And the MLB 2020 season negotiations begin

[CBeisbol]

Originally Posted by cephasjames

Cubs' Tom Ricketts says most revenue goes right back into team

Understanding slightly how business works, I get the plausibility of this argument (as I have seen this very thing with friends who own businesses). But perception says otherwise. And without the owners opening their books, perception is going to win out and people are going to continue to see them as billionaire cash hoarders sitting on piles of gold like Scrooge McDuck.

Then why do they sell for so much?

My understanding of business is that their value comes from how much money they generate.

[Cynical]

Originally Posted by CBeisbol

Then why do they sell for so much?

My understanding of business is that their value comes from how much money they generate.

That's not always the case. For instance, Facebook is valued for a ton of cash, and has never once made a profit. Amazon became profitable for the first time about a year ago. Assets and market control are how a company tends to actually be valued, not how much money it actually makes.

[dkgo]

That sounded very unlikely to be true so I used this thing called "Google" to search for information on the internet.

Turns out Facebook made $18.5 billion in net income in 2019, albeit slightly down from $22.1 billion in 2018.

https://investor.fb.com/investor-new...s/default.aspx

[dkgo]

You are halfway to knowing what you are talking about. A company valuation is based on expected future profit, so yes it is true that a business can currently be unprofitable but investors believe it to be well positioned to earn future profits. Assets and market control aren't worth **** if investors don't foresee those being used to bring in profit going forward.

[Syd Thrift]

Originally Posted by dkgo

Even if what he says is true (which I don't really believe), by owning a business when things go south you have to put more money into it. It's not guaranteed to increase in valuation forever.

538 did some back of the napkin calculations and determined that if baseball played half the season and had regular length playoffs they’d still basically break even as a league. Since they don’t have solid revenue sharing (which the union hasn’t agreed to because the owners refuse to open their books) that almost certainly means that a few mid market teams with higher than normal payrolls will take a bath (while, of course, other teams, most likely large market ones but also small market clubs with tiny payrolls such as the Marlins will still be pulling in a profit). I’m not going to act like it’s a good situation for those who are losing money but, well, they got themselves into this via decades of duplicity...

I do kind of agree with the players on that issue in the long term; baseball just plain isn’t these other leagues, and the big disparity between the New York Yankees / LA Dodgers and clubs like the Tampa Bay Rays is part of the mystique of the sport (plus the fact that rebuilding efforts simply run longer than they do in the NFL in particular). It’s more like international football in that regard. Of course, beyond that, the players aren’t fans because if they agreed to “55%” of the revenue right now, they’d most likely be agreeing to 55% of like 80% of the revenue, with the remainder going unreported (you could do that level of an overall revenue share, and then ensure teams send revenue into other markets as well, without a salary cap necessarily; it’s just, if the league spent over the amount then everyone’s salary would drop by a given percentage, similar to what happens in the NFL).

[Syd Thrift]

Originally Posted by Cynical

That's not always the case. For instance, Facebook is valued for a ton of cash, and has never once made a profit. Amazon became profitable for the first time about a year ago. Assets and market control are how a company tends to actually be valued, not how much money it actually makes.

Amazon became profitable more than a decade ago, although it’s true that they ran at a loss for the first several years of their existence.

This is actually a different situation though. Amazon’s value even in the early days was based on how much money they’d eventually make. A professional sports team’s value is largely prestige based. This is much, much clearer in countries where the locals don’t pay for stadia - a team like Chelsea forces their owner to plow money into it year after year, but they do it because they know that the capital gains on that product is always rising. Even in other US sports, you see a lot of teams - the Clippers come to mind - who don’t necessarily have a history of profit but who sell for a toooon of money.

[cephasjames]

MLB owners reject MLBPA's 114-game proposal for 2020 season

On Sunday, the MLB Players Association submitted a proposal to Major League Baseball for a 2020 season that would include, among other aspects, a 114-game regular season and expanded playoffs. It took the league a few days to respond, but on Wednesday owners rejected the union's proposal and said they would not send a counteroffer.

It should be noted that refusing to make a counteroffer is a well-known negotiating tactic, one commonly employed in baseball circles by agent Scott Boras, and that the league's stance does not necessarily mean the 2020 season is endangered.

