Any of you seen the Forbes magazine story on baseball as a business? It shows that teams like the one for which I am a fan (the Pirates--don't laugh) made killer profits last year. The Pirates made about a 22 million dollar profit, while producing their 13th consecutive losing season. Marc Cuban, Dallas Mavs owner, and Pittsburgh native, says being a baseball owner is easy. Lose and you have got a successful business (he said this on ESPN radio, commenting on the Forbes article). Cuban says he'd buy the Pirates and stop this nonsense. Anyway, it really irks me that the owners can get away with this. Here's the link
http://sports.espn.go.com/mlb/news/story?id=2415787
[ April 25, 2006, 08:37 PM: Message edited by: buccoman ]
Full Version: "Small Market" teams
It's no secret owners in all professional sports leagues make out like bandits. I'm currently taking an Economics of Sports class where we just covered the owners section.
In defense of these owners, you must realize that they are taking gigantic risks in putting up money to sign these high-profile free agents (even the Pirates have brought in some good players). Now many people may say "well they're only making money because we pay so much for tickets." EXACTLY. The FANS' willingness to pay for tickets and parking and concessions and memorabilia and merchandise DRIVES owners to either pocket the cash (depending on their motivation) or spend it on high-profile players.
If you REALLY want to get angry over owners swimming in money like Scrooge McDuck, analyze the economy of the NFL. THOSE owners make TREMENDOUS amounts of money.
If you're a Pirates fan, eh, be happy they're making a profit. Otherwise they might relocate to Portland or somewhere else (another scare tactic used by owners to persuade governments into funding their stadiums so they don't have to).
In defense of these owners, you must realize that they are taking gigantic risks in putting up money to sign these high-profile free agents (even the Pirates have brought in some good players). Now many people may say "well they're only making money because we pay so much for tickets." EXACTLY. The FANS' willingness to pay for tickets and parking and concessions and memorabilia and merchandise DRIVES owners to either pocket the cash (depending on their motivation) or spend it on high-profile players.
If you REALLY want to get angry over owners swimming in money like Scrooge McDuck, analyze the economy of the NFL. THOSE owners make TREMENDOUS amounts of money.
If you're a Pirates fan, eh, be happy they're making a profit. Otherwise they might relocate to Portland or somewhere else (another scare tactic used by owners to persuade governments into funding their stadiums so they don't have to).
I know in my area our team, KC Royals, our in a Catch 22. Recently voters approved for improvement in the stadiums (Royals and Chiefs), but struck down a proposal for a rolling roof (between the two stadiums). The citizens have a desire to keep the teams, but they don't want to give to much. The rolling roof was to much, though interesting enough most voters said they were willing to pay for a retractable roof for the Chiefs but not the Royals.
Why, because the Royals are a loosing team. They are breaking records in loosing. Hence the catch 22. Citizens are less likely to support a loosing team with taxpayer money. This causes the team to threaten leaving (though with since the first measure past it is suppose to mean that they stay for another 25 years). But since KC is a small market team, without some heavy taxpayer contribution, the Royals can't afford what it takes to make a better team.
This has lead some people to pine for the days before Glass bought it to go back to be community owned (not a good idea at all).
Why, because the Royals are a loosing team. They are breaking records in loosing. Hence the catch 22. Citizens are less likely to support a loosing team with taxpayer money. This causes the team to threaten leaving (though with since the first measure past it is suppose to mean that they stay for another 25 years). But since KC is a small market team, without some heavy taxpayer contribution, the Royals can't afford what it takes to make a better team.
This has lead some people to pine for the days before Glass bought it to go back to be community owned (not a good idea at all).
I'm sorry, KU, but I must disagree with your reply. Yes, the Chiefs win more often than the Royals, but team revenue relies upon the SUPPORT of fans and their WILLINGNESS to forfeit their income for a product. The fans DEMAND a scarce product; the fact that they approved improvements to both stadiums illustrate that demand. However, only to a certain degree (although I am confused as to why a football stadium needs a rolling roof and a baseball stadium doesn't. That is where winning may play a factor, although technically it doesn't add up).
