JeromeTyleski

How much would you pay for a team that may not be around next year? If you’re Quint Studer, apparently $9 million is a good market value. In September, that’s what Studer reportedly paid for the Beloit Snappers of the low-A Midwest League. According to Ballpark Digest, much of that sale price will be put back into efforts to build a new stadium, which the Beloit Snappers may need to survive. The stadium situation could be of actual urgency and not just a ploy to create leverage because of the impending negotiations surrounding the Professional Baseball Agreement between Major League Baseball and Minor League Baseball. Currently, MLB wants to reduce the amount of MiLB teams by 42 and according to one version of the list, the Beloit Snappers would be on the chopping block. On paper, choosing the Snappers as part of the “Forsaken 42” makes sense. Their attendance was second-worst in the Midwest League at 1,181/game (the Burlington Bees were dead last at 1,053/game). But MLB wouldn’t care about the attendance (and thus, revenue) of teams they don’t own. What most likely defines MLB’s desire to get rid of teams (besides the cynical view of just not wanting to pay as many minor-league salaries), is the quality of the stadiums their cherished prospects play in. It is here that the Snappers suffer. Harry C. Pohlman Field is 38 years old and one of the worst stadiums in the Midwest League. While not every stadium can be the Quad Cities River Bandits’ Moodern Woodman Park, the Snappers may now need to upgrade their stadium situation to remain viable. All parties appear optimistic about the potential of building a new stadium, so potentially the Snappers will be around to see the 2021 season. In the end, Quint Studer will be fine. He already owns the Pensacola Blue Wahoos, who are not on the potential elimination list, and must be having enough success with the Blue Wahoos to try and add another team to his collection. There’s a strong possibility MLB will try to compensate the owners of any MiLB teams that get contracted and if the payout is anywhere close to what Studer paid for the team, he’ll be fine. But let’s be honest, anyone who can pay $9 million for a team that may not exist in 2021 is going to be fine no matter what. In fact, he may be playing with house money at this point.

Feel like I should apologize for not responding sooner to your reply. What's really hurting the Twins in their TV rights is the fact there's no real in-market competition for them. There's pretty much just one RSN in town and will be for the foreseeable future. I'm not saying FSN lowballed them in the deal, but there wasn't there was no competition to bring costs up. On the ownership stake front, I was trying to find that in a news story but didn't come across it. I've heard Gleeman mention it a few times as well. I'm probably being very poor in the use of my Google-Fu, though. I seem to remember one of their radio deals in the past where they wanted $1MM for the rights, and if I remember right they also get most (if not all) of the ad sales during the radio games. Not sure if WCCO paid them anything or just essentially gives them the time now (and the advertising revenue that comes with it).

Of all the good points you made, this one was the best. I do think some team does this, sooner rather than later. But it's probably not the Twins. However, the idea of having FSN turn into some type of standalone subscription model would be interesting. Probably would be too expensive, considering all the rights they currently have to pay for, however.

