MLB Broadcaster Ron Darling on Why the Sherman/Jeter Group Overpaid for the Marlins

JohnWallStreet had the pleasure of attending the 34th Annual March of Dimes Sports Luncheon, presented by Ford (F). Attended by more than 700 leaders and influencers  in the sports business industry, the event raised $1.17 million for pregnancy and baby health research, education, vaccines and breakthroughs. JWS had a chance to catch up with ’86 Mets Star and current MLB broadcaster, Ron Darling, to discuss the rise in player salaries (and endorsement money) over the last 30 years.

JWS: As a player, did you understand that you were going to have to work once your playing career was over?

Darling: In my day, you certainly thought you were going to work after you were done playing. I always thought I would at 35 years old, still have something to offer.

JWS: When you look at the amount players make today, is there any jealousy or resentment there?

Darling: Whenever I think about the money made by today’s players, I never begrudge what they make. I think about Marvin Miller and the MLBPA, how hard they fought; how many great players, much better than I ever was, never made a nickel or a dime. I just think of all those players that came before, that fought so hard to get the players playing today all the rewards coming their way

JWS: When you made your first all-star game in ’85, did the endorsements start rolling in for you?

Darling: In the mid 80s, endorsements were not really moving the needle. You would get a thing here or there, but there was no branding in those days unless you were a superstar. You were very happy and fortunate with any nickel or dime that would come your way. It’s different today, there are certainly more opportunities; but it hasn’t changed in that the best of the best still reaps the most rewards and the more pedestrian players try to find a place in the market.

JWS: You signed a 3 year, $5 million contract with the Mets.Did you go on a spending spree or were you fiscally responsible?

Darling: I was extremely conservative. I was very lucky that I had a family to take care of. I only owned one car at one time, one house at one time, I didn’t have a posse to worry about; I think all players should be that way. 

Howie Long-ShortRon may not be resentful, but I’d imagine it’s difficult not to think “what if I was born just a few decades later?” Darling entered the league in 1984, when just 6 teams had a total player payroll of more than $10 million; the Mets carried a payroll of just $7 million that season. The team’s average salary was just shy of $283,000 and their highest paid player, George Foster made $2 million (Keith Hernandez had an average salary of $1.6 million). In 2017, 36 MLB players made more than $20 million; with 2 guys having made more than $30 million (Kershaw, Price).

Fan MarinoDerek Jeter traded Giancarlo Stanton (and $30 million) to the Yankees for Starlin Castro and 2 low-level prospects as the Marlins look to cut payroll from $115 million in ’17 to $55 million ’18. The new ownership group paid $1.2 billion for a franchise that lost $50+ million last season, hence the need for a fire sale. JWS got the chance to ask Ron why this group overpaid for the franchise if it meant having to strip it down to nuts and bolts?     

Darling: I think because there are only 30 teams; sometimes you just want to throw your hat in the ring, you just want to be a part of an organization. You think, let’s become owners first and then we’ll figure out all the ramifications of what that means later. When you buy a team, and decide on a business model, that business model doesn’t always fit in with players’ salaries; so sometimes you must make some tough decisions. The business of baseball is much different than the aesthetics of watching it. 

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Former AFL Commissioner, Current NFL HOF CEO Talks Niche Sports and OTT Programming

JohnWallStreet had the pleasure of attending the 34th Annual March of Dimes Sports Luncheon, presented by Ford (F). Attended by more than 700 leaders and influencers within in the sports business industry; the event raised $1.17 million for pregnancy and baby health research, education, vaccines, and breakthroughs. JWS had a chance to catch up with former AFL Commissioner and CEO of the Pro Football Hall of Fame, David Baker, to discuss “niche” sports, OTT programming and the NFL’s 100th anniversary.

JWS: You spent 12 years building the Arena Football League. What is biggest hurdle that “niche” sports face?

Baker: Well number one, I call them “emerging” sports; but without question, it’s time. It’s the time to make the memories. Let’s remember, when the NFL had their first big break, when the Baltimore Colts and NY Giants met in what many consider the game of the century; the league was 38 years old. It almost must be passed down from generation to generation. That’s the biggest hurdle. There are things that you can see that are real cool, and real fast, and they flash; but to sustain it, it’s got to be multi-generational.  

