According to press rumors, Bud Selig and Peter Angelos will
step behind a podium any day now and announce how much MLB will
pay off the O’s owner for agreeing to put up with the Washington Nationals
taking up residence in the town next door. That, in turn, will allow the
Nats to sign a TV contract, so that D.C. residents can enjoy the pleasures
of their brand-new–okay, slightly
used–ballclub without getting up off the sofa.
Of course, those are the same press rumors that were floating around six
months ago, when Jayson
Stark reported of an Angelos deal that “the finish line is now so
close that one source said Tuesday: ‘I don’t see anything now that could
gunk this up.'” Like the revolution and Bruce Chen‘s career, it seems that
Angelos/Selig detente is forever just around the corner.
When the inevitable announcement comes, you can expect the newspapers to
present it as the happy denouement to a bitter but necessary squabble to
resolve the conflict between the interests of the league as a whole and
those of one particular owner. This is what those in the media-criticism
biz refer to as “horsecrap.” Regardless of what t’s are crossed in the
final agreement, it’s plain and simple: Bud Selig got mugged, and he has
no one to blame but his own fear.
The ostensible crux of this whole debate is TV rights. While innumerable
press reports have asserted that the Orioles have “territorial rights” to
D.C., this was never the case: according to baseball’s bylaws, Baltimore
territory includes several suburban counties in Maryland, and stops at the
state line.
What Angelos does have are the more nebulous “cable rights,” which
for the O’s extend clear to the Carolinas. This is par for the course in
the monopolistic world of MLB, wherein every cable system in the country
can be assigned to a specific team, even ones hundreds of miles from home plate.
They are, however, provisional rights–they’re owned by MLB, and
only granted to teams at the whim of the commissioner and the executive
committee. “My own reading of it,” says baseball economist Andy Zimbalist,
“is that Angelos doesn’t have any legal grounds to pursue this at all.”
Why, then, you may ask, is Bud Selig wasting his time negotiating with
Peter Angelos, then? Just give the man some lovely parting gifts, and send
him away to play the home version.
The problem is that Angelos is holding MLB’s traditional kryptonite: the
threat of an antitrust suit. Because the very existence of the
cable-rights pie is a function of MLB’s monopoly powers, an Angelos
lawsuit, even if it ultimately failed, could force Selig to air some
laundry he’d prefer to keep under the bed.
“I think that the discovery phase scares them to death,” says SABR
Business of Baseball Committee co-chair Maury Brown. “I think Angelos is
sitting there thinking, ‘I’m going to shove them into a corner, and
they’re going to bend and I’m not.’ I think he’s hoping they’ll ‘settle
out of court’–that’s how he dealt with
tobacco.”
From Angelos’ perspective, it’s a great gamble, because the potential
payoff is so huge. The package reportedly being offered by MLB includes:
part-ownership of the regional cable channel that would broadcast both O’s
and Nats games (talk has been of Angelos getting 60%, but that’s one of
the issues still being hammered out); a guarantee that if Angelos sells
the team for less than $360 million–a nifty $200 million profit on what
he paid for the Orioles back in 1993–MLB will cut a check to make up the
difference; and a promise of annual MLB payments if the O’s
revenues fall short of $130 million a year, which is more than 21 of 30 MLB teams took in last year. All this for agreeing to give up TV rights that all independent observers agree could be taken from Angelos for nothing if not for Selig’s fear of upsetting the apple cart of owner consensus, and risking having to open the books.
Okay, so nobody’s crying for Bud and his cronies, not when they’re
already sitting on a taxpayer-funded
stadium, a potential $300 million windfall when they finally get
around to selling the team, plus a likely $10
to $20 million in profits from the Nats’ inaugural season. The
Washington Times, in suggesting that Congress step in to settle the
Angelos tussle, harrumphed that “the competitiveness of the team that will
play its games within walking distance of the Capitol will be severely
constrained if Angelos is able to cut a deal with Selig to pocket a large
chunk of Washington-area television-rights fees,” but that’s nonsense –
any additional TV revenue would only have gotten rolled into the sale
price when the Nats finally get a private owner, so it’s only MLB as a
whole that’s getting hurt here.
No, the real trouble isn’t for Nationals fans, but for Orioles fans. As
Derek Zumsteg discussed here last fall, by guaranteeing Angelos’ bottom
line, MLB would be removing any incentive for him to put a competitive
team on the field. A rational capitalist would just call up the entire
Ottawa roster and let them play out the schedule, knowing that the
money will be rolling in one way or another (think Twins owner Carl
Pohlad and his mid-’90s “just keep those revenue-sharing checks coming”
rosters, if you’re having trouble visualizing). If Angelos has a brain in
his head, he’ll be dumping Miguel Tejada, Sammy Sosa and any other high-priced players the minute
he realizes that the fannies they put in the seats are only serving to
ease the burden on the other 29 owners’ wallets.
The other long-term repercussion would likely be to gum up the works for
any other teams that want to move to existing cable territories – not just
San Jose, but Portland (which “belongs” to the Mariners) and others as
well. Says Brown: “Now if they wish to relocate or expand, the whole
country is split up into cable markets, so if you want to go to Butte,
Montana, somebody has the rights. Maybe the Astros would ask for a payoff:
‘You did this for Peter, now you have to do this for us.'”
Of course, that’s only bad if you live in Butte (or Portland, as Brown
does). If you’re an A’s fan hoping for more roadblocks to your team’s
possible relocation, not so much. When elephants fight, sometimes the best
the grass can do is hope for gridlock.
—
Neil deMause is a regular contributor to Baseball Prospectus. He can be reached here.
Thank you for reading
This is a free article. If you enjoyed it, consider subscribing to Baseball Prospectus. Subscriptions support ongoing public baseball research and analysis in an increasingly proprietary environment.
Subscribe now