Well, that didn’t take long. Major League Baseball owners approved a proposal at 2pm ET on Monday afternoon to send to the Major League Baseball Players Association with the hopes that their plan could be approved and they could get something in place to begin the 2020 season. The initial proposal seems dead in the water. Ken Rosenthal and Evan Drellich of The Athletic are reporting that the MLB owner’s plan to go to a revenue share that would give a 50-50 split of league revenues for 2020 is a non-starter for the Players Association, which sees the system as a salary cap.

What the MLB owners are trying to do is make the players take on not only the health risks involved in playing in 2020, but also the financial risks by asking them to take a paycut even further than the one the two sides already agreed to five weeks ago.

Former professional baseball player and now attorney and co-founder of MiLB Advocates Garrett Broshius had this to say:

While there’s most certainly going to be less revenue as a whole in 2020, even if games are played as soon as July 1st – which is one target date MLB has proposed – there’s reason to believe that teams would still be able to break even or perhaps make a little bit of money overall (this could vary from team to team, of course) – Broshius makes an excellent point.

And one that isn’t made in his tweet is non-baseball money that teams like to claim isn’t baseball revenue that only exists because the team exists. 19 of the 30 teams own at least a partial stake in their regional sports network that was given to them by taking less cash per year in their television contracts. The cash is baseball revenue. The money they make each year for owning a sports network is not, at least according to them. Likewise, all of the additional real estate that teams have been able to develop outside of their stadiums simply because they owned a team and would leave the city and got the city/county to pay for most of or all of a stadium and development outside of it is “non-baseball revenue”, but of course, only exists because of the baseball team. That stuff won’t be any part of the “50-50” revenue split in 2020.

Let’s not forget about the sale of BAMTech, either. The BAM in BAMTech stems from MLBAM which stands for Major League Baseball Advanced Media. After serving just the MLB dot com and MLB.tv services, the program expanded to other technologies. Disney paid the owners $1,580,000,000 to acquire 42% of BAMTech in 2017. They already had purchased 33% earlier for $1,000,000,000. That was not “baseball revenue”, either, according to the owners even though the company was started with seed money from all 30 owners to operate MLB.com and MLB.tv.

And then of course, there’s this from Andy Martino of SNY:

The players shouldn’t budge on the already agreed upon deal. The owners are going to use this whole situation to cry poor in free agency either way. If they cave now, they get less now and less in the future.

21 Responses

  1. VaRedsFan

    If things get better and the season starts in July, and they get roughly 2/3rds of the season in, players should get 2/3rds of their salary. Neither side should come out of this looking greedy or petty. MLB owners might have to take a small loss of $$$, but that is no different than any other business in the world has had to endure.

    • J_smith

      I’m with you, I don’t feel bad for players for having to take less money. They still make way more then I do and have access to way better medical facilities then I do and I’ve had to work this entire time

      • Big Timbo

        No players are billionaires. A majority of the majority stake owners of teams are. They all also own franchises worth a billion dollars or more.

        By comparison to the owners, the players are peasants when it comes to finances.

        That you have unfortunately had to choose between your health and your survival because you must pay your bills sucks. That doesn’t mean you should try to force that same reasoning onto someone else.

      • J_smith

        I’m not forcing anything onto them, I just don’t feel bad for them. I don’t feel bad for the owners either. Both groups, players and owners, are much better off then 90 percent of the world. Other business’ and work forces are enduring much worse then they have had to and complaining over money looks bad for both sides. If you genuinely want to play baseball again, great! I’ll watch, and so will a bunch of other people. I just don’t care much about billionaires complaining about it not being fair to have to pay them their contracts or players making a minimum of 550k only getting 2/3 of that. The only ones who really have any right to complain is the minor leaguers. I actually feel bad for them

  2. Sliotar

    Good grief.

    Some balance on the issues would be refreshing.