[Brad K]

Originally Posted by dkgo

You are halfway to knowing what you are talking about. A company valuation is based on expected future profit, so yes it is true that a business can currently be unprofitable but investors believe it to be well positioned to earn future profits. Assets and market control aren't worth **** if investors don't foresee those being used to bring in profit going forward.

A companies market capitalization is based partially on profitability, partially on expectations of future profitability, and partially on how much higher people think the stock will go. The last may be the largest factor.

[cephasjames]

MLB owners planning to have a call Monday to discuss negotiations with players

It'll be interesting to see, should the call actually happen, what comes of this.

[dkgo]

76 game season but just 75% of prorated salary.

**** the owners. I hope the players stay firm for nothing less than a full prorated salary.

[CBeisbol]

Originally Posted by dkgo

76 game season but just 75% of prorated salary.

**** the owners. I hope the players stay firm for nothing less than a full prorated salary.

Yep

Only problem is the media carrying water for the owners and "both sidsing" the issue and the majority of fans believing it.

Plus the owners generally have alternate obscenely huge revenue streams, while the players, generally, don't.

These two issues put more pressure on the players to give in.


But, if there's no season due to money issues, that's fully the fault of the owners.

[CBeisbol]

Andrew McCutchen breaks down the negotiations

https://twitter.com/TheCUTCH22/statu...092660225?s=19

[cephasjames]

MLB's latest proposal includes a 72-game season and a Sunday night deadline for an agreement

Major League Baseball owners have set a Sunday night deadline for their latest counter-proposal to the MLB Players Association... the proposal sent to the union calls for a 72-game regular season, beginning on July 14 and ending on Sept. 27... Players would receive 70 percent of prorated salaries for the regular season, and 80 percent if the postseason is able to be completed.

The proposal from the owners also includes an expanded postseason, with as many as eight teams for each league. If an expanded postseason is completed, players would receive equivalent of 83 percent of prorated salaries, including additional money from postseason pool.

The new offer is roughly equivalent to what players would receive in a 50-game season at full prorated pay

[CBeisbol]

Originally Posted by cephasjames

As Cutch pointed out, they just keep offering the same thing

[Jason Moyer]

The only problem I have with the labor side of this is that I wish they had started high. The initial publically disclosed offers should have been "full salary or nothing, we have contracts" and then eventually they could have gained some public support by saying they'd play for a pro-rated wage. I don't think most people talking about this understand what a huge concession agreeing to pro-rated salaries actually is.

[Westheim]

The proposal from the owners also includes an expanded postseason, with as many as eight teams for each league.

Just call the entire ****ing season "the postseason" if that's all you care about. All problems solved.

[rudel.dietrich]

Is MLB really going to **** this up and miss an entire season?
Not to get over dramatic, but at a time when they should be taking a really hard look at their sport and it surviving for the next 20 years, they are instead maybe going to let an entire season slip by.

[cephasjames]

Originally Posted by rudel.dietrich

Is MLB really going to **** this up and miss an entire season?
Not to get over dramatic, but at a time when they should be taking a really hard look at their sport and it surviving for the next 20 years, they are instead maybe going to let an entire season slip by.

From the article:

The league also plans to announce a definite timeline for resumption of the 2020 season within 48 hours of a potential proposal approval, which would include a minimum three-weeks long spring training.

With a deadline of Sunday, either the Players agree to start the season or Manfred unilaterally starts the season. Either way, there will be a season.

[mitchkenn]

Originally Posted by cephasjames

From the article:
With a deadline of Sunday, either the Players agree to start the season or Manfred unilaterally starts the season. Either way, there will be a season.

i didn't know Manfred had the power to unilaterally start the season, but after looking a bit, he does. Question is, how many players are going to show up? Is this another "replacement player" scenario about to unfold?


honestly, i'm close to the point it doesn't matter anymore. This season is so far gone and i'm nearly at "who cares?' point and waiting for next year. What (if at all) they decide on and play, it'll be a meaningless season this shortened and all.


just my opinion. of course, i am still upset about the DH and moving Houston to the American League thing.

[cephasjames]

Players have to show up or it would be an "illegal" strike according to the current agreement they have. Striking between agreements is a whole other thing. That may happen after 2021.