MONEY MANAGEMENT
CUBS BUILD WITH MID-MARKET FORMULA, WHILE HOT DODGERS ALL IN WITH HIGH-PRICED VETS
Maybe the Pittsburgh Pirates can be instructive, or the Washington Nationals a blueprint, or the St. Louis Cardinals the role model.
But when it comes to whether the Cubs will one day have the organizational muscle to compete on all levels with the best in baseball some day, take a look across the field at the other guys this weekend at Wrigley Field.
The Los Angeles Dodgers — who might be the last of the big spenders in baseball — have redrawn the limits of big-market teams in the game at the same time the Cubs have drawn down their big-market advantage into mid-market business practices under Ricketts family ownership.
It’s well documented how the Cubs’ enormous lingering purchase debt impacts its spending ability and how chairman Tom Ricketts promises to restore baseball operations spending to pre-Theo levels only after the club starts making all that video-board and ballparksignage revenue.
But even if team president Theo Epstein and general manager Jed Hoyer’s restocking of the farm system produces the most optimistic version of the eventual young core they envision, it’s doubtful the Cubs will anytime soon approach the kind of “seize-the-moment” economic power that the Dodgers’ ownership has given Chicago-born general manager Ned Colletti.
“We had an additional element when we got to L.A., because of the history there,” said Dodgers team president and CEO Stan Kasten, of the group that bought the Dodgers for a record $2 billion early last year. “Because of the expectations. And frankly the support that our fan base has given us over a 50-year history.” Doesn’t that describe the Cubs? “It does,” said Kasten, who’s a “big believer” in Epstein and Hoyer and presided over most of the Atlanta Braves’ scouting-and-development-fueled run of division titles the last two decades. “But, again, the quality of celebrity stars and that history in L.A. was significant, particularly when we recognize so much a part of our future is tied up in sponsorship partnerships, media partnerships, everything with that going forward.
“And with that, we wanted to do both things at the same time. And so we did.”
That is, scout and develop a pipeline of players. And load up on the best players that could be found anywhere, with money being no object. That meant last year’s blockbuster trade with the Red Sox for Epsteinsigned, big-bucks free agents Carl Crawford and Adrian Gonzalez.
It also meant giving Cuban free agent Yasiel Puig a $42 million deal that included a $12 million signing bonus, and blowing away the Cubs and everybody else last winter with a posting bid of $25.7 million for Korean left-hander Hyun-Jin Ryu — who’s 9-3 with a 3.14 ERA since then as he faces the Cubs on Friday.
The major-league record $230 million payroll isn’t the intent, Kasten said. But seizing the opportunities available in a fast-changing player-acquisition landscape is, if it means building the best team. And, specifically, given the means. The Dodgers, of course, have that $6 billion regional TV deal that roughly coincided in timing with the sale of the team.
The Cubs make a fraction of that between a pair of deals with CSNChicago and WGN, and far different market forces at play as they use an opt-out clause to try to leverage the WGN part of the deal starting in 2015.
Industry figures from Kasten to agent Scott Boras suggest the Cubs should get deals commensurate with some of the big deals in other markets (L.A., Philadelphia, DallasFort Worth) but without suggesting local leverage points.
Good luck with that, Crane Kenney. The Cubs’ business president has to get that one right — and it still might not be enough to compete with the Dodgers.
Meanwhile, the Cubs charge the third-highest prices in the game and are in the midst of a fourth consecutive year of attendance declines under Ricketts ownership.
“I can’t speak to anybody else,” Kasten said. “We lead baseball in attendance, and the only thing that really matters to me is, ‘What can we do for the spectacular fan base that has been so great for 50 years?’ ’’