Revenue Sharing, Is it Fair?

[GordonGecko]

Yankee fans and other teams often complain that they are unfairly subsidizing poorer teams, when they should be keeping all their revenue and paying as much as they want for players. Other teams will say that without them the Yankees wouldn't be able to earn anything at all.

What do you think about MLB revenue sharing?

[Afterglow]

I think it is a joke.

What else can you call giving teams handouts? Seriously, taking money from one team and giving it to another that didn't earn it is a joke.

I think socialism should be kept out of baseball.

It makes me want to vomit.

[SamtheBravesFan]

I know this has been discussed before, but I'm not sure if there is a way to enforce it: can MLB find out if revenue sharing money is put directly into the team in some form (scouting, salaries, players or whatever) and not just pocketed by the owners as part of profits?

[GordonGecko]

I know this has been discussed before, but I'm not sure if there is a way to enforce it: can MLB find out if revenue sharing money is put directly into the team in some form (scouting, salaries, players or whatever) and not just pocketed by the owners as part of profits?

If a team makes any sort of profit, and they receieved revenue sharing, then by definition that revenue sharing went into their profit. I don't really know where to stand on this. On one hand, the Yankees should have a financial advantage because they have more fans who spend a lot more money. You pay more, you should get more. On the other hand, you need a healthy league of opponents to play against. I think I lean on the side of being against revenue sharing, since most teams seem to be doing very well for themselves, and the Yankees have shown you can't always buy your way to a World Series.

[cborge]

Revenue sharing has to be accompanied by a hard minimum salary to work as intended. The Marlins are expected to receive $25MM in revenue sharing this year while having a payroll of only $22MM...disgusting. Or, as some have proposed, the funds should go into a general fund to be administered by MLB rather than going directly to the Loria, Glass, Pohlad et al.

Or do away with it completely.

For the record, I'm also not opposed to a salary cap and I'm a Yankee fan.

[KCGHOST]

Baseball is not free enterprise; it is a cooperative venture. For it to succeed everyone must profit. The Yankees don't make the sums of money they do because they are better than anyone else. They make money because of a geographical accident. Pick up the Yankees, lock, stock, and nameplate, and switch them with any other franchise and see who makes the money. It will be the NY Whoevers.

And the constant whining that the receivers are just pocketing the money is just sour grapes. If you are a Yankee fan what would you want them to do?? That's right, you would rather they put put it in their pockets rather than invest it in player development.

Even after revenue sharing and the luxury tax the Yankees still have more money than anyone else. With all that money maybe a better question might be why aren't they doing better than they are?? Why do Yankee fans insist that other teams can compete if they are "smart" but don't demand that their team be "smart" as well.

[leecemark]

--Every game has two teams particiapating. Therefore it is only logical that half the money generated from those games should be retained by the home team and half go to the visitor. The Yankees don't make all that money if nobody plays against them . Unless you think there would be a big demand for intra-squad games or games against their minor league affliliates.
--What I'd like to see is half of all revenues go into a central pot. Every team would get an equal share if they spent within an agreed upon window. Teams that spend over the ceiling would forfiet a portion of their share (as they do now). However teams that spend under an established ceiling would also forfeit a portion of their share. Sharing the pile mor eequally should also lead to somewhat more equal spending if it is going to achieve desired ends. A spendign range of say 60-120 million would allow for different points on the building scale as well as accountign for differences in the home half - but not allow billionaires to pocket an extra bundle of cah while not attempting to put a quality team on the field for their fans..

[spark240]

I think the whole premise of MLB revenue is flawed, before you even get into discussion of the relatively minor tweak represented by the current "revenue sharing" system.

The assumed premise is that the Yankees (for example) own the rights to, and have "earned" all the revenue generated from, depictions (broadcasts) of their games which are sold to fans in the New York City area, "their market."

I just don't accept that basic idea. Every game is the product of two teams' direct participation, plus the league context, and it seems to me that the natural ownership of the profits generated from selling this product (no matter where it is being sold or to whom) belongs to all three entities.

So, you ask, is the present system fair? No, it favors big-city teams far too much.

