:33
Speaker 3: and they said somewhere in the neighborhood of around eighty
1:36
Speaker 3: four million dollars a year. Well, that was grossly misunderstated,
1:40
Speaker 3: but got into the court proceedings on how much the
1:44
Speaker 3: value of the club would be. That made a determination
1:47
Speaker 3: for when Guggenheim purchased it. They said, yeah, that's what
1:50
Speaker 3: you guys said it was going to be. That's what
1:52
Speaker 3: we think it's going to be. That was a big
1:54
Speaker 3: determination into what we did when we purchased a club
1:57
Speaker 3: for two.
1:58
Speaker 2: Billion in change. Right.
2:00
Speaker 3: Well, lo and behold what happened. They worked with Time Warner.
2:05
Speaker 3: They partnered on what was what is now Spectrum LA
2:09
Speaker 3: and that became, of course, an eight point three five
2:13
Speaker 3: billion dollar meteorites deal. Well, the court said it was
2:17
Speaker 3: supposed to be eighty four million dollars a year. The
2:20
Speaker 3: average annual value, as reported by the LA Times was
2:23
Speaker 3: is three hundred and thirty four million annually, not eighty
2:27
Speaker 3: four million annually.
2:29
Speaker 2: So they stuck with that.
2:31
Speaker 3: The League, of course, was very unhappy about this, as
2:33
Speaker 3: were I'm sure twenty nine other owners. So the League
2:38
Speaker 3: went back to them and said, look, you know this,
2:40
Speaker 3: this is just not right. They're gonna, you know, we
2:43
Speaker 3: got to do something about this. The Dodgers said, we
2:45
Speaker 3: would have never gone into this purchase if we had
2:48
Speaker 3: thought that that's how much it was going to be.
2:50
Speaker 3: So they they got it bumped up to about one
2:53
Speaker 3: hundred and sixty million dollars, which last time I checked, guys,
2:57
Speaker 3: is less. You know it, there's three hundred and thirty
3:01
Speaker 3: four million dollars annually on your AAV and there's one
3:04
Speaker 3: hundred and sixty million, and that's a wide disparent thing.
3:08
Speaker 2: So that's where we're at now.
3:11
Speaker 3: Look, the numbers that myself and others have looked at
3:16
Speaker 3: was about a six billion dollar dodge, right. I mean,
3:19
Speaker 3: it's not that they're paying six million dollars in revenue sharing.
3:22
Speaker 3: It's that that amount of money does not get allocated
3:25
Speaker 3: to revenue sharing.
3:26
Speaker 2: I've been told, as.
3:28
Speaker 3: Have others, that that number is grossly overstated. What it
3:33
Speaker 3: is they won't say, But I think the bottom line, guys,
3:37
Speaker 3: is the one thing that you can know for certain
3:39
Speaker 3: here is they're not paying the full amount that others
3:43
Speaker 3: would normally do. And so again, I think that the
3:46
Speaker 3: key factor in all of this is that it wasn't
3:50
Speaker 3: Major League Baseball's doing. This has to do with how
3:54
Speaker 3: Frank McCourt had driven the Dodgers into bankruptcy, and yeah,
4:00
Speaker 3: and then that how it became a quarter pointed deal
4:03
Speaker 3: and how that got locked in.
4:05
Speaker 4: If we opened the books, if you were able to
4:08
Speaker 4: look at the books for not just the Dodgers but
4:11
Speaker 4: baseball teams, what would be the first thing you would
4:15
Speaker 4: look at? Because we hear all about the cap, we
4:18
Speaker 4: hear all about this stuff, and players say, okay, well
4:20
Speaker 4: open your books. If everything's going poorly, what would you
4:23
Speaker 4: look at to make this a fair level across the board,
4:27
Speaker 4: which is what I think fans won.
4:29
Speaker 3: Yeah, I think the biggest thing, right, I mean there's
4:31
Speaker 3: a number of things. There's contract appreciation and a bunch
4:34
Speaker 3: of technical minutia that gets played out into that, you know,
4:39
Speaker 3: maintenance on your ballpark, all kinds of stuff, But I
4:42
Speaker 3: think that the biggest thing would be how they're basically
4:49
Speaker 3: formulating any outside stuff. I mean, again, regional sports networks
4:54
Speaker 3: are traditionally not counted as part of revenue, but if
4:59
Speaker 3: you own it, you're obviously one hand is paying the other.
