Brett Davis-US PRESSWIRE
Brian T. Smith reports that Jim Crane and the Astros have lost money for the past five years. Should we believe him?
The Houston Chronicle's Brian T. Smith is at spring training and he's raining knowledge. The past bit of news, though, has set Twitter afire. See below:
Does this mean that all of you who claimed Crane is broke and doesn't have the money to run a franchise are correct? Does this mean that Drayton McLane was a terrible businessman? Does this mean that, as Tim mentioned on Twitter, it makes much more sense why Houston showed Alyson Footer, Jim DeShaies, Brett Dolan, Dave Raymond and Milo Hamilton the door?
Because we shouldn't just accept Crane's statement at face value. MLB finances are one of the trickiest paths to meander in sports. For some reason, MLB owner try to cry poverty every chance they get. It's not just Jeffrey Loria either. It's all of them.
And yet, commissioner Bud Selig is also building up all the money streams coming in for teams. MLB Advanced Media has been a cash cow for the entire league, just as the new national TV deals will bring in millions upon millions of dollars for each team.
We aren't even counting the money that will come in from CSN Houston's regional deal or how much that will change the valuation of the Astros. Crane acnowledged that fact, saying that Houston can't mess up this 20-year TV deal.
I agree with that. They cannot agree to a middle-of-the-road deal now, because it'll be below average and a hindrance to the team in five to ten years. To stay competitive, they have to strike a great deal now and hope it's still a good deal in 20 years.
It's true that Houston has lost attendance in the past five years. It's true that they probably haven't made as much money as they did in 2005 and that a bloated payroll with Carlos Lee, Lance Berkman and Roy Oswalt making huge money didn't help things.
But, we're seeing two different sides of this thing. On the one hand, Crane is saying they've lost money for the past five years. On the other, we have reports from Deadspin showing MLB finances that are wildly positive and we have the Forbes team valuations each spring that show how much money said team has made. Houston hasn't been negative in profits in any of the past five years.
Who do we believe? Baseball's financial books remain closed, except what Crane will tell us from the golf course (he's currently in a pro/am). We have to trust what he says about the financials, even if he's being a little slippery in his wording.
Read that Smith tweet again. Crane says that "as a franchise,' Houston lost money. Doesn't that leave open the possibility that they made money once you count all the revenue from MLB streams, revenue sharing, etc? That wouldn't be money the franchise generated, and as such, could be finagled to make it seem like Houston's finances are dire when in actuality, the organization was fine with that extra revenue.
I'm not saying that's true. But we have a disconnect from three different sources between Crane, Selig and the outside evaluators. Who should we believe?