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2020 Season
#161 · June 14, 2020, 1:54 pm
It is going to be an "interesting" week. Since the ebb and flow is never ending .... would guess even without an official counter offer there still is some back door discussions.
Taking it at face value, Manfred is limited by the terms of the CBA and the March 26th agreement (approved by all the owners) ... basically an amendment to the CBA.
Not sure all the elements of the March 26th agreement ... but things such as service time considerations were approved, likely many of the other "details" were not defined and guess they have to revert to the CBA. There are limitations on the unilateral authority of Manfred (that is why there are contracts and Unions).
Seems to be consensus Manfred has the authority to define the number of games and the schedule. Plus most think it clear that Manfred does not have any right to cut salaries (per game). The agreement is pretty clear on full prorated salaries. No idea if the agreement included the expanded playoffs or if that was a subsequent idea that did not "approved" in any agreement.
Owners can argue all they want that ... in their view ... the Union did not negotiate in good faith that now the games will be without fans in the stands but hard in my mind to convince a neutral arbitrator that refusing to take a pay cut (work games for free) is crossing that line ... especially when the owners have a 50 game option at full prorated pay that they are willing to implement.
If the owners actually want a season ... even at 50 games ... they can't afford the time to take it to arbitration ... make the cases from both sides .... get the arbitration to make a decision ... and that decision at best is a direction to go back to negotiations since the arbitrator in this case probably can't (or wouldn't) try to dictate pay cuts to players considering no specific cuts were part of the agreement.
Hard to see the owners moving from the 50ish game season (and that cost) if the offset is getting to the lucrative playoffs. Seems as though their view is any more games need to result in players taking cuts to offset any other per game losses so the owners remain breakeven (or better) for the year.
Other than the PR / image hit .... would guess the owners don't want to cancel the season and miss out on the revenue from a post-season which might make their 2020 losses even greater. Cancelling 2020 would be shooting themselves in the foot.
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Anyone want to start taking odds on a STRIKE/LOCKOUT in 2022 with the CBA up in the air. IF there is animosity now ... wait until all the issues are on the table without the backdrop of a pandemic.
#162 · June 14, 2020, 5:58 pm
- No idea if the agreement included the expanded playoffs or if that was a subsequent idea that did not "approved" in any agreement. 2. Hard to see the owners moving from the 50ish game season (and that cost) if the offset is getting to the lucrative playoffs.
I am near certain there was no playoff modification/expansion in the March agreement. This was why players were able to & did offer it as a negotiating chip (even if it is self serving; more playoff $ to them). Re your 2nd point.... WHY?!?!
If you have to play "50" games (full pay) anyway, to get to the old playoffs, why would you NOT play a greater # of games to get to an expanded playoffs = more $$$? It's a simple math problem of how many more games (at a loss) makes financial sense to get to the $$ difference of the larger playoff field. I get the "who bears the risk of the playoffs NOT happening" issue, but I 100% understand why the players said "we're done here" when they put hundreds of millions on the table by offering expanded playoffs for TWO years, and owners response to that was... basically the same offer they made before.
#163 · June 15, 2020, 6:49 am
Agree with your premise but that would take agreement with the Union ... but without a new agreement (illogical as that may be) ... the owners seem comfortable with 50 game slate and normal playoffs. Should note that we really don’t know if that .. for the owners .. is breakeven or still is a profit (good bet it is not them taking more losses).
My guess is that owners are not jumping on the SECOND year of expanded playoffs providing funds for more games (players salaries) in 2020 because they want to get that and keep all those revenues for themselves in 2021 ... figuring they can get that Union concession for less costs. Ties a bit to the owners not wanting to defer any salaries ... improves 2020 cash flow but comes out of 2021 profits in a normal season.
Owners seem to want to quarantine 2020 from a financial perspective ... and only focus on potential 2020 losses which is to their benefit. Keep the greater than expected profits of the past few years (per some national media reports) or future profits to themselves and not “share” that with the players.
Another “missing scenario” in any of the owners’ offers is the condition IF fans (at some level) start attending games. If players have to take the risk of no playoffs why shouldn’t they get some benefit from fans in the stands. DeWitt (STL) seems to believe most of his profit comes from fans in the stands (few really believe that). Hmmm ... could it be the owners want to keep all the upside while having the players take all the down side.
Side: the Union does not want to take any per game pay cut in 2020, in part, to set a precedent for 2021, if (because of the virus) fans are still “limited” in the stands.
Really this is a multi-layered negotiation and although we fans just want games ... both the owners and Union are trying hard to either avoid some future unintended consequences or to get some future advantage setting up the next CBA.
#164 · June 15, 2020, 9:24 am
The Athletic today speculates that this outcome is actually what the owners wanted; because they DON'T share in the TV revenue for the existing playoff format. Players' share under CBA is solely a % of gate.
This is just one of many many "points" that "need" to be changed this year due to the circumstances, but have been established by CBA in the past ... by 2 sides that essentially aren't talking to each other. This might be a bigger issue / hurdle to a re-start than people realize. Just because $ is "resolved" doesn't mean everything else is.
#165 · June 15, 2020, 9:59 am
Rosenthal is probably right given the way the owners are forming their offers. Manfred will mandate a 50 game slate.
We are at a bit of a disadvantage in understanding the finances (other than just some blind speculation) on the owners side. For all we know a 50 game schedule plus normal playoffs, all without fans, is a profit maker for the remainder of the season and offsets some early season losses ... that would make sense as an owner making that a baseline plan. Then an incentive for the owners to add games (and expand the playoffs) would have to add more to their overall profits and that would be modeled differently with some sort of breakeven point on cost of added games vs. new revenue ... plus that has to begin to factor in the risk of no playoffs for the pandemic. The more games ... the greater cost during the season that would not be offset if no playoffs ... resulting in a greater loss (than the 50 game plan) for the owners.