JWS: How long do you believe it takes for a league sports league to fully develop?

Baker: It takes 60 years to grow a major league, but with streaming and the internet there are so many more platforms, everybody has an opportunity to find their audience now.

JWS: NFL television ratings are down again this season, are you concerned that football is losing popularity?  

Baker: You’ve got ratings that are dispersing because a lot of millennials are going to streaming and not watching that big screen, but it’s still an aggregate that is significantly higher than MLB, NBA and NHL combined. There was a time when basketball was going through something like this and a guy named Michael Jordan came along; all of us became glued to that game again. I think that the NFL is still strong and destined to be even stronger as we approach the 100th anniversary. 

Howie Long-Short: In preparation for the NFL’s 100thanniversary and centennial celebration, David Baker is overseeing construction of the Johnson Controls Hall of Fame Village; a $800 million sports and entertainment “smart city” that surrounds “the Church of Football” in Canton, Ohio. You can’t invest in the county funded project, but you can in sponsor Johnson Controls (JCI), a multi-international manufacturer of automotive parts & HVAC equipment. The naming rights contract is estimated to be worth more than $100 million (plus technology) over 18 years.

Fan Marino: Speaking of “emerging” sports, the National Lacrosse League (indoor) just announced a partnership with CBS Sports Digital to stream regular season and playoff games (live and on-demand) on the subscription OTT service SportsLive. In a quote that echoed David’s thoughts on streaming and the internet, Commissioner Nick Sakiewicz said,“the future of sports is an ever-changing digital viewing experience.” It may be the present too; the league averaged 344,000 viewers for its TWTR game of the week last season and has 25,000 paying OTT subscribers.

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Pro Sports Lack Female Franchise Owners

Back in early October, Laurene Powell Jobs acquired 20% of Monumental Sports & Entertainment; the company that owns the Washington Wizards and Washington Capitals among other entities. The acquisition was noteworthy as just a handful of other females own American pro sports teams; a short list that includes Jeanie Buss (Lakers), Joan Tisch (NY Giants) and Ann Walton Kroenke (Rams, Nuggets). There are even fewer women in front office and coaching positions. None of the 4 major sports leagues currently employ a female GM and there has never been a female head coach.

Howie Long-Shot: Powell Jobs, the widow of the late Apple CEO, paid an estimated $500 million for her 20% stake; just a drop in the bucket for the 4th wealthiest woman on the planet (estimated net worth of $20 billion). In addition to the NBA’s Wizards and NHL’s Capitals, Powell gets ownership the WNBA’s Mystics, Capital One Arena (home of Caps/Wiz), the AFL’s Valor (Washington) and Brigade (Baltimore) franchises, EagleBank Arena (George Mason University) and the Kettler Capitals Iceplex (training facility).

Fan Marino: ESPN (DIS) Baseball analyst Jessica Mendoza emceed the 34th Annual March of Dimes Sports Luncheon, presented by Ford (F), on Tuesday. JWS had the chance to get her thoughts on female sports ownership.

Mendoza: “Why not? It’s great to have women as decision makers because it’s a different way of thinking, sometimes. I think just having more diversity on anything is good, you just want to make sure it’s the right people. Don’t do it because it’s a woman, to check that box; do it because it’s the right people, who are passionately involved and know what they’re doing. People who care enough about the sport that to help grow it.”  

Businesswoman Laurene Powell Jobs Buying Into NBA, NHL, WNBA With MSE

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Female-Male Sponsorship Pay Gap Growing: ESPN’s Jessica Mendoza 

Despite the national female-male earnings ratio growing to record high (80.5%) in 2016, the gap in sports sponsorship pay has widened since 2014. The size of the sport’s television audience and athlete’s social media following are often cited as the reasons for discrepancy. Men’s tennis star Novak Djokovic, who earned more in endorsement money ($28 million) than Serena Williams ($19 million) in 2017, was recently quoted saying, “the stats are showing that we have much more spectators on the men’s matches. I think that’s one of the reasons why maybe we should get awarded more.” In April, the USWNT was successful in garnering “equitable” (not equal, as the compensation is structured differently) pay; after arguing their performance on the pitch was far superior to that of the men’s team and that the USWNT is more profitable.

