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Rays owner Stuart Sternberg: "Business of Professional Sports" panel

A football team owner, a hockey team owner and a baseball team owner walk into a bar....

Jonathan Dyer-USA TODAY Sports

The many benefits of professional sports easily justify public investment in professional sports facilities, in the view Bucs co-chairman Bryan Glazer, Lightning owner Jeff Vinik, and Rays principal owner Stuart Sternberg.  They were speaking Monday evening at a Poynter Institute panel titled "The Business of Professional Sports."

The event, moderated by Tampa Bay Times columnist Ernest Hooper and ESPN deputy editor Mary Byrne, was part of the annual conference of the Associated Press Sport Editors, and I had the opportunity to attend. Here are my collected impressions:

Public Support for Sports Venues

It was clear that Sternberg, Glazer and Vinik have a strong incentive to think public support for their buildings is justified, as all have received state and/or local financial support for construction and renovation, and continue to seek more resources.

Glazer maintained that every televised Bucs game, as well as the occasional 'RayJay' Super Bowl or BCS championship, is a "three-hour commercial" for our region.

The owners referenced increased restaurant business and hotel stays as direct economic benefits of their teams. Vinik suggested that the presence of healthy major league franchises would help draw high value added businesses to the region, and it’s part of his pitch when he recruits firms for his development.

(While I think their arguments have some merit, I should note that economic research has never found a compelling case that public investments in sports facilities ever provide taxpayers with a measurable return on investment.)

Sternberg’s public funding "ask" will surely find an ally in Vinik, who contends that the economics for a 100% privately financed venue just don’t work.

No matter how you parse the numbers, he stated with Sternberg and Glazer nodding agreement, an owner trying this would be immediately "under water."

Owners were asked whether it would make sense for the local governments putting up financing to also share in profits. Vinik was the only one who didn’t flinch at that question – he noted that Broward County’s deal with the Florida Panthers has some such component (although according to Forbes there haven’t been many profits to share), but added that these sorts of deals were very complicated to negotiate.

Derrières in Chairs: Competing for Audience Dollars

The owners were in agreement about the challenges of bringing fans into their venues. Because fans can easily watch from home with the refrigerator and bathroom just a few steps away, sports franchises need to provide a great "joint" experience that has appeal whether the team wins or loses.

New technologies are both helpful and hurtful to this effort.

On the one hand, the overwhelming number of potential distractions makes it harder to grab the attention of an audience. On the other hand, some technologies can be harnessed to improve the fan experience.

Sternberg mentioned MLB’s Advanced Media operations and its Ballpark app as something fans can use to optimize their in-park experience.  Vinik is partnering with a Seattle firm on some new fan experience technologies.

The owners believed that the more fans "opt in" to such technologies, the better they can tailor the park experiences to fan interests.

Leveling the Playing Field

Byrne asked each owner what they would like to see from their respective leagues.

Vinik responded with a paean to the NHL's salary cap and other competitive balance policies.  He bought the Lightning, he said, in part because the NHL's policies ensured that his team could compete on equal footing with teams like the Maple Leafs.  There was some laughter when he then handed the mic then to Sternberg, whose situation is of course quite different.

Sternberg said that he bought the Rays in part because their lowly status meant you could "do crazy stuff"; at the time they bought in (2005), there was "nowhere to go but up".  But, he said, it does get "little tired" as each year the resource gap seems to widen, and other teams can turn their $200 million payroll into five new all-star free agent signings.

His plea to the league: while revenue sharing is helpful, please find more effective ways to share resources in addition to revenues, so that losing big market teams aren’t rewarded with high draft picks while innovative small market teams are penalized for their success. (His concerns overlap with some MLBPA  concerns about "tanking", although for different reasons).

At one point Sternberg compared the Rays to the large intestine, with money that comes in one end (e.g. increased value of television contracts) merely coming out the other end (e.g. rising player salaries.)  Yes, comparing money to feces seems odd to me, too.

Some other (fairly Rays-centric) thoughts:

  • We love the media! Sternberg was emphatic about the importance of good media relations, in particular the need to build relationships with the "local guys" who might otherwise got boxed out by the national media.  He was critical of a reported effort by the MLBPA to limit media access to players, but MLBPA director Tony Clark has since denied that he is seeking any new media limit.
  • New stadium will be regional amenity. As expected, Sternberg provided no new details on stadium search plans at this meeting, though he would do so once he arrived at Spring Training. Instead, he reiterated the Rays hope that their stadium will have multi-use appeal, so that it becomes an amenity used even off season (and thereby, perhaps, an easy sell to tax payers).
  • Buenos Dias, Havana! According to Sternberg, MLB asked all teams to indicate interest in playing in Cuba, and then used a lottery to pick the Rays from among these teams (perhaps the first time in history that the Rays have benefited from any MLB lotteries!).  The trip will cause some expense and inconvenience, but it is emerging as a historical event, with national media coverage and likely presidential attendance.
  • Class warfare. A question to Sternberg  related to the Yankee’s effort to prevent Stubhub from selling prime seats to discount-seekers got an unexpected answer.  Sternberg responded as though the main concern in limiting these secondary markets was security, and the need for teams to "know who is entering your building" to protect those in attendance.  I’m struggling to believe that my purchasing a ticket through Ticketmaster includes some sort of security vetting that isn’t done through Stubhub, so I’m puzzled by this response.
  • Strong Rays fan base. Sternberg noted on several occasions his confidence that support for the Rays is both broad and deep.  On average, about 200,000 people within the Tampa Bay media market watch each of the 150 televised games.  And even "poor" attendance still means that 1.5 million people attended a Rays game last year.  No other regional attraction can claim anything close to that.
  • I could tell you about ManU, but then I’d have to kill you. Of the three, Glazer seemed the least at ease.  He did get a few challenging questions.  Perhaps the most tension-filled moment came when he was asked how the franchise squares its concern about domestic violence with the decision to draft Jameis Winston.  Glazer gave an awkward non-answer about carefully researching all players they acquire through draft or trade.  Oddly, when he was asked a rather benign question about his ownership of Manchester United he responded that he agreed to participate in this event on the condition that he would not answer any ManU questions.  Perhaps he and the team are involved in delicate negotiations to resolve the Syrian civil war that would be threatened by early exposure?  Because otherwise his refusal to address softball questions about his other team is hard to fathom.
  • Owners are fans, too.  Vinik pleaded with the audience to avoid checking their phones during the event.  "The puck drops at 7:38" he noted, and he was recording the Lightning game at home.  "Please don't tell me the score" he asked, so he could enjoy watching the game without spoilers.

Because this was an event for sports editors, there’s a lot of further coverage!  You can read Gary Shelton’s take;  a few Tampa Bay Times articles;  and Tampa Tribune coverage. Thanks for reading.