132 replies to this topic

[dude]

wow....I just figured out how to do something with this message board by accident.....

[SportsGuy]

Don't forget...season ticket prices are less than individual tickets.

That being said, the rough estimates Matt is making are essentially spot on..a few million here and there is meaningless when talking about this.

We also have no idea how much they get out of concessions, fanfest, merchandise sales and I don't think radio has been mentioned either.

So, there is just no doubt that they should easily be able to pay another 40+ million over where they were in 2011.

[Matt_P]

Last year revenues (if you believe MLB) were something over 9 billion.  I believe (I guess i could search it, I didn't) it's gone up about 500M a year for a number of years now.

 

http://bizofbaseball...rials&Itemid=39

[RShack]

wow....I just figured out how to do something with this message board by accident.....

 

???

[JeremyStrain]

Last year revenues (if you believe MLB) were something over 9 billion.  I believe (I guess i could search it, I didn't) it's gone up about 500M a year for a number of years now.

 

Teams choose to spend whatever they choose to spend based on a number of factors, one of which is their net profit/lose profile.  Expenses drive their profit/loss profile.

 

THAT 47% includes all of that.

 

When the Orioles generate 10% more ticket sales, ticket price increases, additional MLB TV revenue, playoff revenue, .....etc....

 

They aren't generating (much) additional expenses associated with the additional revenue.

 

For whatever reason, you want to associate the next 50 million in new money with the first 100M and assume it's all available under the same expense profile.

 

 

I have no idea why this would be true.  Every team in baseball will announce it's ticket price (and average ticket price)  increases or decreases before the season starts.

 

Because that's how bookkeeping and accounting works.

[dude]

Because that's how bookkeeping and accounting works.

 

According to the article (2001, Doug Pappas) that Matt linked, ...

Average ticket price is calculated on the unrealistic assumption that the team sells every available ticket at its face value.

[Matt_P]

So they probably went up another 500M in 2014 to get to 8.5 billion.

 

Likely crosses into 9B this year.

 

2013 was $8.5B. 2014 was $9B.

[dude]

Turns out someone did it for 2001. The average price of a seat was found to be greater than the average revenue of a seat. The difference is about $50M for all of baseball. That's $50M out of nearly $1.38 billion or about a 3.7% difference.

 

For the Orioles, the difference was -$2.10 per ticket in 2001.

 

http://www.baseballp...?articleid=1294

 

I'd be interested to know if this is true today.  

 

I'm confident the average revenue for a ticket sold is less than the total face value (first discount covers that).....but given the explosion of attendance, new stadiums nad the high dollars seats....I'd be pretty shocked if that was still true from 14 years ago.

 

Maybe.

 

What I also find interesting is this data he uses looks like it's from the same data dump exposed (I believe) through the Labor strife they had back then.  One of the links I've kept for many years has one of the only rollups I think we've seen before or since.  if this link still works...from USA Today

[dude]

So they probably went up another 500M in 2014 to get to 8.5 billion.

 

Likely crosses into 9B this year.

 

ok....so 9B was correct (I thought I had heard it before)...either way....<<shrug>>

[Matt_P]

What I also find interesting is this data he uses looks like it's from the same data dump exposed (I believe) through the Labor strife they had back then.  One of the links I've kept for many years has one of the only rollups I think we've seen before or since.  if this link still works...from USA Today

 

They do indeed link to that article.

[JeremyStrain]

According to the article (2001, Doug Pappas) that Matt linked, ...

 

Which is the data they put out there publicly on the team site, that's not actually accounting, nor is it used when talking about revenue. That's like saying how many seats they have, it's describing the park, not the financials.

 

Has nothing to do with the conversation about revenue, payroll or % allocated. In the money sense, the average ticket price, like I said, is calculated after the season when they get the ticket revenue and divide that by the number of tickets sold. It's how you account for discounts, price tiers and so forth.

 

Semantics between descriptive price and accounting price, but that one doesn't have any connection to finances, which is where I thought this conversation was.

[dude]

They do indeed link to that article.

 

Maybe I'll just share my opinion this way...

 

Baseball teams are toys for rich people.  Angelos (or any other owner in general) aren't using the team to put food on the table or send their kids to school.  I'ts not about monthly expenses and your 401k.

 

I don't believe that owners have an obligation to spend their own money....you have guys like Illitch that clearly do....but I also think it's absurd for a billionaire to hoard millions off his toy just because.

 

My perspective of 'available resources' is a zero balance at the end of the day.  Regardless of what you (owner) can personally do (if 20M fell out of Angelos' pocket, he wouldn't know)....I don't expect you to lose money on the team.

 

That said....if your revenues go up 25M....that IS new revenue that you can use (leverage organizational resources) to improve the product that you are responsible for in a community sense.

 

Suggesting that a team should only spend 47% of new resources BECAUSE of some MLB pending percentage is silly.  He can spend 10%, 50% or 100% of new money....he isn't ever committing his own (non-baseball) resources when the new money is flowing in.

 

....and I get it if you want to say ANY spending is in theory a loss.... but I'm coming back to the thought the resources of the organization are available to the organization.

[fishteacher]

So, I hear Buck Showalter went to Peter Angelos right before Christmas about possibly going after Max Scherzer,  I think this was their interaction....