Zulgad: Is MLB really making return about dollars and cents?

[Richie the Rally Goat]

  On 5/29/2020 at 1:46 PM, Major League Ready said:

This is another exceptionally naive point of view. In my experience, business owners and those who lead large organizations are always much more concerned about their customers and the long-term health of an organization that the average employee. Billionaire's don't achieve that level of success without an acute awareness of their clients. Their success is a product of servicing said clients needs.

 

The average baseball fan is not fanatical. Many of them understand the rest of the world is making concessions. Most of them understand the teams are going to lose an enormous amount of money. Most of them understand players would happily play for a quarter of what they get paid if that's what revenue dictated. Yet, they are unwilling to make any concessions during a global pandemic. The "I need to get mine" is not going to play well with most people.

The players did make concessions during a pandemic, that’s the point....

 

Management is keenly aware of their client’s perspective. Who their clients actually are, is presumptive. There is a host of entities involved in funding a ball club including: secondary ticket sales, TV broadcasters/networks, MLBAM, Disney, and Private Equity investors, and yes fans who ultimately foot the bill but don’t have a direct voice to management.

 

The point is, this CBA fight isn’t in our best interest as fans. It’s in the best interest of players, and owners, who have a multitude of stakeholders.

 

It’s not about virtue, or fans. It never was, not from either side. It’s about money, and one side trying to leverage more out of the other.

[rdehring]

 

  On 5/28/2020 at 7:09 PM, Sconnie said:

the players unionized in 1966. Were it not for unionization, free agency and the collective bargaining agreement as we know it, today, would not exist. No union, no collective bargaining. No collective bargaining, no free agency.

In 1967 (earliest I could find) average MLB salary was 2.4x average US household Income. In 2019 89k x 2.4 = $213k average Mlb salary in 2019.

Players would absolutely go to the KBO for double the salary.

Very interesting comment, Sconnie.

 

I don't know about baseball salaries, but I do know actual information about some of the best football players at that time.  Had a job that gave me access to State tax returns.  Pulled a couple of the biggest names you all recognize playing for that green and gold team from your State.  The biggest two stars on the team had the largest salary I found, $25,000.  That's why rather than training all off-season, they all had off-season jobs which were needed.

[Vanimal46]

[old nurse]

 

  On 5/28/2020 at 4:29 PM, Major League Ready said:

If you look at my statement, I said costs could be estimated within +/-5%. Frankly, I would expect a skilled analyst to come within 3%. 

 

The Twins had 269M in revenue for 2019.  Based on reported profit that means they had $250M in total cost. MLB payroll was $128.7M + 11.5% taxes and benefits for a total of $143.5M or a total of 57.4 of total cost. They also paid just shy of 12M + Payroll taxes in bonuses for the Amateur and International drafts. Therefore, we know the price cost for $166.8M or 66.67% of a $250M budget. Therefore, we only have to be within 15% on the remaining two-thirds of the budget to be +/- 5% of the total.

Of course, we also know the costs of MiLB players. We can easily estimate the costs of all other employees and contracts within +/- 10% which means we would be within 4% overall. There is also the possibility of getting tax records. I am not positive, if the freedom of information act would allow us to request tax records.  If this is possible, we could be quite accurate with an estimate for all other employees.

 

This is obviously not like having the exact numbers but +/- 4% is perfectly adequate for most of the conversation here.

You know the player costs. Everything else is a guess, even the guess that one could be within 5%

[jkcarew]

MLB embarrassing itself. On both sides. Objects in mirror (NHL, soccer) closer than they appear.

 

Collapsing under it’s own weight. Owners unwilling to come out behind for a year despite many years of coming out well ahead...a union dominated by the far right end of the salary bell curve...those making too much money in any one year (and in many cases, already set for multiple generations) to be incented to compromise for a half-season, or even to play at all, under the circumstances. There’s probably a deal to be made with certain owners and a class of players. But between MLB ownership and this union? Seriously doubt it. And I’m starting not to care. Let them all stay home. Next season too. However long it takes for both parties to figure out they need us more than we need them.

