By Brian Gayso
I wonder how many times Pittsburgh Pirates owner Bob Nutting and President Frank Coonelly have watched “The Producers” together?
I mean, the main characters in the movie come up with a brilliant idea to make money in Broadway. They realize a show that flops can make them more money than a hit show, so they decide to make the worst possible show they can, expecting it to not to run past opening night.
The Pirates have put their best “Producers” impression on display at PNC Park over the past few years, trading away players such as Jason Bay and Freddy Sanchez in order to prepare for the future.
Despite the on-field product, the Pirates earned $25 million in operating income last season according to Forbes.
Yes, these are the same Pirates that lost 105 games last season.
In addition, the Pirates earned an average of roughly $15.6 million in each of the past seven years.
Over those same seven years, the Boston Red Sox earned an average of only $5.3 million per year, including four years in which they lost money.
These same Red Sox made the playoffs five times during those seven years and won two World Series championships.
How can a successful team struggle with income while a losing team can make money?
Before blaming the Pirates for making out like bandits, blame Major League Baseball. Forbes reports that the league took around $400 million from large market teams, like the Yankees, and distributed the money to smaller market teams, allowing teams like the Pirates to turn a profit, through revenue sharing.
The main problem is that no one knows for sure where the revenue sharing money is being spent by teams. Nutting and Coonelly say that they use the money to improve the team, but the results have shown otherwise, as the team has yet to reach the .500 mark in the past eighteen years.
What can be done to fix this problem?
Here are three ideas that might work:
1. Put stricter rules in place requiring revenue sharing dollars to be spent on player development and payroll.
A team can say that they are spending revenue sharing dollars on player development costs and payroll, but the only ones that really know where the money is going are the teams themselves. The league currently requires teams to spend revenue to “improve [their] performance on the field,” according to the SportsBusiness Journal. There is too much gray area in this wording, and there needs to be stricter regulations. If the league mandates that all revenue sharing money is spent either on player development or on the player payroll, teams should be able to become more competitive. In turn, this should generate more interest in the teams in their respective markets, hopefully increasing attendance. This, in theory, would lead to higher revenues for these smaller market teams, making them less reliant on revenue sharing and allowing the larger market teams to not give as much towards the fund.
2. Only allow a team to receive revenue sharing funds once every three years. This concept will force smaller market teams to not become dependent on revenue sharing money year after year. Teams will need to find other ways to increase their revenues, which will hopefully make them spend more money on players and player development. This concept would appease owners of larger market teams because they will not need to pay money to the smaller market teams every year.
3. Big market owners are unlikely to want a salary cap, so a hard salary floor may be the next best thing. By requiring teams to spend a certain amount of money on player payroll, teams should become more competitive and, in turn, allow for teams to become more profitable through increased interest in the team. If the smaller market teams can improve their profits on their own, they will not need to rely on big market owners for money.
The current collective bargaining agreement expires this December, and the SportsBusiness Journal writes that revenue sharing is likely to be a key issue. Hopefully the issue can be resolved and a solution can be found to help to make all teams competitive, something Pirates fans would love to see.
In the mean time, Pirates fans can only hope this season turns out the way the Broadway show did in “The Producers;” becoming the talk of the town despite all efforts to fail.
I mean, the main characters in the movie come up with a brilliant idea to make money in Broadway. They realize a show that flops can make them more money than a hit show, so they decide to make the worst possible show they can, expecting it to not to run past opening night.
The Pirates have put their best “Producers” impression on display at PNC Park over the past few years, trading away players such as Jason Bay and Freddy Sanchez in order to prepare for the future.
Despite the on-field product, the Pirates earned $25 million in operating income last season according to Forbes.
Yes, these are the same Pirates that lost 105 games last season.
In addition, the Pirates earned an average of roughly $15.6 million in each of the past seven years.
Over those same seven years, the Boston Red Sox earned an average of only $5.3 million per year, including four years in which they lost money.
These same Red Sox made the playoffs five times during those seven years and won two World Series championships.
How can a successful team struggle with income while a losing team can make money?
Before blaming the Pirates for making out like bandits, blame Major League Baseball. Forbes reports that the league took around $400 million from large market teams, like the Yankees, and distributed the money to smaller market teams, allowing teams like the Pirates to turn a profit, through revenue sharing.
The main problem is that no one knows for sure where the revenue sharing money is being spent by teams. Nutting and Coonelly say that they use the money to improve the team, but the results have shown otherwise, as the team has yet to reach the .500 mark in the past eighteen years.
What can be done to fix this problem?
Here are three ideas that might work:
1. Put stricter rules in place requiring revenue sharing dollars to be spent on player development and payroll.
A team can say that they are spending revenue sharing dollars on player development costs and payroll, but the only ones that really know where the money is going are the teams themselves. The league currently requires teams to spend revenue to “improve [their] performance on the field,” according to the SportsBusiness Journal. There is too much gray area in this wording, and there needs to be stricter regulations. If the league mandates that all revenue sharing money is spent either on player development or on the player payroll, teams should be able to become more competitive. In turn, this should generate more interest in the teams in their respective markets, hopefully increasing attendance. This, in theory, would lead to higher revenues for these smaller market teams, making them less reliant on revenue sharing and allowing the larger market teams to not give as much towards the fund.
2. Only allow a team to receive revenue sharing funds once every three years. This concept will force smaller market teams to not become dependent on revenue sharing money year after year. Teams will need to find other ways to increase their revenues, which will hopefully make them spend more money on players and player development. This concept would appease owners of larger market teams because they will not need to pay money to the smaller market teams every year.
3. Big market owners are unlikely to want a salary cap, so a hard salary floor may be the next best thing. By requiring teams to spend a certain amount of money on player payroll, teams should become more competitive and, in turn, allow for teams to become more profitable through increased interest in the team. If the smaller market teams can improve their profits on their own, they will not need to rely on big market owners for money.
The current collective bargaining agreement expires this December, and the SportsBusiness Journal writes that revenue sharing is likely to be a key issue. Hopefully the issue can be resolved and a solution can be found to help to make all teams competitive, something Pirates fans would love to see.
In the mean time, Pirates fans can only hope this season turns out the way the Broadway show did in “The Producers;” becoming the talk of the town despite all efforts to fail.
Tidak ada komentar:
Posting Komentar