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dshawg1

Stanton to Yankees-Done

56 posts in this topic

3 hours ago, weird-O said:

The thing is, words like "win" and "competitive" have multiple meanings. When we fans use those words, we're mostly talking about what happens on the field. The Angelos group gauges those words in $$$$. They're winning like crazy, because money rolls in so fast, they can't keep up with counting it. 

Hence, my unwavering appreciation for what DD has accomplished in his time here. He has managed to give us a team that has been competitive between the white lines, in spite of the meddling that you mentioned.

* This next part in a preemptive response to those who will be very quick and excited about pointing out that DD inherited most of the team that has been winning, since he took over.
I know AM left a good foundation, but he didn't leave behind a playoff caliber team. AM was never, ever going to push the agenda of winning now. If allowed, he would have spent another decade losing games, amassing top 10 over all picks, while also blundering most of those top 10 picks, as he did with the ones he had to work with. DD made this team a post season contender. Which GM did most of the heavy lifting, is a topic for debate. But the thing that is undeniable is, DD decided to go for it, the day he was hired. No DD = no post season games in Baltimore.   

Good points.

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3 hours ago, weird-O said:

The thing is, words like "win" and "competitive" have multiple meanings. When we fans use those words, we're mostly talking about what happens on the field. The Angelos group gauges those words in $$$$. They're winning like crazy, because money rolls in so fast, they can't keep up with counting it.

That's an excellent point. Fans have only one countermeasure, and that's to stop buying tickets and even to boycott businesses who sponsor the team. And there will never be enough fans willing to do those things for it to matter. That is why I don't see anything changing until Angelos sells to someone who actually wants to win on the field.

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4 minutes ago, Evil Yoda said:

That's an excellent point. Fans have only one countermeasure, and that's to stop buying tickets and even to boycott businesses who sponsor the team. And there will never be enough fans willing to do those things for it to matter. That is why I don't see anything changing until Angelos sells to someone who actually wants to win on the field.

Actually, attendance isn't really a factor with this ownership group. Sure, larger crowds look better on TV. But the turnstiles aren't a major revenue source for the O's. Here's one reason I say this. The Ownership group has a really nice contract with the MD. Stadium Authority. The contract has a clause that says the amount of money the O's pay in rent, for OPACY, is based on attendance figures. The smaller the crowds, the lower the cost of rent. I've always held the opinion that Pete brilliantly danced with the X & Y axis, until he found the point at which he was maximizing attendance revenue. That is to say, he figured out that X number of fans in the seats gave him the best combination of incoming $$ at the lowest rent pmt. 

Pete and Co. make their riches from MASN. And that isn't limited to ad. sales. At the time that MASN went live, Direct TV agreed to pay Pete $3 for every subscriber in the O's territory. They got that, whether people actually watched MASN, or not. I'm not sure what that per house $ figure is now. Direct TV was happy to pass on that expense to their customers, because it was a great way to lure people away from Comcast. When Pete approached Comcast with that demand, they told him to take a walk. For them, it was insult to injury, since they had walked away from CSN in questionable circumstances, and a bitter divorce that took place in the courts. Direct TV was now the only TV provider that offered O's games. Eventually Comcast gave in, and also started carrying MASN. Pete won at every turn.  

And here's the most frightening thought of all. Pete could sell the O's tomorrow, but keep MASN. Imagine if a new ownership group took over, and had to subsist on the $25M they get from MASN, and whatever ticket revenue that comes in. That's what Waybe Huizenga did, when he sold the Marlins. He no longer owned the team, but he still owned the stadium, which included all the parking receipts, and all revenue from concession stands, plus the rent. He also retained all media revenue. If I remember correctly, WH didn't even have to pay the Marlins for the rights to broadcast their games, because of the contract that he created between his media company, and his baseball team. All the new owner got was ticket sales. Brutal     

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7 minutes ago, weird-O said:

Actually, attendance isn't really a factor with this ownership group. Sure, larger crowds look better on TV. But the turnstiles aren't a major revenue source for the O's. Here's one reason I say this. The Ownership group has a really nice contract with the MD. Stadium Authority. The contract has a clause that says the amount of money the O's pay in rent, for OPACY, is based on attendance figures. The smaller the crowds, the lower the cost of rent. I've always held the opinion that Pete brilliantly danced with the X & Y axis, until he found the point at which he was maximizing attendance revenue. That is to say, he figured out that X number of fans in the seats gave him the best combination of incoming $$ at the lowest rent pmt. 