    Doug’s own writing, on the agreement from 5 weeks ago …

    “This scenario means that the players get at least some financial certainty. If the season never comes to fruition, they get something rather than nothing. The other thing that the players were worried about was service time.” (Concern alleviated).

    Add in that MLB owners are still (apparently) trying to keep their organizations employed, pay cuts or not … and it sure looks like to date, in 2020, …. the owners are bearing the cost and the risks.

    • Doug Gray

      The owners aren’t bearing the cost or the risk. They’ve profited billions of dollars in the last decade. Now, for the first time in twenty five years they are seeing a possibility of a 1-year small loss and they are asking the players to take even less than they already agreed to in order to not have to take that loss.

      • BK

        You are assuming the loss will be small as are some others covering baseball. The near 40 percent hit in revenue loss due to fans coming to stadiums will not be the only loss, but in and of itself it’s huge. $4B+ is a lot of money. TV revenue will also be down as less games are played, just not to the same degree. Also, the properties around the stadiums (the non-baseball revenue ones) are going to bring in next to nothing. Merchandise sales are way down if they are following other retail trends (retail chains are going bankrupt by the bushel right now). Both sides are bearing risks.

        Your last point is spot on … players can decide if they want more money this year or if they want to see the free agent market tank next year. The owners will definitely pass along the losses when they do their next round of hiring in free agency. Based on how the economy is going there’s a good chance it tanks any way. They know this and want the best deal they can get this year.

        #1 rule in economics: there’s no such thing as a free lunch. They can work an equitable agreement out now, of they can let the supply-demand equation run it’s course over time.

  3. Sliotar

    Everything of this magnitude is a negotiation … and any negotiator worth their salt knows the starting positions are … “make a low-ball offer” and “immediate rejection.”

    Owners are greedy, and probably are walking back the deal of 5 weeks ago.

    But, it is tough to feel sorry for players when they retain Tony Clark as union chief. IMO, Clark is either incompetent or in the owners’ pocket.

    Look at key issues he failed to obtain in the last 2 CBAs, when times were good:

    -Share of any digital rights (hello, BAMTech)
    -End of service time shenanigans
    -Salary cap floor (raising total amount of salaries and increasing competitiveness)
    -Changes to arbitration
    -Third-party determination on “true” total of baseball revenues

    Think Clark is going to outfox the owners in the next CBA next year? Not a chance.

    Marvin Miller is not in the Baseball Hall of Fame. Tells you how much he gained for the players, and how much owners despised him.

    Miller is likely rolling over in his grave on how badly MLB players are represented.

    • Jim Walker

      Anyone involved in putting together this change should have been around baseball along enough to know that setting a fixed revenue % was tantamount to a salary cap sort of arrangement and waving a red flag at the MLBPA which has been dug in against a salary cap forever.

      Trying to force a change in the players’ position on this issue under the duress of the current situation is little more than extortion. The proper place was this negotiation was the next CBA agreement.

  4. IndyRedsFan

    I don’t think that Broshuis makes an excellent point when he makes this argument.

    “MLB doesn’t give players more money when teams bring in more revenue than expected in a given year. They make the players honor the contracts they signed. So why should the players give back money when the owners bring in less than expected? ”

    The owners have tried in the past to institute Revenue Sharing, and the players have turned it down because they see if as a salary cap. If they had accepted it, then in “good years” they would be sharing in the extra revenue.

    I’m siding with the owners on this one. A 50/50 split of whatever revenue that comes in during an uncertain season such as this seems more than fair to me.

    • BK

      There are so many that simply want to vilify the owners at every turn. Those ML profits turn into huge contracts (just the way the Collective Bargaining Agreement intends). The players prioritize those types of deals and they continue to rain down.

      This is a global emergency. Stop bickering and work out a fair deal to both sides. The original deal was negotiated a few days into this pandemic. Most expected the worst would be behind us by mid to late April at that time. That’s what the models were telling us. 5-6 weeks later, the pandemic lingers. Neither side should try to leverage the emergency. MLB is losing money this year — split the difference seems like a reasonable approach.