Also, many fans ARE willing to support a losing team. I live in Seattle where the tradition and legacy of sports teams is sparse. Since the mid-70's, both the Mariners and Seahawks have had sub-.500 records many years. But when those owners threatened to move their teams, our fans reluctantly approved the erection of both Safeco Field and Qwest Field. The same can be said for the White Sox and the Giants in the mid-90's when they threatened to move to Tampa Bay (before they received the Devil Rays).
The revenue of sports teams (in this case, specifically, the Royals) is determined by the fans' willingness to pay for their product. Tickets, merchandise, etc. support the team. The owner(s) is playing the "small market" card which tends to work. You seem correct in the fact that the team is managed poorly.
I read, however, that Kansas City is interested in an NBA team. Please, take my Sonics or the Portland Trail Blazers. Trade for the Royals!
Also, many fans ARE willing to support a losing team. I live in Seattle where the tradition and legacy of sports teams is sparse. Since the mid-70's, both the Mariners and Seahawks have had sub-.500 records many years. But when those owners threatened to move their teams, our fans reluctantly approved the erection of both Safeco Field and Qwest Field. The same can be said for the White Sox and the Giants in the mid-90's when they threatened to move to Tampa Bay (before they received the Devil Rays).
The revenue of sports teams (in this case, specifically, the Royals) is determined by the fans' willingness to pay for their product. Tickets, merchandise, etc. support the team. The owner(s) is playing the "small market" card which tends to work. You seem correct in the fact that the team is managed poorly.
I read, however, that Kansas City is interested in an NBA team. Please, take my Sonics or the Portland Trail Blazers. Trade for the Royals!
Pirates lose again tonight....Worst team in Pittsburgh Pirate history....Owners will rake in record profits. I understand the economics of sports, but these teams, and especially ones with a 120 year history like the Pirates, belong to the communities. Taxpayers paid for beautiful PNC Park in Pittsburgh. There has got be a huge uproar about this, doesn't there?! :confused:
QUOTE
Jepson:
I'm sorry, KU, but I must disagree with your reply. Yes, the Chiefs win more often than the Royals, but team revenue relies upon the SUPPORT of fans and their WILLINGNESS to forfeit their income for a product. The fans DEMAND a scarce product; the fact that they approved improvements to both stadiums illustrate that demand. However, only to a certain degree (although I am confused as to why a football stadium needs a rolling roof and a baseball stadium doesn't. That is where winning may play a factor, although technically it doesn't add up).
The fans were willing to do the minimum to keep them, which was approve the improvments for an agreement to stay. They were not willing to go the extra mile and improve the rolling roof. The rolling roof would have rolled between the two stadiums, it would completely enclose the Chiefs stadium and cover the Royals. Most blamed the Royals for the votes defeat, because polling showed the support for a Chiefs roof.I'm sorry, KU, but I must disagree with your reply. Yes, the Chiefs win more often than the Royals, but team revenue relies upon the SUPPORT of fans and their WILLINGNESS to forfeit their income for a product. The fans DEMAND a scarce product; the fact that they approved improvements to both stadiums illustrate that demand. However, only to a certain degree (although I am confused as to why a football stadium needs a rolling roof and a baseball stadium doesn't. That is where winning may play a factor, although technically it doesn't add up).
The store of the roof - the NFL said that if the Chiefs had a roof they would be guaranteed to host a Super Bowl. Then the MLB said if Royals had a roof they could host an all-star game. (Which is a little ridiculous considered at the time the all star game is played we rarely have inclement weather). So then they began tinkering with roof designs. Most people rejected the idea of a fixed roof for either. They though of a retractable roof for the Chiefs. Then someone got the bright idea to spend a lot of money on a Giant Canopy Roof, that would roll between the two stadiums. It is something that hasn't been done and would be very unique. Then they started adding more ideas, an events plaza between the two stadiums and and ampitheater. So I think it got defeated because it was just too much, however I feel that if the Royals had a better record it would have passed.