For those of us that keep an eye on the financial side of the Minnesota Twins, 2024 is going to be a big year. No, there’s no long-term albatross contract that finally comes off the books (at least not yet). 2024 is the first year of a potential new local TV rights deal with Fox Sports North (or whatever Sinclair will call the station once it takes over operations). Currently, the Minnesota Twins receive around $40MM a year in local TV rights. Undoubtably, that amount will grow in the new deal to a potential $60-$80MM range. But what if they go another route? What follows is a rough idea that may not even be possible with current contracts, but let’s have fun with a thought experiment. It’s the offseason, after all. What if the Minnesota Twins went ahead and bypassed the middleman (Fox Sports North) and distributed the games themselves? One caveat here. There would still be a local TV deal. However, due to the existence of what I’ll call “Victory Sports” (I had to do the callback. It was either that or “Minnesota Twins+”), the amount of revenue from the broadcast option will be significantly smaller. For a complete shot-in-the-dark number, let’s say the revenue from that deal is $20MM/year. Assuming a new deal would land in the $70MM range, that leaves $50MM in revenue on the table. The dirty secret here is that while the percentage of viewers for MLB games is high, the amount of viewers isn’t tremendous. In 2018, the average amount of viewers for a prime time Minnesota Twins game was 77,000, which is two Target Fields worth of fans. Not exactly the large number I thought it would be. In 2019 that number grew to 110,000. Let’s say that number drops to an even 100,000 in 2024. Now, you can’t just spread a $50MM charge across 100,000 viewers. That’s expecting each household to pay $500/year just to watch Twins games (and actually you would need $700/year because at that point there would be no value in a broadcast rights deal). However, what if there was a nominal $20/year charge to subscribe to Victory Sports? Let’s say half the fans do that option. $20 x 50,000 = $1,000,000. Nowhere close to $50MM. On a personal note, I’m a cord-cutter who paid $50/month for YouTube TV just to watch Minnesota Twins games, but I don’t expect many fans to make that financial decision. But even if we increase the cost of Victory Sports to $50/year, that only nets us $2.5MM. However, Fox Sports North doesn’t pay the Minnesota Twins $40MM/year just to get 100,000 eyeballs on their channel every night during baseball season. No, Fox Sports North pays that much so it can sell advertisements. Across a season, there are 16.2MM viewers across all Minnesota Twins games, albeit a lot of those viewers are the same from game to game. What if the Minnesota Twins were to sell ads themselves and reap the revenue? I feel like that would be worth at least $50MM and potentially up to $80MM. In addition, the team could sell curated product to each Victory Sports subscriber via e-mail or video advertisements. You like Eddie Rosario? How about a $20 discount off Eddie Rosario jerseys for Victory Sports subscribers the day after he hits a home run? How about other perks like first opportunity (after season ticket holders) to buy tickets for the Home Opener? Now this doesn’t include the cost of producing games, which could either be potentially baked in to the broadcast deal, or any other production costs, but as smart TVs and phone apps become more common, I believe a direct-to-consumer option is worth exploring. What do you think? Am I way off the mark here? Too much speculation? Let me know.

It’s Christmas. Santa has already come down the chimney and dropped off presents. Wrapping paper that was once wrapped around a gift with precision lives either in the recycling bin or in shards on the floor. Tears, both of joy and of disappointment, have been shed. Meanwhile, the Twins fan waits patiently, periodically looking up the chimney to see if a gift is just stuck along the walls. It’s something you get used to as a fan of a lower-to-mid-market team. You’re not the rich kid that gets a new car every other holiday season, but you’re also not the family that shops at the food shelf for Christmas Dinner. You’re in the middle, which can be the worst place of all. Part of being a fan in the middle is talking about payroll, about business, about dollars. This has been a reality for me since LaVelle was writing his annual stories in the early 2000s about not being able to keep the resurgent Twins teams together. Instead of just being excited that a possible Josh Donaldson signing would improve our offense for the next four years, we have to consider how much of his potential $20MM+ salary in 2022 may hold us back from resigning some of our homegrown players. A couple of years ago this attitude made me start counting down the days until Joe Mauer’s contract was going to be off the books. Would shedding $23MM from the expenses materially change anything in terms of wins and losses? Probably not, but that $23MM could have been better spent in 2018. I dislike having to think that way but it’s a necessity. Right now, the Minnesota Twins have at least $23MM to spend, and probably closer to $30-35MM. Essentially, they could add a Lexus to their fleet and not miss the money . However, the further away I get from midnight, the less sure I am that Santa Claus is going to come through. I tried to be good all year. I went to the Twins Winter Caravan, I wanted to go to Twinsfest (work duties got in the way), I bought my flex pack and renewed for 2020 even though the prices went up. I did everything a fan is supposed to do. And right now it feels like my financial dedication is being answered with silence. I feel like I’m closer to shopping for an off-brand Martin Perez at the food shelf than walking out my front door to a luxury automobile topped with an oversized red bow. But I’m in the middle class. I’m resourceful enough to know I don’t need to live off handouts. I’m naïve enough to think I can reach the top of the mountain, if even for just one year. And I’m smart enough to know the intelligent allocation of dollars are the best path to get to the peak. So that’s what I aim to do here on my blog. I want to explore the money game, the dollars behind the diamond. I want to figure out the best use of $100K, of $10MM. I plan to do some research, a lot of speculation and hopefully some education. So sit back, enjoy the unseasonable warmth and gather around the fire. Because if the stove’s not hot, at least the fireplace is.