  5. AJ

    Right now I doubt there is any agreement the players would accept. As always deals are about leverage and currently the players are still getting paid until May 24th and therefore have very little incentive to agree to the current proposal. I’m sure they will hold out in hopes of a better deal until we get closer to or beyond May 24th. At which time the players will have little choice but to accept the deal on the table in absence of any real leverage or risk losing the entire season.

  6. Old-school

    This is dumb and a food fight. Every aspect of society is taking a huge hit. Hospital systems are furloughing workers and cutting salaries to front line crucial workers.

    The union is going to lose. Just shut it down and let all parties join the rest of society and get crushed.
    Total complete melt down.

    • Jim Walker

      Does the union lose anymore by not playing than the owners by not having games and making no revenue from game TV?

      As you said this pandemic is shaking and shaping all phases of our lives. The very idea of playing any professional sport while the pandemic rages at the current levels is distasteful to many who aren’t core fans.

      Given the gravity of the overall situation, I’m not sure than a year or 2 from now when the “new normal” is settling in that anyone is really going to care from a public relations view whether the MLB owners of MLB players won or lost this disagreement.

  7. Gonzo Reds

    This hurts to say as after so many bad years I was SO looking forward to this year where we might have the guns to compete but… if losing this year is what it takes to get a salary cap like other sports then so be it!

    Reds fans deserve to be on an equal footing with Yankees and other large market fans. Salary cap is the one way long term and why not pick this fight now?

    • Jim Walker

      Because the salary cap issue needs to be settled on a level playing field, not one tilted by a pandemic.

  8. Jim Walker

    Here’s how the owners’ have leveraged this virus crisis to their advantage:

    1. Used the pandemic to force MiLB to accept the MLB reorganization plan for the minor leagues

    2. Reduced the June draft to 5 rounds and set $20K as the maximum contract any undrafted player can sign.

    3. Reneged on an agreement with the players’ association to pay prorated per game player salaries based on the full amount of each player’s 2020 contract. Then in reneging, they threw in the firebomb of trying to get a key element of salary cap in place, a fixed % of revenues for player compensation.

    There will be those who say that #’s 2 and 3 here were meant to be temporary for this emergency situation. However having them in place would tend to make them the baseline for negotiations in the next CBA when things have settles into whatever the “new normal” turns out to be.

    The behavior of MLB is shameful.

  9. Don

    my 1st thought is:

    Do not let an emergency go to waste

    This is the forever conflict between employer and employee, employers want to pay the lowest possible salary and employees want the maximum salary.

    At some point either this will be worked out with the current employees, the business will stop operating or the business will replace the employees with other workers. There are not any other options.

    Professional sport owners make astronomical amounts of revenue and profit, elite athletes get paid astronomical amounts of money.

    They both need to understand that they most play their games in workplaces that were built and paid for by taxpayers and then these same taxpayers by the product that only exists because the taxpayers built their workplace.

    I do have a question:
    Has the Fox Sport Ohio and the local cables companies contract been worked out?
    If not, will anyone other than die hard fans really care about a product which they can only listen to on radio, they cannot watch on TV or attend in person?

  10. B-town fan

    I’m shocked, I’m shocked, just shocked, “you like my Casablanca reference there” that the players and owners would be fighting over money at a time like this with what everyday average working people, their fans are going through. Honestly I wouldn’t expect anything different.

  11. Hotto4Votto

    The players are 100% right on their stance. The owners should honor the contracts signed and the agreement made in March.

  12. Scott C

    I would like to see baseball in the worse way but this is a ridiculous proposal from the owners. I understand prorated pay, to some degree, although the owners are still by and large going to do all right, There is no baseball without players, the owners need to keep the word. This only makes them look greedier than we already thought they were.