Killion asked Wolff about territorial rights while both were in Detroit for the ALCS last week:
And that statement is important, whether you believe Wolff or not. The A's have been in full-on sales mode regarding the new ballpark/village concept for some time now. At this point details are very important, especially the site. While San Jose may be more desirable for some in the Valley, the obstacles are enormous and it's possible that the financing plan being applied to the Fremont site can't work in San Jose without major modifications and delays.Wolff completely dismissed any lingering idea of moving the A's to San Jose -- a step that would require a deal with the Giants over territorial rights.
``That's over,'' Wolff said. ``Dead. Over. I'm not going to waste one more ounce of energy on it.''
Supposedly, the rub is that the Giants in the post-Bonds era could be in such dire financial straits that they may be looking for a bailout of sorts. Don't believe it. While Bay Area fans can argue for days about Brian Sabean's competency as Giants GM, the Giants will get enough players or stars to bring out a minimum of interested fans. A $75-85 million payroll allows for this - see Seattle for proof. That doesn't mean the Giants will be good, but they will at least have one overpriced slugger and probably one overpaid arm. Who knows, they may get rid of Sabean and overpay for a GM.
The idea that the Giants are going to be hemorrhaging money for the next decade is ludicrous. Let's remember some key facts about their operations:
- They may have $20 million in debt service every year, but they can write off about $5-7 million of that thanks to MLB's stadium operations expenses deduction.
- They're past the sixth year of their tenancy at China Basin, and officials have admitted that they can pull in 34,000 per game and still remain financially healthy. Below that, and they'd have to slash payroll a bit. Use this as a guide: each drop of 1,000 per game equates to $2.5 million in revenue. Even if they were to keep the entire amount (which they don't thanks to revenue sharing) that amount wouldn't even pay for a marginal player. If the G-men were to average less than 25,000 per game, then I'd be concerned. I don't see this happening.
- Thanks to vested interests in both KTVU and KNBR, the Giants can hide ad revenue and local broadcast rights fees. In 2003, a season after the Giants went to the World Series, they reported non-gate revenue of $78 million. The A's reported $75 million. Who's kidding whom?
- If it really does become dire straits for the Giants, they can do what the A's have been doing for years: suck on the teat of revenue sharing, if only temporarily.
- They could secure better bond interest rates because revenue streams to secure the bonds would not be tied solely to stadium revenue (the Giants struggled with this initially). Entitlements would pick up a majority if not all of the cost.
- Through some clever organizational setup (hiding revenue), the A's could still have the aforementioned stadium expenses deduction even though their stadium-related debt load would be near zero.
- Not having to pay the Giants while having similar access to Valley companies equates to increased dividends for the owners - ahem - or increased payroll.
The Warriors and the Coliseum JPA have finally hooked a big one for their naming rights deal: Redwood Shores database giant Oracle. Two interesting things about the deal: 1) It's only 10 years long, and 2) the venue will be simply called "The Oracle" with no apparent reference to Oakland. 10 years is a virtual blink of the eye in naming rights terms, and it doesn't cover the remaining balance on the expected naming rights fee contribution to the arena renovation's debt service. Perhaps there's an option that could be exercised by Oracle. Regarding the name, I suppose it's "fitting" that if the team doesn't have Oakland in the name, the venue doesn't have to either.
32 comments:
Rhamesis, why do you do this? This will again fire up those who insist that it's going to be the "San Jose A's". It's not good for their health having their emotions go up and down like the hydraulics of a '64 Impala at the corner of King and Story.
(If that doesn't get a response from Tony, I don't know what will:))
In all seriousness though, I'm convinced that it's not about Magowan keeping the A's out of Santa Clara County. Instead, the Giants want the A's OUT OF THE BAY AREA, period.
Problem is that there's really nowhere else for the A's to go that has a decent corporate base. And contraction just puts MLB one step closer to losing its anti-trust exemption.
So, Selig instead tells Wolff to stay in his current territory. Except someone forgot to tell him how far south that territory went.
Poor Bud. He should have stayed in Milwaukee.....
.....All together now:
"1,2,3,4,5,6,7,8. Schlemiel, schlimazel, hasenpfeffer incorporated!"
