Tag Archives: The Lerners

Nats: Angelos/Orioles delay MASN trial into 2015

The Washington Nationals grievances against Peter Angelos and the Baltimore Orioles will have to wait until March to get addressed in court, according to a report from The PostMASN hearing pushed to March after discovery dispute entangles Commissioner Rob Manfred

The legal saga between the Nationals and the Mid-Atlantic Sports Network will drag for months longer than previously expected after a skirmish over discovery bumped a pivotal trial date from December to March and entangled incoming commissioner Rob Manfred. The delay ensures the Nationals will not receive a potential financial windfall until after this offseason.

We won’t know until March at the earliest whether there is anything to this and if there is, whether it was deliberate incompetence by MLB or just the standard variety. Nonetheless, it’s bad news for the Nats, who will continue to be low-balled on television revenue.

It’s probably also a loss for the Orioles franchise and their fans.

The corrupt bargain MLB imposed on the Nats and their fans states that both franchises receive the same broadcast fees, so the business side of the Baltimore franchise is also being short-changed. Angelos owns roughly 80% of MASN, so he pockets most of the profits personally. Now, perhaps there is some trickle-down from him, but that seems rather unlikely. Avarice and spite are his ethos, though I cannot say which is stronger.

Should the Nats ultimately prevail in this round, it will not be much of a victory. To summarize, here is how the arrangement has worked using the bully in the cafeteria model.

In 2004, the Orioles were the bully who wasn’t even letting the Nats into the school cafeteria. In 2005, the bully grudgingly acquiesced to let the Nats in, but they weren’t allowed to sit at a table. At the end of 2006, the bully let the Nats have some table scraps and a chair and acted like he was doing the Nats a favor. The principal went along with it and told the Nats they should be thankful. In 2012, the principal thought that maybe the Nats deserved a seat and some more lunch, but wouldn’t say so directly, appointing three other students to make the decision. The bully did not accept the decision and was willing to have a smaller lunch, just so that the Nats would have a smaller lunch too. The principal retired, leaving behind the vice principal who may have not followed school policy.

It’s a mess and it puts the Nats in a tougher spot moving forward, as illustrated in last week’s WTOP story The Nationals’ financial dilemma. The author, sports editor Noah Frank, formerly worked for the Nats and thus has more of an insider understanding and hometown bias which I welcome given the Baltimore bias much of the DC sports media.

Overall, the Nats are losing this war and the Lerner family is just battling to improve the terms of the occupation.

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anti-masn

Could MASN be a Pyrrhic victory for Peter Angelos? Let’s hope so.

Earlier this month, Grantland published a story by chronicler of Les Expos de Montréal, Jonah Keri on the Baltimore Orioles and their reluctance to spend. That’s nothing new or of even relevant to D.C. sports fans. What is relevant are details of Mid Atlantic Sports Network (MASN) which is primarily owned by Angelos/Orioles.

In 2005, MLB and Angelos worked out a deal allowing the Nationals to operate in D.C. in exchange for a new local TV deal that overwhelmingly favored the Orioles. In July 2006, the Mid-Atlantic Sports Network launched a full-time sports programming slate headlined by O’s and Nats games. The terms dictated that each franchise would receive the same amount in rights fees, but that Baltimore would control a 90 percent share of MASN and any MASN-owned spinoff networks at the start; the Nationals would pick up an additional 1 percent stake each year after an initial two-year wait, until eventually reaching a 33 percent cap. Angelos got his lopsided deal, while the Nationals, who play in the nation’s seventh-biggest market, got screwed.

While the Orioles are bringing in quite a bit more than the Nationals, neither team is profiting from MASN as much as it could be. According to SNL Kagan, a group that analyzes cable and broadcast network deals as well as regional sports networks (RSNs), MASN properties generated $167.8 million in total revenue in 2012. The bulk of that money came from advertising and subscriber fees, with 5.4 million consumers paying $2.14 a month. That’s well below the $2.47 industry average for 2012 and $2.69 projection for 2013, and several of the media experts and sports deal makers interviewed for this story said MASN should be getting much more. Comcast SportsNet Mid-Atlantic, which primarily airs Washington Capitals and Wizards regular-season games, got $4.02 per month in 2012, indicating the market would likely support a higher rate for MASN. It’s hard to know whether to blame the network’s low subscriber fee on inept management, the timing of the deal, or other factors, but whatever the reason, it’s clear MASN will be leaving tens of millions on the table until it renegotiates with local cable providers.

First off, I have to acknowledge that while the “low” subscriber fee is bad for the revenue of the franchises, it’s not a negative for cable subscribers whether they watch those channels or not. It won’t go as far to say that Angelos is “saving” cable subscribers by having the “low” rate because if not for him, CSN would probably have the Nats and we were already paying for that channel. Angelos was successful in keeping MASN off of most DC area cable systems well into 2006, the Nats second season.

