Publicly-owned teams?

dbish
02.08.11

Would making some of the smaller-market teams (or teams that just refuse to spend to stay competitive) publicly-owned help their situations? Looking at the success of Green Bay (I know, I know, not a baseball team…) over the years, I wonder if there’s something to be learned. Obviously the sports are set up differently, but just a simple thought/question to get some discussion going. Thoughts?

Here’s a link to the team payrolls for 2010


6 Comments on “Publicly-owned teams?”

  • Bethany Heck

    I would be inclined to push for pursuing something like this if there was a stronger tie to payroll and winning. Now, there might be when it comes to the regular season, but we’ve had plenty of lower budget teams make it far in the playoffs recently, and some, like the Giants, win it all.

    02-08-11 » 2:07 pm »

  • Ryan Barger

    The Cleveland Indians were the first Major League team to sell shares on NASDAQ in 1998 as a way of monetizing their success in the late 90′s. But I think those shares were bought out when the team was sold to current owner Larry Dolan.

    I think a team would be at a disadvantage for selling shares on the market just because of the level of sharing of financial data that is mandated for public companies. MLB teams have always kept the financial details as secret as they can.

    The stock exchange is already influenced so much on emotion and speculation. I bet a sports team would be a rather unstable stock… perfect for day trading. :-) (I say that without even looking at the stock performance history of Green Bay or the Indians).

    02-09-11 » 7:16 am »

  • dbish

    that’s interesting. i had no idea the indians tried it out already.

    02-09-11 » 9:56 am »

  • yoshiki89

    Well, the Indians did try it, yes…but that was before the highly controversial MLB Revenue Sharing policy was adopted officially in the early 2000s (the standard response to the question ‘why doesn’t the MLB have a salary cap?’).

    Here’s a brief article about Revenue Sharing: http://www.bnet.com/article/mlbs-revenue-sharing-formula/210897

    So theoretically (from a financial standpoint) there really isn’t an impetus for team payroll to be a reflection on how the team is doing at the bank. The only driver I can see is that with or without revenue sharing, teams that don’t do well financially only expose owners to takeover bids.

    Market is factored out with revenue sharing. It just doesn’t matter…how can the Pirates survive with 18 losing season? How can the Marlins survive with abysmal attendance figures? Those teams and others stay alive with the money made by teams like the Yankees that don’t have that problem.

    That’s the big difference: NFL feels that pressure because teams don’t ‘donate’ their X percent to the NFL pool. The NFL regulates this behavior with salary caps.

    The picture is way more complex than this, and I know as much about finance as I do diesel engine repair…but this is the way I understand it and how it works today.

    02-09-11 » 12:42 pm »

  • yoshiki89

    …and yes, I’m glad you brought up the Giants. Bring up the Padres also. Their rosters’ payroll couldn’t even staff the Yankees’ bullpen and yet, they manage to make things happen. Just when everybody begins to drink the Yankees’ Payroll Equals Wins kool-aid, somebody comes along and proves it really doesn’t matter; it only SEEMS like it matters.

    As a CUBS fan, I can testify to this personally…argh…

    02-09-11 » 12:46 pm »

  • sliver7

    There is a distinguishing factor left out with the Green Bay Packers’ situation. While they are a publicly owned corporation (since 1923), they are not a publicly traded company (meaning, one cannot simply buy shares on the open market, and they’re not traded on any exchange).

    In addition, the Packers’ articles of incorporation stipulate that no one person may own more the 200K shares (which, with the number of outstanding shares issued, is ~4% of the corp) and that shares never pay dividends.

    Also keep in mind that there was a very robust revenue-sharing system in place in the NFL (We’ll have to see how that works out when the current labor issues get resolved). Basically, the only money an NFL team takes in that ISN’T shared (in some way) with their opponents is exclusive merchandise (see: all the extra Dallas Cowboys stuff) and stadium concessions.

    04-10-11 » 1:08 am »



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