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View Full Version : How John Harrington changed MLB to make the rich get richer


Fenway
12-09-2010, 05:40 PM
Like everybody else I am a little stunned by what Boston has done the past 5 days but not really surprised. The Red Sox created a monster in 2001 when they decided to switch NESN from a pay service of $10-12 a month to basic cable.

These 3 articles give background

http://www.forbes.com/forbes/2002/0415/092.html

http://www.sportsbusinessdaily.com/article/10513

http://books.google.com/books?id=tHFMP525iS4C&pg=PA100&lpg=PA100&dq=moving+nesn+to+basic+cable&source=bl&ots=aaWISMRamh&sig=ayLRMpimnJZs2nTFN8Y9y1rs88c&hl=en&ei=


When the Red Sox were put up for sale in late 2000, they knew NESN was the sleeping giant in the sale especially because Charles Dolan was at the door waving $$$$$. Harrington and Dolan despised each other dating back to when NESN was born in 1984.

Dolan owned SportsChannel ( which in many markets is now FOX Sports xxxxx )

Dolan of course bought SportsVision in Chicago for little money as JR simply wanted out and Dolan knew what would happen when Chicago finally was fully wired for cable. At the same time he also bought PRISM which was Philly based and was a HBO type service that in Philly and Boston showed movies and sports. (Boston it was the Celtics)

In New York he paid the Yankees 50 million for a 10 year deal around 1983 for half the games to move from WPIX to cable and brought back Mel Allen.

He then tried to buy the rights to the Red Sox and Bruins but Buddy LeRioux and Jeremy Jacobs decided to launch their own channel (NESN) instead that was similar to what the Tigers had in Detroit with PASS. NESN was at first 60% owned by the Red Sox, 20% by the Bruins and the other 20% by Viacom (which owned WSBK-TV and had the over the air rights to the Red Sox and Yankees)

Dolan was not happy and he refused to even offer NESN on his Massachusetts cable systems (Cablevision) which included Boston. This went on for almost three seasons as Dolan was trying to break NESN.

(The NY Daily News wrote about this in 2002 when Dolan tried to stop YES) (http://www.nydailynews.com/archives/sports/2002/04/19/2002-04-19_hizzoner_s_turn_at_bat.html)

The Mayor of Boston finally told Dolan in 1986 he would revoke his Boston franchise unless he got the Sox on his TV that night (remember the Red Sox were the surprise team that year)

So for almost 15 years NESN was $10 a month or $15 if you added Sportschannel (Celtics-Whalers)

Dolan kept offering to buy and Harrington said no. Dolan tried to buy Viacom's 20% but the Red Sox had the right to match it.

When Harrington decided to move NESN to basic the cable companies balked at first but in a master stroke he gave Comcast first option to buy the channel if they ever decide to sell it. Comcast added NESN to basic and Time-Warner, Cox and Charter did the same. Harrington made one major mistake, he assumed since NYY was locked into a long term deal with Dolan's MSG channel he couldn't counter. Ooops.

Steinbrenner quickly figured out he had to do the same and quickly formed YES and even paid Dolan a huge fee to break the contract.

The Mets followed a few years later with SNY which is really CSN but since Comcast is not a player in the cable market of NYC they allowed the SNY name.

CSN of course now has started sports channels in many markets and Dolan's FSN is hurting.

The problem is team owned cable only works in a few markets....Minneapolis and Kansas City tried and it was a disaster and the Indians STO only exists because the Indians owner can't stand Charles Dolan ( who is family LOL)

I expect in Chicago within 5 years you will see at least 2 sports channels... Bulls/White Sox and Cubs/Hawks going at it.

Bottom line - NESN going to basic started this madness.

and now NESN has launched
http://cdn.nesn.com/cat/cat_nesn_national_400.jpg

which is available in North Carolina, South Carolina, Florida and Michigan with more to come.

http://www.nesn.com/nesn-national-channel-listings.html

The rich get richer

Lip Man 1
12-09-2010, 05:53 PM
Fenway:

With respect, tell me something new.

It's been that way in baseball for decades. The Yankees even had their own major league farm team in the Kansas City Athletics.

This is nothing new.

Lip

Fenway
12-09-2010, 06:23 PM
Fenway:

With respect, tell me something new.

It's been that way in baseball for decades. The Yankees even had their own major league farm team in the Kansas City Athletics.

This is nothing new.

Lip


Lip

But the gap was never as wide as is today.

Bill Veeck saw this coming 60 years ago but his fellow owners just laughed at him.

Pete Rozelle DID listen to Veeck however and today a Green Bay can compete with NY and Chicago.

canOcorn
12-09-2010, 09:21 PM
FSN made a new deal with the Rangers in September that will pay the club ~$80M year.