5:03
Speaker 3: So I think it would be interesting to look at.
5:05
Speaker 3: I mean we see this a bit with the Braves
5:07
Speaker 3: right where they have their public disclosure on how much
5:09
Speaker 3: the battery is. I think it would be interesting to
5:12
Speaker 3: understand exactly what their revenue input is, what their true
5:16
Speaker 3: costs are, and the percentage of how much of that
5:21
Speaker 3: is going to pay for the players. It's been hanging around,
5:25
Speaker 3: you know, anyway, from like forty eight percent fifty percent
5:28
Speaker 3: of costs are around the players, right. But again I
5:33
Speaker 3: think that that's, of course, that's an aggregate. I mean,
5:36
Speaker 3: how much other clubs spend are there If you looked
5:39
Speaker 3: at the pirates books, they would be widely disparate of
5:42
Speaker 3: what we see in terms of what let's say the
5:46
Speaker 3: Dodgers do. It'd be interesting, I think, to see all
5:48
Speaker 3: the different revenue sources that all these clubs have, and
5:52
Speaker 3: again what some of the have nots have and what
5:55
Speaker 3: obviously clubs like the Dodgers, Yankees, Red Sox Cubs have.
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7:01
Speaker 5: Mari, that's always what I say. I say, open your
7:04
Speaker 5: books fully and we'll see. But teams are smart, they
7:08
Speaker 5: know we lost because we always I'm not gonna use
7:11
Speaker 5: the pirates. I use the Marlins. The Marlins have the
7:13
Speaker 5: Miami Marlins Baseball Club that does this tickets, and then
7:17
Speaker 5: they put the payroll out of that. But then they
7:19
Speaker 5: also have a separate entity, Miami Marlins Inc. Or whatever
7:23
Speaker 5: it is, Marlin's Baseball Inc. That does the parking and
7:26
Speaker 5: the concessions and the merchandise, and that's the when they
7:29
Speaker 5: make money. So they go back to Major League Baseball
7:31
Speaker 5: and say, hey, we lost, we lost all this money
7:33
Speaker 5: this year.
7:33
Speaker 2: Look guys.
7:34
Speaker 5: But then in the other you know, it's like under
7:36
Speaker 5: this rock we have this, and under this rock we
7:38
Speaker 5: have something different. I don't know, it's a crazy game
7:40
Speaker 5: that we can't get more transparency. I get why they're playing,
7:45
Speaker 5: you know, they're playing the game the way the rules are,
7:48
Speaker 5: but gosh, it would be nice to just know how much,
7:51
Speaker 5: like the Braves kind of have to do, how much
7:54
Speaker 5: every team is making, So then people would also say, man,
7:57
Speaker 5: the players aren't as greedy as we thought they were.
8:00
Speaker 2: Yeah.
8:01
Speaker 3: I think another thing on this is it would be
8:03
Speaker 3: interesting to see what the percentage of revenues come out
8:07
Speaker 3: of revenue sharing to the bottom teams, right, the ones
8:12
Speaker 3: that are hanging around at the bottom in subsequent years. Right,
8:18
Speaker 3: And we have there's a lot of discussion about what's
8:20
Speaker 3: happening at the top, and obviously there's economic disparity, But
8:25
Speaker 3: I have always contended that the biggest.
8:27
Speaker 2: Problem is at the bottom.
8:28
Speaker 3: You know, you shouldn't have teams hanging around there for
8:32
Speaker 3: you know, subsequent five six years, right, I mean, you
8:35
Speaker 3: should be using that revenue sharing money to try and
8:37
Speaker 3: make yourself better. And throwing your hands up in the air.
8:40
Speaker 3: I don't think is a way to really satisfy that.
8:44
Speaker 3: I understand what the commissioner's trying to do. Right, They're
8:47
Speaker 3: saying that there's concern about one club or the other
8:51
Speaker 3: having a leg up. But guys, unless I'm wrong here,
8:54
Speaker 3: we had the same conversation in ninety eight to two
8:57
Speaker 3: thousand with the Yankees, right, I mean the Yankees were
9:01
Speaker 3: the poster child for this discussion for a long time.