So, if the owners' 50 game plan works for them financially ... the only acceptable plan for them is zero downside risk from that plan and some upside profit potential. Risk is hard to quantify and greater loss may be perceived as much worse that less loss or more profit. (side: there is some sort of analysis technique that "balances" the values of minimizing loss and maximizing gains to achieve an "optimum" decision using probabilities of multiple events .... way out of my league).
#166 · June 15, 2020, 10:40 am
June 15th and still no agreement!
UGH!
#167 · June 15, 2020, 12:20 pm
Your analysis of Owners technical position as business owners trying to limit risk is probably correct.
The problem "average" people have with it is; why should Billionaires' business NOT suffer in the year of Coronavirus, when SO many other people's businesses and incomes are struggling so badly. The players ARE losing 2/3 of their income, and while most don't feel sorry for them either, and no one expects 100% of limited revenue to just be "given" to players, to take the stance that "our businesses have to make a profit, or maybe more accurately, 'cash flow positive' no matter what the underlying circumstances" is about as tone deaf as is humanly possible given the situation.
#168 · June 15, 2020, 1:25 pm
Yeh, the owners are really out of touch with common man (and woman), the impact of the current pandemic on the mood of the fan base, and somehow have become focused on the "short run" and "winning" the negotiation to the detriment of their long run benefit (at least that is my view but apparently not the owners).
Did hear Buster Onley today ... he too seems really frustrated with everyone but especially the owners. He actually invoked Jeff Luhnow (our favorite defrocked Astros GM) as one of the catalysts for the MLB front offices / owners to be taking this hard line, short run stance.
Before entering MLB, Luhnow was part of McKinsey and Company a major management consulting firm plus his education is Economic and Business Management. What he brought was analysis at the detail level AND the attitude to win every small detail at any cost (bang the trashcan).
Front offices saw his success .... built similar analytic front offices with similar mode of operation.
Combine that win every point attitude and probably the belief that the unwashed masses that are the fans will just come back because .... well baseball is great ... set them toward not factoring in the future. Plus, they are just making playing in 2021 (if not with full fans in attendance) and the follow CBA just more contentious.
Profit is always on the margin ... so if MLB attendance just drops because they lost 5-10-20% of fans ... it will kill profits then layer on the 2021 work stoppage (same issues as 2020) and the lockout / strike in 2022 ... doomsday scenario for some owners.
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Side note: wasn't Fowler identified as one of the two point league negotiators? No words of wisdom from him and should we put some of this owner posturing on him?
#169 · June 16, 2020, 7:51 am
Well, every day a new "insight" into negotiations .... all very frustrating.
Ken Rosenthal and Evan Drellich of The Athletic report that
- Rob Manfred would need approval from 23 of the game’s 30 owners to open the season AND “There are definitely more than eight owners who don’t want to play,” one player agent told Rosenthal and Drellich.
- It may be a moot point. Manfred is not required to force the start of a season, and according to Rosenthal and Drellich, it doesn’t appear his office will do so over fears of a potential billion-dollar grievance from the union. Which apparently was in a note form one of the negotiators based on the owners not negotiation in good faith.
So if they don't have the votes to start a season AND will not take the risk of losing an arbitration over a grievance ... just maybe the 2020 season is toast.
The fact that some owners never did want to open the season had been speculated but this is the first report (albeit still opinion) citing this high a level, may does a lot to explain why the owners don't seem to want to move in negotiations.
#170 · June 16, 2020, 7:55 am
Can't recommend the Athletic (subscription) enough, just for Rosenthal's pieces. I also love that you can tailor your story "feed" to your teams.... I like to follow my teams in depth, but don't want to read another Tom Brady article. I care about some overriding issues like MLB season happening or not, so I get those too... There's my unpaid plug.
The Union led by lead negotiator Meyer has boxed the owners/Manfred in... kind of. By players agreeing to a Manfred imposed season length when there is still time on calendar to go much > 50 games, the door is open for the players to file a grievance they would have a good chance of winning that owners didn't attempt to maximize # of games played.
Manfred's "not 100% sure a season will happen" 180 is either a delaying tactic to try to shrink calendar down to 50 game range (theoretically eliminating a grievance for longer season), OR more ominously a signal that as many have speculated, some owners really don't want to play this season at all due to the losses they'll take with no fans... Manfred needs 75% (23) approval from owners for his "imposed" season. Rosenthal quotes player agent source saying their are "definitely more than 8" owners who don't want to play the season this year, so not a given Manfred would get it.... opening no season possibility. Apparently per terms of March agreement, some of the underlying conditions (Coronaviurs prevalence. travel & social distancing requirements) make it possible for Manfred to NOT play the season. In other words, he doesn't HAVE to impose the 50 game season. But not playing would be catastrophic for baseball...
Owners wanting to avoid a grievance is good business sense. Owners wanting to not play season and possibly being forced to go on the record voting against it (& citing BS reasons why)... do we the public find out who?.... SOOO short-sighted. I find it hard to believe players wouldn't still have some grounds for a grievance there? But more importantly, as Rosenthal writes, Manfred's leegacy is on the line.... it IS possible to get players to sign off on no grievance; by making real concessions (i.e. actually negotitating!).... he speculates 62-65 games @ full pay for expanded playoffs. Any attempt to negotiate has to START with the reality of players getting paid 50 games full pay... go from there. The $/game "negotiation" is over!