[bryanspellman]

I am for it IF it is required for half to go into player development and the other half to Free Agent Signing/extentions. That ensures that my team isn't just putting money in your owners pocket PLUS if you invest it into your team then you will get less sharing in the future as your team will get better and make more money...



the Yankees have shown you can't always buy your way to a World Series.
They never have BOUGHT thier way into the World Series. Typical Yankee-hater.

[Captain Cold Nose]

They never have BOUGHT thier way into the World Series. Typical Yankee-hater.

GordonGecko is a lot of things. Looking at his posts, that's one thing he's definitely not. Exact opposite, actually. Check out the ballparks and stadiums forum and don't be so defensive when the praise isn't glowing.

[GordonGecko]

I am for it IF it is required for half to go into player development and the other half to Free Agent Signing/extentions. That ensures that my team isn't just putting money in your owners pocket PLUS if you invest it into your team then you will get less sharing in the future as your team will get better and make more money...

They never have BOUGHT thier way into the World Series. Typical Yankee-hater.

Guy, like Cold Nose said I'm the opposite - I have season tickets to the Yankees I can even show you my prized final game tickets. That statement shouldn't be taken as a jab to Steinbrenner & the Yanks, I've defended the man for actually pumping the money into the team instead of pocketing the profits.

Teams try all the time to buy their way to a world series, that's the only thing you can call it when you give fat contracts to every free agent you can get your hands on. You buy the talent, and the talent gets you there. That doesn't make any team any less legitimate. If the Yankees can afford to do it, it's because they have the most fans with the most money, and they earned a better quality team. Heck, I don't even know why I'm defending myself here. Good day sir.

[sturg1dj]

its un-American but so is the monopoly that is Major League Baseball so I have no problem with it.


p.s.
the saying typical Yankee hater is such an annoying little whine


you probably blindly support your team without seeing its faults at all. Same for your political party whatever it may be.


look, I love my family...but if someone in my family had a drug problem I am not going to blindly defend them I am going to let them know what I think. If someone in my family beats up bums for fun I am not going to blindly support them. Just because you love something doesn't mean you cannot criticize it.




and let me also add

the 1996 Yankees Championship team
of the 9 starters only 3 were homegrown
Bernie Williams
Gerald Williams
Jeter

of the starting rotation only 1
Andy Pettite

and the closer was not since it was Wettelend. Rivera was set-up

now I would like to say that I believe that the majority of titles won in the last 20 years have been bought one way or another, so its crazy to say that the Yankees have never bought a world series. Yes, they have success with their farm system too, but they have also stayed as competitive as they are because can get anyone they want AND also they are not afraid to rent a player since they can afford them. Its nothing really to be ashamed about, its just the way it is.

[SHOELESSJOE3]

--Every game has two teams particiapating. Therefore it is only logical that half the money generated from those games should be retained by the home team and half go to the visitor. The Yankees don't make all that money if nobody plays against them . Unless you think there would be a big demand for intra-squad games or games against their minor league affliliates.
--What I'd like to see is half of all revenues go into a central pot. Every team would get an equal share if they spent within an agreed upon window. Teams that spend over the ceiling would forfiet a portion of their share (as they do now). However teams that spend under an established ceiling would also forfeit a portion of their share. Sharing the pile mor eequally should also lead to somewhat more equal spending if it is going to achieve desired ends. A spendign range of say 60-120 million would allow for different points on the building scale as well as accountign for differences in the home half - but not allow billionaires to pocket an extra bundle of cah while not attempting to put a quality team on the field for their fans..

I don't get that one at all, of course if the Yanks don't play the other teams there would be no profit, there would be no league, nothing to watch, whats the logic.

Why even bring up Yanks would make nothing playing intra-squad games or playing minor league teams, of course they would make almost nothing, on the other hand that would never happen, whats this all about.

To get back to the real world, the theme here, I could understand the Yanks or other big market teams sharing, problem is will those that receive use the money to better their team.

[sturg1dj]

the business of baseball is too confusing because of all of its loopholes it has that other business don't. Is each team a separate business entity or is the league the entity.

if they are all separate then they should not have to bend to the league's demands

if the league is the entity then it should be able to decide where all the profits go.