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I read, however, that Kansas City is interested in an NBA team. Please, take my Sonics or the Portland Trail Blazers. Trade for the Royals!
KC is building the Sprint Arena downtown. Right now we have no team for the Arena. The have taken the if you build it they will come attitude. The are looking for an NBA or NHL team. When the plans were first proposed there was talk about an NHL team being on the hook, but this occured at the time of the strike. I think they just hope some team will come. Perhaps the Kings will come back to KC.
QUOTE
buccoman:
these teams, and especially ones with a 120 year history like the Pirates, belong to the communities. Taxpayers paid for beautiful PNC Park in Pittsburgh.
And there we have the myth of 'hometown teams' in a nutshell, which I'm sure these (m/b)illionaire owners laugh uproariously about. These teams are private enterprises picking the pockets of sucker fans (and non-fans) whenever possible, and don't forget it.these teams, and especially ones with a 120 year history like the Pirates, belong to the communities. Taxpayers paid for beautiful PNC Park in Pittsburgh.
"Small-market" team is a misnomer when judging economic status; there are small-revenue teams.
I agree with you on the no small markets, but small revenue teams. Green Bay is in no way a struggling team, but is definitely small market. The Marlins are in no way a small market team, but definitely small revenue (based on the worst owner MLB has seen in a while.)
I remember laughing at an article once that called the A's and White Sox small market. So what would they consider the Giants and Cubs??
I remember laughing at an article once that called the A's and White Sox small market. So what would they consider the Giants and Cubs??
Haha, I do see where you're coming from, Dan, about the "small market" franchises. But, if you look at it from the overall standpoint of the league itself, Oakland and Chicago (AL) ARE small-market teams. They don't spend money extravagently (sp?) like the Cubs and Giants (how loaded are THEY with bloated contracts on mediocre players). Billy Beane just happens to be the most brilliant GM in the game right now and no matter how much talent he dumps, he ensures his farm system is plentiful. I can't, however, support his choice of free agents (Frank Thomas, Milton Bradley, and Mark Kotsay? That's the best he could do?). But whatever, they win and that's the important thing (except their attendance is sparse at best).
And back to KU, I'd love to read what you did about the NFL and MLB passing over KC for All-Star and Super Bowl games. They won't do it because of the lack of an enclosed space? Football is MEANT to be played outside (even in February)! And the All-Star game is ridiculous anyway (and played in July), so I've already grown tired of where the games are played (how many more times do we have to watch games played in FLORIDA?). Fascinating.
And back to KU, I'd love to read what you did about the NFL and MLB passing over KC for All-Star and Super Bowl games. They won't do it because of the lack of an enclosed space? Football is MEANT to be played outside (even in February)! And the All-Star game is ridiculous anyway (and played in July), so I've already grown tired of where the games are played (how many more times do we have to watch games played in FLORIDA?). Fascinating.
The current ownsership group bought the Pirates for about 150 million dollars, and the franchise is now valued by Forbes at about 375 million. Successful business but bad baseball team. In what other business can your product be so bad, but your business grow and prosper? ...As for the Royals, that's a beautiful ballpark (way ahead of its time), but what a terrible location right there on I-70. Add the roof? Why? I hate indoor baseball. Smart voters, if you ask me...
Well, in what other business would you be able to extort a new facility at $250M-$750M by threatening to leave the location. I guarantee if Sprint said its facilities in Overland Park, Kansas were out of date and not on par with other wireless companies, Kansas would give it some tax credits, but not build it a $300M new building. The reason so many teams' values have shot up is because you get a part of the new ballpark or at least a sweetheart deal to go with it. It's good to see places like Kansas City where people know when enough is enough.