9:06
Speaker 2: Do we need to do something?
9:07
Speaker 3: Probably I don't know if a CAP is really going
9:09
Speaker 3: to do what I think a lot of people think
9:11
Speaker 3: it will do. But it's always that question of can
9:15
Speaker 3: you really have a truly equal parody across all of them?
9:21
Speaker 3: And you never will. I mean, the Dodgers are feasting
9:24
Speaker 3: right now on all of the Pacific rim deals that
9:28
Speaker 3: they're making with sponsorships that they've done through Otani and Yamamoto.
9:32
Speaker 3: I mean, that's something that isn't new, right, I mean,
9:36
Speaker 3: but it isn't old for them. I mean, if you
9:38
Speaker 3: go back to before Otani was there, they had some
9:41
Speaker 3: but we're seeing this now and you go, well, is
9:44
Speaker 3: it always going to be like that? I don't know,
9:46
Speaker 3: but it does give them a leg up. And again,
9:49
Speaker 3: large market, large brand clubs are always going to have
9:54
Speaker 3: additional revenue streams that these other ones don't. I don't
9:56
Speaker 3: think that it's going to a CAP system is going
9:59
Speaker 3: to work in the manner that I think a lot
10:01
Speaker 3: of fans think it will. First of all, I don't
10:05
Speaker 3: think it'll ever happen. But even if it did, I
10:07
Speaker 3: think it will help the middle class. It would help
10:11
Speaker 3: the middle class more than the ones.
10:12
Speaker 2: At the bottom.
10:13
Speaker 3: I don't know if the Pirates or Marlins or Rays
10:15
Speaker 3: get any more competitive than they are now.
10:19
Speaker 4: All right, I'm gonna put you on the spot. You
10:21
Speaker 4: talked about the Pacific Rim and all the money that
10:24
Speaker 4: the Dodgers are bringing in. Is there any way of
10:28
Speaker 4: not projecting it forward, but figuring out how much that
10:33
Speaker 4: is bringing because you can do You can do the
10:35
Speaker 4: TV revenue that you were just talking about. You can
10:38
Speaker 4: do the math. It comes out to about one hundred
10:40
Speaker 4: and sixty million more if I did the math from
10:44
Speaker 4: what you were saying per year that they're able to
10:47
Speaker 4: bring in. That's not revenue shared through that. But like
10:51
Speaker 4: the show, hey, the Yama Modo, do you have any
10:54
Speaker 4: inside info or like any guesses about where some of
10:58
Speaker 4: those contracts are and are they going to get to
11:00
Speaker 4: grow as the team continues to win in those areas.
11:05
Speaker 3: Yeah, I mean it's a really difficult thing. I mean
11:07
Speaker 3: we've kind of others have kind of looked at it
11:09
Speaker 3: and tried to eyeball it. You know, somewhere maybe around
11:14
Speaker 3: you know, two hundred and twenty million dollars that that
11:19
Speaker 3: could come in through Pacific Rim sponsorship deals. You know,
11:22
Speaker 3: it's significant. Other clubs have had this advantage in the past,
11:26
Speaker 3: the Mariners did this when Nintendo was the primary owner. Certainly,
11:31
Speaker 3: with each ye row, you're able to ink those kind
11:33
Speaker 3: of deals, but it is a unique situation. First of all,
11:37
Speaker 3: each row is a star, and it's not like this
11:40
Speaker 3: drives everyone. I don't know what the let's say, the
11:43
Speaker 3: Padres have done with you've darbish, but you know they're
11:46
Speaker 3: the possibilities are there. And again, I think that the
11:49
Speaker 3: the key factor in this is that when you're a
11:52
Speaker 3: large brand in a large market, your ability to just
11:56
Speaker 3: reach out and make those kind of deals. You're just
11:59
Speaker 3: staffed to deal with this. So isn't going to continue
12:02
Speaker 3: to grow? That is largely, I think, going to depend
12:05
Speaker 3: on the health and well being primarily of shoe O Taani.