[SHOELESSJOE3]

its un-American but so is the monopoly that is Major League Baseball so I have no problem with it.


p.s.
the saying typical Yankee hater is such an annoying little whine


you probably blindly support your team without seeing its faults at all. Same for your political party whatever it may be.


look, I love my family...but if someone in my family had a drug problem I am not going to blindly defend them I am going to let them know what I think. If someone in my family beats up bums for fun I am not going to blindly support them. Just because you love something doesn't mean you cannot criticize it.




and let me also add

the 1996 Yankees Championship team
of the 9 starters only 3 were homegrown
Bernie Williams
Gerald Williams
Jeter

of the starting rotation only 1
Andy Pettite

and the closer was not since it was Wettelend. Rivera was set-up

now I would like to say that I believe that the majority of titles won in the last 20 years have been bought one way or another, so its crazy to say that the Yankees have never bought a world series. Yes, they have success with their farm system too, but they have also stayed as competitive as they are because can get anyone they want AND also they are not afraid to rent a player since they can afford them. Its nothing really to be ashamed about, its just the way it is.

It's called capitalism, thats just the way it is. You make money, you reinvest to stay competitive, same as Ford, GMC and other firms. There are some other teams not as rich as the Yanks who don't care to spend. Some years ago there was one player from another team who chose to be anonymous who said he hated the Yanks and George Steinbrenner but said he wished his owner and some others would put up their money like he did.

I might add that yes the Yanks are a rich team but much of that money was earned going back to the 1920s by fielding good teams, building a hugh fan base even outside of NY which over the years generated a great deal of revenue by packing them in attendance and also sale of Yankee merchandise over the years.

Remember long ago there was 3 teams in NY, the Dodgers and the Giants who owned NY. For a while the Yanks didn't even have their own park.

Giants and Dodgers were also in the big city, the media capital, it wasn't only the Yanks.

Bottom line yes they are a rich team but it wasn't all handed to them, go back to the 1920s, don't just look at today.


Closing, no problem with the Yanks or other big market teams sharing, the problem could be, what are the other teams doing with the money.

[sturg1dj]

It's called capitalism, thats just the way it is. You make money, you reinvest to stay competitive, same as Ford, GMC and other firms. There are some other teams not as rich as the Yanks who don't care to spend. Some years ago there was one player from another team who chose to be anonymous who said he hated the Yanks and George Steinbrenner but said he wished his owner and some others would put up their money like he did.

I might add that yes the Yanks are a rich team but much of that money was earned going back to the 1920s by fielding good teams, building a hugh fan base even outside of NY which over the years generated a great deal of revenue by packing them in attendance and also sale of Yankee merchandise over the years.

Remember long ago there was 3 teams in NY, the Dodgers and the Giants who owned NY. For a while the Yanks didn't even have their own park.

Giants and Dodgers were also in the big city, the media capital, it wasn't only the Yanks.

Bottom line yes they are a rich team but it wasn't all handed to them, go back to the 1920s, don't just look at today.


Closing, no problem with the Yanks or other big market teams sharing, the problem could be, what are the other teams doing with the money.




well if you want to go there then I will have to point out that it was all bought then and it was handed to them


BABE RUTH




purchased by the Yankees from the Red Sox from an owner who had no intention of fielding a good team just wanted money.

[SHOELESSJOE3]

well if you want to go there then I will have to point out that it was all bought then and it was handed to them


BABE RUTH




purchased by the Yankees from the Red Sox from an owner who had no intention of fielding a good team just wanted money.

Won't debate that, that should have been included in my previous post. Should we fault the Yanks for making the deal of the century.

Harry was a dummy when it came to the game, or some would say his first love was not baseball, either way he blew it and further down the road sold off more of his team.





Just a bit more of Yankee history and some of their stars.

Lou Gehrig. The Giants Mcgraw illegally signed Lou off the Columbia campus and sent him to the minor league Hardford team under a differnt name. Right under John's nose, he had first bite, he must have been sleeping he let him get away, some were already calling him the next Babe Ruth.

Joe Dimaggio scouted by a number of teams but they were scared off when Joe suffered a serious knee injury in the minors. Yankee scout Bill Essick was relentless in working over the Yankee owner to take the chance on Joe, they picked him up.

Yogi Berra, tried out with the Pirates, too clumsy, too slow, even the Dodgers considered him, briefly.

Whitey Ford looked over by some teams, the Dodgers turned him away, too small.

