Do Be Careful What You Wish For (if the Atlanta Braves are to be Sold)

SunTrust Park rendering, via AtlantaBraves.com

If the Atlanta Braves are Sold… What Will You Get?

EDITORIAL:  In the past 16 hours or so, I’ve seen a lot of twitter comments from people reacting to this notion/rumor/idea originating from a whole bunch of fans.

It’s been essentially unanimous: dump Liberty Media and get (a) an owner that cares; (b) an owner that will return the Braves to what they used to be; (c) an owner that will spend money on the team.

It’s fascinating to me how many people seem to equate “caring” with “spending money”.  I do believe, for instance, that oft-criticized Orioles’ owner Peter Angelos “cares” about his team.  Yet his 2015 Opening Day payroll ranked 17th among the 30 MLB teams.  I believe Fred Wilpon cares about his New York Mets.  They opened the season ranked 21st in payroll.

Payrolls vs. Media Markets

There is actually a tighter correlation between each team’s home city and their ranking as a media market rather than other factors such as “how rich the owner is”.  Here are those rankings for the latest season, with media market ranks in parentheses:

(* = Canadian rank; sources:  deadspin.com; newgenerations.com)

Some teams have additional external factors that impact their spending:

• Mets:  a “crippling debt load” of roughly $700 million.
• Braves:  a bad TV contract deal; stadium issues
• Rays:  Stadium location, stadium, area demographics
• Arizona:  now have a ‘game-changer’ TV contract

At the same time, some have ownership that simply does not wish to spend beyond their means.

• Oakland (John Fisher/Lew Wolff):  “This is the way we do it in Oakland.”
• Houston (Jim Crane):  “It doesn’t bother me that people want us to spend more money. But it’s not their money.“
• Miami (Jeffrey Loria)… enough said.

How many other Ownership Entities Have Done What Liberty Media Has Done?

Sure, the Braves have indeed had a more-or-less stagnated payroll in the past couple of decades.  In 2000, their total spending ranked 3rd in baseball.  The low point was 2011, ranking 17th.

But was this all Liberty Media?  No, it really hasn’t been.  Liberty took over in 2007 from Time Warner.  Note that spending from 2004-2006 ranked 12th, 8th, and 13th.  Since then it’s been 16/14/13/16/17/15/16/13, with 2015’s results still pending (probably around 15-16 again).  In other words, it hasn’t really changed much since the end years from the Time Warner era… yet the numbers have increased:  $83 million in 2000 / $92 million in 2007 / $114m in 2014.

But aside from payroll, what has taken place?

• Liberty managed to work a significant TV deal renegotiation.  It isn’t a $1.5 billion deal like Arizona got, but they will  get $500m extra over time.  Not bad for negotiating with no leverage.
• They tried to work with the city of Atlanta for an entertainment complex adjacent to Turner Field.
• When the city failed to respond, they took the initiative to begin what’s now going to be the same kind of enterprise – next to Sun Trust Park in Cobb county.
• You want to see money spent?  The entire property in Cobb will see $1.1 billion of development before its done… with roughly 2/3rds of that guaranteed from Liberty Media and its partners ($360~$400 million coming from the taxpayers).

You see, there is merit to having owners invest in the team in this manner:  it generates new revenue streams that can be put back into the team.  But spending ‘extra’ money from year-to-year without those benefits is simply unsustainable… particularly from a company whose first responsibility is to deliver a profit for its stockholders.

Next: Math by the Millions