Pete and Co. make their riches from MASN. And that isn't limited to ad. sales. At the time that MASN went live, Direct TV agreed to pay Pete $3 for every subscriber in the O's territory. They got that, whether people actually watched MASN, or not. I'm not sure what that per house $ figure is now. Direct TV was happy to pass on that expense to their customers, because it was a great way to lure people away from Comcast. When Pete approached Comcast with that demand, they told him to take a walk. For them, it was insult to injury, since they had walked away from CSN in questionable circumstances, and a bitter divorce that took place in the courts. Direct TV was now the only TV provider that offered O's games. Eventually Comcast gave in, and also started carrying MASN. Pete won at every turn.

And here's the most frightening thought of all. Pete could sell the O's tomorrow, but keep MASN. Imagine if a new ownership group took over, and had to subsist on the $25M they get from MASN, and whatever ticket revenue that comes in. That's what Waybe Huizenga did, when he sold the Marlins. He no longer owned the team, but he still owned the stadium, which included all the parking receipts, and all revenue from concession stands, plus the rent. He also retained all media revenue. If I remember correctly, WH didn't even have to pay the Marlins for the rights to broadcast their games, because of the contract that he created between his media company, and his baseball team. All the new owner got was ticket sales. Brutal     

Boy, that's an ugly scenario. It basically means that Angelos or his heirs will keep earning money but the team will never be good again. Because, while I wouldn't buy the team without MASN in the deal, there's probably someone who will.

The inheritance tax, unless Trump kills it, might be what saves the Orioles as a viable (winning) franchise. Dynasties only benefit those on the inside. Failing that, MLB needs to step in and say, "a deal structured this way is not in the interest of baseball. Denied." However, the era of the strong commissioner (defined as one willing to gainsay an owner) is over in professional sports.

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57 minutes ago, Evil Yoda said:

Boy, that's an ugly scenario. It basically means that Angelos or his heirs will keep earning money but the team will never be good again. Because, while I wouldn't buy the team without MASN in the deal, there's probably someone who will.

The inheritance tax, unless Trump kills it, might be what saves the Orioles as a viable (winning) franchise. Dynasties only benefit those on the inside. Failing that, MLB needs to step in and say, "a deal structured this way is not in the interest of baseball. Denied." However, the era of the strong commissioner (defined as one willing to gainsay an owner) is over in professional sports.

Unless, of course, steps have been taken to ease the tax bite once the principal owner dies.

The Orioles could very well have been put into a trust, such as the Detroit Tigers when Mike Illitch passed away, or the Steelers with the Rooney family. The Chicago Cubs are currently owned by a trust, as were the Boston Red Sox after Jean Yawkey died. 

Or, insurance policies which would pay off the taxes upon the owner's death could keep the team in the family, such as with Jerry Buss and the Lakers. The trouble is, unless these steps were taken some time ago, the tax bill could still be enormous due to the skyrocketing value of professional sports franchises. There's also the possibility of Angelos transferring control of the team to his sons, then paying the tax at that point as a gift tax, such as Lamar Hunt did two decades ago with the Kansas City Chiefs.

The business model of a sports franchise as a family business is dead and gone, largely because most family fortunes--such as the Wrigleys with the Cubs--cannot cover the tax liability. There's also the potential of a valuation clash between the IRS and the estate's heirs, which can result in a long and protracted legal battle. Thus, the only way to extract the true value, as well is to sell the business outright.

Whether or not Angelos has done any such thing, I have no idea, though I would tend to doubt it. I've seen various articles stating that Angelos has been told by advisers on more than one occasion that he needs to work out the inheritance, but he has yet to do so. Owning a major league team is much more than possessing an extremely valuable asset; it's a platform that not even an enormous fortune can provide a man or a family. Without the Orioles, Angelos is just another trial lawyer.

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Yes, that's why I said "might". :)

I am sure that as a wealthy man and as a lawyer Angelos is well aware of how to mitigate the effects of this tax, should he choose to take the necessary steps. Thanks for laying them out.

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