Mickey Mantle early on scouted by both St.Louis teams. The Browns showed little interest dropped out. Cardinal scout Runt Marr the first scout to contact Mick paid a visit to Mick, never got back to him.

It wasn't all a gift.

[tigers527]

I think it is a joke.

I think socialism should be kept out of baseball.
Ummm...you are aware that MLB already functions as somewhat "socialist"? There are anti-trust exemptions that allow a singular body (the MLB front office) to govern 30 competitively separate organizations (teams). If this were capitalistic it would be called MONOPOLY, but it is that anti-trust exemption that allowed Congress to wield such a big hammer regarding the roids.

Another "socialist" aspect of the league is the licensing of the players images, shouldn't every single player in the league be able to sell his own image? From Jerseys (split with the team), to his video game representations, to baseball cards? Thats Capitalism baby, but the union and the MLB front office agree to negotiate as a singular group regarding all that stuff.

The thing that needs to be addressed is the TV money. The rules in MLB are antiquated, every team gets a "home market" (for Toronto the entirety of Canada is the Blue Jays "home market") and that "home market" was exclusively a given MLB teams broadcast rights for them to sell locally. Even if a game was being nationally broadcast and was not carried by the local television, that region would be blacked out from receiving the nationally broadcasted games coverage. Recently this changed, I can FINALLY see what Joe Morgan has to say about the Tigers. The Tigers still get to sell Tigers coverage from here (Detroit) to who knows (Lansing) only national games override/simulcast with the local now.

To put it simply, YES (sarcastic cap yes) the Yankees deserve to sell the broadcast rights for as much as they can, but 50% of the reason the Yankees can charge what they do for TV rights is because they play another team. It is not a bubble.

I am not sure how I feel about revenue sharing over all, but I do think the TV money needs to be negotiated and split on a league wide basis (similar to the NFL). While a salary cap is not the way IMO (parity sucks), but making teams spend that TV money and requiring a salary minimum might help the league the players and the competitiveness.

There are people on this site smarter than me that an iron out the details.
;)

[SHOELESSJOE3]

Ummm...you are aware that MLB already functions as somewhat "socialist"? There are anti-trust exemptions that allow a singular body (the MLB front office) to govern 30 competitively separate organizations (teams). If this were capitalistic it would be called MONOPOLY, but it is that anti-trust exemption that allowed Congress to wield such a big hammer regarding the roids.

Another "socialist" aspect of the league is the licensing of the players images, shouldn't every single player in the league be able to sell his own image? From Jerseys (split with the team), to his video game representations, to baseball cards? Thats Capitalism baby, but the union and the MLB front office agree to negotiate as a singular group regarding all that stuff.

The thing that needs to be addressed is the TV money. The rules in MLB are antiquated, every team gets a "home market" (for Toronto the entirety of Canada is the Blue Jays "home market") and that "home market" was exclusively a given MLB teams broadcast rights for them to sell locally. Even if a game was being nationally broadcast and was not carried by the local television, that region would be blacked out from receiving the nationally broadcasted games coverage. Recently this changed, I can FINALLY see what Joe Morgan has to say about the Tigers. The Tigers still get to sell Tigers coverage from here (Detroit) to who knows (Lansing) only national games override/simulcast with the local now.

To put it simply, YES (sarcastic cap yes) the Yankees deserve to sell the broadcast rights for as much as they can, but 50% of the reason the Yankees can charge what they do for TV rights is because the play another team. It is not a bubble.

I am not sure how I feel about revenue sharing over all, but I do think the TV money needs to be negotiated and split on a league wide basis (similar to the NFL). While a salary cap is not the way IMO (parity sucks), but making teams spend that TV money and requiring a salary minimum might help the league the players and the competitiveness.

There are people on this site smarter than me that an iron out the details.
;)


Just so I understand, is that word the an error, should be they.

[tigers527]

Just so I understand, is that word the an error, should be they.
Yup...sorry about that. Its been changed.

[SHOELESSJOE3]

Yup...sorry about that. Its been changed.

No apology needed here, we all do it now and then, just wanted to make sure, thanks.

[leecemark]

I don't get that one at all, of course if the Yanks don't play the other teams there would be no profit, there would be no league, nothing to watch, whats the logic.

