by The newly formed economic reform committee made up of five team owners drew criticism from MLB Players Association executive director Tony Clark, who told The Athletic’s Evan Drellich “the basic theme” the committee reducing and controlling player payroll rather than any significant reshaping of the league’s business.
“The economic reform committee is not a new idea. They had a Blue Ribbon panel, and even an economic committee that was put together back in 1991….Those two in particular, and maybe even a third, based on the comments that came out today, are focused on the best way to discourage the player. salaries,” Clark said.
The MLBPA declined to make an initial comment last week when the committee was announced, although it’s naturally not surprising that the union and owners would have very different views on economic disparities within major league baseball. At first, Clark feels that “baseball is doing very well,” he seems to believe the committee exists in the first place.
“There was a lot of discussion in 2020 about the challenges facing the industry. A number of positions were taken which suggested that the industry was doing harm, and that it was unlikely to go away for years to come.,” Clark said. “And yet, 2021 revenue (across the league) was almost back to pre-pandemic levels; 2022 is higher than it was before the pandemic. And so the industry is doing well.”
The primary reason for the creation of the committee is the potential bankruptcy of Diamond Sports Group, as 14 different MLB teams have broadcast deals with Bally Sports (the regional networks owned by Diamond Sports). This will certainly have a big impact on the revenue streams for those teams, but in the near future, Clark insists.
“We think, based on the expertise we are getting, that growth will still happen in the long term,” Clark said. “Live events, sports themselves, have been extremely successful so far. It’s the model (regional sports network) that seems to be challenged, not fan interest in sporting events.”
While some teams may be hit harder depending on the specific length of their TV contracts, there is also the possibility that those game broadcasts (and therefore revenue) could be covered through new deals with streaming platforms, as opportunities may arise in a relatively quick manner. bankruptcy prompts the resolution of any existing contracts with Diamond Sports Group.
To that end, many of the problems surrounding Town Sports could be resolved long before the end of the current Collective Bargaining Agreement, which expires at the end of the 2026 season. than a year ago after a 99-day lockout, much could still change between now and 2026, though it looks like the league will continue to push revenue disparities between teams as a key driver for an overhaul of financial structure of the ball in the next CBA.
Commissioner Rob Manfred noted last week that the league’s investigation into the Bally Sports issue led to a broader discussion among owners of revenue disparities, another objective of the economic reform committee. There doesn’t seem to be a salary cap on the table so far since even the owners, Manfred said, would have trouble finding a cap that would satisfy all parties.
That said, Clark reiterated the long-standing MLBPA principle that “we are never going to agree on a cap….I don’t agree on a cap. The salary cap is the final restriction on a player’s value and salary. We believe in a market system. The market system has served our players, our teams and our game very well.” In the last round of CBA talks the union explored the idea of a salary floor, which Clark said was “like what’s on top right now” in terms of the current societal structure rather than an actual boundary. But, “we have not yet had a conversation with the league that does not include something much more restrictive at the top. That makes the conversation void for now.”
Not surprisingly, Clark praised the Padres’ increased spending, which came under public criticism from some owners (including the Rockies’ Dick Monfort). Although the Padres play in a relatively smaller market, Clark feels that the teams are willing to spend and compete at the upper levels “should be celebrated, not questioned.”
“The question that should be asked in relation to one team’s payroll versus another is whether or not that team is making a conscious decision to have their payroll there, or is it possible for them to increase their payroll?” said Clark. “The answer is the latter, not the former. So at the end of the day, especially when you see teams in smaller markets – aka San Diego, in this case, as the best example – they provide a level of engagement for their fans, and a level of excitement to be one of the seven. our smallest markets, it begs the question why they made that decision, and why not.”
Returning to labor talks, the union and the league are in ongoing negotiations over another CBA, the first agreement between MLB and minor league players. While no agreement has been reached since the two sides began talks in November, Clark doesn’t think it’s likely that work will stop if an agreement isn’t in place before Opening Day, since then. “It is most likely that the current terms and conditions will continue as we continue to negotiate.” According to Clark, one of the roadblocks is that the league has once again looked to reduce the size of minor league rosters, which the union considers to be “non-starter” on a proposal.