12:11
Speaker 3: I mean, if he keeps going in this trajectory, right,
12:13
Speaker 3: I mean, he's got a couple more years left, three,
12:16
Speaker 3: four or five maybe left under him. He may not pitch,
12:20
Speaker 3: you know, at the later end of his career, but
12:22
Speaker 3: he should still be able to do damage at the plate,
12:25
Speaker 3: and I could I still think he's going to be
12:27
Speaker 3: a star. If he's injured, and that's always a possibility
12:30
Speaker 3: for every player in the league, then it changes a
12:32
Speaker 3: little bit, but those opportunities are going to be there,
12:35
Speaker 3: and that's of course a risk with the sponsors. You
12:38
Speaker 3: don't go into a deal it's like one year or
12:40
Speaker 3: two years, or can I back out of this if
12:42
Speaker 3: said player gets injured. They're normally locked in. So I
12:46
Speaker 3: think that it probably continues to open up opportunities for them.
12:49
Speaker 3: I don't know how big those deals are, but I
12:52
Speaker 3: I you know, I think it would be probably irresponsible
12:55
Speaker 3: if you're the Dodgers not to look into every opportunity
12:57
Speaker 3: you can.
12:59
Speaker 4: You talked about the cap. Everybody says yes to a
13:03
Speaker 4: cap or no to a cap. I want you to
13:05
Speaker 4: find the answer in between. I want you to find
13:07
Speaker 4: the answer that suffices and brings honest, real world like
13:13
Speaker 4: financial change without the cap, which the players don't want,
13:18
Speaker 4: or with the cap, which the owners want. It's like
13:20
Speaker 4: it's too polarized, it's too they're too far apart for
13:23
Speaker 4: it to happen in my opinion, but there is a
13:26
Speaker 4: clamoring from the fans that they want some a little
13:29
Speaker 4: bit more economic stability. Where do you feel like that
13:33
Speaker 4: could change the most in your financial opinion?
13:37
Speaker 3: Yeah, I mean something's gonna happen out of this labor deal.
13:40
Speaker 3: I don't know what it is. I don't think obviously
13:43
Speaker 3: the players are gonna say no cap and listen, you're
13:45
Speaker 3: gonna undermine all the good momentum that you have. So
13:49
Speaker 3: even if you lost regular season games, I can't see
13:51
Speaker 3: it going past losing Maybe may.
13:53
Speaker 2: Right, So let's say that they don't.
13:56
Speaker 3: I would think, or I would hope, that there would
13:58
Speaker 3: be something around the system that they currently have in place.
14:02
Speaker 2: Now, how tight they.
14:04
Speaker 3: Get that stuff locked up at the top, or what
14:06
Speaker 3: additional surcharges you could put in place? Right, So, you
14:10
Speaker 3: could do some increased penalties for multiple years, and you
14:15
Speaker 3: could increase the penalties for those that go past a
14:19
Speaker 3: certain point right in those thresholds above that. The real
14:23
Speaker 3: issue in my mind has always been at the bottom.
14:26
Speaker 3: Could you do the luxury tax and reverse? Could you
14:30
Speaker 3: put a threshold at the bottom and say, Okay, if
14:33
Speaker 3: you go past this point at the bottom, you're going
14:36
Speaker 3: to lose as much in revenue sharing, and if you
14:38
Speaker 3: do it in subsequent years, that's going to compound. And
14:41
Speaker 3: if you go past a certain point and you go
14:43
Speaker 3: deeply below that, you're going to get hit more. You
14:46
Speaker 3: could use draft picks, you could do all kinds of things.
14:49
Speaker 3: The problem with that is you cannot do a floor
14:53
Speaker 3: without something at the top. And so again, I'm sure
14:58
Speaker 3: that the players Association would be more than happy to
15:00
Speaker 3: see something at the bottom, but the owners, of course,
15:04
Speaker 3: are going to want to see some tightening at the top.
