A billion pardons as I try and make Pirates-Warriors-NBA owners-David Stern-TV into slurpable soup.
Leaked financial documents show the anemic Pittsburgh Pirates to be simultaneously be rolling in cash and BS. Usually, I would read this type of story, shake my head at Major League Baseball, and gchat my existence down to a nub. And usually, there’s more than baseball on TV. So, extra time led me to catch this via stat-monger economist David J. Berri. DJ wrote up the Pirates situation, and followed that with a parsing of the Lacob-Kawakami interview. He summarized:
“The Warriors are similar to the Pittsburgh Pirates. But despite buying a team that hasn’t won, Lacob still expects to make money with this team. And note, he didn’t say ‘well, if we win we can be successful.’ No, he is saying that making money is almost guaranteed.”
Oh, it’s noted. Every time the Warriors bleat “luxury tax!” from here on out, it’s noted. And, as the permanent ink on that note dries at the speed with which it was penned, I wonder how Lacob can count on making bank when the League is crying poor. I asked David Berri how he felt about Stern’s 400 million dollar loss prediction:
“I find Stern’s argument to be unbelievable. And I think what we see the owners do undermines his case.The sale price of the Warriors, the statements of the new Warriors owner, and the money paid to free agents suggest Stern’s owners don’t agree with Stern.”
Per that statement, I did some rudimentary number crunching below:
Total MLB roster payroll $2,646,178,018
Avg per team: $88,205,934
Total NBA roster payroll $1,880,001,921
Avg per team: $58,750,060
Payroll gap between MLB & NBA: $766,176,097
NBA 2010 Finals per game TV audience: 10.6 rating, 18.1 million viewers
MLB 2009 World Series per game TV audience 11.7 rating, 19 million viewers
NBA 2010 Finals highest rated game: 18.2 rating, 28.2 million viewers
MLB 2009 World Series highest rated game: 13.5 rating, 22.8 million viewers
More sportswriters should ask how the NBA geysers money despite paying out 766 million less than the MLB shells in salary. If–as we’re led to think–salaries have gotten out of hand, the owners need to be saved from themselves, the sky will puke goat diarrhea if changes aren’t made, then… where are the real losses coming from? Admittedly, championship ratings are a very incomplete barometer of sports league health. But given the financial opacity that cloaks pro sports, writers have little to go on.
Also, if ratings are decent, and salaries are low relative to the league that makes it rain on the Pittsburgh Pirates, then how is athlete compensation the main problem? If the NBA really has lost one billion dollars over the last five years, there’s likely a flaw more endemic than employee overpay. I’m not calling anyone a liar, but more information would be helpful–especially in lieu of our sad-sack Dubs clearing a 450 million buck price tag. If we’re running teeth-first into a soul-scratching NBA work stoppage, I’d like to know why.
UPDATE
I should have originally posted the Lacob quote that led to this piece. Here it is:
“This is an incredible business opportunity. Turning this into a winner No. 1 and running this business better in certain ways… Look, sports franchises appreciate 10% a year on average over three decades, the last three decades. There’s no reason to think this won’t appreciate in value. So that is the least of my worries. We will make money on this team in appreciation of value.”
I would also add that baseball has more games, different revenue sharing system, etc. Obviously these factors influence profit, but that is my point: If the NBA is losing money, the issue has to be more systemic than salary.
Title should read, “Lacob, Stern and the Mysterious $150 million.”
Interesting how the NBA can afford to give itself that much money in such hard times.
Or, Lacob bought the team in anticipation of a new CBA completely turning the economics of the nba into something better. That would make far more sense . Its not like the warriors have a ton of tickets to sell or can get into a new arena in the next 3 years.