Thursday, December 15, 2005

Arthur Isn't a Blank Check for the Braves, Har Har Har.


If this article by Tim Tucker is to be believed, then Braves fans are all a'twitter at the prospect of Arthur Blank buying the team (and his non-denial of interest is certainly an encouraging sign.) While Arthur has done a great job with the Falcons, the notion that he's going to ride in on a white horse and re-establish the Braves as one of the biggest spenders in baseball is a pipe dream for several reasons.

The basis of the assumption that Blank will be much better for the Braves than Time-Warner starts with the belief that Time Warner has been bad for the team, but in reality, they've simply been operating as any rational business would. The Braves were one of baseball's big spenders in the mid 90s when they were drawing close to three million fans every year and TBS was a major revenue stream for them. Now, attendance has settled at about 2.4 million every year, which places the Braves in the middle tier of baseball teams, and MLB's rights fees charged to TBS have become onerous, as they want ESPN to be their chief vehicle for showing games nationally. It's far more profitable for teams to show games locally now than it is to take the SuperStation approach. Thus, the Braves have lost the two chief assets - attendance and TBS - that made them one of the richest teams in baseball in the mid 90s. The notion that the Braves should have been spending with the Red Sox and Dodgers, both of which draw more fans, sell more expensive tickets, and have greater local TV revenues, is not right and the resulting criticism of Time Warner was always unfair. Yes, it would be great to have an owner who was willing to take a $20M loss on the team every year in order to field one of the most expensive teams in baseball, but it was impossible to assume that Time Warner would do so, especially since its primary interest is to serve its shareholders and said shareholders would not have been happy to see their dividends diminished so Larry in Kennesaw can watch a $110M roster every night.

Blank would be slightly more likely to take a loss than Time Warner was, since he doesn't have shareholders to answer to and could therefore indulge a little if it made him happy. That said, he didn't become a billionaire by taking losses to assuage his ego. I would be mildly pleased to have an owner who has a personal, emotional stake in the team's success (as Blank clearly does with the Falcons,) but it's important not to overrate how much money Blank would be willing to lose to scratch that emotional itch.

And Blank's personal investment in the team could also be a negative. One advantage of the Time Warner approach was that they stayed out of baseball operations. Like any disinterested investor, they simply set financial parameters and then let the baseball people make decisions. That has been a very successful approach for the team, dating back to the time in the second half of the 80s when Ted Turner reached the same realization and got out of the way so Bobby Cox could start building the franchise. Blank, on the other hand, has been anything but disinterested in his role as the Falcons' owner. The shots of him wheeling Michael Vick around when Vick had a broken ankle are memorable, but what's more troubling for me is the fact that Blank inserted himself into the negotiations with Peerless Price and Keith Brooking, fell in love with both players based on his interactions with them, and was likely a major reason why the Falcons overpaid for both of them (Price moreso than Brooking.) I'm uncomfortable with the idea of Blank inserting himself into negotiations with the Braves, especially since baseball deals have longer term impacts than football deals since the contracts are guaranteed. What if he drives the price of Andruw Jones' renegotiations in a few years because he takes a shine to Andruw and we end up paying through the nose for the tail end of a great career?

(One note in Blank's defense: in a competitive free agent market, his personal touch is often a positive factor for the Falcons. For instance, Pat Dye Jr. and Rod Coleman have both said that Blank's interest in Coleman was a major factor in drawing Rod to sign with the Falcons over the Giants and he has certainly been an excellent addition to the team. An interested owner can make bad decisions, but he can also be more attractive to play for than a nameless corporate monolith.)

Overall, Blank has certainly done a good job with the Falcons. Yes, he has benefited from Michael Vick, who was acquired before he bought the team, but he's also done dozens of little things, from cutting ticket prices to improving Falcons' tailgating from awful to merely mediocre to increasing the team's media profile in the local market, that have made the team far more popular than it was when it was owned by the Smith family. He would likely make the same efforts with the Braves, but it's important not to overrate his potential impact. When he bought the Falcons, they were one of the worst run franchises in the NFL, so a customer-savvy owner was a major difference. The Braves, on the other hand, are one of the best-run franchises in MLB, so his impact would not be as great.

All that said, it would be amusing to see him in his impeccable suits wandering through the home dugout at the Ted, through a miasma of dirt, sunflower seeds, and dip spit.

2 comments:

Caelus said...

You may have convinced me to hold off on my "Blank will be the savior of the Braves franchise" belief. I was excited with the thought of the Braves being released from the hands of corporate bean counters so that they could spend the money needed to fill holes...........bullpen especially. Now, the thought that a Blank-like owner may start sticking his nose into Braves operations like Ted Turner did back in the 70s, may have turned me towards your line of thinking.

Michael said...

The only savior would be someone who is willing to take a financial loss on the team, which is a pipedream. The bottom line is that the payroll is a fair reflection of the team's TV and ticket revenue. I don't think that T-W was pocketing the money. There is the argument that they were hiding TV revenue, but if that was the case, then why so much pressure to sell?