[diehardtwinsfan]

 

  On 5/27/2020 at 5:10 PM, Cap'n Piranha said:

Tell that to Pete Rose and Shoeless Joe Jackson.  I'm also not saying owners would ban players, I'm saying the owners could create their own CBA, and only employ players who agree to abide by it.  That could be the entire current membership of the current MLBPA, none of the current MLBPA, or somewhere in between.  Will some fans be turned off by this, and refuse to consume baseball?  Sure.  But the vast majority will pretty quickly, if not instantaneously move on, and care only that their favorite team is playing again.

 

I should also say, I'm not opposed to players getting paid, just the idea that they are somehow aggrieved by vicious parsimonious owners.  I'm also not on the side of the owners--I simply think if the players aren't careful, they will find out the hard way just how replaceable they are.  Painlessly replaceable?  No--getting rid of the current players will be like performing your own root canal for the owners.  But if the tooth is so painful it causes you to pass out, and is getting infected opening up  chance of death, a self-performed root canal might be the preferable option.  And that's what players, and some posters on this board, don't seem to understand; the owners are only going to put up with so much before the drastic option becomes the reasonable one.

The owners cannot legally do this. They would lose their antitrust exemption and the draft would be thrown out. There'd be no MLB. 

[diehardtwinsfan]

 

  On 5/29/2020 at 6:07 AM, USAFChief said:

Bust it, owners. 99 percent of the players will come crawling back. If they dont, in a decade the game will be no different anyway.

 

There will be no game. Baseball is dying sport. I think what's being missed here is that you have a work stoppage right now, and most definitely another one in 2022 at a time where the sport as a whole is losing appeal to the younger generations.... not to mention that very few people, no matter what side they fall on in this argument, are going to spend money on a sport after listening to billionaires dicker with millionaires over finances.

 

Again, my frustration with all of this is that baseball has a unique opportunity to drive in fans at a time where people would watch b/c their out of netflix reruns and espn great games of all time series to watch. There's a beautiful opportunity right now to bring in new fans to a sport that badly needs them, and everyone wants to play hardball. Not smart.

[USAFChief]

  On 5/30/2020 at 12:42 PM, diehardtwinsfan said:

There will be no game. Baseball is dying sport. I think what's being missed here is that you have a work stoppage right now, and most definitely another one in 2022 at a time where the sport as a whole is losing appeal to the younger generations.... not to mention that very few people, no matter what side they fall on in this argument, are going to spend money on a sport after listening to billionaires dicker with millionaires over finances.

 

Again, my frustration with all of this is that baseball has a unique opportunity to drive in fans at a time where people would watch b/c their out of netflix reruns and espn great games of all time series to watch. There's a beautiful opportunity right now to bring in new fans to a sport that badly needs them, and everyone wants to play hardball. Not smart.

There need be no work stoppage. Owners schedule games, players show up to play.

 

If that's the current MLB players, great. If it's current minor leaguers, in a few years it wont matter.

 

And here's the kicker: all the current MLB players will squawk, but they'll show up and play. None of them are going to give up 6 and 7 figure salaries for very long. They'll be just fine and baseball will be just fine without the MLBPA.

[Vanimal46]

 

Now we’re getting somewhere!

[BD57]

 

  On 5/27/2020 at 8:59 PM, The Wise One said:

. Baseball is not like any other business. The fanny in the seat is about 30% of the revenue. For this 30 % for 1 year some people will think that teams will be in financial ruin without that money.  In the words of Sherman T Potter "Horse Hockey"  From  security that will not be needed  as much to ticket takers, cooks, servers, cleaners and whatnot that 30 % is not as free as TV, sponsorship and licensing money.  that make up the other 70% of revenue. For a business that operates on a somewhere near 20% profit margin and had a recent 50 million dollar windfall for BAMTECH  the notion it is somehow going to be hurt by paying the players a prorated salary is ludicrous.

 

So you want to fight the "Players are being ripped off, as usual" fight this year - as usual.

 

M'kay ... 

 

While it's easy spending other people's money, the guys who actually pay the bills aren't obliged to agree with you.

 

[Cap'n Piranha]

 

  On 5/30/2020 at 12:23 PM, diehardtwinsfan said:

The owners cannot legally do this. They would lose their antitrust exemption and the draft would be thrown out. There'd be no MLB. 