Why even bring up Yanks would make nothing playing intra-squad games or playing minor league teams, of course they would make almost nothing, on the other hand that would never happen, whats this all about.

To get back to the real world, the theme here, I could understand the Yanks or other big market teams sharing, problem is will those that receive use the money to better their team.


--What don't you get? I merely said that the Yankees need the other teams in order to get the huge revenuses they do. Therefore the other teams are entitled to half of them. That still leaves the Yankees with more money than anybody else since they get half of their own revenues and a share of everybody elses. It just narrows the disparity somewhat.

[SHOELESSJOE3]

--What don't you get? I merely said that the Yankees need the other teams in order to get the huge revenuses they do. Therefore the other teams are entitled to half of them. That still leaves the Yankees with more money than anybody else since they get half of their own revenues and a share of everybody elses. It just narrows the disparity somewhat.

What don't I get, why even bring it up, obviously there has to be a team to play, don't we all know that. If there was only one team the Yanks only, we wouldn't have anything to discuss.

Of course the Yankees need an opponent, all teams need some one to play.
We could turn it around and say any team needs an opponent or there is no game.

Yes other teams should get their share when playing the Yanks but why harp on the fact that the Yanks survive because there are other teams to play.????????

[spark240]

the business of baseball is too confusing because of all of its loopholes it has that other business don't. Is each team a separate business entity or is the league the entity.

if they are all separate then they should not have to bend to the league's demands

if the league is the entity then it should be able to decide where all the profits go.

That's the thing--it's both. Each team is independent, but only within the context of the league, which is also an "entity" with interests which are not necessarily congruent with any one team's interests. The league needs the teams, and the teams need the league. (Indeed, any one team is more dependent on the league than the league is on any one team.) Too many fans identify with "their" team's interests to the exclusion of all else, but the game itself, and therefore fans of the game, are usually best served when the league's interests prevail over any single team's (or small subset of teams').

[spark240]

Yes other teams should get their share when playing the Yanks but why harp on the fact that the Yanks survive because there are other teams to play.????????

Because right now the Yankees are getting the majority of the profits from products for which they are only collaborators in the production.

Myself, I go even farther than leecemark--I don't believe the Yankees (or any team) are naturally entitled to even 50% of broadcast revenue from "their" games.

[SHOELESSJOE3]

Because right now the Yankees are getting the majority of the profits from products for which they are only collaborators in the production.

Myself, I go even farther than leecemark--I don't believe the Yankees (or any team) are naturally entitled to even 50% of broadcast revenue from "their" games.

I haven't looked into the numbers, so you could have a good point. I won't debate the percentage because I have not looked that close.

What I'm pointing out is the fact that Leecemark seems to be saying without teams to play the Yanks would be making nothing. It's like the Yanks should be thankful that there are other teams to play so they should share, why even bring that up. Every team needs an opponent to play a game, am I missing something, don't all teams need other teams.

Some of Leechmark's words. The Yankees don't make all that money if nobody plays against them, do we have to be told that, if there is no one to play there is no Yankees either. Lets discuss the split of the profits not the obvious.

Not debating the cut, or how it should be split.

[digglahhh]

I suppose all you guys took your tax rebate checks and went out and bought yourself a new HD-TV, right? I mean, you certainly wouldn’t use it for anything stupid like, paying college tuition or anything… High priced junk is the backbone of this economy and investments in the future are for squares or pinkos. Word to Bartolo Colon for Grady Sizemore and Brandon Phillips.

For those not intellectually adroit enough to have caught my drift yet, there’s more than one way to skin a cat. A stable and frugal payroll is not prima facie evidence of pocketing revenue sharing dollars as opposed to investing it in one’s team. In fact, haphazardly, but deliberately increasing payroll (usually by signing overpaid, mediocre veterans) is the antidote to competiton, not the panacea for lack thereof.

Efficient use of resources looks very different than what you want to see. Small market teams should use revenue sharing dollars to improve infratructure, to attract top scouts, executives, and talent developers. They can use money to improve facilities, to expand commercial and marketing ventures, to sign young talent. They can save and invest that money in the anticipation of having to retain their blue-chippers. If Florida “pockets” 25M a year for three years, and then turns around and signs HanRam for 75M, what’s wrong with that? You ain’t gotta spend it like you got a hole in your pocket, like you’re PacMan Jones a fifth of Hen-Rock deep at Scores.

