Skip to content

Team values shoot up an average of 16%

Mar 22, 2012, 8:20 AM EDT

Money Bag

Forbes has released its annual franchise valuation package. In short: it’s good to own a ballclub:

The average Major League Baseball team rose 16% in value during the past year, to an all-time high of $605 million. In 2011, revenue (net of payments to cover stadium debt) for the league’s 30 teams climbed to an average of $212 million, a 3.4% gain over the previous season.

Obviously some teams do better than others, but that’s pretty healthy growth.  And where is all of that value and dough coming from? Local TV:

Rights fees paid by cable television channels are behind the growth in team values. Aggregate cable television revenue for baseball’s 30 teams has increased to $923 million from $328 million over the past 10 years.

And that’s only going to increase — to as high as $1.5 billion by 2015, Forbes estimates — as new deals for the Angels, Rangers, Astros, Padres and Dodgers kick in.

Driving all of this is your DVR, which has devalued advertising for most programming, but which largely doesn’t impact live sports because people really like to watch live sports live.  That has sent rights fees skyrocketing as Fox, Comcast and others have been willing to pony up big to show content with commercials people will actually watch.  This is almost an almost exclusively local phenomenon too, as national rights have not been up for bid for a while and won’t be until next year.

Which, by the way, is another reason why anyone slamming baseball this fall over its abysmal national ratings and claiming that the sport is in trouble compared to the NFL has no idea what they’re talking about.

  1. Baseball Beer Burritos In That Order - Mar 22, 2012 at 8:49 AM

    Their article “The New Moneyball” is also worth a read, although I had to cringe at the description of Frank McCourt as “regal-looking”…he’s always looked like a marmot to me.

    • paperlions - Mar 22, 2012 at 8:57 AM

      Marmots everywhere are highly offended at this comment.

    • koufaxmitzvah - Mar 22, 2012 at 10:12 AM

      Frank does spend $50k a year on his hair.

    • Kyle - Mar 22, 2012 at 11:47 AM

      Oh, nice marmot…

  2. El Bravo - Mar 22, 2012 at 9:02 AM

    Get that scratch, MLB. C.R.E.A.M.

    • Jonny 5 - Mar 22, 2012 at 9:38 AM

      Dolla dolla bill yaw!

      • koufaxmitzvah - Mar 22, 2012 at 10:10 AM

        I am intrigued to hang out on this part of the message thread, but, alas, I feel as if I am not cool enough to participate.

  3. - Mar 22, 2012 at 9:27 AM

    Which, by the way, is another reason why anyone slamming baseball this fall over its abysmal national ratings and claiming that the sport is in trouble compared to the NFL has no idea what they’re talking about.

    Exactly. There was a local radio host rambling on about this, this morning. I thought about calling in to tell him what an ignorant person he is. But I decided not to. After all, if there’s anyone more annoying than a No Nothing Sports Radio Talk Show Host. It’s No Nothing Sports Radio caller.

  4. mattintoledo - Mar 22, 2012 at 9:49 AM

    This is why I never understand when labor disputes come up and people who are mad at the players say, “The owners should make a lot of money. They’re the ones taking all the risk.” They make take risk on a short term basis, but when they decide they’re done “losing money” they can sell the team for hundreds of millions more than what they bought it (usually on the back of a publicly funded stadium that cost hundreds of millions of dollars itself).

    • paperlions - Mar 22, 2012 at 11:22 AM

      Owners of baseball teams take no risks. It has been decades since owning a baseball team was a risk, it is a guarantee of high profits no matter how much you invest in players.

      • Kevin S. - Mar 22, 2012 at 2:07 PM

        Seriously, when you can buy a team entirely on credit, mismanage it into bankruptcy for close to a decade, and then sell it for nearly four times the purchase price, I think it’s safe to say that there is no risk in owning a team.

  5. mrfloydpink - Mar 22, 2012 at 10:22 AM

    I think that a look at Forbes’ numbers indicates that they are inherently a little unreliable. Consider the Dodgers, valued at $1.4 billion. This is, as the article notes, a 75% increase over last year. Now, what exactly have the Dodgers done in the last year to merit a 75% increase? Absolutely nothing, EXCEPT be put up for sale–the $1.4B figure is clearly based on the sale prices being bandied about. Which means that (a) the figure for the Dodgers last year was clearly WAY off, and (b) the figure for any team that has not been put up for sale is clearly WAY off.

    • scottp9 - Mar 22, 2012 at 11:49 AM

      I don’t completely disagree with you, but one thing that’s changed from last year is that we’ve seen what the Dodgers’ next local TV contract might look like – and it’s huge. Also, of course, I think most would expect the Dodgers to be worth more under new ownership, since the current regime has been bleeding the team dry.

      • mrfloydpink - Mar 22, 2012 at 4:18 PM

        This is true enough, but we’ve seen what the Angels’ contract will look like, too. They didn’t jump 75% in value. Same with the Rangers.

Leave Comment

You must be logged in to leave a comment. Not a member? Register now!

Top 10 MLB Player Searches
  1. H. Ramirez (2382)
  2. G. Stanton (2336)
  3. G. Springer (2317)
  4. C. Correa (2308)
  5. J. Baez (2285)