 

Is there literature you can point me to that details why the owners MUST allow the current membership of the MLBPA to play, else lose the antitrust exemption?  Specifically after 2021, when there will be absolutely no extant agreements between the owners and players?

 

Further, say MLB does lose it's anti-trust exemption; what are the pitfalls of that other than some potential lawsuits that most teams could probably get around with beefed-up employment contracts.  It would maybe open the way for competitor leagues, but as I've detailed in other posts, are there really 20-30 entities willing to lose tens of millions of dollars a year in order to start a rival league?  Unless the players are willing to take a large pay cut, no new league featuring current MLBPA players will be profitable for some time; if the players are willing to take a pay cut, why not stay with the established league, rather than risk at all on something that might fold in a year or two.  Football is by far the most popular sport in the US, and yet no alternative league has ever established itself as a mainstream competitor; why would a less popular sport prove different?

[Richie the Rally Goat]

 

  On 6/2/2020 at 6:00 PM, Cap'n Piranha said:

Is there literature you can point me to that details why the owners MUST allow the current membership of the MLBPA to play, else lose the antitrust exemption?  Specifically after 2021, when there will be absolutely no extant agreements between the owners and players?

 

Further, say MLB does lose it's anti-trust exemption; what are the pitfalls of that other than some potential lawsuits that most teams could probably get around with beefed-up employment contracts.  It would maybe open the way for competitor leagues, but as I've detailed in other posts, are there really 20-30 entities willing to lose tens of millions of dollars a year in order to start a rival league?  Unless the players are willing to take a large pay cut, no new league featuring current MLBPA players will be profitable for some time; if the players are willing to take a pay cut, why not stay with the established league, rather than risk at all on something that might fold in a year or two.  Football is by far the most popular sport in the US, and yet no alternative league has ever established itself as a mainstream competitor; why would a less popular sport prove different?

NFL has it's antitrust exemption since 1961. The reason competitors all fail, is because the NFL holds the strict rights to a draft. The competitors can only sign free agents.

 

 

Were the MLB to lose anti-trust exemption means losing the draft. Free Agency starts day one, but the union may survive. Suddenly a level playing field could mean legitimate competition for eyes and talent.

[The Wise One]

 

  On 6/2/2020 at 2:27 AM, BD57 said:

So you want to fight the "Players are being ripped off, as usual" fight this year - as usual.

 

M'kay ... 

 

While it's easy spending other people's money, the guys who actually pay the bills aren't obliged to agree with you.

I have not said the players are being ripped off. I have said that there is and has been more than enough profit in baseball to pay the salaries agreed to. It is not spending other's money. It is holding them to their word. It would seem that far to many people do not care about holding people to their word

[lecroy24fan]

After the news today it clearly is all about dollars and cents. The owners need to open their books. Until then I refuse to believe anything they say. And I will say this again:

 

The owners have insurance for situations like this. 

[mlhouse]

 

  On 6/2/2020 at 8:53 PM, Sconnie said:

NFL has it's antitrust exemption since 1961. The reason competitors all fail, is because the NFL holds the strict rights to a draft. The competitors can only sign free agents.

 

 

Were the MLB to lose anti-trust exemption means losing the draft. Free Agency starts day one, but the union may survive. Suddenly a level playing field could mean legitimate competition for eyes and talent.

 

The claim that the NFL holds the strict rights to a draft is a false claim.  The AFL had its own college draft.  The WFL had its own college draft.  The USFL had its own college draft.  

 

Lots of players, like Hall of Fame LB Bobby Bell of the Kansas City Chiefs signed with the AFL team that drafted them in college rather than the NFL team that drafted them (which was the Minnesota Vikings).

 

Viking WR Anthony Carter was a territorial draft pick in the USFL and a 12th round pick in the NFL draft by Miami.  He signed with the Michigan Panthers of the USFL.  

 

The rival football leagues then bid on the rookies and other free agents.  

[howeda7]

 

  On 6/3/2020 at 7:24 PM, lecroy24fan said:

After the news today it clearly is all about dollars and cents. The owners need to open their books. Until then I refuse to believe anything they say. And I will say this again:

 

The owners have insurance for situations like this. 

