The 2014 MLB TV Windfall
Today’s report from Sports Business Journal’s John Ourand indicates that MLB’s national television deals are just about locked in. We’ve discussed this a couple times now. I’ve done some rough math on it, and the financial picture looks even healthier than I previously projected. Sure, the TV deals will more than double in value, from $660 million to $1.55 billion. But it’s when that figure is coupled with all other sources of national revenue that the picture starts to really brighten.
The table above reflects rising revenues from every source except for Sirius XM, whose deal was locked in years ago with the money paid in advance. MLB Advanced Media, the internet and broadcasting subsidiary of MLB, admitted last year that it was hitting nearly $500 million in revenue just for 2010. Combine each team’s share with other non-TV sources (adjusted for inflation), and each team comes away with $31.8 million per year. All told, that’s an estimated $83.5 million per year.
That doesn’t even include the dividend each team ownership group gets as an equity partner in MLB AM.
Every team is going to get this windfall, so it’s not as if the A’s or Rays are getting some great competitive advantage. It will allow both teams to be able to confidently offer FA-competitive long-term deals to their own free agents, though $100 million payrolls are still probably beyond reach. To get $100 or $110 million payrolls, both teams will need new stadia. The impressive thing about these bumps is that the A’s will get $10-15 million more via Central Revenue than they get from playing in the Coliseum. Add in local TV/radio and the usual $30 million or so in annual revenue sharing, and the A’s should net $180-185 million per year starting in 2014. Not rich compared to the other teams, but a far cry from destitute.