BD -
1. It's not about the Giants giving KNBR/Cumulus a discount. It's about cooking the books so that the ad revenue and rights fees aren't so high. Thus, the hoarding of revenue on both sides.
2. They would absolutely have debt, but with entitlements fees acting as security, little team revenue would be required to pay it off. It's almost liability free given the Bay Area housing market.
3. I heard that too this afternoon on the Fitz-Brooks show, but I'm going by the press release instead.
You're just to funny Rob...how and the heck did you know about King & Story and lowriders? You've been doing your homework on SJ...PROUD OF YA! I know it's easy for all of us here to dismiss everything Purdy and Killion say about the A's future, Giants T Rights, and such. However, there's one thing they have over all of us (R.M. included, I think)...THEY'VE ACTUALLY TALKED TO LEW WOLFF PRIVATELY ON MANY OCCASIONS! Perhaps it's just my wishful thinking of the A's relocating to SJ proper, but I just don't feel these two columnists would print "nonsense" without the approval of THE MAN HIMSELF! And let us never forget that Lew Wolff's a part (10%) owner of the A's; not THE owner! Anyhow Rhamesis, isn't the Giants window for writing off their construction costs against revenue sharing over in 2010?
rob said:
"Instead, the Giants want the A's OUT OF THE BAY AREA, period."
I think most of us understand this. Magowan (and Selig, mind you) knew that if Wolff couldn't work a deal in Oakland, he'd want to move to San Jose. By refusing negotiations for Santa Clara County, and knowing that Oakland was a logistical long-shot, Magowan played his hand and hoped Lew would fold and leave town.
This was before the Fremont ace-up-Wolff's sleeve was pulled. Even if Magowan now wanted to negotiate, Lew's got no reason too.
That's why I can't really compute the Oak-SJ bickering that still exists. It's Fremont, or, we can cross out fingers for Sac, or gone.
Off Topic:
Has former A's radio station KFRC disappeared off the AM and FM dial?
The observation that Macgowan would like the A's to leave the Bay Area is so blindingly obvious and irrelevant it does not warrant repeating as often as it has been. EVERY professional sports team, in every sport, would love the luxury of not having to compete with other teams. The Yankees would love the Mets to leave New York. The Cubs would like the White Sox to leave Chicago. For that matter, the Avalanche would love the Nuggets to leave Denver. It's not happening. So what?
Macgowan may: (A) have refused to negotiate T-rights on a gamble that Bay Area politics would frustrate the A's efforts to get a stadium anywhere in the Bay Area and they would then leave (as Murf has suggested). High risk gamble. Or, (B) he may believe that Fremont is enough of a step down from San Jose that he's still better off with the A's there than downtown SJ proper, even with a payoff.
Who knows?
One thing is for sure: Macgowan would have to be monumentally stupid (and I don't think he is) not to have foreseen the possibility of an A's stadium in Fremont. If you're going to make a major bet for your business on a "territorial rights" strategy, you're going to sit down and think, hmmm, where could the competition build a stadium in their territory if the T-rights hold up? It's not like there's no precedent for a suburban stadium. Hell, years ago when T-rights first came under discussion, I said to my buddies: "The A's ought to just build in Union City right next to the Dumbarton Bridge and validate tolls for people coming through from the peninsula."
Wolff has a good business strategy, but it's not rocket science. Selig understands how close Fremont is to San Jose as well. And the idea of contraction is a joke. MLB gets hundreds of millions in rights fees for every new team. They would have to buy out existing owners to the tune of hundreds of millions to contract. There will be expansion again in MLB long before there is contraction. In fact, there will NEVER be contraction; that's just an empty threat for trying to scare the player's union.
The answer to the KFRC question is yes and mostly yes. The old AM 610 is now KEAR (Family radio) which happened when CBS/Infinity traded the AM station for KEAR's FM station at 106.9 which is FM talker KIFR Free FM.
99.7 still has the call letters KFRC but is now called "Movin 99.7", playing 80's and 90's R&B stuff. It's actually quite good, but the oldies are now gone completely and I'm guessing that KFRC is never mentioned on air except at hourly station ID breaks.
