Maybe Major League Baseball’s latest proposal to the players’ union Monday provides some sort of path to a reasonable discussion. Color me skeptical. Each step seems to take the sides farther apart. And what gets lost in that current bickering is that baseball needs fundamental change. Not just to stage the 2020 season in empty ballparks. But after the novel coronavirus pandemic has been controlled and we arrive at whatever normal becomes.
“Is this going to damage the sport? Of course,” said Roger Ehrenberg, founder of a New York-based venture capital firm. “It’s already been so damaged. It’s been a slow grind downward. What people are forgetting is that you can have a business that’s highly valued at a moment in time, but it can still be in decline.”
That would be baseball: nearly $11 billion in annual revenue, yet on the brink.
Why ask someone such as Ehrenberg — who has never been involved in professional baseball — about the present and future of professional baseball? Precisely because he has never been involved in professional baseball. This is among the game’s problems right now: There are no outside voices.
That includes executives on both sides, of course, so entrenched in their positions and distrustful of the people across the table that there is almost no format in which to make a deal. But it includes the baseball media, too. (Looks in mirror.) So many of us have made the same calls to the same people for so many years that fresh ideas and perspectives can be too easily dismissed. We know how baseball’s economic structure was created and how it has changed over the years, which side won at which juncture in time. Why wouldn’t it continue that way, ad infinitum?
Enter Ehrenberg — and, please, if there are more like him, step forward. He’s a baseball fan. He might well be a baseball nut. But that’s beside the point. He has been successful both on Wall Street and in the venture capital world. He knows how good businesses work. He knows what broken businesses look like.
“Rip up the 2016 CBA,” he tweeted Friday evening, part of an impassioned 13-tweet thread that’s more insightful than anything that has come from either side in months. “Start again. Start with the frame of owners and players as partners. Scrap the luxury tax: it is the worst kind of cap. Add a real cap but also have a player revenue share to align interests. The players need synthetic equity in the game to expand the pie.”
Major League Baseball, this is logic. Logic, this is MLB. You guys should really get to know each other.
“I had these kind of vague notions of the kind of positioning of the players and the owners before all this,” Ehrenberg said by phone Monday. “But honestly, until covid, and until I started to get a sense of the way the discussions were going and I took a big step back, I hadn’t thought about it that deeply. Once I did, it just unleashed this enormous well of thoughts that crystallized all in that moment.”
The key in all of this is what Ehrenberg said: taking a big step back. The squabbles right now are about staging some sort of a season in the midst of a global pandemic. They seem paramount. They’re tiny compared with the seasons beyond this one.
Ehrenberg’s six essays on medium.com are essential reading for anyone who wants to understand that broad view, not to mention how deals can be made, how a workforce and its bosses should share the goal of growing the business, and how a lack of trust poisons it all.
What Ehrenberg is writing rings of so many conversations I’ve had with front-office executives and agents since the last collective bargaining agreement was completed in 2016. Why can’t these sides be more creative? Not just to get a deal done for this season. But for the upcoming CBA negotiations in 2021 — and beyond. Given that MLB and team revenue could be fundamentally altered when current television rights deals expire — a development that’s almost inevitable, given that fans don’t consume sports in the ways they did when those deals were consummated — they’re going to have to change their thinking at some point. Now is a perfect time to start.
The players and the sport don’t need to permanently be at war. Quite the opposite. They need to be in lockstep, because the owners have no product without the players and the players make no money without the owners.
An example: The players’ response to the notion of a salary cap has always been knee-jerk. There will be none. It’s a non-starter. We’re together on this.
But why? The NBA has a salary cap, and its players are extraordinarily well-compensated. Indeed, baseball could learn from the structure of the NBA’s collective bargaining agreement, which also provides that every team must spend at least 90 percent of the salary cap on player salaries. That salary floor matters not just because it ensures players get a reasonable cut of cash, but it might also address the practice of tanking in baseball that has so raised the ire of both players and fans in recent years.
What might matter more, though, is how the NBA’s salary cap and floor are determined: as a percentage of league revenue. So rather than baseball’s current structure — in which a revenue increase benefits only the owners — the players have a vested interest in helping grow the sport.
It’s worth pointing out in all of this that the NBA and the NHL, which both had their seasons stopped midstream by the coronavirus, have figured out deals to restart them. Maybe they will never happen. But if they don’t, it will be because of public health, not because two stubborn sides so set in their outdated ways can’t get past their own hardheadedness.
As he has written and tweeted over the past couple of weeks, Ehrenberg has heard from plenty of his sports-loving friends in the business and tech worlds. What they say is scary: “Baseball’s already lost us.”
The players and the owners should listen to that, because it’s not some media frenzy. It’s real and thoughtful. Yes, it’s one voice, and a voice that doesn’t have a seat at the table. But that’s part of the point. Who wants to sit at that table and quarrel some more? It’s so tired. Switch seats. Invite ingenuity. Embrace fundamental change. Don’t view everything as a win or a loss.
Come together and think differently. Not for 2020. But for the future of the sport.