Stanton on Root Sports

[ice99]

The Mariners have built up a bank cushion over the past 3 seasons. They should zig, while most of the AL contenders are zagging. Using Forbe's estimates it should be about a quarter of a billion. But let's say it's 80 percent of that, $200 million. They can break even this season, rather than trying to cut to make a profit.

The ownership group forayed into the Pyramid Alehouse redevelopment. They can benefit from increased attendance, and their owned RSNW can benefit from a sustained viewership, or at least a smaller drop-off.

[gil]

There has been been something bothering me about this whole thing. Let's grant that Stanton/the ownership group is treating this "like a business" (i.e., caring more about maximizing profit versus having a winning baseball team). Even then, when you lose one revenue source, it doesn't make sense to starve you other parts of your business. For example, if I owned a micro-distillery, and for some reason revenue for one spirit (e.g. gin) went to zero, I wouldn't therefore cut back my investment in making other spirits (e.g., whiskey, vodka). I conclude that reduced revenue from ROOT sports should mean less investment in the Mariners baseball team. I think it's pretty basic business logic.

That is the issue. They treat Payroll as an Expense that they need to have Revenue to fund instead of what it is. An INVESTMENT!

Just and Ass Backward way to think about it and is the fundamental flaw in their Business model. I couldn't even believe my eyes when I read it the first second and third time. It makes everything make sense though doesn't it.

Most importantly, Stanton says, the club will need to innovate and create “unforgettable experiences” at Mariners games. “That,” he says, “translates into revenue, and revenue translates into resources that allow us to build championship teams.”

https://www.forbes.com/sites/jabariyoun ... 59bf892706

Exactly. How about the "unforgettable experience" of going to some games with the Mariners leading the division?

[GL_Storm]

Geoff Baker was on a local Mariners podcast today and said he believes ROOT NW will dissolve by next year.

He said billionaires get to be billionaires by spending other people's money. He said that fans should be very weary when teams start asking for public funds to build stadiums, because billionaires are greedy and won't deliver on the back end with money of their own to build a contender. He also said that if Stanton went and asked other minority holders in the Mariners for cash to help build out the roster, they're saying no... because again, they're only in it for an investment stake and spending their own cash isn't how you get rich.

He says he'd be surprised if the Mariners spend much in F/A or increase payroll at all over the next 2 seasons. He says by 2025, they could be making $0 via their TV deal.

Good times.

I think this is most likely right. Lacking the ability to extract monopoly rents from Comcast, Root NW probably isn't much of a business. I doubt they make much in advertising. The whole ballgame for Root was being able to tax the majority of Comcast's customers in the region and Comcast told them to fuck off, basically. So yeah, most likely Root will simply cease to exist.

[D-train]

There has been been something bothering me about this whole thing. Let's grant that Stanton/the ownership group is treating this "like a business" (i.e., caring more about maximizing profit versus having a winning baseball team). Even then, when you lose one revenue source, it doesn't make sense to starve you other parts of your business. For example, if I owned a micro-distillery, and for some reason revenue for one spirit (e.g. gin) went to zero, I wouldn't therefore cut back my investment in making other spirits (e.g., whiskey, vodka). I conclude that reduced revenue from ROOT sports should mean less investment in the Mariners baseball team. I think it's pretty basic business logic.

That is the issue. They treat Payroll as an Expense that they need to have Revenue to fund instead of what it is. An INVESTMENT!

Just and Ass Backward way to think about it and is the fundamental flaw in their Business model. I couldn't even believe my eyes when I read it the first second and third time. It makes everything make sense though doesn't it.

Most importantly, Stanton says, the club will need to innovate and create “unforgettable experiences” at Mariners games. “That,” he says, “translates into revenue, and revenue translates into resources that allow us to build championship teams.”

https://www.forbes.com/sites/jabariyoun ... 59bf892706

Exactly. How about the "unforgettable experience" of going to some games with the Mariners leading the division?

Yeah you know what is unforgettable? It is NOT paying $15 for a beer, Hydros and Bobble heads it is this you stupid FUCK.

[D-train]

Geoff Baker was on a local Mariners podcast today and said he believes ROOT NW will dissolve by next year.

He said billionaires get to be billionaires by spending other people's money. He said that fans should be very weary when teams start asking for public funds to build stadiums, because billionaires are greedy and won't deliver on the back end with money of their own to build a contender. He also said that if Stanton went and asked other minority holders in the Mariners for cash to help build out the roster, they're saying no... because again, they're only in it for an investment stake and spending their own cash isn't how you get rich.