ML, one issue I haven't seen discussed yet is the impact New Yankee Stadium may be having on the A's situation. As I understand, Steinbrenner will be able to deduct new stadium costs for purpose of the luxury tax calculation. Presumably, this will dramatically decrease revenue sharing in future years, since the Yankees pay most of the luxury tax.
How much do you think this affects the A's strategy? For example, one might think the A's would bide their time, get close to a deal in Fremont, then use this as leverage to get T-rights in Santa Clara County. On the other hand, if they're about the take a big hit to revenue due to decreased revenue sharing, this might put a premium on getting a deal done NOW, even if a better deal for the long haul might be out there.
What are your thoughts?
What about the Earthquakes new stadium in Fremont surrounded by the village/development...and the A's Stadium in Downtown San Jose which will be closer to transit, etc.
"So your telling me there's a chance" Killon's powers of deduction are on par with Jim Carrey in dunb and dumber.
What's more depressing than the A's not coming to Downtown San Jose? The prospect of a soccer stadium at the Diridon South site! Could you imagine the horror Murf...16 games a year (vs. 81 home games for MLB), with an average attendance of only 10k, for a third tier sport on par with single A baseball? THANKFULLY, IT WILL NEVER HAPPEN! And don't give us this crap Earthshaker about "friendly's" and concerts making up the rest of the MLS off-season. Hey Rhamesis, how much longer before MLS folds?
How about a new stadium for the Raiders on that Diridon site? (Or at the Spartan Stadium site, for that matter). :-)
The mayoral race has to shake out first before any public statements can be made, but I've heard there are people working behind the scenes to get a deal done. SVS+E is looking at the land for their concert hall, and downtown soccer advocates know Diridon South is the only place a SSS will fit. I wouldn't be surprised to see a deal in which both end up on the land, with SVS+E operating both venues (and the arena) and the A's-Quakes giving SVS+E a cut. Maybe an ownership stake? The remaining questions would be related to parking and NIMBY matters.
bartleby - the Yanks will no doubt benefit from the deduction, but they'll still be paying debt service for the stadium. Besides, so-called small market teams like the A's can take advantage of this as well - as I explained in the "trifecta" possibility. The effect of the revenue drop if the Yanks' deduction goes through might be $1-2 million per year per team. It means something on an aggregate level, but not per team. CBA negotiations are about to wrap up. I'm curious to see what the new revenue pool system looks like.
anon - if the A's went to SJ and the Quakes to Fremont, the A's and Giants would have to deal with the TR situation. Again, I don't see either side budging.
What's more depressing than the prospects of a soccer stadium at Diridon South? Rhamesis giving credence to the idea! Cmon R.M., you the man and all, but I just don't see the city of SJ spending millions to acquire the Diridon South plot for a 22k seat, 16 MINOR league games a year, money losing Sucker specific stadium! Look, if soccer proponents want to push a SSS at the Fairgrounds, that's fine. But Diridon South, at $10 million per acre? Again, I just don't see it happening. If not a Ballpark, a concert hall might work, as well as high-end retail, a cineplex, and high-density housing. HERE'S TO A BALLPARK AT PAC COMMONS AND A "SANTANA ROW" ON STERIODS AT DIRIDON SOUTH!!
Georob, thanks for the update on KFRC. I wonder if the A's may switch to KEAR .
Soccer fans, and proponents of a SSS at Diridon South, read and weap!:
http://community.foxsports.com/blogs/
jamietrecker/2006/09/27/mls_systematically_
lies_about_its_attendance
Again R.M., unless the city of SJ wants to throw hard-earned taxpayer money into the fire, I just don't see soccer happening at Diridon South (thankfully!).
>>If the G-men were to average less than 25,000 per game, then I'd be concerned. I don't see this happening.<<
Many of the "charter" season ticket holders had 7 years of price protection, which ran out this season. Some were hit with 50% price increases on already pricey tickets. Much grumbling in G-land these days.
If it weren't for the ASG in 2007, they'd be awash in non-renewals; they manage to hold that off for a year. Still, those charter rights can be had (in many cases) for less than they sold for originally; it'll only get worse over there.
Bottom line: sub 30K a game average may not be far away. Sinking to 25K would take some bad teams as well, but is not out of the question.
Great post Anon 7:00 PM!
