While most of the attention this past weekend was paid to the exhaustive and detailed outline of what the safety and health protocols and procedures would be for MLB to resume action, MLB owners attempted to cloak their projections of losses for a season behind closed doors underneath that. However, it didn’t take long for a host of observers to call a range of bullshit on that.
It feels as though the owners took their 10.4B revenue total from last year, claimed that 39% of that revenue was from tickets and game-day sales (concessions, merch, parking, etc), and multiplied that 10.4 figure by .39. That was before adding on loss of TV revenue and any other loss they could come up with and cutting those in half that definitely don’t pass the smell test. As Craig Edwards at FanGraphs and others have pointed out, it’s unlikely that if there is a half-season of baseball, networks are just going to automatically cut in half what they pay for a full season. The projections also ignore that a lot of teams partially or fully own their regional sports networks (or RSNs), which would certainly interfere with the numbers the owners are claiming here.
When it comes to the ticket numbers, even that could be fudgy. Much like the amateur draft bonus structure, loss of tickets have been listed as total losses in this report. But much like the amatuer draft, that’s not entirely true. MLB teams won’t be forking over anywhere near what they would normally for the draft, as the players agreed to sell out amateur and international players by deferring their bonuses over the next two seasons as well as cutting the draft to five rounds. Those bills will come due, but they’re not coming due this season, so they are not losses this season, even if they are listed as such. By the time owners have to pay the back-dated bonuses of 2020 draft picks, their revenue streams, one would hope, will be up and running again.
That’s partially the case as well with tickets. MLB teams still have most of their season-ticket money. Every team is offering either credits or refunds for April and May so far, but will be offering both for the full season shortly, you’d have to guess at least. As you might imagine, they’re pushing the credits. Refunds involve calling or emailing a rep. Credits to 2021 are automatically applied if ticket holders take no action.
MLB teams won’t release what percentage of their tickets are season tickets, and they certainly won’t tell anyone what percentage of season-ticket holders have opted for credits or refunds. They’ll want the players to believe that every single season-ticket holder has requested a refund and then turn their empty pockets out, but that’s not reality. Given the realities of the world right now, and the unemployment rate and iffy employment statuses elsewhere, it is likely that more season-ticket holders will get refunds than might normally. But that’s not all of them.
Which means that the owners are getting to hold some season-ticket money as a buffer against the tickets they won’t get to sell this year. And the single-game tickets they sell next year will be a buffer against the season tickets that have been credited from this one. They’re not equal and the owners will take a loss, but it’s not what they’re telling you and it’s over two years. And you can bet that when the owners get back to selling single-game tickets next season, they’ll be dotting the schedule with more “premium” games that they can charge more for to try and make up more of the difference. If you think baseball owners aren’t evil enough to try and raise ticket prices after a pandemic, then your optimism is a beacon of light we could power a couple small towns by.
Take the Cubs, who last week had their owner Tom Ricketts claim that tickets and game-day revenue made up 70% of the team’s total revenues. This is a combination of regurgitated horseshit escaping Ricketts’s lips and odd-timing, as the Cubs were still in the process of getting their own RSN off the ground and had not yet come to terms with Comcast and other outlets. Those will be huge revenue drivers when they come to an agreement. As the Cubs, and every other MLB team, haven’t and will never open their books, we’ll never have a true idea just how wide off the mark this claim actually is.
But still, even if we take that at face value, and we’ll have to do a lot of stretching and straining to do so, the Cubs drew three million fans last year. Even the most conservative estimate would have a third of those being season-ticket holders. If half the season ticket holders took the credit for this season and into next, at an average ticket price of $128, that’s $64M that the Cubs can simply hold onto this year. Again, that’s conservative, back-of-the-napkin-math, and that’s also the shell game all owners are playing everywhere. It also doesn’t take into account the money owners are saving by not having to pay concession staff (if not contracted out), far less security people, ushers, attendants, etc. Teams have already pledged $1M each to gameday employees, but in order for that to not be lower than the total of what they would normally spend on gameday staff, teams would have to only spend $12,000 per game on hundreds of people who work a normal game at each stadium. Based on what the Dodgers are doing, you can bet this is actually quit the savings.
But you throw these giant numbers out there to turn fans against the players in a PR battle, whether they’re true or not. As we’ve learned the past four years, the truth rarely matters when trying to court the hearts and minds of the irretrievably stupid.