He says he'd be surprised if the Mariners spend much in F/A or increase payroll at all over the next 2 seasons. He says by 2025, they could be making $0 via their TV deal.

Good times.

I think this is most likely right. Lacking the ability to extract monopoly rents from Comcast, Root NW probably isn't much of a business. I doubt they make much in advertising. The whole ballgame for Root was being able to tax the majority of Comcast's customers in the region and Comcast told them to fuck off, basically. So yeah, most likely Root will simply cease to exist.

But there will still be demand to watch the games and they will get paid by SOMEBODY to provide that content even if ROOT goes tits up. Zero revenue sky is falling prediction is ridiculous.

[GL_Storm]

Geoff Baker was on a local Mariners podcast today and said he believes ROOT NW will dissolve by next year.

He said billionaires get to be billionaires by spending other people's money. He said that fans should be very weary when teams start asking for public funds to build stadiums, because billionaires are greedy and won't deliver on the back end with money of their own to build a contender. He also said that if Stanton went and asked other minority holders in the Mariners for cash to help build out the roster, they're saying no... because again, they're only in it for an investment stake and spending their own cash isn't how you get rich.

He says he'd be surprised if the Mariners spend much in F/A or increase payroll at all over the next 2 seasons. He says by 2025, they could be making $0 via their TV deal.

Good times.

I think this is most likely right. Lacking the ability to extract monopoly rents from Comcast, Root NW probably isn't much of a business. I doubt they make much in advertising. The whole ballgame for Root was being able to tax the majority of Comcast's customers in the region and Comcast told them to fuck off, basically. So yeah, most likely Root will simply cease to exist.

But there will still be demand to watch the games and they will get paid by SOMEBODY to provide that content even if ROOT goes tits up. Zero revenue sky is falling prediction is ridiculous.

Sure, but not nearly as much. The money that's been coming from RSNs was a massive surplus that came from the cable tv monopoly system, and that's going away. A centralized system through MLB, a streaming offering, which is probably where we're headed, won't generate anywhere near the same level of income.

[D-train]

I think this is most likely right. Lacking the ability to extract monopoly rents from Comcast, Root NW probably isn't much of a business. I doubt they make much in advertising. The whole ballgame for Root was being able to tax the majority of Comcast's customers in the region and Comcast told them to fuck off, basically. So yeah, most likely Root will simply cease to exist.

But there will still be demand to watch the games and they will get paid by SOMEBODY to provide that content even if ROOT goes tits up. Zero revenue sky is falling prediction is ridiculous.

Sure, but not nearly as much. The money that's been coming from RSNs was a massive surplus that came from the cable tv monopoly system, and that's going away. A centralized system through MLB, a streaming offering, which is probably where we're headed, won't generate anywhere near the same level of income.

I estimated it would be $3 Billion a year. $100M a team.

End all RSNs and then they could lift all blackouts. 10 million subscribers x $300 a season. Still less than $2 a game.

[D-train]

Wow they had 3.5 million already in 2019 and that is with all the blackouts making it unusable for all local fans. Drop the blackouts and double the price from $150 to $300 and the subscriber numbers easily triple if that is the only way to watch.

The exact number of MLB app subscribers is a tightly held figure by the league. However, based on a year-end 2019 list of the top 10 streaming video apps from research firm Parks Associates, MLB probably has at least 3.5 million subscribers, based on its rank as the seventh-most popular paid streaming service.

[GL_Storm]

But there will still be demand to watch the games and they will get paid by SOMEBODY to provide that content even if ROOT goes tits up. Zero revenue sky is falling prediction is ridiculous.

Sure, but not nearly as much. The money that's been coming from RSNs was a massive surplus that came from the cable tv monopoly system, and that's going away. A centralized system through MLB, a streaming offering, which is probably where we're headed, won't generate anywhere near the same level of income.

I estimated it would be $3 Billion a year. $100M a team.

End all RSNs and then they could lift all blackouts. 10 million subscribers x $300 a season. Still less than $2 a game.

Where did you get those numbers?

[D-train]

Sure, but not nearly as much. The money that's been coming from RSNs was a massive surplus that came from the cable tv monopoly system, and that's going away. A centralized system through MLB, a streaming offering, which is probably where we're headed, won't generate anywhere near the same level of income.

I estimated it would be $3 Billion a year. $100M a team.

End all RSNs and then they could lift all blackouts. 10 million subscribers x $300 a season. Still less than $2 a game.

Where did you get those numbers?

Read my subsequent post.