15:06
Speaker 3: So that I think is maybe the only way that
15:09
Speaker 3: you could see something. Is it going to still satisfy
15:13
Speaker 3: the issue at hand? I mean, even if you had
15:15
Speaker 3: a cap system, let's just say you put a floor
15:17
Speaker 3: at I don't know, one hundred and ten million, which
15:20
Speaker 3: would be really, you know, significant above what we've seen
15:23
Speaker 3: some of the clubs paying right now, do you honestly
15:27
Speaker 3: think that, you know, the Pirates, Marlin's Rays are going
15:31
Speaker 3: to go much above that point? To begin with, Guys,
15:35
Speaker 3: the last time I checked the team with the best
15:38
Speaker 3: record in the league last year was the Milwaukee Brewers. Now, granted,
15:43
Speaker 3: they weren't able to do much in the postseason, right
15:45
Speaker 3: and that's where you start to get into a separate discussion,
15:49
Speaker 3: But there's still parody in terms of the performance of
15:51
Speaker 3: teams making it. And if the owners were to somehow
15:56
Speaker 3: seek to get additional teams in the postseason, and I
16:00
Speaker 3: don't know if people remember this, but they initially wanted
16:03
Speaker 3: two more teams in the postseason during this last round
16:07
Speaker 3: of labor negotiations that are in the deal.
16:09
Speaker 2: That we have now.
16:11
Speaker 3: You know, then it makes it even easier for some
16:14
Speaker 3: of these clubs that have lower payrolls to reach it.
16:17
Speaker 2: Again.
16:17
Speaker 3: The Guardians, you know, who are in a softer division.
16:21
Speaker 3: But I don't know if you get a you know,
16:24
Speaker 3: we're never going to see a system in which everybody
16:26
Speaker 3: has the same payroll. And if I look across the
16:28
Speaker 3: isle at the NBA or the NFL, it's not like
16:31
Speaker 3: they're doing great in terms of parody. And there's discussions
16:34
Speaker 3: today going on what's going on with the Cleveland Browns.
16:37
Speaker 3: You know, when are they going to get together? The
16:40
Speaker 3: game is designed differently in baseball. You don't have a
16:44
Speaker 3: quarterback and a receiver corps which are skilled players that
16:46
Speaker 3: can be on the field all the time, or a
16:48
Speaker 3: point guard and a forward. You really have to have
16:51
Speaker 3: a really well balanced roster. And I always go back
16:56
Speaker 3: to remembering the Texas Rangers when they spent and allocated
16:59
Speaker 3: all that money Alex Rodriguez. What happened? They didn't have pitching,
17:03
Speaker 3: They didn't. They weren't able to do anything and hung
17:05
Speaker 3: around the bottom of the standings. And so again, you
17:08
Speaker 3: just have to be well balanced.
17:11
Speaker 5: Lauri, don't forget the Browns have Shador. He's a Pro
17:16
Speaker 5: bowl Okay, So don't ever forget that he's a pro
17:18
Speaker 5: bowler ahead of Trevor Lawrence and Josh. There's a whole listing. Anyways,
17:22
Speaker 5: we don't have time to get into that whole thing.
17:24
Speaker 5: And Bill Belichick is not a first ballot Hall of Famer.
17:26
Speaker 5: So everything is perfect in the NFL because it's been
17:29
Speaker 5: what fifteen straight years of the Chiefs and the Patriots,
17:32
Speaker 5: one of the two going to the AFC Championship Game.
17:35
Speaker 5: The cap doesn't solve everything, and I'm just tired of
17:38
Speaker 5: hearing about it. Yes, you're not getting a cap without
17:40
Speaker 5: a floor, but is there any way, and you're way
17:45
Speaker 5: deeper in the economic than I am, is there any
17:48
Speaker 5: way that this gets settled without some sort of a workstop?
17:51
Speaker 5: Is do you think the sides can get together and say, man,
17:54
Speaker 5: we have all this momentum Because all you hear from
17:56
Speaker 5: everybody is baseball's healthy, it's growing, The revenues are a
18:00
Speaker 5: TV watching is up, ticket sales are up, merch sales
18:02
Speaker 5: are up, everything is up. But then all of a sudden,
18:05
Speaker 5: we're not making enough as owners, you know, So is
18:07
Speaker 5: there a way that they can figure this out, hopefully
18:09
Speaker 5: before we get to the worst part, which is a
18:12
Speaker 5: work stoppage.
18:14
Speaker 3: Yeah, I don't know, Aja, I mean, it's just I
18:18
Speaker 3: won't see it's a guarantee. But it seems highly likely
18:21
Speaker 3: that we're we're at least going to get an off
18:23
Speaker 3: season lockout. And you know, last time this happened when
18:27
Speaker 3: the lockout hit, you know, we got one hundred and
18:30
Speaker 3: sixty two games in, but they had to compress the
18:32
Speaker 3: season and play a bunch of double headers. And I
18:34
Speaker 3: don't know if you know, if the owners sit on
18:38
Speaker 3: this thing with a cap, whether they're.
