For the longest time the talk about the A’s financial problems have revolved around the team’s old ballpark. However, in the new age of regional sports networks shelling out huge sums of money to teams, the Coliseum now seems like a secondary issue compared to the lack of TV money.
The A’s current deal was signed in 2009 before the TV rights deals exploded (or the bubble started inflating).
The deal goes for 25 years with an option to opt out of the deal in 2024. The exact financial terms were not disclosed, but the estimates available seem to point that it is in the $15 to $20 million a year range. Wendy Thurm recently listed out all of the TV deals for Major League Baseball and that number puts the A’s squarely in the bottom handful of teams with quite a bit of time to wait around before they can renegotiate.
Marine Layer from New Ballpark has taken a look at the A’s deal and speculates that with the escalators that are a part of the deal the team could see that annual payout reach $30 million. This still depends on the A’s ability to retain some of the ratings growth they saw at the end of last year, allowing CSN California to boost subscriber and advertising fees. Even with this, CSN California pays out rights fees to carry the Sharks and Kings as well, which most likely dampens their ability to pay a huge fee for the A’s.
Looking at the published reports and putting in a couple estimates for teams that don’t have public information, the average TV rights deal is about $45 to $50 million per year. This is skewed quite a bit by the Dodgers, Angels and Yankees deals so let’s also take a look at the median, which comes out to $33 million per year. That is still about 50 to 100 percent more than what the A’s are getting annually in their deal from CSN California.
Taking a look at the way things shake out in their own division and things look even more grim; the A’s play in the same division as teams with the 2nd, 4th, 5th and 10th highest local television revenues. The Angels deal pays them $147 million per season, the Rangers and Astros both get $80 million and the Mariners get $45 million a year and will be looking to sign a new deal after the 2015 season.
Yikes, that sure is a lot of money in the AL West. Considering how all of these teams’ ballparks offer the ability to generate more revenue than the Coliseum, and the A’s margin for error in building their team is even smaller.
The new national TV deals will help with revenue, but that money is split evenly among the teams. That allows every team to spend more, which doesn’t really change the status quo in a league without a salary cap.
A new stadium would certainly help bring in new revenue streams, but even that might not be a panacea with the A’s ownership picking up a large portion of the development costs and having to service that debt. In addition, that dream keeps getting pushed into the future and doesn’t seem to be much closer than it was when the new ballpark talk started years ago.