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View Full Version : Will the economy affect FA asking prices?


guillen4life13
10-13-2008, 10:34 AM
Given that overall sports revenues are expected to decrease (the NBA has just announced a cut of 9% of their domestic workforce) due to the economy, do you think that free agents will have less leverage when it comes to contract negotiations?

I'm not expecting their prices to go down, but rather would you think that contracts will stay at the monetary level that they were at last season?

What do you think?

Parrothead
10-13-2008, 10:46 AM
Given that overall sports revenues are expected to decrease (the NBA has just announced a cut of 9% of their domestic workforce) due to the economy, do you think that free agents will have less leverage when it comes to contract negotiations?

I'm not expecting their prices to go down, but rather would you think that contracts will stay at the monetary level that they were at last season?

What do you think?

I hope they go down but they will not since many of the players have no concept of reality. Their salaries are out of hand. yes, I know they are worth what someone is willing to pay.

jabrch
10-13-2008, 11:12 AM
Given that overall sports revenues are expected to decrease (the NBA has just announced a cut of 9% of their domestic workforce) due to the economy, do you think that free agents will have less leverage when it comes to contract negotiations?

I'm not expecting their prices to go down, but rather would you think that contracts will stay at the monetary level that they were at last season?

What do you think?


I want to see if the economy impacts the ticket sales, in particular for the luxury tickets, for the two NY franchises in their new parks. That will be an indicator to me as to what we will see with salaries.

Steelrod
10-13-2008, 11:34 AM
Bad example. The Yankees will sell out no matter. The $2,000 seats were the first to go. The Mets, on the other hand may give some insight.

DumpJerry
10-13-2008, 12:18 PM
I want to see if the economy impacts the ticket sales, in particular for the luxury tickets, for the two NY franchises in their new parks. That will be an indicator to me as to what we will see with salaries.
Front row seats in the new Yankee Stadium next year are $5,000.00 per game ($405,000.00 for the season for one of those chairs).

Second row is the bargain.


$2,500.00 per seat per game.

CashMan
10-13-2008, 12:30 PM
Front row seats in the new Yankee Stadium next year are $5,000.00 per game ($405,000.00 for the season for one of those chairs).

Second row is the bargain.


$2,500.00 per seat per game.


Ray, people will come, Ray. They'll come to Iowa for reasons they can't even fathom. They'll turn up your driveway, not knowing for sure why they're doing it. They'll arrive at your door as innocent as children, longing for the past. "Of course, we won't mind if you have a look around," you'll say. "It's only twenty dollars per person." They'll pass over the money without even thinking about it; for it is money they have and peace they lack.

I thought of that quote when you said how much tickets were going to be.

LoveYourSuit
10-13-2008, 12:32 PM
Attendance - I think the Small Market Teams will suffer the most.

Corporate Revenue (Ads) - Everyone will take a hit.

DumpJerry
10-13-2008, 12:40 PM
Ray, people will come, Ray. They'll come to Iowa for reasons they can't even fathom. They'll turn up your driveway, not knowing for sure why they're doing it. They'll arrive at your door as innocent as children, longing for the past. "Of course, we won't mind if you have a look around," you'll say. "It's only twenty dollars per person." They'll pass over the money without even thinking about it; for it is money they have and peace they lack.

I thought of that quote when you said how much tickets were going to be.
Ironic post given your username.

While I'm sure they will sell out those hyper expensive (overpriced) seats, it will be a tough challenge since most of the usual customers are now out of business on Wall Street.

It will be an interesting summer in New York as both teams open new parks and try to convince the locals that they can, indeed, make the post season.

Parrothead
10-13-2008, 02:09 PM
I want to see if the economy impacts the ticket sales, in particular for the luxury tickets, for the two NY franchises in their new parks. That will be an indicator to me as to what we will see with salaries.

The Mets announced that they sold all their luxury boxes already.

http://www.cnbc.com/id/27120272

MUsoxfan
10-13-2008, 02:21 PM
I think the effect might be seen more in 2010 than in 2009. Many corporations probably already set aside funds for luxury boxes and uber-expensive Yankee tickets in 2009 before the recent plunge

Foulke You
10-13-2008, 02:54 PM
There are certain teams that are probably immune to the economy. The Yankees, Mets, Red Sox, Dodgers, and Cubs come to mind. These are the teams that usually set the bar sky high for free agents anyway so I doubt we'll see a reduction in free agent asking prices any time soon.

