Tom Boswell Isn't Happy. . . With the way Major League Baseball is ignoring the economic opportunity offered by moving the Montreal Expos to Washington, DC:
Baseball, specifically the Montreal Expos, could have been here next season. Theoretically, they still could. (And the Easter Bunny could be real.) But baseball is blind to its opportunity.
MLB owns the Expos. Washington or Northern Virginia would pay more than $300 million for them. That one sale would erase more than a full year of the cash operating losses MLB claims it is suffering. Pay some indemnification to the Orioles, then divide the spoils among the 28 remaining teams. But that would be too sensible, too efficient, too constructive. In other words, completely outside baseball's ability.
It's relatively easy to bash major league owners. It's even easier to bash major league owners if you're a life-long Washingtonian like Boswell, and you've seen not one, but two franchises ripped from the city you call home. And indeed, on the surface at least, it appears that Washington is a great market for baseball. At the least, it's far better than the city Bob Short left in 1971 when he absconded to Arlington, Texas.
Over the past few years, countless columnists have made the case that the Baltimore-Washington area can support two teams. More often than not, they point to the fact that the area already supports two football teams. They also point out that while Baltimore pursued an NFL team, the Redskins owner at the time, the late Jack Kent Cooke, didn't say a word in protest -- in marked contrast to Orioles owner Peter Angelos, who skwaks loud and regular whenever talk about baseball in Washington gets uncomfortably close.
In the end, the argument for baseball in Washington from columnists like Boswell is simple. We've lost two teams, we've been teased too many times. You owe it to us. You've been unfair. It's a sham the nation's capitol doesn't host the national pastime. Can't we appeal to the better angels of your nature?
Gosh, Washington deserves baseball, can't you see?
Unfortunately, to paraphrase Clint Eastwood in Unforgiven, deserve's got nothing to do with it. Because for as long as Major League Baseball has a better business option, Washington, DC will never get a team.
"Sorry Mr. Boswell, deserve's got nothing to do with it."
And just what are those options? Consider this. Let's say at the end of the season MLB contracts two teams, the Expos being one. Because the team is owned by all 29 major league franchises, any losses the team racks up this year will be written off as a loss on the books of every franchise, thereby reducing their total tax liability.
In losing just two teams (let's say Montreal and Tampa Bay for example), baseball's partners in television could hardly care less. They don't get any ratings from Canadian cities, and losing Tampa as a major league city will affect their total ratings not a whit.
Now, let's say baseball waits a few years, and then decides it's time to grant a pair of expansion franchises. Just what will the price tag on those two franchises be? During the last expansion, in 1998, the total take from both the Arizona Diamondbacks and the Tampa Bay Devil Rays was $155 million each. If baseball waits 5 to 10 years, who knows how much they'll get next time?
So tell me, with that sort of money waiting over the horizon, why in the world would you sell to owners in Washington now?
Let's backtrack a moment. Remember the comparison between Cooke and Angelos that the columnists always make? Well, why don't we compare their two situations and see what we can discover?
Back in the late 1980s and early 1990s, when Baltimore was desperate to bring a team back to the city, Cooke was living the good life down in DC.
The Redskins were still in the midst of the Joe Gibbs era, and RFK Stadium was sold out every weekend with a season ticket waiting list 75 years long.
With a sold out stadium, and with NFL television revenues split equally between every franchise in the league, a new team in Baltimore presented absolutely no threat to the Redskins in any way, shape, or form. If an expansion team landed there, Cooke would get a cut of the NFL's expansion fee just like any other owner. If an exisiting team moved in, he'd suffer not at all (as it turned out, the NFL wound up charging Art Modell a fee for moving to Baltimore anyway, so the Redskins still made out on the deal).
If anything, the prospect of Maryland using public funds to build a new football stadium only played to Cooke's long-term advantage -- something that ultimately helped leverage just enough public infrastructure spending to get his new stadium built in the Maryland suburbs.
Now, consider Peter Angelos for a moment. Though, before this season, his stadium was regularly full, studies suggest up to 25 percent of his gate comes from the greater Washington area. Even worse for him, Washington represents a significant share of his total television audience. Worse still, it represents the most affluent segment of his cable audience.
We also know, courtesy of the Washington Post, that the Orioles would like to establish their own cable network to air their games once their contract with Comcast Sports Net expires in 2007.
Meanwhile, Comcast has expressed an interest in airing the games of a potential Washington franchise -- even to the point of suggesting that they would work to clear an additional channel across area cable systems so as not to interfere with their Orioles broadcasts. A channel that would undoubtedly be offered to Baltimore area cable systems as well.
So, Angelos is staring down the barrel of having competition for his gate, as well as competition for his television audience. Permanent competition. And, as many of us learned in Econ 101, competition usually drives down prices. Prices for tickets. Prices for advertising. Prices for a cable audience. Which means lower revenues, at least in the short term.
Knowing this, why in the world would Peter Angelos let a team move to DC just out of the goodness of his heart? The fact is, he would be crazy too. And for those who say the effect on his franchise would be minimal, doesn't it still make business sense to raise as great a racket as possible over the prospect? All the better to extract that much more blood from any DC ownership group -- money that would wind up in Angelos' pocket instead of the pockets of the other 28 major league owners.
And, if all that didn't work, are we forgetting just how Angelos made his billions? He's a lawyer for heaven's sake! If there's anyone who could use the courts to maximum advantage to block a team moving to Washington, it would be Angelos.
All in all, moving a major league team to Washington could prove to be a major league headache. So, why bother at all, especially when more lucrative business options remain open to you?
There would be only one reason that all of those obstacles could be overcome, and we could be sitting in RFK next spring watching the Washington Nationals open the season against the New York Mets. And that would come in the shape of an owner so powerful, with pockets so deep, that neither Angelos, nor the remaining major league owners could tell him no.
In the end, baseball isn't blind to the opportunity in Washington. If anything, it's more than aware of the potential obstacles. And when it comes to money, expect MLB to take the easy way out. Instead, let me suggest that it's Boswell, not MLB, who despite his best intentions, is blind to the cold reality of business.
