Nov
17

Biz of Baseball updates: CitiField and Mark Cuban’s troubles

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I ran across a few business-of-baseball related stories that I found interesting. They’re not Yankee-related, but perhaps you’ll like them too…

  • While CitiGroup is going to wind up cutting 52,000 jobs over the next few months, the Mets are claiming that the stadium naming deal is safe for now. Citi has contracted with the Mets to pay $20 million annually for the next twenty years for the rights to name the team’s new club. We’ll see how much of the $400 million payout the beleaguered financial institution can make. I wonder if a naming rights deal is the best use of the bank’s government bailout fund.
  • The SEC levied some insider trading charges against Mark Cuban today, and that will probably be the final nail in the coffin containing his bid to buy the Cubs. The MLB owners have long resisted allowing Cuban into their exclusive club, and this development gives them the perfect excuse to turn him down. Sam Zell would do well to hold onto the club until the economy improves a bit.
  • The AL Champion Rays, despite finishing 26th in attendance in 2008, plan to raise ticket prices for next season. As questions have emerged about the long-term viability of baseball in the Tampa area, it will be interesting to see how potential fans react to the higher ticket prices.
Categories : News
  • Steve

    ‘Don’ Selig set up Cuban. He just didn’t want a messy lawsuit when he rejected Cuban, so he had some of his friends in Washington trump up these charges.

    He’s innocent. Once Cuban agrees to drop the lawsuit ‘Don’ Selig will make this little problem go away.

    • http://www.spartacus.schoolnet.co.uk/CRsmithT1.jpg tommiesmithjohncarlos a/k/a Mr. Snarky Irrelevant Non Sequitur Jones

      “You have twenty-four hours to get us our money. And, just to show you that we’re serious… you have TWELVE hours to get us our money.”

      “I’m afraid I must insist. You see, my wife, she has been most vocal on the subject of the pretzel monies. As in, ‘Where is the money? When are you going to get the money? Why aren’t you getting the money now?’ And so on. So please, the money.”

  • Steve

    “As questions have emerged about the long-term viability of baseball in the Tampa area, it will be interesting to see how potential fans react to the higher ticket prices.”

    Long term viability? There are PLENTY of Yankee and Red Sox fans down there.

  • JeffG

    Cuban got rich of the dot com era – for those of you that don’t believe that that was an age of inside information, think again. You could probably make the analogy that it was the steroid age of investing.
    FINRA / SEC have been targeting insider trading for at least a couple of years now, expect for there to be more cases like this.
    Him getting off is not going to be that easy. Cubs? Don’t care – I’m a Yankee fan but, from what little I know of Cuban and the Mavericks he’s not really the baseball type. Especially for a historic team like the Cubs. This is not the Blue Jays pouring fog ice on the field for opening day.

  • http://deleted Randy

    i don’t get the whole inside trading thing cast as an illegal act. if you look at it in a larger context the system is exclusive. 90% of Americans do not have the means to be a player in the market. the insider trading laws go off this supposed fair playing field idea when the stock market excludes everyday citizens. i don’t see someone quick to offer some seed money to allow everyone to be a player in the market. in my mind, the system is inherently unequal so why not allow people to go with whatever tips they can get. there was never a fair, level field to begin with. i don’t see what he did as anything wrong. i felt the same way about Martha Stewart. her problem was that she lied about things instead of being forthcoming with info. that’s what really got her into trouble.

    • http://www.spartacus.schoolnet.co.uk/CRsmithT1.jpg tommiesmithjohncarlos a/k/a Mr. Snarky Irrelevant Non Sequitur Jones

      in my mind, the system is inherently unequal so why not allow people to go with whatever tips they can get.

      Because in publicly traded companies, inside information can create a situation where management/executives can use the access to information they have to extract a profit from a company at the expense of innocent shareholders. There is a public trust to fiduciary integrity that must be maintained, as the net worth of countless individual Americans is at stake.

      • http://deleted Randy

        Oh you mean like what happened to create this financial crisis (i know this isn’t EXACTLY what happened but you get my point)? I think integrity is the last thing that exists in this economic climate. It seems like a lot of the fellows who went with certain information i.e. consumer’s poor credit scores, etc. got a pardon while the rest of us are suffering.

        • radnom

          You’re not making any sense.
          At first you are saying there is nothing wrong with insider trading and that Martha Stewart types did nothing wrong.
          Then you said that sort of thing is bad because things like it created the financial crisis (not true, but irrelevant).

          There are definitely reasons insider trading is illegal you must be able to see that. And it is not true that “90% do not have the means to be a player in the market”. I am a college student with modest source of income and already have a presence in the market. It’s a small one, but people like me are the people who get screwed if you allow insider trading to go unpunished.

          • http://deleted Randy

            i am not connecting insider trading to what happened with the mortgage issue. I was using the mortgage issue as an example of integrity not being a part of the equation. If that wasn’t clear i apologize. And it is true that the heads of these companies took advantage of people with bad credit and benefited when all of these people couldn’t afford their mortgages. When the shit hit the fan they took all their money and ran. That it was created the snowball effect. How is that untrue or irrelevant to the financial crisis?

