This week in “Last Week in BizBall”, George Steinbrenner’s legacy, MLB debuts in 3D, plus the weekly tidbits
GEORGE STEINBRENNER’S LEGACY
The passing of George Steinbrenner was deservedly the dominant subject LWIB. He received much praise for restoring the New York Yankees to their position as one of the world’s great sports franchises and global brands. Retrospectives of Mr. Steinbrenner’s era as Yankees owner also included his two banishments from MLB, one stemming from his criminal conviction for making illegal election campaign contributions and the other for attempting to blackmail one of his players. Some argue that Mr. Steinbrenner’s legacy in MLB is how he fundamentally changed the economics of the industry and along with that brought “competitive imbalance” to the game. LWIB, Victor Matheson blogged at The Sports Economist:
Of most importance to the game of baseball, however, was Steinbrenner’s willingness to use the proceeds of his business deals to buy the best talent, ushering in an era of “haves” and “have nots” in Major League Baseball. In 1991, the Yankee’s payroll of roughly $28 million was only slightly above the league average and less than the payrolls of such small market teams as the Kansas City Royals and Oakland A’s. Since that time, however, the Yankees have flexed their financial muscles and actively pursued the biggest, and highest paid, names in the game including guys like C.C. Sabathia, Mark Teixeira, and most notably, Alex Rodriguez. With an opening day lineup featuring the four highest paid players in the game, the 2010 Yankees have the highest payroll in Major League Baseball for the 12th consecutive season.
Unfortunately, not every team in every city can compete with the deep pockets of the Yankees and their closest followers. While in the 1980s it was rare for the highest spending team to have a payroll more than 3 times that of the poorest team, today it is not unusual for the Yankees to outspend their poorest rivals by a multiple of 5 or 6 to 1, and in 2006 the Yankees outspent the hapless Florida Marlins by an astonishing 13 to 1.
And with money has come success. Since baseball expanded the playoffs in 1995, the Yankees have qualified for the postseason 14 of 15 years winning 5 World Series titles. Of course, over the time period many small-market teams have been left behind. For the likes of Pittsburgh, Milwaukee, and Kansas City the season is often over before it’s even begun since Steinbrenner opened up his wallet.
Kurt Badenhausen of Forbes views Mr. Steinbrenner’s legacy in MLB from a decidedly different perspective. Rather than creating a hierarchy of “haves” and “have nots” in MLB, Mr. Badenhausen argues that all of MLB benefited from Mr. Steinbrenner’s transformation of the Yankees franchise into a financial behemoth.
Instead of complaining, though, MLB owners should be eternally grateful for the success of the Yankees under Steinbrenner for a simple reason: He lined their pockets (in addition to his own) with millions of dollars annually.
The Yankees are one of the biggest draws in baseball when they are on the road. This year is no different with 35,400 fans on average buying tickets to see the Yankees in other parks, 1,500 per game more than any other team. More than 25% of MLB licensed merchandise sold is typically Yankee gear and this money gets split evenly among baseball's 30 teams.
The Yankees most direct contribution to other teams is through baseball's revenue sharing system where $433 million transferred from baseball's high revenue teams to its financial laggards in 2009. The Yankees were once again the biggest contributors to the revenue sharing pie with a bill of $125 million (the Yanks also paid a $25.7 million luxury tax on their high payroll). The Florida Marlins received the biggest revenue sharing check for the 2009 season worth $43 million or $6 million more than the team's entire payroll.
That George Steinbrenner’s impact on MLB, in fact all of professional sports, will be debated for decades following his passing is befitting.
MLB MAKES 3D DEBUT
LWIB saw MLB make the leap to 3D. From Glen Dickson at Broadcasting & Cable: “For the last major U.S. professional league to experiment with the 3D format, MLB’s All-Star Week created a flurry of activity, with two regular- season games, the State Farm Home Run Derby and the All-Star Game all broadcast in 3D in a span of four days.” (The aforementioned regular season games were the Yankees/Mariners matches of July 10 and 11.) While practically nobody watched the ASG in 3D, what is important to MLB and the broadcasters is how baseball translates to the new technology, particularly in comparison to other sports. Ken Kerschbaumer of the Sports Video Group blog came away very impressed:
Once the game began, it was clear that the 3D coverage was a winner. The low-home shots from behind home plate added a tremendous sense of depth, especially during shots when the umpire, catcher, batter, pitcher, and even infielders and outfielders were all visible. As the pitch came into the plate, there was also a great sense of the movement of pitches, in particular breaking balls and sliders. Toss in the occasional ball to the backstop for the 3D wow effect, and it was just as good as being in the ballpark.
The centerfield shot and low-home and third shots also proved extremely effective, giving viewers a better sense of the length of a lead, positioning of infielders relative to the base, and more.
