Bloomberg just came out with their valuations for every Major League Baseball team. Check it out, the interactive graphic is really cool and fun to play with. There really are not any surprises to the rankings, but it is fascinating to see the various differences from top to bottom.
These rankings are different from the ones that Forbes presents because Bloomberg has added in the value of sports networks. I believe that is a smart addition. In today’s world, owning the media and controlling ability to broadcast the teams everywhere is key.
The TOP 5:
- 1) New York Yankees ($3.3 billion): Of course, they are the top dogs. One of the most valuable teams in all of sports in the entire world.
- 2) Los Angeles Dodgers ($2.1 billion): They don’t get credit for a “regional sports TV deal” but are still #2. But over a BILLION less than the top.
- 3) Boston Red Sox ($2.1 billion): Gate, concessions and merchandising all keep Boston near the top. Success on the field has helped.
- 4) New York Mets ($2.0 billion): Although the Mets suck, the team is still worth a lot. The media deals are very good and the NY market huge.
- 5) Chicago Cubs ($1.3 billion): Another big drop from the 4th place Mets. Cubs continue to hold value although the team never wins.
The BOTTOM 5:
- 30) Tampa Bay Rays ($0.53 billion): Tampa is worth 1/7th of the Yankees. Remarkable that the team has been winning for the past few years.
- 29) Kansas City Royals ($0.54 billion): The Royals are owned by former Wal-Mart executive. Cheap. This is an example of not investing in the team.
- 28) Cleveland Indians ($0.57 billion): Get rid of the “smiling Indian logo.” Small market with no media revenues.
- 27) Colorado Rockies ($0.58 billion): Attendance is pretty good at #10, but again no media properties hamper the valuation.
- 26) Oakland Athletics ($0.59 billion): Same story as the others. No media. No fans. No concessions. No money. But they win.
The major differences between the most valuable and the least comes down to the media packages. The TV, radio, etc. rights are a function of the size of the audience. The three largest markets, NY, LA and CHI have the most valuable teams. BOS has such a strong regional appeal (all of New England) and “Red Sox Nation” throughout the USA. Plus, Boston has won three World Series in 10 years.
TB, KC, CLE, DEN and OAK are all small markets. Although none of these teams has won a World Series, most of them have been competitive. So, the size of their markets totally restricts their ability to have franchises worth more. Also, none of these teams has a “regional sports network.” That is a huge difference.
Some comps:
- The Yankees made $932-million from their regional sports network. That alone is more than the total value of 18 of the 30 teams.
- The Yankees paid $97-million into the revenue share pool. The Royals received $36-million from the pool. Socialism?
- The Yankees made $265-million from the gate receipts alone. The six bottom teams (TB, KC, CLE, OAK, PIT, SD) all made less than $40-million.
- The Yankees are still over $1-billion higher than the second place Dodgers.
My favorite team, the St. Louis Cardinals are in the middle at #15 and $0.85-billion). Although they were #2 in attendance and have a successful franchise and tradition, the lack of a media outlet and regional sports network brings their value down.
Own the media.
The value will follow.