18:40
Speaker 2: Able to do that.
18:41
Speaker 3: You know, one way, another way to deal with this,
18:44
Speaker 3: and this still has to go through and be negotiated
18:47
Speaker 3: with the players, is increased revenue sharing. And that's that,
18:51
Speaker 3: you know, here we are talking about the Dodgers or
18:53
Speaker 3: whether we're talking about the Yankees, they're kind of doing
18:58
Speaker 3: eventually something that might be a backdoor around that, which
19:01
Speaker 3: is of course the commissioner would love to sell the
19:04
Speaker 3: rights to all thirty clubs at their local media rights
19:09
Speaker 3: right package all that together sell it to somebody like
19:12
Speaker 3: ESPN or Apple or Amazon streamer, And that would if
19:17
Speaker 3: you did that and did that's all centralized. I mean,
19:20
Speaker 3: that's the brilliance of what Pete Roselle did with the NFL,
19:26
Speaker 3: which was, you know, all the media rights are centralized,
19:29
Speaker 3: and that's how everybody's making solid money that way, all
19:32
Speaker 3: the way across the board. But I don't know, I
19:35
Speaker 3: just don't see how again, irrespective if they were pushing
19:39
Speaker 3: for a cap last time we saw this, whether it
19:42
Speaker 3: was trying to redo on the salary arbitration system and
19:47
Speaker 3: dealing with that, whether it was the players trying to
19:49
Speaker 3: get more money to the rank and file, and whether
19:51
Speaker 3: you have a pool of pre RD players. You know, again,
19:54
Speaker 3: I think that we're going to come out of this
19:57
Speaker 3: largely the same, but there might be some big changes.
20:00
Speaker 2: You know.
20:00
Speaker 3: Again, if you're gonna make big changes, I don't see
20:04
Speaker 3: how that doesn't come with additional time. And I could
20:08
Speaker 3: see us all sitting on our hands on December first
20:11
Speaker 3: until maybe January, and again that happened last time, where
20:15
Speaker 3: we're like, why aren't you guys doing anything? And they
20:18
Speaker 3: need that artificial deadline of spring training to really push
20:22
Speaker 3: things into gear, and that's when you start to get
20:24
Speaker 3: some real momentum.
20:26
Speaker 5: Got it, By the way, that's Rob Manfred's dream is
20:29
Speaker 5: to centralize all the MLB. But if I'm the Dodgers, Yankees, Mets,
20:34
Speaker 5: Red Sox, why would I want to if I'm not
20:36
Speaker 5: making it so anyway, that's a whole owner's fight. But
20:39
Speaker 5: I want to ask you this, since you're again you're
20:41
Speaker 5: in tune of with this more than most people are,
20:44
Speaker 5: and you can maybe explain this because I have this
20:45
Speaker 5: fight with fans all the time. Every fan says, oh, man,
20:49
Speaker 5: these players are getting paid so much, right, and they're oh,
20:53
Speaker 5: they're so greedy. They get all this money. The players
20:56
Speaker 5: are happy with the money they get what they like
20:58
Speaker 5: to see some team spend more, absolutely, But for some
21:01
Speaker 5: reason the fans don't say, well, if a cap system
21:03
Speaker 5: goes in for the owners, the guess who makes more money.
21:07
Speaker 5: The owners make more money. But no one ever says
21:09
Speaker 5: the owners are greedy, right because they want a cab
21:12
Speaker 5: and they don't want to spend like especially the lower owners.
21:14
Speaker 5: Why is that? Is it just a pr battle that
21:17
Speaker 5: the players are losing? Because people say, oh, why is
21:20
Speaker 5: Hoheo Tani makes seventy million dollars a year for what
21:23
Speaker 5: he does? But I guarantee if you go and look
21:25
Speaker 5: at CEOs around the world. Now, let's let's put a
21:28
Speaker 5: keep in mind, the people that make over thirty forty
21:30
Speaker 5: million in baseball is less than what fifty people in
21:33
Speaker 5: the world. So you take the top fifty CEOs in
21:36
Speaker 5: the world and throw their numbers out there, Elon Musk,
21:39
Speaker 5: Jeff Bezos, whoever you want to throw out there. What
21:41
Speaker 5: are they making per year? No one complains about them.