Howie Long-Short: There would seem to be value in female endorsement deals. Women control 70-80% of consumer purchases and the women’s active wear market is booming ($18 billion in annual sales). As OTT niche programming becomes more prevalent, the audience size for women’s sports will rise. That will help women close the gap in endorsement pay.

Fan Marino: ESPN (DIS) Baseball analyst Jessica Mendoza emceed the 34th Annual March of Dimes Sports Luncheon, presented by Ford (F), on Tuesday. JWS had the chance to get her thoughts on the growing sports sponsorship pay gap.

Jessica: As much as you (brands) want to get young boys to buy because Steph Curry is wearing that shoe, there are just as many girls that would do the same if Skylar Diggins was wearing them (signature shoe). I believe in my heart girls play sports. I know I bought a bat based on who I saw swinging it. I think the key is being able to get that (message/product) out there enough, to where you (brands) start to see the return. At the end of the day, it’s not a charity. It’s not like “oh we’re going to give women more money because it’s the right thing to do”; you’re going to make decisions because it’s the business thing to do.

A Concerning Trend: The Growing Gender Pay Gap in Sports Sponsorships

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Simone Biles Wins Sportswoman of the Year Award, JWS Gets an Exclusive Interview

JohnWallStreet had the pleasure of attending the 34th Annual March of Dimes Sports Luncheon, presented by Ford (F), on Tuesday afternoon. The event honored ’86 Mets pitcher Ron Darling (Sports Legend of the Year), 4x Olympic Gold Medalist Simone Biles (Sportswoman of the Year), NFL EVP, CMO Dawn Hudson (Corporate Leadership) and Pro Football Hall of Fame CEO David Baker (Sports Leadership). Attended by more than 700 leaders and influencers within in the sports business industry; the event raised $1.17 million for pregnancy and baby health research, education, vaccines, and breakthroughs. JWS had a chance to catch up with the Sportswoman of the Year, Simone Biles, to discuss the financial side of an Olympic sport.

JWS: You don’t get in to gymnastics for the money or to play in the “big leagues”. What is the goal of a young gymnast?   

Simone: When most gymnasts get in to it at 6 years old, they say “I want to go to the Olympics”; but you don’t really think much about that. You think, I want to be a college athlete and you strive for the college scholarship. It’s hard to be a professional gymnast because our careers are very short; your peak age is 16-18 years old and then you are kind of done.

JWS: When did you decide to turn professional and can you tell us about the experience of signing your first endorsement deal?

Simone: After my second World Championships, I was being scouted by agents; but I wasn’t ready to go professional yet, so I waited another year. When I turned 18 years old we decided to look for an agent. We got one signed and she asked what were some of the things I liked; obviously, the first thing was athletic clothes because I’m in them daily. Nike (NKE) reached out, Under Armour (UAA) reached out and you go with what is best for you. I like to do what represents me. I chose Nike.

JWS: Do you feel as if signing lucrative endorsement contracts has validated your athletic career?  

Simone: I don’t like to think like that. I try to think of what I have achieved and go from there; rather than focus on the money.

Howie Long-Short: Based on the public information available, it appears as if Simone has an estimated net worth between $2.6 million and $3 million; far more than most gymnasts will make in their careers. Gymnast compensation is tied to placing in competition (and endorsements, which don’t come without medals). Speaking in the most general terms, gold medals are worth $25,000, silver medals are worth $15,000 and bronze medals are worth $10,000 in prize money.

Fan Marino: While on the topic of the Olympics, NBC is going all out with their 2018 Olympic coverage from PyeongChang, South Korea. The network has announced they’ll be airing primetime coverage live, across all time zones, for the first time; crucial for those that don’t live on the East Coast and want to avoid “spoiler alerts” on social media. NBC Universal will be airing 2,400 hours of programming, a record for the Winter Games.

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