A Territorial Rights Primer

Today I was looking through my 539 blog posts for something offered a proper treatment of the territorial rights issue. Alas, there was no real explanation. So I’ll try to put it in fairly simple terms.

A team’s territory can also be considered its sales region. Most national companies that have local branches or a remote sales staff follow a similar construct: they sell and advertise to customers within a defined area or region.

Two types of territorial rights exist, those for siting a stadium and those for broadcasting. The dynamics couldn’t be more different. Site placement tends to be determined by placing a stadium in the center of a large, dense population base. Historical matters come into play, as do peripheral factors such as transportation and civic redevelopment plans.

Attendance of a team’s games is active, as opposed to broadcasts, which are passive. Regular attendance is primarily limited to those within a fairly tight radius, 18-20 miles from the stadium. However, a team’s territory isn’t defined by this radius. Instead, it’s often defined by specific counties within a team’s market.

A team’s broadcast territory is usually much larger due to the nature of over-the-air broadcasting. A VHF TV signal can cover at least a 50-mile radius around it. High power, clear channel AM stations (like KNBR) can reach numerous states and hundreds of miles at night. The definition has evolved to include coverage of regional sports networks, which are carried by local cable franchises and direct broadcast satellite.

Most large cities are well separated from other large cities, allowing teams to set up virtual monopolies within their markets. The notable exceptions to this are the two team markets: New York City, Chicago, Los Angeles, Washington-Baltimore, and the Bay Area. Check out the circa-1999 rules noted by the late Doug Pappas:

  • The Orioles’ territory includes Anne Arundel, Howard, Carroll and Harford Counties in Maryland
  • The Marlins’ major league territory includes Palm Beach County
  • The Dodgers’ and Angels’ territory includes Orange, Ventura and Los Angeles Counties
  • The Yankees’ and Mets’ territory includes New York City, plus Nassau, Suffolk, Westchester and Rockland Counties in New York; Fairfield County south of I-84 and west of SR 58 in Connecticut; and Bergen, Hudson, Essex and Union Counties in New Jersey
  • The Athletics’ territory includes Alameda and Contra Costa Counties
  • The Phillies’ territory includes Gloucester, Camden and Burlington Counties in New Jersey
  • The Giants’ territory includes San Francisco, San Mateo, Santa Cruz, Monterey and Marin Counties, plus Santa Clara County with respect to another major league team

The rules have changed to reflect the Expos’ move to DC. Other than that, they haven’t changed at all. Yet one oddity remains in that the A’s and Giants have the only market that is split, not shared.

So by that count that gives the Giants seven counties (4.5 million population), while the A’s have two (2.5 million population). The most widely circulated explanation for this is the Giants, when they pursued a stadium in Santa Clara or San Jose in the late 80′s/early 90′s, had no outright claim to Santa Clara County, which was effectively up for grabs. Then owner Bob Lurie asked A’s owner Wally Haas for the rights to Santa Clara County. The change was granted by Haas, the commish, and the other owners. Subsequently, both stadium initiatives in the South Bay failed. Lurie held onto Santa Clara County’s territorial rights even as he moved his attention to St. Petersburg. The A’s were in the midst of a great run of on-field success and record attendance. Santa Clara County’s rights couldn’t have been further from Wally Haas’s mind. The rest is well-chronicled history.

The A’s, always the scruffy, overlooked team, have a decidedly adverse stadium and financial situation compared to many of their brethren. Who knew the Silicon Valley, fresh off recession and the closure of numerous defense contractors, would explode the way it did during the dot-com boom? That even after the bust, its economy would stay robust due to the continuing strength of tech stalwarts and the culling of the internet company herd? That it would become this desirable?

Territorial rights typically aren’t challenged, well, because there’s no need. Since most of the teams are already resident within exclusive markets, there’s no competition. Only NYC has the capability to hold another team, and while some teams have considered moving there, such a move has never been a serious threat. When it comes to television, it’s been more of a struggle. Potential moves to Portland, San Antonio, and the Carolinas all face challenges due to pre-existing broadcast territories. The explanation for why territorial rights haven’t been challenged is quite simple. Challenges haven’t been needed. That’s the rub. Since they haven’t been challenged whether on an individual team basis or on principle, owners haven’t wanted to set that precedent. Neither has any commissioner. It strikes at one of the core tenets of baseball’s antitrust exemption. It’s that kind of thinking that has MLB backing the largest set of lobbyists in pro sports.

In the next post, I’ll propose a clean, simple way for the Giants to give Santa Clara County to the A’s. Clean and simple? Really? Yes.

Then I’ll explain why it probably won’t happen.

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