Despite the Astros' Legal Claims, More Money's Not the Key to Competing With Texas
I've read way too much of the legal documentation generated in the Astros/CSN Houston bankruptcy litigation. And I'm not much in the mood to rehash what I've read -- I also assume you're pretty tired of reading about it, too. But I did recently see a new argument generated by the Astros attorneys that I cannot let stand.
The Astros have recently started to argue that the deal negotiated by Drayton McLane with CSN Houston for the team's media rights does not generate enough money to allow the Astros to remain competitive with the Texas Rangers and the Los Angeles Angels of Anaheim. And since that $54 million is not enough, the Astros can only approve network carriage deals that ensure an immediate profit for the network because the Astros need that money to make up for the shortfall caused by the bad deal for the media rights.
I'm not going to address any legal matters. I'm not going to address the Astros' now claiming the deal they negotiated is a bad one. I'm going after something else. I'm going after the notion that what media rights the Astros negotiated do not allow the team to be competitive with the Rangers and the Angels.
To put it bluntly: That's a bunch of bull. It's not the amount of money a team makes from its media rights that allows a team to be competitive. It's how that team uses its money that allows it to be competitive. Just ask the Oakland A's, a division competitor with a bad TV deal, the worst stadium in baseball, awful attendance and a cheap owner. Yet the A's are, year after year, one of the best teams in baseball, and have won the division the past two seasons.
But according to the logic of the Astros legal briefs, there is no way the A's should be competitive because the A's' media rights are not enough to allow the team to be competitive with Texas and Los Angeles. The A's earn way less in media rights than the Astros. So the A's should be even worse than the Astros.
Maybe the A's are just an outlier -- there was a book and an Oscar-nominated movie regarding the A's gaming the system and being smarter than everybody else. But then how to account for the Tampa Bay Rays, another team that earns less in media rights than the Astros? The Rays also have the disadvantage of playing in the AL East, home of the New York Yankees and Boston Red Sox, two teams whose media rights deals and spending dwarf those of the Rangers and Angels. But what do you know, the Rays were in the playoffs last season, and are generally acknowledged as one of the best teams in baseball.
The Astros also earn more money in media rights -- when those rights are paid -- than the Detroit Tigers and Cleveland Indians, two more American League teams that made the playoffs last season. And if you take a glance at the National League, you notice that the Astros earn more in media rights than the Pittsburgh Pirates, Cincinnati Reds, St. Louis Cardinals and Atlanta Braves, all teams that -- you guessed it -- made the playoffs last season. The Astros also have a better media rights deal than the San Francisco Giants, winner of two of the past four World Series, and the Washington Nationals and Baltimore Orioles, two teams that were in the playoffs two seasons ago. (The breakdown of MLB team media rights from 2013 can be found here -- the Astros figure is slightly off, but the chart still appears to be valid.)
The Astros want the money owed by CSN Houston. Nobody can blame the team or Jim Crane. There's lots of things that money can be used for, including players' salaries, scouting, the minor league system and so on. And a better deal, or a profitable network, will allow the team to keep its players and go after free agents. But the Astros don't need to make as much as the Rangers and Angels to be competitive; in fact, despite all of the money being spent, the Angels really haven't been that competitive the past several seasons.
If the Astros aren't competitive over the next seasons, it's not going to be because the team's media rights didn't allow it to stay even with the Rangers and Angels. It's going to be because the kids in the minors, the well-regarded draft choices, the smart moves and trades, didn't work. And if the kids and moves and trades don't work, no amount of money spent by the Astros will be able to make things better.
There are lots of reasons for the Astros to be contesting this CSN Houston involuntary bankruptcy. Most of all there's the whole CSN Houston owes the team over $27 million dollars. But don't argue that it needs to be contested because the bankruptcy affects the team's ability to be financially competitive with Texas and Los Angeles. There are just too many other teams out there who get less money than the Astros who have found ways to be competitive with the Rangers and the Angels.
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