There are more interesting details:

For now, the MASN status quo remains. The Nationals aren’t completely helpless, though: According to a source close to the Washington franchise, MLB has sent the team an undisclosed sum every year to help bridge the gap, and to prevent the Lerners from taking matters to court, until the deal becomes more balanced…

…when the Lerner family bought the Nationals in 2006, it was saddled with this lemon of a deal, in which neither it nor the team’s first president, Stan Kasten, had any say. The terms stipulated that the deal could be renegotiated after five full seasons, and the Nats took their first opportunity to challenge the terms after the 2011 season. When that challenge dragged into 2012, those terms looked even more unfair. After spending years rebuilding a franchise that had been decimated by penny-pinching and mismanagement in Montreal, the Nats finally made the playoffs for the first time, winning 98 games and the NL East title. That same year, the Orioles made the postseason for the first time in 15 seasons. MASN viewership skyrocketed, enhancing the network’s already rising economic profile, but the Nats saw just a fraction of the returns.

The suggestion that the team or possibly, the Lerner family themselves, are getting payola under the table additional compensation is new to me. Whether that statement is accurate or not will certainly not be mentioned by the Lerners (see, publicly financed Nationals Park roof for reference) so we’ll have to take this cocktail party supposition with a grain of salt. An aside – several years ago I heard a rumor from a one-time employee that in addition to the $450 million purchase price, the Lerner ownership also assumed over $100 million in debt from when MLB operated the franchise. Of course, I’ve had mixed results from that source.

Given that the Lerner family is the richest in MLB, they may have the patience to wait this out a while and if they get a little good behavior money on the side, well, why not. There is risk in that as well, but TV deals have gone up so much across the league, they seem unlikely to regress all the way back.

The motivations of Angelos on the other hand, are not completely clear. As the rest of the article notes, he hasn’t not been a big spender for most of his tenure as Orioles owner (BREAKING: Since I finished writing this post, Baltimore signed Ubaldo Jimenez for four years to which Cleveland fan Vince Guerreri invoked Bill Veeck’s maxim about “the high cost of mediocrity“), this offseason being another example of that and doesn’t seem motivated by his team winning on the field. Seemingly, his motivation for being loved, liked or even respected by his fan base is not significant either — he has had a dozen years to bring Maryland’s favorite son Cal Ripken, Jr. into a meaningful role with the franchise and choose not to go that way. Hiring Ripken would be at minimum on par with bringing in Dan Duquette to take credit for Andy McPhail’s improvements. It seems as though Angelos, in addition to being duplicitous (2004: “There are no baseball fans in Washington, D.C., that’s a fiction.” 2010: What’s good for the Nationals is good for MASN) lacks business sense. Perhaps he is self-aware of that, but it isn’t a stretch to say he’s more motivated to be vindictive. What’s really weird is that he and the Orioles still enjoy relatively uncritical coverage in either his home market of Baltimore or the market he is envious of, Washington, even though he isn’t good at his job.

Another possibility is that the three main participants are quite old. Selig will be 80 in July and has pushed back his retirement date for years. Officially, he plans to step down at the beginning of 2015. Angelos will be 85 in July while Lerner is 88. The three of them could be punting or should I say, pitching around the hitter, to the next generation. That’s not necessarily bad for the Nats, the next commissioner may not have a friendship with Angelos. Of course, what the descendents of the principal owners want and are willing to do is an unknown, though Mark Lerner and his brothers-in-law seem to be in for the long haul. Whehther Angelos’ family is the same I cannot say.

Left unsaid in Keri’s piece is a wild card in all of this – Ted Leonsis. The owner of Monumental Sports & Entertainment, holding company of the Washington Capitals, Wizards, Mystics and Verizon Center, has won’t shut up been very vocal about his plans to create a new cable channel as soon as his broadcast deals with CSN expire, going as far to start an online channel. Obviously, CSN and unless Angelos is really oblivious, MASN, have to be quite interested in this development. For CSN, they are looking at extinction unless they reach a deal with Leonsis. Angelos and MASN probably realize that too and should they team up with Leonsis, that channel would be the dominant sports channel in multiple regional markets without any meaningful competition — i.e. what Angelos wanted from MLB and lost, yet on terms very favorable to him, even if he lacks the business-sense to make it work. Of course the question is whether split profits would be a deterrent to some or all sides. CSN is but one small part of the Comcast empire that includes, many other RSNs, cable/broadband systems and something called the National Broadcasting Company. Fighting over the DC & Baltimore markets might not be a big deal to the diagonally integrated corporate conglomerate.

