COMMENTARY | Conventional wisdom had the Philadelphia Phillies trading off the majority of their veteran core for prospects in order to start the rebuilding process at the Major League Baseball trade deadline. In light of their recent 1-8 road trip after the All-Star break, that didn't sound like a bad idea. The only problem with that idea is that it will never happen.
It can't ever happen.
Why? Money, of course.
Phillies GM Ruben Amaro Jr. said that he doesn't ever envision a time when his team undergoes a complete rebuilding process. When your revenues are as high as the Phillies organization, you can make those statements. Long gone are the days when the Phillies were considered a "small-market team," as former team president Bill Giles once said. Now, the Phillies are in the rarefied payroll status of the Yankees and Red Sox. And they will be staying there for the foreseeable future.
The Phillies' new(ish) ballpark is appropriately named after a bank, because it basically allowed the team to print money and expand the payroll right up to MLB's luxury tax threshold. While the sellout streak ended this season, Citizens Bank Park is still a major revenue source for the Phillies. Unfortunately, the economics of major sports today isn't dependent only upon gate receipts. The real money comes from broadcast rights, and that is where the Phillies are really about to join the "Big Boys."
The Phillies' current local television deal with Comcast is good, but it's about to become great. That's because the Phillies' current deal is going to expire after the 2015 season. Under normal circumstances, the Phillies would have been due a nice increase from Comcast, but recent events will guarantee that the Phillies will join the likes of the Yankees, Red Sox and Dodgers in their next local television deal.
Everybody knows how the Yankees became behemoths in television revenue by creating their own regional sports network, YES. But did you know that they recently divested a portion of their ownership to Fox Sports? Yes, Fox.
You see, Fox Sports is about to launch Fox Sports 1, an all-day sports channel that hopes to challenge ESPN for ratings. Before you laugh, think about how stupid we all thought the idea of the Homer Simpson network broadcasting NFL games was so many years ago. Apparently, Fox knew what it was doing all along, so doubting its new venture would be foolish.
What would also be foolish is for the Phillies to sell off all their marquee players and start a rebuilding process with younger players. Simply put, that isn't even an option.
The Phillies need to stay relevant in order to continue to pile up impressive television ratings. They had the second-best television audience in 2001 with an average of 276,000 viewers per game and still had the fourth-best average in 2012 with 168,000 per game, in spite of a .500 record on the field. The reason for that is that fans like to see stars. The Phillies have plenty of stars in Ryan Howard, Chase Utley, Jimmy Rollins, Roy Halladay, Cliff Lee and Cole Hamels. The problem is that most of those stars are well into their 30s.
The Phillies can't dump all of those stars and start to rebuild like, say, the New York Mets did this season. They need to keep most of their big names and even add to them in order to keep a competitive team on the field. If the team's record suffers, the TV ratings will decline accordingly. That is simply bad business, and major sports teams aren't in the habit of making bad business decisions.
To let you know what kind of money we're talking about here, some perspective is in order.
Mark Walter and his group bought the Los Angeles Dodgers for $1.2 billion last year, even though the team itself obviously isn't worth that much money. What he really bought were the television rights. The move paid off, as their deal with Fox ended up being close to $8 billion.
The Dodgers made trades for big-name players like Hanley Ramirez, Josh Beckett, Carl Crawford and Adrian Gonzalez as much for their name value as for their production on the field. The team that former owner Frank McCourt ran into bankruptcy, suddenly is worth over a billion dollars thanks in large part to the television revenues. That's why the Phillies won't be selling off their aging stars.
If a Dodgers team that can't even crack the top 5 in television audience size can get an $8 billion deal, the Phillies should be able to do the same. Sure, L.A. is considered a more attractive market than Philadelphia, but L.A. isn't exactly a sports town. Philly is. Plus, the Phillies are going to have Comcast and Fox Sports engaging in a bidding war.
Comcast is headquartered in Philadelphia, and there is no way it wants to lose the local broadcast rights to the hometown Phillies. Before you count out Fox, remember that it did what was previously unthinkable and got a piece of the YES Network. According to insiders, it won't be able to get either the Mets or Red Sox, so Fox Sports has set its sights on the Phillies. Fox Sports has already scooped up the local TV rights to about half of MLB, and it apparently wants another East Coast team like the Phillies.
That is great news for the Phillies and their fans, because that means that the money will continue to roll in. That, in turn, will keep the team's payroll among the top 5 in baseball for the foreseeable future.
Of course, that can't happen unless the Phillies maintain their status in the top 5 in local television ratings. And the only way to do that is to keep winning games on the field with star players.
All of this is a very long-winded way of telling you why the Phillies were not sellers at the trade deadline. They may ship out players like 3B Michael Young and catcher Carlos Ruiz for a few prospects before the August 31 waiver trade deadline. That's the second trade deadline where teams have to pass players through waivers before they can trade them. They may even try to trade closer Jonathan Papelbon, if someone is willing to take on what's left of his enormous contract, but the core of star players will being staying in Philly for at least a little while longer. Technically, that's more of a retooling than a rebuilding. It's what the Yankees and Red Sox do. And now, it's what the Phillies will do as well.
Sometimes there is more that goes into the decisions of a professional sports team than just what transpires on the field. Sadly, it almost always involves money. Normally, that isn't a good thing but at least this time, it's a very good thing for the Philadelphia Phillies.
Bob Whalon is a life-long Philadelphia sports follower. He has seen far more losing seasons than winning seasons from his beloved Phillies and apparently isn't ready to let go of the single greatest era of Phillies baseball just yet.
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