And I agree - Kauffman is a gorgeous stadium in a mediocre location. It was always good when I wanted to see AL games while living in St. Louis - easy back onto Highway 70. I actually saw a game there once where the grassy hill behind the outfield caught fire. Much more interesting than the Royals and Jays.
And I agree - Kauffman is a gorgeous stadium in a mediocre location. It was always good when I wanted to see AL games while living in St. Louis - easy back onto Highway 70. I actually saw a game there once where the grassy hill behind the outfield caught fire. Much more interesting than the Royals and Jays.
Pirates win! Pirates Win! Pirates win!
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buccoman:
Pirates win! Pirates Win! Pirates win!
When members get this excited after a team's win, you know that it's gonna be a LOOOONG season. But the Bucs had a good idea in killing our hopes early, as opposed to making us agonize for weeks. Keep that bar low. Pirates win! Pirates Win! Pirates win!
Btw, speaking of the Pirates, my buddy Chuck Finder is a columnist for the Post-Gazette. Here's one of his columns, called \"We Will\" , taking jabs at the slogan for this year's team. I think it's highly entertaining.
Dat's a hysterical column....poor Pirates.
Despite their ineptitude, I always find a way down for a game there. I am sure this season will be no different.
Despite their ineptitude, I always find a way down for a game there. I am sure this season will be no different.
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Falconpride:
Btw, speaking of the Pirates, my buddy Chuck Finder is a columnist for the Post-Gazette. Here's one of his columns, called \\\"We Will\\\" , taking jabs at the slogan for this year's team. I think it's highly entertaining.
Hey, Falcon. nice to see a Pittsburgher on here. Finder is your friend? Does he post on here? lol Anyway, the "small market" Pirates win two in a row over the (hapless?) Phils!!!!Go Pirates. Go Royals. Go Tribe! Mostly go Buccos!
QUOTE
buccoman:
Pirates win! Pirates Win! Pirates win!
When members get this excited after a team's win, you know that it's gonna be a LOOOONG season. But the Bucs had a good idea in killing our hopes early, as opposed to making us agonize for weeks. Keep that bar low. Pirates win! Pirates Win! Pirates win!
Btw, speaking of the Pirates, my buddy Chuck Finder is a columnist for the Post-Gazette. Here's one of his columns, called \\\"We Will\\\" , taking jabs at the slogan for this year's team. I think it's highly entertaining.
QUOTE
blueraider:
Dat's a hysterical column....poor Pirates.
Despite their ineptitude, I always find a way down for a game there. I am sure this season will be no different.
That ballpark (PNC Park, of course) they gots' in the 'Burgh is just too beautiful to NOT go....Bit of a trip from Buffalo but worth every mile! Go Bucs!!
Dat's a hysterical column....poor Pirates.
Despite their ineptitude, I always find a way down for a game there. I am sure this season will be no different.
"Friend" is a generic term I use for "acquaintance". Chuck and I talk every now and then, and he offered to write me letters of recommendation to any school to which I applied (not that I needed them, as I was accepted anyway--I'm smart like that 
). And no, Mr. Finder doesn't post on here, I don't know many breeders that do.
And Blue, the next time I speak to Chuck, I'll pass along your approval of his column. As a fellow journalist, I'm sure he'll appreciate it wink .
). And no, Mr. Finder doesn't post on here, I don't know many breeders that do. And Blue, the next time I speak to Chuck, I'll pass along your approval of his column. As a fellow journalist, I'm sure he'll appreciate it wink .
Same story with the D-Rays, they made 20 million last year, the owner Vince Namoli was padding the profits knowing he was about to get bought out.
Zach Duke and the small market Pirates 8-0 over the Cubbies yesterday. They have to face Pedro and the Mets tonight.....
A's swept 2 in Anaheim from the "big market" Angels. A 1-0 nail biter and a 10-3 that was not as close as it looked as the A's scored 6 in the 9th inning.
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