Essentially, you’re asking your team to go cop an iced out Rolex because you wanna see those dollars in the most flagrant form. Forget what the prudent, wise, investment strategy is – pimp your team with Jose Guillen rims.

The rampant myopia surrounding this issue is a microchosm of the pathological financial behavior so many of us exhibit on a personal level.

(Post was started by Gordon Gecko – insert requisite Teldar Paper joke here)

[GordonGecko]

Just thinking out loud here...

Maybe the fairest way would be to assign a percentage of revenues to the opposing team for ticket & food sales and broadcast rights, and scrap revenue sharing alltogether. The number could be something like 20-25%. So if the Yankees earn $2.5 million from a home game with the Orioles, the Orioles would get say 500k (20%). When the Yankees play at Camdem yards and Batimore takes in $1.5 million, the Yankees would get 300K. The difference in cut would be the "sharing" of revenues in a manner directly proportional to the popularity of the two teams involved. Obviously merchandising revenue would not be split at all, since why would the Orioles get any money from people who buy Yankees jerseys.

[spark240]

Maybe the fairest way would be to assign a percentage of revenues to the opposing team for ticket & food sales and broadcast rights, and scrap revenue sharing alltogether.

I think this is not far off. Here's how I'd do it...

Gate revenue (game tickets) plus parking and concessions - 20% for the visiting team. This is basically a return to the old pre-"sharing" system. Once upon a time, the gate was the primary revenue stream.

Merchandising - 100% to home team is fine.

Broadcast revenue - This is the big one these days, and this is where I get radical. Equal shares from each game's total nationwide (all "markets" and contracts combined) rights, to each participating team, plus a separate share to the league (i.e., divided among other 28 teams).

My point of view is, the broadcast depiction of the game is a product, distinct from the physical event, which requires the equal participation of both teams, plus the league context, to acquire its meaning and value in the market. Both teams, and the league, should share in the profits of selling this product, no matter where it is sold, or to whom. It doesn't matter if most of the viewers of any particular broadcast are residents of one city or another, or fans of one team or another--the product they are buying (through their cable or satellite subscriptions, and by their viewing of related advertising) does not rightfully belong to any one team.

Gate and concessions revenue are different because the production of the physical event--as opposed to the broadcast depiction--really is being carried out more by the home team staff. Merchandising is the one category where fan allegiance (and marketing savvy) should reasonably be allowed to run free.

[sturg1dj]

I haven't looked into the numbers, so you could have a good point. I won't debate the percentage because I have not looked that close.

What I'm pointing out is the fact that Leecemark seems to be saying without teams to play the Yanks would be making nothing. It's like the Yanks should be thankful that there are other teams to play so they should share, why even bring that up. Every team needs an opponent to play a game, am I missing something, don't all teams need other teams.

Some of Leechmark's words. The Yankees don't make all that money if nobody plays against them, do we have to be told that, if there is no one to play there is no Yankees either. Lets discuss the split of the profits not the obvious.

Not debating the cut, or how it should be split.


I think the point has been brought up right now because the home team gets all of the revenue from games, right? he is saying it takes two to play a game so why not split the money? A Yankee v. Royals game at Yankee stadium draws more than a Yankee v. Royals game at Kauffman, we know that. Sure its the Yankees fans that do that, but without the Royals they would not go to the game. Sure the Yankees are the drawing card, but the Royals make the game possible so they should be entitled to the money.

[SHOELESSJOE3]

I think the point has been brought up right now because the home team gets all of the revenue from games, right? he is saying it takes two to play a game so why not split the money? A Yankee v. Royals game at Yankee stadium draws more than a Yankee v. Royals game at Kauffman, we know that. Sure its the Yankees fans that do that, but without the Royals they would not go to the game. Sure the Yankees are the drawing card, but the Royals make the game possible so they should be entitled to the money.

Well, that makes it a bit more clear. The way I read the original post gave me a different impression, more like it was being said, with no team to play the Yanks make nothing, that didn't sound right, of course it takes two to make a game.

