2020 MLB Season: This week’s financial plan is crucial to baseball’s return

Despite other aspects of the potential shortened 2020 season moving along fairly smoothly, negotiations regarding the financials for this year have not. MLB and the MLBPA are finally set to discuss that this week.

When it comes to hashing out the important details of money, of the four major American sports leagues (MLB, NFL, NBA NHL), none has a wider gap to fill for the return of its respective season than Major League Baseball. We’ve seen the argument already: MLB team owners want players to accept more pay cuts, preferably a 50/50 revenue-sharing plan that will help offset potential losses; on the other hand, the players feel they’ve already made appropriate concessions from when the MLBPA agreed to pro-rated salaries back in March.

Neither is completely wrong (even if it’s quite difficult to sympathize for a group of owners that have enjoyed profits like never before), so let’s make the case for both side’s interests.

The owners

I’ll be honest. I’m definitely in the player’s camp here. The owners’ case is weak at this point. As mentioned above, the benefits of owning an MLB team have never been better, which was vividly illustrated when the league reported almost $11 billion in 2019 revenues. No matter the circumstances, losses, or even future pain, all will be felt more for the players than the owners…no matter what.

However, there’s a potential big ticket item that could make this season a long-lasting nightmare for teams, especially if a second-wave of COVID-19 appears.

Perhaps more damaging than the reported $640,000 loss per game or the almost 40% in total revenue vanishing from the absence of gate money… is the potential loss of the 2020 postseason and the profits from national TV, which is primarily the reason teams are wanting to spread the risk this year. According to ESPN’s Jeff Passan, revenue from national TV usually comes in at around $1.7 billion per year. You can add another couple hundred million to that number when factoring in the addition of potentially 16 more playoff games this season (postseason field increased from 10 teams to 14 for 2020). Another wave of the coronavirus that results in a second shutdown would — that after going through the process of resuming the sport — would be catastrophic for teams paying players’ their full pro-rated 2020 salaries. The league feels like the overall financial risk shouldn’t be theirs to endure alone (regardless of how dang rich they are).

The players

This is a simple case of maintaining a bargaining chip or one’s leverage. In late March, MLB committed to advancing $170 million (over two payments) in salaries to players, as part of a major agreement that settled issues like service time, a potential draft reduction and what’s now an expanded postseason. The players left that deal believing they had yielded enough to move forward, and rightfully so given they ultimately would be the ones risking their health (while receiving lesser salaries).

Baseball’s player’s union has stood stronger than perhaps any of the three other major sports leagues — MLB is the only league still without salary caps — and the MLBPA was quick to strongly dismiss any future deals that would even resemble such a setup. For players, they simply cannot hand over the union’s most prized position on the bargaining table, and I’m not sure there will ever be a big enough pandemic to cause the MLBPA to surrender to a salary cap.

Can they reach common ground?

If there’s one thing both sides can agree on it’s that having a 2020 season (no matter how short) is much better than not, and that a postseason is just as mutually beneficial (just look at how large the player’s playoff pool is each year).

So how can they make that happen?

First of all, team owners may need to squash the whole 50/50 split idea. The MLBPA ain’t buying it, as to them it’s just another tactic resembling a salary cap:

“A system that restricts player pay based on revenues is a salary cap, period. This is not the first salary cap proposal our union has received. It probably won’t be the last.” — MLBPA chief Tony Clark

Secondly, MLB would be smart to allow more transparency as to what exactly they stand to lose going forward. Yes, the “Economics of Playing Without Fans in Attendance” report was a damning write-up, but everyone knows it was a stunt to shift the focus on the players and that it’s them who should give up more. I mean, claiming some teams stand to lose $300 million (like MLB claims New York Yankees will lose) from a fan less 2020 season has already been debunked by several journalists. Perhaps it’s time to “get real”.

Of course, finding a compromise isn’t solely dependent on ownership. The players must also cooperate.

Tampa Bay Ray’ starter Blake Snell made some compelling points during his rant on Twitch, but his desire to get “all of his” $7 million salary this season is impractical, if not downright unrealistic. If the league and its owners can bring forth proof that further pay cuts are required to stage an 82-game season, then players should at least do their part and negotiate appropriate terms. Just because a split down the middle in potential revenues (or losses) is off the table, doesn’t mean some other — perhaps more specific — financial plan can’t be worked out.

Regardless, the future of the 2020 MLB season weighs heavily on this coming week. As we enter the final days of May, the league, its owners and players are quickly running out of time — it has already been declared that players will need roughly three weeks for a second Spring Training. Will the league keep pushing for its 50/50 split revenue?… and will the players continue to reject any further salary reductions?

For the sake of the sport… I sure hope not.