            I commend you on using whatever economic resources you have as a college student to go in the market but there are plenty of people who do not have that luxury. They can’t afford rent, they can’t afford to pay for their kids’ education and they are having trouble holding on to their jobs. So how can they think about getting into the market? I don’t know your personal situation but I will assume that you don’t have a family to support, you don’t have a mortgage, you don’t have to pay student loans back, you don’t have bad credit (i really hope you don’t), you don’t have a huge car note and you don’t have to worry about losing your work study job. I’m in grad school and I don’t have to worry about most of that so I’m pretty sure you don’t. There are plenty of people in this country with major issues they must contend with and the privilege of playing with stocks all day is not one of them.

            And speaking of unpunished, shouldn’t these guys who are getting major severance and bailout packages get punished? They seem to have had a larger impact on everyday American lives than Mark Cuban or Martha Stewart has.

            • Andy In Sunny Daytona

              Martha Stewart lied to the government. That’s why she went to jail. Period.
              Mark Cuban is not facing any jail time at all.

              • RustyJohn

                The way I see it, the government lies to us everyday- it would be a just world when the politicians are in jail instead of the people who actually create jobs.

                I digress…

                Let that be a lesson to everyone- whenever a lovely Agent of the State arrives at your home or place of work to question you, tell them to fuck off.

            • radnom

              Alright, thanks for clarifying what you meant when referring to the current crisis, but I still have to disagree that just because people are getting away with shit doesn’t mean its wrong.
              I wish all of those people who were breaking the law could be punished but its hard to have oversight on the people who hold the power. Still, any victory is still a good thing.

              And in terms of the mortgage crisis I blame the government more that the companies (although there is plenty of blame to go around). There never should have been the level of deregulation that there was to even allow loans/mortages like that to be legal.
              Hopefully Obama will be a step in the right direction here, as Bush was a total pawn to that (Clinton, somewhat as well).

              Finally, I definitely hear you about not having to support a family, pay a mortage, etc. I am lucky and I know it. I know there are people who will never have the means to enter the market. But the claim that it is out of reach for 90% of people is just not true.
              I’m on an extremely limited budget and still manage to save a little away each week, month year to put towards the future. I feel like more than 50% of Americans could do the same if they wanted (conservative estimate too). The problem is they run up credit card debt and buy mortages they can’t afford. Its a shame.

  • gregori

    regarding citibank.
    do some math.
    52,000 job cuts is approx $3 billion per year in savings in salary, taxes and benefits
    that’s $60 billion in the same 20yrs in which $200 million would be spent on the naming rights.
    noting this, one would think this is something of a non-issue.

    • http://www.riveraveblues.com Ben K.

      It might be a small percentage of the total savings from jobs, but it’s still gotta sting to see the company shelling out a comparatively decent amount of money for the money rights when your job is going bye bye.

  • Januz

    I guess Citi Field is right up there with Enron Field & Ameriquest Field as FAILED corporate sponsorship of baseball stadiums. I like the fact, that the Yankees are keeping the name Yankee Stadium, instead of some ugly corporate name.
    As for the future of Citi Field, I do not think the name “Citi Field” will last beyond 2009, not only because Citi can’t afford it, but because the image conscious Wilpon’s do not want to be identified with a company who fired 53,000 people (Remember, how they stress how they use UNION LABOR on the Citi Field construction?).
    Image aside, the Mets always seem to do things on the cheap, and their stadium is so much less, than Yankee Stadium it isn’t funny. Note the following. Source: baseball.suite101.com/article.cfm/stadiums_under_construction – 32k “Here are cost and capacity figures for the four 2009 facilities drawn from official and other published reports:

    Yankee Stadium (52,300)–Up to $1.9 billion.
    Citi Field (45,000)–$850 million.
    Dallas Cowboy Stadium (80,000)–$1 billion-plus, including $325 million from City of Arlington, $150 million from National Football League and remainder from Cowboys Owner Jerry Jones
    TCF Bank Stadium at the University of Minnesota (50,300)–$285 million
    If costs for Yankee Stadium finish at $1.9 billion, the price runs to more than $36,000 per seat, by far the highest unit cost. The Citi Field and Cowboy seat costs are about half that and the TCF Bank Stadium cost runs about $5400 per seat. Land value and labor costs vary considerably between New York City and the Minnesota university campus………….”.

  • Brad K

    Baseball anyone? Just kidding. I think CitiField is in trouble. I’m sure that the Wilpon’s don’t want to hear people (customers) complaining about tax payer monies being used to put their name on a baseball stadium, think AIG. In fact this whole mess is likely to cause a major shift in sports marketing across all sports. There is a tremendous tie in to sports by financial institutions and all of these relationships are likely to be questioned. This is true not only for the Citifields of the world but for just about every sport. The repercussions from the current crisis will be felt in sports for a long long time.