Not a problem with the split home/visiting team.

[sturg1dj]

did anyone see this? (http://sportsillustrated.cnn.com/2008/writers/ian_thomsen/08/01/lebron.greece/index.html)


Greek team may make $eriou$ run at LeBron after 2010 season

Story Highlights

* LeBron James will become a free agent following the 2009-10 NBA season
* $40 million? $50 mill? Who knows how much the Greeks would be willing to pay?
* Olympiakos signed ex-Hawks forward Josh Childress to a lucrative deal last month

Decrease font Decrease font
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Who knows whether LeBron would seriously consider a lucrative European offer?
Who knows whether LeBron would seriously consider a lucrative European offer?
John Biever/SI
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You'll never guess which NBA star the Greek team Olympiakos of Athens may be targeting next.

Here's the buzz I heard Friday: Olympiakos is considering a run at LeBron James when he becomes a free agent in 2010.

This talk was beginning to make its way through the NBA on Friday. I heard it from a reliable league source, who told me that it emanates from Olympiakos.

At first glance it is ludicrous to imagine that the NBA's next big star would move overseas as he's trying to win championships and replace Michael Jordan as a household name globally. But look at it this way: Neither the Euroleague nor Greek league impose any kind of salary cap on its teams, which means there would be no ceiling on an offer that the billionaire ownership of Olympiakos could make to James.

As a free agent in 2010, his new contract in the NBA would start at less than $20 million annually.

What if Olympiakos were to offer him $40 million per year? Or $50 million? Who knows how much the Greeks would be willing to pay? The point is that the limitation on his salary is entirely up to them.

Last month Olympiakos signed Josh Childress, a sixth man of the Atlanta Hawks, to a three-year contract worth $20 million "net'' (meaning that most of his taxes and living expenses are paid by the club in addition to his salary) that exceeded his value in the NBA. The Aggelopoulos brothers, the young billionaires who own Olympiakos, do not expect to earn revenues to cover the cost of that contract. They signed Childress simply in hope that he will help them win basketball games.

At the most expensive levels of European basketball, the club owners are obsessed with bringing glory to their club and their fans as well as to their city and country. Imagine the glory that the recruitment of James would bring to Olympiakos. At the very least, he would destroy their cross-town rival Panathinaikos: The value of that alone would be priceless to Olympiakos.

The owners of Olympiakos already lose millions annually on their player payroll. It may be worthwhile to them to lose $40 million or more in exchange for the grandeur of LeBron.

From James' point of view, playing overseas for a year could enhance his marketing status and turn him into more of a global star than he is now. He could build up his name in an entirely unprecedented way and then return home as a free agent to sign with the NBA team of his choosing.

I am not saying that any of this is going to happen. I can tell you, however, that this kind of speculation is going to generate a lot of talk throughout the basketball world -- and not just concerning Olympiakos, either. What's to stop the billionaire owners of CSKA Moscow or other elite Euroleague clubs from making a similar run at James?

The landscape of basketball may be changing, after all.



the first true threat to American monopolistic sports business in many years. In the past other leagues have done all they can to destroy rival leagues (MLB and the Mexican League or NFL and the USFL) but this league is a little harder to get at since its not in the country. but it just goes to show what effect having a ceiling on salaries could possibly have.

I don't think LeBron would leave since there is too much other money to be made here.

I also know this is the wrong sport, but I think it is relevant to this discussion on sports business

[TJH1923]

did anyone see this? (http://sportsillustrated.cnn.com/2008/writers/ian_thomsen/08/01/lebron.greece/index.html)






the first true threat to American monopolistic sports business in many years. In the past other leagues have done all they can to destroy rival leagues (MLB and the Mexican League or NFL and the USFL) but this league is a little harder to get at since its not in the country. but it just goes to show what effect having a ceiling on salaries could possibly have.

I don't think LeBron would leave since there is too much other money to be made here.

I also know this is the wrong sport, but I think it is relevant to this discussion on sports business

Lebron and his entourage are posturing for their payday. It is two years away. He will more than likely get a boat load of money from a NBA team. I don't see him going to Europe. The value of the Euro vs the Dollar favors the Euro right now. What happens when the Dollar and the US Economy improve? This is an early negotiating tactic designed to get the NBA's attention which it will.