These are but a few possible scenarios presented and I’ve looked at it more at a mostly local & regional level; FOX Sports or some other corporation may want to be a player too. Ultimately, I expect the endgame to be not terribly palatable to Washingtonians or the Nats franchise. The likeliest situation has Angelos and not necessarily the Baltimore American League ball club coming out far ahead of anybody else. The Lerners may ultimately buy him out, holding their noses as they do it. Regardless, it is worth pointing out that the demise of the Baltimore Orioles is an acceptable, albeit unlikely outcome, for the Washington National League ball club and their fans should it result in the restoration of television rights. Since in the Angelos and Orioles point of view, Washingtonians were acceptable as collateral damage, the same can be applied to Baltimoreans. Perhaps Mr. Keri’s city would be a suitable relocation site for Orioles, whose lease ends in 2021.

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Nats sign Rafael Soriano, last year’s Yankees closer

Washington Nationals owner Ted Lerner is 87 years old and it isn’t unreasonable to assume he wants to win and soon.. The Nats are coming off of the best record in MLB, but had a first round playoff exit largely because the tired bullpen couldn’t hold a lead.

Superagent Scott Boras is well aware of Lerner’s wants and is the agents of several Nats players, some that were drafted by the team (Stephen Strasburg, Bryce Harper, Danny Espinosa), others than were picked up in free agency like Jayson Werth and the departed Rick Ankiel. Add to this Rafael Soriano, last year’s New York Yankees closer, who just signed with the Nats yesterday. So, did Boras find a sugar daddy in Lerner? Probably, but it isn’t the first time he’s done this and I think it has worked out for the Detroit Tigers (2 pennants in six years).

Two years, $28 million (though some of it is apparently deferred). This looks like a great signing, regardless of money, because who cares about the money. Here’s the Post story (
Rafael Soriano and Washington Nationals agree to terms on two-year contract worth $28 million) from Adam Kilgore who also speculated on signing Soriano on January 6 (What about Rafael Soriano?)

Thomas Boswell notes they are ALL IN.

OTHER THOUGHTS

Drew Storen wasn’t the only reliever to break down in Game 5, both Edwin Jackson (why was he in there?) and Tyler Clippard gave up runs. Storen blew it, but he had help and got squeezed on strike calls. I think he’s been scapegoated too much. He probably just got a jolt and wont’ get as many save opportunities, but will still get some in Davey Johnson’s A/B bullpen strategy.

Clippard’s arm is going to fall off sometime soon — he’s been so overworked the last few years. Bullpen depth is going to be critical.

Persumably, a full season of Strasburg and other starters being more seasoned means longer outings and the bullpen not getting worn out. That proved to be a problem in October.

This should be fun.

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Nats want District to pay for overtime Metro

Nationals ask District to pay to keep Metro open late for fansWTOP
It is official, the Washington Nationals ownership is still really stupid. Rather than put down a $29,500 deposit on keeping the Metro going for an extra hour in the event of a really late game, they’ve asked the District to do it. Huh?

Metro requires organizations, like sports teams and event promoters, to provide a refundable deposit of $29,500 per hour of operation to keep the system running beyond normal operating hours. Most organizations, like the Capitals and the Redskins, have agreements with the transit agency in place. The Nationals do not.

Even Dan Snyder is willing to spend to set up a deposit! Dan Snyder!

Bob Short and Calvin Griffith approve this plan.

Ugh. Was a public relations nightmare really worth saving $29,500?

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Mark Lerner needs to prioritize Nats fans in selecting a new spring training home

Mark Lerner, the most public member of the Washington Nationals ownership group, just left spring training. Among other things, Lerner told Nationals Journal, The Post that the Nats are looking to move away from Viera for spring training which is not news, but worth mentioning again. Logistically, playing on the east coast of Florida is undesirable due to being at least 60 miles away from any other facility. Speaking of logistics, here is a look at the logistics for me to go see Nats at their current spring training location, something I have not yet been able to do:

A rough calculation has the trip from my condo in Alexandria to Viera (about 868 miles) will cost me $241.36 for gasoline round trip. That does not include incidental travel, meals or lodging. Just in travel, I’m spend at least $30 a day in food and $100 a night in lodging. I would have already sent $500 just getting there and back. That’s a bit of cash.

The presumed new Nats spring training location is the Gulf coast of Florida. That is obviously farther from here, but still a realistic possibility for people driving from the D.C. area. Lerner made it clear that the Gulf coast is his preference, but also said that Arizona is a possibility, not news that this Washingtonian particularly wants to hear.

