Right to it:
Bill (New Mexico): Business question. There’s clear evidence that the recession has affected some teams’ attendance, but has the recession changed the way the teams spend the money they do bring in? For example, are we seeing any teams favor a spending strategy that emphasizes the “visible” things (trading for high-priced guys, expensive draft choices, etc.) that bring in fans, over long-term investments like Latin American scouting? Not obvious to me, but what am I missing?
Shawn Hoffman: If anything, most teams are cutting back on the “visible” things and plunging more money into the DR and Venezuela. It looks like MLB will get through this recession relatively unscathed, but they were scared as hell this winter, and I think a lot of teams started to re-focus on ROI, instead of just trying to make a splash.
For what it’s worth, I think we’ll get a more bullish FA market this offseason than last year, but I don’t think the Carlos Silvas of the world will get 4/$48M for another couple of years, at least.
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dianagramr (NYC): Hi Shawn … thanks for the chat … You are the Commish for a day, and you are across the table from the MLBPA reps. What do you ask for from them (in terms of actually having a chance at getting).
Shawn Hoffman: I’m not sure there’s really anything. Mandatory draft slots? Ehh, I guess. But most of the problems with the current system are going to be fought between the teams, not between the owners and the players. And even with those (like revenue sharing), there probably won’t be any major changes to the current system.
Two things I would NOT ask for: a salary cap and a worldwide draft.
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Mountainhawk (Salem, MA): Why do you hate the idea of a cap so much? League with salary caps have proven successful. Leagues without inevitably result in a structure like the EPL, where a few teams have a shot every year, and the rest just hope they can get a bite of the apple. The NFL is the powerhouse league, the NHL has seen huge revenue growth since putting in the cap, and a city like Pittsburgh winning the cup when they would have had no hope a few years ago of competing financially. Caps are good for sports leagues. The Red Sox and Yankees are competitors only on the field, in business they are partners trying to maximize the take of MLB from the total entertainment pie.
Shawn Hoffman: Let me be totally upfront: I’m a Pirates fan. I was at Super Bowls XL and XLIII. Sidney Crosby holding the Stanley Cup is my desktop wallpaper.
Caps help competitive balance, no doubt, and that’s been great for my teams. But they break when team-by-team revenues aren’t virtually equal, b/c of payroll floors and guaranteed minimums for the players. That’s why the NFL owners (the supposed beneficiaries) voted unanimously to axe their CBA, and there’s a bankrupt NHL team about to get the Expos treatment. I’d rather my teams have a lesser shot at being good if it means keeping them in business.
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Grant (Chicago): Reasonable to assume as a follow up to cbelford’s question that the announcement that Heyward’s off to the AFL means the team will agree with you and not call him up in September?
Shawn Hoffman: …which is the logical move. Teams have become very aware of this in the past few years. Lots of people that the system, but as a fan of a small market team, I’d much rather have my guy for 6.5 years than have some of that wasted on a Sept. callup.
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Tony (Brooklyn, NY): How much of an annual “economic rent” do you think that the owners & players jointly extract from the fans by not letting the teams move to locations with the largest economic base (including concessions for new stadiums since only one or two teams is “bidding” to play in a given city). Thanks!
Shawn Hoffman: A lot. But Subway does the same thing by not allowing two franchises to be next door to each other. A team in Brooklyn would be great, but if it was a complete free market, you’d have every team in one of 5 or 6 cities, like you have in European soccer.
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mhixpgh (Pittsburgh): Hi Shawn. Are you a Pittsburgh resident? Or perhaps a Pittsburgh native? If so, do you think thePirates front office feels any pressure to put a winner on the field given the recent success of the Penguins and the Steelers? Current Pirates ownership seems to show no shame in making a slim corporate profit from the franchise.
Shawn Hoffman: I’m a New Yorker, but I had a “Terrible Crib” when I was born. Wasn’t really an option.
This Pirates front office has a plan and they’re sticking to it. The other teams winning hasn’t changed that. As far as the ownership goes, I think their problem was that they trusted Kevin McClatchy, who trusted Cam Bonifay, and then trusted Dave Littlefield. I don’t think they’re actually “trying to lose,” despite what many of my cousins say.
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Mountainhawk (Salem, MA): If the bankruptcy court forces the NHL to allow the move to Hamilton, do you think we could see baseball teams declaring bankruptcy to force their way into NY, LA or Boston?
Shawn Hoffman: That could cause some serious problems, since it would basically invalidate the franchise structure. Don’t see it happening though, the NHL will spend whatever it needs to to keep Balsillie out.
Feedback? Write a comment, or e-mail the author at shawn(AT)squawkingbaseball.com