[sturg1dj]

Lebron and his entourage are posturing for their payday. It is two years away. He will more than likely get a boat load of money from a NBA team. I don't see him going to Europe. The value of the Euro vs the Dollar favors the Euro right now. What happens when the Dollar and the US Economy improve? This is an early negotiating tactic designed to get the NBA's attention which it will.

you're probably right


but keep in mind, the boatload of money in the NBA is capped and the European boatload is not capped. The league max is like $15-16 mil which is a lot less than $50 mil

[Ubiquitous]

Yankee fans and other teams often complain that they are unfairly subsidizing poorer teams, when they should be keeping all their revenue and paying as much as they want for players. Other teams will say that without them the Yankees wouldn't be able to earn anything at all.

What do you think about MLB revenue sharing?

I'm not sure if it has been said already but starting next year the Yanks get to seriously reduce their revenue sharing check and in fact basically 29 other teams are helping to fund Yankee Stadium. As part of the 2002 CBA teams are allowed to deduct stadium construction costs from their revenue sharing pool.

[TJH1923]

I'm not sure if it has been said already but starting next year the Yanks get to seriously reduce their revenue sharing check and in fact basically 29 other teams are helping to fund Yankee Stadium. As part of the 2002 CBA teams are allowed to deduct stadium construction costs from their revenue sharing pool.

I don't know if I would use the terminology "29 other teams are helping to fund YS". I do know the Yankees have been helping to fund numerous Major League Franchises for several years. At least now they will be able to put the revenue into their own franchise (stadium). Baseball needs the Yankees to keep doing exactly what they are doing. The Yankees have helped make their partners (other MLB owners) a great deal of money.

[philkid3]

I suppose all you guys took your tax rebate checks and went out and bought yourself a new HD-TV, right? I mean, you certainly wouldn’t use it for anything stupid like, paying college tuition or anything… High priced junk is the backbone of this economy and investments in the future are for squares or pinkos. Word to Bartolo Colon for Grady Sizemore and Brandon Phillips.

For those not intellectually adroit enough to have caught my drift yet, there’s more than one way to skin a cat. A stable and frugal payroll is not prima facie evidence of pocketing revenue sharing dollars as opposed to investing it in one’s team. In fact, haphazardly, but deliberately increasing payroll (usually by signing overpaid, mediocre veterans) is the antidote to competiton, not the panacea for lack thereof.

Efficient use of resources looks very different than what you want to see. Small market teams should use revenue sharing dollars to improve infratructure, to attract top scouts, executives, and talent developers. They can use money to improve facilities, to expand commercial and marketing ventures, to sign young talent. They can save and invest that money in the anticipation of having to retain their blue-chippers. If Florida “pockets” 25M a year for three years, and then turns around and signs HanRam for 75M, what’s wrong with that? You ain’t gotta spend it like you got a hole in your pocket, like you’re PacMan Jones a fifth of Hen-Rock deep at Scores.

Essentially, you’re asking your team to go cop an iced out Rolex because you wanna see those dollars in the most flagrant form. Forget what the prudent, wise, investment strategy is – pimp your team with Jose Guillen rims.

The rampant myopia surrounding this issue is a microchosm of the pathological financial behavior so many of us exhibit on a personal level.

(Post was started by Gordon Gecko – insert requisite Teldar Paper joke here)

This is my favorite post in B-F history. Not one of them. The.

[Brad Harris]

Very simple formula, based on the 50% equity premise explained in previous threads:

- Independent auditor hired by MLB to do bookkeeping and maintain universal accounting standards which all teams must adhere to (in order to prevent Tribune Company, TimeWarner, Disney, etc. from hiding revenues in other subsidiaries of the same corporate umbrella).
- 50% of all local revenues for each team contributed to revenue sharing pool.
- Revenue sharing pool divided into 30 shares, distributed equally amongst all teams.
- MLB retains 10% of all national revenues and divides remaining 90% into 30 equal shares to be distributed amongst the individual teams.
- MLB's 10% used as operating funds and to establish a "trust fund" for things like assisting future stadium construction loans et al
- Caveat that all revenue sharing funds receiving must be spent on payroll and/or player development.
- No salary cap, min. floor or luxury tax necessary