I think teams like the Brewers, Twins, Royals, and even the White Sox to an extent will feel the economic pinch a lot more than the other clubs I mentioned. People will go to a few less games, buy a bit less in concessions, and that means less revenue overall.

WhiteSox5187
10-13-2008, 04:24 PM
There are certain teams that are probably immune to the economy. The Yankees, Mets, Red Sox, Dodgers, and Cubs come to mind. These are the teams that usually set the bar sky high for free agents anyway so I doubt we'll see a reduction in free agent asking prices any time soon.

I think teams like the Brewers, Twins, Royals, and even the White Sox to an extent will feel the economic pinch a lot more than the other clubs I mentioned. People will go to a few less games, buy a bit less in concessions, and that means less revenue overall.
Actually those clubs might see their attendance go up. People who are feeling a pinch might not have enough money to go on a vacation to Florida but might have enough to go to a few ball games and figure "Well, we can't do Florida, but the Sox are in town tonight, and they're playing well...plus there are fireworks!" Really it depends on the seasons those teams have, if they're good, people will come. If they suck, people will stay away.

Also I think most teams make most of their money from TV deals these days.

UofCSoxFan
10-13-2008, 04:49 PM
There are certain teams that are probably immune to the economy. The Yankees, Mets, Red Sox, Dodgers, and Cubs come to mind. These are the teams that usually set the bar sky high for free agents anyway so I doubt we'll see a reduction in free agent asking prices any time soon.

I think teams like the Brewers, Twins, Royals, and even the White Sox to an extent will feel the economic pinch a lot more than the other clubs I mentioned. People will go to a few less games, buy a bit less in concessions, and that means less revenue overall.

Some interesting points to consider: The economy is certainly better in some areas than others. Chicago, for example, still is relatively strong as it is very diverse and not overally tied to the financial or technology sectors, which are being hit hardest right now. I could see San Fransisco and New York, on the other hand, being impacted a lot. Another point: Detroit had very high attendance this year (due to high expectations and a good team) despite having the weakest economy in the US (they had 10% unemployment even before the latest "crisis" when the national average was slightly above 4%).

Sometime in times of economic stress, people become even more passionate about their teams as a diversion (see fans of the Pittsburgh Steelers).

I think attendance will be down and salaries will likely go up only a little bit. They certainly won't go down as the general labor market rarely sees decreases in salaries, let alone a professional sports labor market.

The NBA laying off 9% of its work force, which includes accountants, PR people, etc... that could be replaced by people at any number of corporate firms won't reflect a similar decrease in salary/employment of its talent force where there is a strikingly more limited supply of "employees."

Steelrod
10-13-2008, 05:46 PM
We won our division and were in 1st place for almost the entire season. Yet attendance was still down for 2007!

DumpJerry
10-13-2008, 07:22 PM
There are certain teams that are probably immune to the economy. The Yankees, Mets, Red Sox, Dodgers, and Cubs come to mind.
While it appears that the Cubs are in great shape financially, they aren't. After the Yankees, they have the highest contract obligations in MLB. They are in a tight bind because, unlike the Yankees, they raised ticket prices for the 2008 season by well over 10% (IIRC from what Steve Stone reports, it was over 20%). The Yanks did not and this is how the Yanks can jack up the prices next year. If the Cubs try to do a huge jack on their prices two years in a row, especially if it's to pay for existing big contracts, they will be hurting in the sales department. A lot of their ST holders and frequent single game buyers said it was ok to pay more for 2008 because they saw a lot of potential for how '08 would end based on the '07 season. That is no longer true.

This is probably part of the reason why they have not been able to sell the team yet and some of the well-heeled potential buyers fled after seeing the books.

PatK
10-13-2008, 09:35 PM
Cubs aren't as financially sound as people may think (when compared to the Red Sawx, Yankees, or Mets), mainly for the fact that they are trying to find a buyer, and they are hamstrung with some pretty $$$ contracts that the new owners won't be able to get rid of no matter how hard they'd try (Soriano and Fukudome the most notable).

The economy has cooled some of the interest in buying the team.

The big thing they have going for them is the Chicago economy hasn't been beaten down as elsewhere (as someone has mentioned), and their two consecutive post-season appearances.

Dibbs
10-13-2008, 10:39 PM
Even if you had the money to be able to spend $5K on a regular season Yankees game....why would you?

DumpJerry
10-13-2008, 10:42 PM
Even if you had the money to be able to spend $5K on a regular season Yankees game....why would you?
Clients. My top earners. Just two reasons.......