Do they? Most insurance policies will not cover business interruption for something like this. And if they do, it will be the insurance companies going under.

 

That said, I'm not siding with the owners on this. Suck it up and play 100 games or so. The long-term damage of no season is not worth it. If you want to cut costs, go back to the Arizona plan and save on travel. I don't see much point of playing in home stadiums if there are no fans anyway.

[Cap'n Piranha]

 

  On 6/2/2020 at 8:53 PM, Sconnie said:

NFL has it's antitrust exemption since 1961. The reason competitors all fail, is because the NFL holds the strict rights to a draft. The competitors can only sign free agents.

 

 

Were the MLB to lose anti-trust exemption means losing the draft. Free Agency starts day one, but the union may survive. Suddenly a level playing field could mean legitimate competition for eyes and talent.

 

As MLhouse said above, anyone can have a sports draft.  Hell, me and 29 of my closest friends could decide we're going to have an MLB draft, each pick 25 players, and start our own league.  It won't go anywhere, because the players won't sign with us, because we don't have the money to sign them.  But if Jeff Bezos gave us each $1B, and we gave each drafted player $10M to play this year, we would undoubtedly steal almost every player we drafted from MLB.

 

So like I said, what is the actual downside to MLB losing it's antitrust exemption?

[Mike Sixel]

For those saying this is a fight between millionaires and billionaires, I recommend reading this.....

 

short version....more than half of MLB players made less than 400K in their career so far. Also, the average length of a MLB career is dropping, but the late start to actually making the majors hasn't changed much, if at all......and that doesn't count losing money while in the minors for most players. 

 

https://fivethirtyeight.com/features/how-much-money-do-mlb-players-really-make/

 

 

[yarnivek1972]

  On 6/5/2020 at 4:54 PM, Mike Sixel said:

For those saying this is a fight between millionaires and billionaires, I recommend reading this.....

 

short version....more than half of MLB players made less than 400K in their career so far. Also, the average length of a MLB career is dropping, but the late start to actually making the majors hasn't changed much, if at all......and that doesn't count losing money while in the minors for most players.

 

https://fivethirtyeight.com/features/how-much-money-do-mlb-players-really-make/

The article isn’t really clear if the money made by players includes their signing bonus. For example, let’s say this was 2017. Miguel Sano’s MLB player earnings to that point were about $ 500 K. But he had already received a $3 mil signing bonus.

 

A pretty good chunk of the players that make it to the bigs get a hefty signing bonus. Not all of course. Probably not even half. Luis Arraez’s bonus was $40,000 for example. But quite a few.

[Mike Sixel]

  On 6/5/2020 at 11:48 PM, yarnivek1972 said:

The article isn’t really clear if the money made by players includes their signing bonus. For example, let’s say this was 2017. Miguel Sano’s MLB player earnings to that point were about $ 500 K. But he had already received a $3 mil signing bonus.

 

A pretty good chunk of the players that make it to the bigs get a hefty signing bonus. Not all of course. Probably not even half. Luis Arraez’s bonus was $40,000 for example. But quite a few.

Even when articles are written with data, people argue against the actual point of the article and data, while supplying no data of their own.

[USAFChief]

  On 6/6/2020 at 2:17 AM, Sconnie said:

The sub article on Cutch’s check stub is fascinating too

 

https://www.bankrate.com/financing/taxes/pirates-pay-stub-highlights-jock-taxes/

 

6 years 51 mil comes down to $820k gross annual pay but nets $427k annually. Every state and many cities take their cut.

 

$427k net per year is still a lot of money, but that’s money that isn’t exactly Scrooge McDuck money, and Cutch is doing better than the average Mlb player.

uh...that was 427k net for 2 weeks, not a year.

[USAFChief]

  On 6/6/2020 at 12:30 AM, Mike Sixel said:

Even when articles are written with data, people argue against the actual point of the article and data, while supplying no data of their own.

Mike, could you possibly use this article more dishonestly? It specifically says the number is this low because it includes players with as little os 1 day of MLB service time. Half the players in this "data" had less than 1 year.