And from the aforementioned report from Glen Dickson:
Steinberg and Delaney (LWIB Note: Jerry Steinberg is with Fox Sports and Ed Delaney with YES Network) agree that the low-home camera position in 3D, which was employed extensively during the Yankees/Mariners contests, was particularly dynamic.
“It was the money shot,” Delaney says. “When A-Rod [Yankees third baseman Alex Rodriguez] got brushed back, you felt the speed. And when a ball would skip in the dirt and come right to the camera, you were ducking away from the ball.”
The shots from low-first and low-third were also impressive, he adds. “You could take a shot of a batter, and see the background of the dugouts, the depths of the guys in the dugout and the crowd standing behind. It really popped.”
Shots from center-field and high-home positions were less exciting, as they didn’t give as great a sense of depth. But they still worked for game coverage. “If you’re shooting from center field, you don’t get the ‘Holy Cow!’ 3D experience,” Steinberg says. “But that doesn’t matter; you’re still getting depth.”
Pundits are divided over the prospects of 3D TV. Currently the production costs are exorbitant and 3D TV sets are expensive. Plus wearing the glasses fundamentally changes the interpersonal dynamics of TV viewing (interacting with others in the same room, using a second screen). But the electronics industry, leagues, broadcasters (de facto ESPN at this point) and cable/sat providers are betting that sports in 3D is the product that will drive widespread adoption just as it did with HD. If 3D TV does take root, the games that translate best to the new technology will profit the most.
SELECT READ MORE TO SEE THE WEEKLY TIDBITS
THE WEEKLY TIDBITS
- The Pittsburgh Pirates have the worst record in the NL. Despite that, many baseball pundits have expressed optimism this season about the future on field fortunes of the chronically uncompetitive franchise. The positive reviews are a result of the addition to the Pirates roster this season of young players Pedro Alvarez, Jose Tabata (although there are questions concerning his true age) and Neil Walker. Along with these three rookies the Pirates have one of MLB’s best young players in second year CF Andrew McCutchen. LWIB, Bob Smizik of the Pittsburgh Post-Gazette drew attention to recent remarks from Pirates General Manager Neal Huntington that are certain to dampen the hopes of the Pirates faithful. Here's what Huntington told SI: ``If a player wants to chase every last dollar, he’s probably not going to be here. If he buys into what we’re doing, he’ll leave some money on the table and he’ll stay.’’ (HT Joel Hammond of Crain’s Cleveland Business)
- Yes, TV ratings for the ASG tanked and it hasn’t been a banner year for MLB’s national TV ratings on the whole. However local TV revenues have never been more important in MLB and on that front there was some good news LWIB. Jason Dachman wrote at the Sports Video Group blog that up to this point in the season, “ …several regional sports networks (RSNs) in the Northeast have reported solid ratings increases.” Mr. Dachman reports that both the Mets (SportsNet NY) and Phillies (CSN Philadelphia) have recorded record ratings thus far this season. Phillies numbers are up 16% over last season and are “…on track for their eighth consecutive season of ratings growth.”
- Next season the St. Louis Cardinals will join the swelling ranks of pro sports teams making their local TV broadcast available via cable TV only. Dan Caesar reported for the St. Louis Post-Dispatch, “The Cardinals will place their entire television package on Fox Sports Midwest beginning next season, marking the first time none of their locally produced telecasts will be on over-the-air TV since they began televising games in the 1940s.” How impactful the change will be on Cards fans is debatable. Mr. Caesar reports that about 11 percent of homes in the market do not have cable or sat but the Cards counter that only 4 percent of their fans that come to Busch Stadium do not subscribe to one of those services. Further muddying the picture is an analysis which reveals that over the last decade, Cards broadcasts on “free TV” draw 34% more viewers than games broadcast on cable. Cards fans do not yet know if their sat or cable provider will reach an agreement with FSM to carry the full slate of 150 games.
- The Triple-A Portland Beavers franchise must relocate for next season because their present home (PGE Park) will be transformed into a soccer only stadium to accommodate a new MLS franchise. Ballpark Digest reports that the latest rumoured outcome is a purchase of the franchise by their current “parent club”, the San Diego Padres. Evidently the Padres plan is to have the Triple-A franchise play some of their home schedule at Petco Park with the remainder played in the home park of their High-A Lake Elsinore affiliate. According to the report, Beavers owner Merritt Paulson is seeking $13-15 million for the franchise and is willing to finance the sale.
- The plan to construct a new ballpark in San Jose to house the Oakland A’s franchise requires voter approval. Ballpark Digest reminds us that, “….the San Jose City Council has until Aug. 3 to put a question on this fall's ballot asking voters to approve using city-owned land for a $465-million ballpark…”
- Sarah Talalay of the South Florida Sun Sentinel blogged that Marlins President David Samson reiterated that he anticipates the 2015 ASG to be played in Miami.
Pete Toms is senior writer for the Business of Sports Network, most notably, The Biz of Baseball. He looks forward to your comments and can be contacted through The Biz of Baseball.
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