For MLB, 2009 brought money, money, money

Pondering Sabathia's opt-out clause
Open Thread: A letter from Safe At Home

Despite a depressed free agency market brought about ostensibly by a bad economy, Major League Baseball enjoyed a banner year for revenue in 2009. According to Maury Brown at the Biz of Baseball, the 30 clubs drew in a combined $6.6 billion in revenue last year, a 1.5 percent increase over 2008. Brown believes that higher ticket prices charged at both new Yankee Stadium and Citi Field are partially responsible for the increase, and MLB retained its spot on the money-making scale right behind football. It will be interesting to see how these figures play out when the Collective Bargaining Agreement expires in late 2011. The money is out there, but many owners are trying to invest more wisely than in the past.

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Pondering Sabathia's opt-out clause
Open Thread: A letter from Safe At Home
  • bexarama

    The Yankees are bad for baseball!!!

    • http://twitter.com/tsjc68 tommiesmithjohncarlos a/k/a Archimedes Torquemada

      Damn, you beat me to it.

      Smart, fast, and chesty: the triple threat.

      • http://mystiqueandaura.com Steve H

        You were too busy thinking about your next movie quote Eric.

        • http://www.secondavenuesagas.com Benjamin Kabak

          Are you being bovercritical here, Steve?

          • http://mystiqueandaura.com Steve H

            What better way to insult a man than call him by his name?

  • http://mystiqueandaura.com Steve H

    Scott Boras just J.I.H.P

  • Chris

    If the NFL has a lockout in 2011, I wonder if that could be enough to push baseball into 1st in terms of revenue. In baseball, it seems that the Players Association and Owners realized that the best way to grow the pie was to avoid lockouts/strikes. I wonder if the (relative) labor peace in football has caused them to forget how much damage a strike can do.

    • Will

      Baseball’s revenue has been growing at a faster pace than the NFL’s for years. While football has remained primarily tied to its network deals, MLB has been leveraging its content in various areas, most notably the internet. It’s not a matter of if, but when baseball passes football.

  • Bob

    1.5% not 15%

    • http://www.bronxbaseballdaily.com Rob A from BBD

      Bob is right. A 15 percent increase would be crazy.

  • mustang

    How could this be when the Yankees just broke even last year?

    It’s Yankeesomics.

    • http://www.secondavenuesagas.com Benjamin Kabak

      Do you understand the difference between revenue and profit?

      • mustang

        And you don’t understand the concepts that YES Network and The Yankees are one in the same.
        Is this the same “Yankeesomics” you use to explain to me how Igawa’s $26,000,194 posting fee didn’t really count towards the Yankees bottom-line that only his salary did?
        Didn’t get that one either.

        • http://www.secondavenuesagas.com Benjamin Kabak

          His posting fee doesn’t count against the Yanks’ luxury tax payments. That’s all everyone has ever said about the Igawa money. The Yanks paid some money to acquire the rights to Igawa, and those dollars don’t count against the luxury tax. The salary they’re paying Igawa does. Anyway, what does that have to do with MLB revenues vs. individual team profits?

          If you don’t like the way Forbes calculates team profit margins, take it up with them. MLB doesn’t open its books. So that’s all we have access to. You choose not to believe them because of the value the YES Network has on paper. That’s your prerogative, and until we see the books, neither you nor I are right or wrong.

          • mustang

            “The New York Yankees’ value increased to $1.306 billion over the past year, according to the annual estimates by Forbes magazine” Apr 17, 2008

            Although I do understand what your saying the statement above is the end to the argument. Anything else is just playing with numbers by the Yankees, MLB or whoever.
            .

            • mustang

              “Yankees’ $69 million in earnings was by far the highest net income of any team”

              http://money.cnn.com/2009/11/0.....ld_series/

              Nice read

              checkmate

              • http://www.secondavenuesagas.com Benjamin Kabak

                Missing from that article are the revenue sharing figures and luxury tax payments the Yankees were due to pay. They had to fork over $25.69 million in luxury tax payment. So already, their $69 million is down to $44 million. The 2009 numbers aren’t public, but in 2005, the Yanks paid out another $75 million in revenue sharing. Although they can write off some of the cost of the new stadium from their revenue sharing bills, but they’re still stuck with a significant bill, and David Goldman doesn’t consider that either.

                Meanwhile, the team owes debt service on stadium financing plans and has a whole slew of other expenses not readily identified in that article’s simplified “Profit = Income – On-field payroll” expenses. The team makes a lot in revenue, and those dollars are reinvested back into the team. That’s why the Yanks have such a high payroll and why the owner’s profit margins are so low. The Steinbrenners choose to run the team that way.

                • mustang

                  “The Yankees’ 2009 revenue figure doesn’t even include additional playoff ticket sales they raked in, but most of that bonus playoff income will be offset by the hefty luxury tax that the team will have to pay this year.’

                  We didn’t read the whole thing now did we and yes I know they didn’t make 25.69 in playoff income.
                  But again you stated they probably broke even with the YES money these numbers don’t even count the YES money.

                • mustang

                  “That’s why the Yanks have such a high payroll and why the owner’s profit margins are so low. The Steinbrenners choose to run the team that way.”

                  Really LMAO
                  All I know is that I wish I could use “Yankeesomics” on my taxes.

                • Will

                  Mustang…you are woefully ignorant of economics. Please stop embarrassing yourself.

                  Are the Yankees a successful enterprise? Of course. As a team, are they just breaking even or operating in the red. Likely true as well. Just because the owners of the Yankees are also now successful (part) owners of a media company (YES) doesn’t mean you can transfer that over to the club. The Yankees baseball team is not operated at a profit, and hasn’t been for year. Period.

                • mustang

                  Again for the thousandth time the problem with your statement is that the Steinbrenner’s can borrow from the net worth of the team. And when your talking about $1.306 billion they are going to be OK.
                  The bottom-line is that the Steinbrenner’s can sell the team today clear of all debt (if they have any) and walk away with more profit then they had even a few years ago.
                  I may be “woefully ignorant of economics” and I understand trying to keep operating cost down, but isn’t the goal of business to increase the overall value of your investment? It seems to me that pointing out a small if any loss in the baseball teams operating cost in a successful enterprise like the Yankees is just nit picking to make an obscure point.

          • mustang

            “The salary they’re paying Igawa does. Anyway, what does that have to do with MLB revenues vs. individual team profits?”

            Nothing. But another example of playing with the numbers you tried to convince me once that somehow the 26 million posting fee didn’t matter to the Yankees bottom-line because they didn’t pay tax on it.
            The whole thing was the biggest mistake of the Cashman tenure. Trying to save 8 million or so on the tax by not signing Lily and blowing 46 million on an AAA pitcher.

  • http://kierstenschmidt.com Kiersten

    dolla dolla billz ya’ll.

  • http://i.cdn.turner.com/si/multimedia/photo_gallery/0902/mlb.alex.rodriguez.through.the.years/images/1993.alex-rodriguez.jpg Drew

    6.6 B is just sick.