 

The MLB minimum is over 1/2 a million per year, but you already knew that.

[old nurse]

 

  On 6/6/2020 at 8:28 AM, USAFChief said:

Mike, could you possibly use this article more dishonestly? It specifically says the number is this low because it includes players with as little os 1 day of MLB service time. Half the players in this "data" had less than 1 year.

The MLB minimum is over 1/2 a million per year, but you already knew that.

Pointing out the number of players that are not millionaires yet now a member of the union and have played only minimally is no less dishonest than pointing out the league minimum for rookies.  when somewhere near 15 of the players appearing for the Twins last year had far less than a year of service time for their career or the year. It is also dishonest to call them millionaires when their career earnings are such that short of living on nothing their net after taxes is not even close to that

[yarnivek1972]

  On 6/6/2020 at 12:30 AM, Mike Sixel said:

Even when articles are written with data, people argue against the actual point of the article and data, while supplying no data of their own.

I simply stated that the article didn’t clarify if money earned by the players included their bonuses. Thus making it a pretty useless article IMO because the data it gives may be incomplete.

[The Wise One]

The old statistic was 1 out of 5 position players play less than 1 year.  Average pitching career was 4 years at one point.  The median income last year was 1.5 million. Yes it is fair to say that not all ball players are millionaires. Over half the players made a million. It would be still fair to say millionaires vs billionaires

[The Wise One]

 

  On 6/5/2020 at 11:48 PM, yarnivek1972 said:

The article isn’t really clear if the money made by players includes their signing bonus. For example, let’s say this was 2017. Miguel Sano’s MLB player earnings to that point were about $ 500 K. But he had already received a $3 mil signing bonus.

A pretty good chunk of the players that make it to the bigs get a hefty signing bonus. Not all of course. Probably not even half. Luis Arraez’s bonus was $40,000 for example. But quite a few.

eliminating 35 rounds of the draft, between 600 and 700 players signing saves less than 30 million. 160 players split about 235 million. For every multi million dollar signing there will be quite a few with less than a million. A good chunk is less than 20% of a normal draft. 

[The Wise One]

Last little oddity in the "they aren't millionaire" kerfuffle. I have earned a lot of money through the years. Irs, the state, county, schools, retirement medicare all get bite. Even if I earned 2 million somebody else gets a hunk of it first. College ball types have the loan sharks known as student loans to also pay off. Agents, buscones all get a hand in the pocket. There is a lot to pay off before they become millionaires.

[yarnivek1972]

  On 6/7/2020 at 2:42 PM, The Wise One said:

eliminating 35 rounds of the draft, between 600 and 700 players signing saves less than 30 million. 160 players split about 235 million. For every multi million dollar signing there will be quite a few with less than a million. A good chunk is less than 20% of a normal draft.

Let’s be clear. We’re talking about players with experience in MLB. Obviously, the minors are probably better than 90% non-millionaires.

But the guys that are typically higher draft picks and guys that get big international money are guys that are more likely to make it to the bigs.

[yarnivek1972]

  On 6/7/2020 at 3:08 PM, The Wise One said:

Last little oddity in the "they aren't millionaire" kerfuffle. I have earned a lot of money through the years. Irs, the state, county, schools, retirement medicare all get bite. Even if I earned 2 million somebody else gets a hunk of it first. College ball types have the loan sharks known as student loans to also pay off. Agents, buscones all get a hand in the pocket. There is a lot to pay off before they become millionaires.

Then let’s also not forget that players at the MLB level get per diem over and above their salary, free bats, gloves, shoes, etc. and that’s just an average guy. The good ones obviously get big endorsement money.

[The Wise One]

 

  On 6/7/2020 at 5:57 PM, yarnivek1972 said:

Let’s be clear. We’re talking about players with experience in MLB. Obviously, the minors are probably better than 90% non-millionaires.
But the guys that are typically higher draft picks and guys that get big international money are guys that are more likely to make it to the bigs.

Drafting has improved, but not really that much. Try looking at draft results 22 of the 42 picks, those boys with the big bucks, from 2015 have not seen the major league leagues. Come up with the data to prove your point. All of those non bonus babies on the Twins last year and non good draft picks hint you are wrong