The Screwball Economics of Major League Baseball

Police in riot gear guard the dugouts, preparing for the worst with German shepherds at heel. This is Philadelphia in 1980, after all.

It's the bottom of the ninth. Two strikes. Two out. Bases loaded.

Human rocket Willie Wilson of the Kansas City Royals hugs the plate, curiously dressed in full powder blue, a color fancied by baseball teams and wedding parties of the era.

Cover illustration by Tim Teebken.

His nemesis this evening is Phillies closer Tug McGraw, whose fame later will be shadowed by that of his son, country singer Tim McGraw. The screwball artist fires a pitch letter-high, but Wilson can only flail. Kansas City's insurgency is repelled. The Phillies win their first World Series since forming during the Chester A. Arthur presidency.

A record 54 million people tune into the game that night. It will be perhaps the last time baseball legitimately can call itself America's national pastime.

See related story: "Diamondbacks GM Kevin Towers' 'Moneyball' Strategy Isn't Madness"

Fast-forward to fall 2012. Marco Scutaro cracks a 10th-inning single into the wet outfield of Detroit, nudging the San Francisco Giants to a World Series sweep. The Nielsen ratings soon will reveal how far baseball has plunged.

An average of just 12 million people tune into the 2012 Series — a collapse of nearly 80 percent from McGraw's heroics three decades earlier. In head-to-head competition, a regular-season NFL game will lap the Series by 10 million viewers. The geek comedy Big Bang Theory will pummel it by 5 million.

Even the investigative drama Person of Interest — featuring "a software genius and an ex-CIA operative who work together to prevent violent crimes before they can happen" — will best the Series by 2 million viewers.

Commissioner Bud Selig has little to say about this spurning of affections. This flight of fans, after all, is very old news.

Last October's contest marked the seventh straight Series to produce record-low ratings. Baseball's defenders try to explain the numbers away, citing late East Coast start times, an outbreak of entertainment alternatives, and the favored wail of curmudgeons everywhere: that a younger, lesser generation of men prefer to whack pixelated zombies than witness the splendor of Pablo Sandoval going yard.

Others claim the Tigers and Giants failed to ignite the country's passion. "I am of the belief that the matchup of the World Series is always important," says Professor Wayne McDonnell Jr., known as "Dr. Baseball" for his study of sports at New York University.

But of America's three major sports, only baseball needs excuses.

The NFL's ratings remain on a march to the heavens; 108 million people watched the most recent Super Bowl. Viewership for the NBA finals — though reduced from the days of Bird, Magic, and Jordan — is once again climbing skyward.

Meanwhile, baseball's ratings continue to plummet, irrespective of month or matchup. Record-low Series of the past seven years featured the game's biggest attractions, from the moneyed villains of Boston and New York to storied franchises like St. Louis and San Francisco. None stanched the bleeding.

Regular-season games have declined equally. Fox's Saturday audience has gone down an average of 800,000 since 2001. Sunday-night ESPN telecasts have shriveled by a million viewers in just the past six years.

In any other industry, such staggering drops would raise alarms of a rotting ship. One might presume that TV execs are screening Selig's calls. But the exact opposite is happening.

ESPN, Fox, and Turner recently struck deals that double their annual payments to MLB. The Los Angeles Dodgers will soon ink a 25-year pact for local rights that's worth an estimated $7 or $8 billion.

If it all seems incongruent, born of the same economics that brought you bank bailouts and the housing crisis, that's because it is. Baseball, you see, is expecting you to pick up the tab.

In an age of stagnant wages, the average cable or satellite bill is expected to reach $200 by the end of this decade — even before extra fees for phone and Internet knock on the door.

"It's an unsustainable model for sports rights to escalate at a pace that's exponentially higher than wages for families," says Dan York, DirecTV's chief content officer. "It's coming to the breaking point."

Inside broadcasting's executive suites, the Holy Grail has a new name: "appointment TV," considered the last defense against a fierce and fast-encroaching enemy, the DVR.

The problem for networks is that viewers no longer show up like they're supposed to. Instead of planning Tuesday nights around, say, Justified, people recorded shows to watch at their convenience. And unless they have a fondness for commercial interruptions, they fast-forward through their daily regimen of Geico ads. Which makes Justified less valuable to advertisers.

Human nature, however, isn't partial to watching a baseball game three days after it's played. Viewers still want to see it live, even if it means opening their homes to Flo from Progressive.

"Live sports and a few other events, like the Oscars, are still must-see programming," says Maureen Huff of Time Warner Cable, the company soon to be writing those very large checks to the Dodgers.

Advertisers also see sports as the best weapon for reaching young men, known to have a special gift for eluding commercial reach. Never mind that baseball's youthful audience has gone AWOL. More women age 50 and older watched the last World Series than did men under 49. But compared to babe cops and reality fare, the game's ratings practically shine.

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Sounds like a perfect plan to me dude. Wow.


It is time for a customer revolt. The cable companies are perfectly able to create custom packages for each customer's interests. The problem is Congress is in the pocket of companies like Viacom, and won't change the laws to require cable to offer custom packages. Maybe only anti trust lawsuits can end this racket. Under the current model Kansas City, Pittsburgh and Florida will never, ever again be in World Series. And it looks like no one cares anyway. I have a 20 year old son, and he and none of his friends care one iota about baseball. It's all NBA and NFL only.


I think your commentary on mlb economics was a wonderful, eye-opener for both sports fans, and non fans. You explain the crazy rise in prices to the viewer, but also point out potential exit strategies for non fans. I read your article in The Riverfront Times, in St Louis, Mo. I wonder why you had to tarnish your article by comparing baseball purists, to the Republic Party. The President won handily, but by only 4%. The Senate & House are under different parties, much change is in the air. I wonder why one political party was brought into a sports article? And in a negative manner? Thanks for the informative article.

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