Spending vast sums has not been in Toronto’s corporate DNA since the World Series days of 1992/93, when Toronto had the largest payroll in MLB (at $50-million). Indeed, the Blue Jays’ unwillingness to act like a large market, instead of the Mudville Nine, has confounded their fans and critics since the glory years of the early ‘90s.
As we pointed out last February, the club is the seventh-largest media market in MLB, but has a 2012 payroll commensurate with the 22nd largest market. Till this week, the team has never had a payroll over $100-million in club history.
Now, the Blue Jays have assumed the core of the Miami Marlins lineup and estimates are they’ll take on approximately $166-million in new contracts through 2018.
Clearly, the 2012 collapse of management’s Youth Will Be Served plan chastened the Blue Jays. While the season’s attendance and TV ratings were improved from 2011, Toronto finished 22nd in MLB attendance with an average crowd of 25,921 - 52.2 per cent of capacity. TV ratings surged early but levelled off late. Seeing their manager John Farrell depart did nothing for credibility, either.
So now critics have their wish with the Marlins trade. As dear old dad used to say at moments like these, “Where’s the money going to come from?” In part, from the new national MLB TV deal that brings the Blue Jays an extra $25-million a year starting in 2014. That can help defray Jose Reyes (who has $96-million left through 2018) and Mark Buehrle ($52-million through 2015).
If injury-prone Josh Johnson ($13.75-million in 2013) jumps the Jays in free agency after the season, that lessens the financial load even more. Toronto dumped $5-million a year when it dealt Yunel Escobar and $1.5 million when Jeff Mathis went in the same trade. GM Alex Anthopoulos could also trade a salary like Adam Lind ($5.15-million) or J.P Arencibia ($495,000) to create wiggle room. But it will be tight.
In other organizations, the team could raise the needed cash simply by increasing its regional TV rights fees. In this regard, Toronto has fallen way behind the MLB elite teams such as the Dodgers, who are estimating as much as $4-billion on a new regional TV deal. (Rogers won’t say how much Sportsnet pays, except that it’s a figure approved by MLB.)
But with Rogers owning both sides of the relationship, moving money from the left Rogers pocket to the right Rogers pocket is an accounting exercise not a spike in revenue. Shareholders will likewise be curious which branch of Rogers is cut to transfer any money to the Blue Jays.
There’s plenty of money to be made if the Jays reach a World Series. That’s the gamble in this trade. The Jays will need almost all of it to meet this new payroll.
“ robneyer @ robneyer Is Jeffrey Loria the worst person ever? Or just the worst baseball owner? Or neither?”
“ Michael Rosenberg @ Rosenberg_Mike I see how Jeffrey Loria got rich selling art. He charged taxpayers $479-million for a sculpture of his middle finger.
As we said yesterday, all this is anathema to the hockey culture. It’s news to NHL deep thinkers like Gary Bettman and Murray Edwards that the more you pay your stars, the more the public is intrigued by them. Look at the superstars of the NFL, MLB and NBA; the more Derek Jeter or Kobe Bryant or Peyton Manning is paid, the more they’re worth to their leagues in publicity.
The NHL believes otherwise, of course. Hammering salaries flatter than a copper penny is the linchpin of its parity party. The NHL shield is the only brand allowed. So the league and the NHL Players Association are now discussing, not just how to divide the NHL revenues 50/50, but how the NHLPA’s 50 per cent share should be spent.
This is a media age that wallows in celebrities like A Rod or Lebron James. For a league outside the pale in the U.S., creating stars is imperative. You can do that by paying Sidney Crosby what he’s worth to your business: $12-million a year. And paying the spear carriers a lot less on short contracts.
If you pay them like stars, that’s how fans will see them. But the salary micro-managing of this CBA, married to the NHL’s business 1990s plan of expansion and equity, will do nothing to position the NHL for that future.
An oldie, but a goodie
Back in the 2004-05 lockout we participated in a panel of 30 (including Scotty Bowman and other hockey and media types) to design a new CBA. The result was a plan that rationed contracts above a dollar threshold.
- Maximum two-year contracts for players based on performance.
- Pay scales ranging from a minimum $400,000 per season to unlimited amounts for one “franchise player” per team (such as Crosby).
- Outright free agency for players after 500 career NHL games or at age 28.
- Teams could move players between categories in the offseason.
The proposal was an elastic supply at the bottom end and room for teams to pay stars like stars at the top end. Instead, the current CBA has produced lengthy terms in contracts for players with just two years in the league, restricted supply at the bottom end of the pay scale and fourth-line players like Matt Stajan getting four-year deals.
To work within the python grip of a salary cap, the new CBA will need as much flexibility to assign value with the 50 per cent going to payers. That means the NHL needs to back off and let the market work.