21:45
Speaker 3: Yeah, And you know, I think it's probably this idea
21:48
Speaker 3: that all of us probably play a little league and it's,
21:51
Speaker 3: you know, a kid's game, and there's still this perception that,
21:54
Speaker 3: for whatever strange reason, that some you know, Joe Average
21:58
Speaker 3: could go get in the box and go do what
22:00
Speaker 3: you guys have done. You know, I don't know, but
22:04
Speaker 3: I do know this. A key component of this discussion
22:08
Speaker 3: around a cap is that if you look at the
22:12
Speaker 3: franchise values that are occurring in the NFL and more
22:16
Speaker 3: specifically the NBA, they've been going up faster than franchise
22:22
Speaker 3: values for MLB.
22:25
Speaker 2: And that's a concern, right and.
22:27
Speaker 3: They believe that a large part of that is a
22:29
Speaker 3: cap system, because what are you doing. You really get
22:31
Speaker 3: into cost certainty, you really have a better idea of.
22:34
Speaker 2: Where things are at.
22:36
Speaker 3: That increases the value of your club for other people
22:38
Speaker 3: that want to get involved in it, and you're able
22:40
Speaker 3: to go ahead increase your sales. So that I think
22:43
Speaker 3: is maybe the largest thing that is not being discussed.
22:47
Speaker 3: That franchise values would absolutely go up under a cap system.
22:50
Speaker 3: So who does that benefit? Of course, it benefits the owners.
22:55
Speaker 3: The other thing about the cap system that needs to
22:57
Speaker 3: probably be discussed is, you know, it would be a
23:00
Speaker 3: percentage of baseball related revenue, So let's say it's fifty percent. Well,
23:05
Speaker 3: it's not like that number always goes up. And this
23:10
Speaker 3: is something again that's I think critical in the discussion
23:13
Speaker 3: right now. You know, Rob's going to the players and saying, look,
23:17
Speaker 3: if you had done this thing and a cap system prior,
23:21
Speaker 3: this is how much money you left on the table.
23:22
Speaker 2: By not going that way.
23:25
Speaker 3: Right now, we're watching and seeing with the revenue or
23:28
Speaker 3: with the regional sports network bubble bursting, those revenues are
23:32
Speaker 3: going down, and so what happens when that happens? Right
23:36
Speaker 3: of course, then the amount of money going to the players,
23:38
Speaker 3: whatever that figure is, would go down. Now the clubs
23:42
Speaker 3: would be forced to spend what that is. But you
23:45
Speaker 3: know what, what does that do? You know, you're either
23:47
Speaker 3: artificially overspending for some players or you're compressing the players
23:52
Speaker 3: at the top. And so I think maybe that's the
23:55
Speaker 3: thing that gets lost in this discussion. That and the
23:58
Speaker 3: idea that if there was a caps system, suddenly the
24:00
Speaker 3: Pirates are going to be running ramshot and be able
24:03
Speaker 3: to go ahead and compete all the time with the Dodgers.
24:07
Speaker 3: It's just not going to be like that, because again,
24:09
Speaker 3: we have a cap system in the NFL and the NBA,
24:12
Speaker 3: and we can see how parody works with those systems.
24:14
Speaker 3: It's you know again, MLBI is the best parity out
24:17
Speaker 3: of all of those.
24:20
Speaker 1: Yeah, this is just a long time setup to accomplish
24:23
Speaker 1: a franchise value soaring. That is the main objective. There's
24:27
Speaker 1: no doubt about that. There are ramifications of that. Like
24:30
Speaker 1: you said, Hey, if we put a penalty on not
24:32
Speaker 1: spending enough, guess what, all of those teams will spend
24:35
Speaker 1: enough in five seconds, and if not, they'll sell like
24:38
Speaker 1: the Twins would have for one point five billion, which
24:40
Speaker 1: is still thirty four x versus the one point seven
24:43
Speaker 1: or one point seventy five that they're suddenly looking for.