CSN-Chicago might only be paying the White Sox ~$20M now, but that just means CSN is making a killing and while those profits don't show up on the Sox books, JR/Sox own 20% of CSN-Chicago.

Lip Man 1
12-09-2010, 09:49 PM
Fenway:

And pointing out that the gap has never been this wide does what exactly?

Everybody knows the Yankees and Red Sox will continue to outspend and buy anything and everything they need until MLB puts a 3rd team in N.Y. and a 2nd in Boston, devalues those existing franchises, forces their advertsing markets to shrink and lowers the value of their radio and TV deals.

It's actually very simple and will save everybody countless hours from posting threads on the subject. The only catch right now is MLB has a gutless Commissioner but that doesn't exclude the possibility that someday they may not.

The other "solution" is for MLB to can those owners who refuse to compete and simply want to rake in revenue sharing money and bring in billionairs like Mark Cuban who'll tell the Yankees and Red Sox to shove it up their rear end and go toe to toe with them from a money standpoint.

Either solution is preferable to what is happening now but again everybody knows what the problem is and has been for the past 15 years with all due respect.

Lip

ewokpelts
12-10-2010, 03:18 AM
the csn-chicago arrangement is very beneficial to all parties. each team is an equal owner in the channell(with comcast ). Rocky is on very good terms with Jerry(Rocky is a minority partner in the Bulls, and of course co-owns the UC with jerry), so I doubt he'd run off with the ricketts in 15 years to form a new channel. Also, the ricketts HAVE to sell to jerry thier share if they decide to split. I doubt they want to give jerry(or his successors in ownership) 60% control of a station.

cards press box
12-10-2010, 05:47 AM
Lip

But the gap was never as wide as is today.

Bill Veeck saw this coming 60 years ago but his fellow owners just laughed at him.

Pete Rozelle DID listen to Veeck however and today a Green Bay can compete with NY and Chicago.

And how long will teams like the Padres and Royals just accept with this situation? To put it another way, will the constant migration of the best talent from teams like Tampa Bay and San Diego to Boston and New York eventually result in baseball attendance just tanking in these small markets? What then?

So far, the smaller teams have not stood up to teams like the Red Sox and Yankees. If those teams get desperate enough, perhaps their desperation will give them the courage to do so.

I see two possible solutions: (1) more equitable sharing of local media revenue (e.g., the home and road team splitting all of the media revenue that a particular game generates) or (2) allowing small market teams to relocate to greener pastures without interference from the other clubs (i.e., elimination of the territorial rights that teams have for a particular area). Both possible solutions face tremendous obstacles among the owners. The most likely outcome is this: the current system, warts and all, will stay the same. At some point, the small markets will revolt but I don't think we're there yet.

Fenway
12-10-2010, 06:45 AM
Lip you will find this column amusing

http://bostonherald.com/sports/columnists/view/20101210al_east_back_to_normal_gotta_lovehate_sox-yanks/


A friend last night ( who happens to work for Yankees radio ) said...

Nobody comes to Cleveland for the theater...they come to New York..Why should baseball be different?


At least Boston keeps the Yankees honest

ZombieRob
12-10-2010, 07:28 AM
There really needs to be a cap in baseball. That, or some teams really need to fold. How is the Pirates who owned the 70's can't afford a team anymore? The Royals had a great run in the late 70's early 80's and can't field a team? Florida doesn't deserve any baseball teams. If a cap was in place guys like Torre and Francona would actually have to manage instead of picking their noses. Less teams and a cap IMO would so much improve the quality of baseball.

Fenway
12-10-2010, 08:30 AM
Lip

The irony is that the White Sox today could have owned a powerhouse in SportsVision but JR bailed out too early.




Fenway:

And pointing out that the gap has never been this wide does what exactly?

Everybody knows the Yankees and Red Sox will continue to outspend and buy anything and everything they need until MLB puts a 3rd team in N.Y. and a 2nd in Boston, devalues those existing franchises, forces their advertsing markets to shrink and lowers the value of their radio and TV deals.

It's actually very simple and will save everybody countless hours from posting threads on the subject. The only catch right now is MLB has a gutless Commissioner but that doesn't exclude the possibility that someday they may not.

The other "solution" is for MLB to can those owners who refuse to compete and simply want to rake in revenue sharing money and bring in billionairs like Mark Cuban who'll tell the Yankees and Red Sox to shove it up their rear end and go toe to toe with them from a money standpoint.

Either solution is preferable to what is happening now but again everybody knows what the problem is and has been for the past 15 years with all due respect.

Lip