Who knows, maybe Ann Killion really does know what she's talking about when it comes to the Giants financial situation.
If the Giants don't re-sign Bonds they'll have $30-50 million free for payroll, which is less than $40 million for 2007. Many of their kids are under control, so to keep the fanbase interested they need to sign 2 or 3 major free agents. The renewal situation makes it all the more important. They'll overpay for someone. They won't do Marlins-style fire sale. Two or three more seasons of mediocre play with no stars and I'd be worried.
I'm with Tony on soccer downtown. Putting an MLB team downtown makes the statement "We are a major league city." Devoting your last stadium-worthy land parcel downtown to MLS makes the statement "We are a second-tier city and expect to always be a second-tier city." Frankly, I'd rather see them put a nice minor-league baseball stadium there, if it came to that.
Well said, bartleby66, well said. I agree with everything you said at 10:52. The day SJ builds a soccer stadium on that prime piece of real estate is the day it gives up being taken seriously forever.
Wow, what did he say?
It was a personal attack against one of the posters. That won't be tolerated.
hey Earthshaker, the home depot center is in Carson, not downtown la! apples and oranges pal. a soccer stadium belongs at the fairgrounds not dtsj.
Exactly. Having a soccer stadium as your prime downtown landmark just screams "third-tier city."
I disagree. Not having a soccer stdium there does nothing to negatively affect SJ's image. However building one only calls attention to the fact SJ has no teams in the top sports (unfortunately hockey alone no longer cuts it).
However, you do raise a good point. Internationally, a soccer stadium doesn't have the same image problems. Quite the opposite in fact. Being in Silicon Valley, SJ should cultivate an international image. So there is a benefit. But domestically it just cements SJ as having a collection of second-rate sports teams. Perhaps I put too much emphasis on that aspect.
The Quakes stadium could very well be in Santa Clara, not in San Jose. Let's see how it shakes out.
I don't think the soccer-skeptics amongst us are saying SJ shouldn't build a soccer stadium, just that it shouldn't be downtown. At the fairgrounds, great. If they could build a replacement for Spartan Stadium that served both SJ State and MLS, even better. But the benefits of soccer just don't justify use of a prime downtown site and having MLS define the city.
MLS is kind of where Arena Football was ten years ago. Arena Football has also had great growth, but it's still pretty far from being what anyone would consider a major-league sport. It great that SJ gets more use out of HP Pavilion by having the Sabercats there, but that alone would not have justified building it.
I'm also doubtful that the international popularity of soccer makes much difference. Those countries that love soccer have big-time soccer leagues of their own to follow, they're not going to waste time watching our watered-down version of the sport.
Exactly right bartleby. Go ahead and build it somewhere else (not on the city's dime however) but not on prime downtown real estate. I'd be perfectly happy to see it built in either of the places you mentioned.
"Give it time" - you know, some of us have been hearing this exact same contention from soccer fans for almost 40 years now. Soccer is always just around the corner from becoming a big sport in this country. But it hasn't and it won't. I can't elucidate the reasons why (other than for me personally), but it just isn't a popular sport in this country.
This post should end this debate regarding soccer in the South Bay. I have a co-worker who played collegiate soccer at Gonzaga. He was also glued to the tube during the recent World Cup. And guess what...HE CAN'T STAND MLS!! He never attended Clash/Earthquakes games and probably never will. MLS is an inferior product akin to pro-lacrose and roller derby...is it any wonder the "best" of MLS want to play in Europe. ENOUGH SAID ABOUT SOCCER!!
Taking a break from the Chi Bears waxing!
This should FINALLY end this "soccer" war of words. Build a joint soccer/SJSU stadium at the SE corner of Alma Ave. and Monerey Rd. near the current Spartan Stadium (north of the Bold Knight restaurant). This land is already owned by San Jose's DiNapoli Family, who as you know are part owners of the A's (and presumably future EQuakes). The stadium could be a state of the art, compact 22-25k seat stadium for MLS and the SJSU Spartans. It would host not only MLS but NCAA football, bowl games, Friendly's, concerts, etc. The Alma/Monterey area is also near DSJ and marks the southern end of the resurgent Martha Gardens neighborhood; with condos, lofts, coffee shops/restaurants in the making. Peace out Earthshaker!
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