24:46
Speaker 1: So more a great info, and I want to tie
24:47
Speaker 1: it all back to the start of this conversation. If
24:51
Speaker 1: there is a problem, and clearly there is amongst other
24:54
Speaker 1: owners with the way that the Dodgers are spending, this
24:57
Speaker 1: does sound like an issue. Maybe it's not a massive
24:59
Speaker 1: issue in the number is a little bit too inflated
25:02
Speaker 1: on how much they're saving on the revenue sharing. And
25:04
Speaker 1: I know there's a legal component to this, but can't
25:07
Speaker 1: during the next CBA they sit down and say, hey,
25:10
Speaker 1: you're clearly not bankrupt, we should get this level again
25:13
Speaker 1: and let's figure out a little more revenue sharing. And
25:16
Speaker 1: the key that everyone says in our chat always is
25:18
Speaker 1: the revenue sharing not being tied to forcing player spending
25:20
Speaker 1: is absurd, right, because you could just be spending it
25:23
Speaker 1: on real estate your spring training facility. You can get
25:25
Speaker 1: a one hundred million dollars facelift and then it just
25:27
Speaker 1: improves your real estate value. You didn't spend a dime
25:29
Speaker 1: on your team. You got to improve that part of
25:31
Speaker 1: your team, but that should not account for what other
25:34
Speaker 1: teams are giving up. So what are your thoughts on
25:37
Speaker 1: the way that the owners might decide to attack a
25:40
Speaker 1: team like the Dodgers for not sharing as much on
25:44
Speaker 1: their TV revenue.
25:46
Speaker 3: Well, again, it's not like this is an unknown quantity.
25:49
Speaker 3: I mean, this has been going. This is you know years,
25:52
Speaker 3: you know, over a decade. So look, maybe, but I
25:56
Speaker 3: think the Dodgers would come back and go, look, we
25:59
Speaker 3: did this as a you know, it was done out
26:01
Speaker 3: of a quarter pointed thing that we got to go
26:03
Speaker 3: back and revisit that thing, and you know, there's all
26:05
Speaker 3: the legal ramifications of it. They could they get an adjustment?
26:09
Speaker 3: Maybe you know, there was already an adjustment again, So
26:15
Speaker 3: could they revisit that? I suppose, But none of this
26:18
Speaker 3: should be a surprise to any of the other twenty
26:21
Speaker 3: nine owners. I mean, this has been around. I am
26:23
Speaker 3: sure that they've sat around and said and stood on
26:26
Speaker 3: this for a while. So could they revisit it? I
26:29
Speaker 3: maybe I think that overall, just the general revenue sharing
26:34
Speaker 3: model might be revisited and that may be something to
26:37
Speaker 3: look at again. And that I think is maybe the
26:41
Speaker 3: thing that I think maybe gets lost is that it
26:45
Speaker 3: always seems to go and fall on the players, right,
26:47
Speaker 3: we need to go ahead and put a cap system
26:49
Speaker 3: in because the players aren't making too much, or we
26:51
Speaker 3: need to go ahead and be spreading that wealth around there.
26:56
Speaker 3: It would be easier, I imagine, to go to the
26:58
Speaker 3: players Association and say, hey, we want to go ahead
27:00
Speaker 3: and clean up things on the ownership side with how
27:03
Speaker 3: revenue is being shared than trying to take a cap
27:06
Speaker 3: system in place. So it's always a battle between the
27:11
Speaker 3: owners and the players, and then the small market, mid
27:15
Speaker 3: market and large market owners against each other. That's the
27:19
Speaker 3: tale as old as time.
27:22
Speaker 1: Yeah, that's the battle getting them to share more of
27:24
Speaker 1: the revenue when they don't feel like the teams that
27:27
Speaker 1: are getting that revenue sharing are actually spending it where
27:29
Speaker 1: they should. So I wish I could be inside those meetings.
27:33
Speaker 1: Those meetings are the real fun ones when they come
27:35
Speaker 1: out and then say thirty, oho, we all agreed, Maury,
27:37
Speaker 1: this was great. Thank you so much for joining us.
27:39
Speaker 1: So much more from Maury in his Forbes articles, appreciate
27:43
Speaker 1: the time.
27:44
Speaker 2: All right, guys, you take care. Thanks for having me