To fly out to Phoenix (1970 flight miles), I could get a plane ticket for just $359 if I don’t mind having a layover somewhere. That is surprisingly cheap, but I would need to pay security fees, plus rent a car ($300 for a “standard” car) and put gas in it. That is just to get me there though — I’d have to get one for my wife too, maybe my son. So, that easily puts us up over $1000 before for food, tickets, souvenirs, etc.

So, the upshot of this is traveling to Phoenix is more than twice as far away and probably costs twice as much as Viera. Is that how you want to reach out to your fans, Lerner?

Also, in case you were wondering why Stan Kasten left:

“The only thing I can compare it to is, Stan’s not in the middle now,” Lerner said. “On the major things, [Rizzo] comes in front of the board. Mike’s running the show in baseball ops. It’s his baby now. It’s new to him, too. Everybody has a little bit of a learning curve in this business.”

We’ve noticed that learning curve, Mark, we’ve noticed.

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Nats videos: Ryan Zimmerman, Mark Lerner, Bryce Harper, Jayson Werth

Some Washington Nationals videos for lunchtime viewing:

CSN Washington‘s Kelli Johnson spoke to Ryan Zimmerman

Lindsay Czarniak talked to Mark Lerner, co-owner, about his “Strasburg therapy” but not shagging flies in the outfield:

I’m trying to stay off the Bryce Harper bandwagon until he gets to the big leagues, but here is what he and Jayson Werth had to say the other day:

Harper and Justin Bieber comparisons?

I’m not sure I’ve ever heard a Bieber song and I suspect ignorance is bliss in this case.

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Business of Sports Q&A featuring Redskins, Nats, Caps and Wizards ownership wrap up – where is the video?

Tuesday, Washington Post Live presented Business of Sports – Q and A with panelists Ted Leonsis, owner the Washington Capitals, Wizards and Mystics (Monumental Sports), Robert Tanenbaum, principal owner of the Washington Nationals and Marla Lerner Tanenbaum, chairperson of the Washington Nationals Dream Foundation, Daniel Snyder, owner of the Washington Redskins and Will Chang, owner of D.C. United.

I was hoping and expecting that video of the entire event would be online, right now there are only clips. I have emailed Post PR and was told the video was being edited and I’d get a reply when its ready. Nothing yet, but if they ever do get it, I’ll post the video.The video has finally been posted

The Tanenbaums, particularly Robert, have not been the most active of the Nats principal owners (how can you have 5 principal owners anyway?) which I noted in the early post. Robert Tanenbaum noted that the Nats will win the World Series in the Year of the Bear. Obviously, I’m worried he’s right because:

THERE IS NO “YEAR OF THE BEAR”

Oh my, that built no confidence.

Meanwhile, DC Sports Bog has lots of coverage of course:

Snyder and Leonsis on the media D.C. sports owners rooting for each other Snyder: No to HBO’s Hard Knocks Snyder on FedEx Field

Also, Chang indicated that he’d like United to stay in D.C. and that he has a greater sense of urgency about finding a new home field for the soccer team. I have mentioned before that I would like to see DCU stick around here and not go somewhere like Baltimore. I have only been to one game so far, but I am open to going to more and who knows, maybe in a few years my son will be a big soccer fan.

I was hoping and expecting that video of the entire event would be online, right now there are only clips. I have emailed Post PR and was told the video was being edited and I’d get a reply when its ready. Nothing yet, but if they ever do get it, I’ll post the video.

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Panel discussion with Redskins, Nats, Caps, Wizards, United, Mystics ownership at 8:45

Washington Post Live is hosting a panel discussion, the Business of Sports Q&A, featuring ownership from all the D.C. pro teams at 8:45 a.m. today The panelists include:

Ted Leonsis, owner the Washington Capitals, Wizards and Mystics (Monumental Sports)

Robert Tanenbaum, principal owner of the Washington Nationals and Marla Lerner Tanenbaum, chairperson of the Washington Nationals Dream Foundation

Daniel Snyder, owner of the Washington Redskins

Will Chang, owner of D.C. United

The panel will be talking about what they “do and don’t do to make their franchises successful.” Last time I checked, only one of those owners is successful right now. I am interested to see what questions make it through the screening.

The Tanenbaums appearance as the Nats representatives on the panel is a little surprising, because Ted Lerner is the “managing principal partner” and his son Mark is the principal partner that has been most active, at least publicly, of the principal owners. I cannot recall any occasion other than the introductory press conference in 2006 that Robert Tanenbaum, a son-in-law, was specifically involved in.

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I am probably the only one who is OK with Mark Lerner shagging flies

Principal owner Mark Lerner (not to be confused with the managing principal owner, his father Ted) likes to put on a Washington Nationals uniform and catch fly balls during batting practice from time to time. He gets mocked for it, I’m okay with it, since it sounds like a lot of fun. Its like fantasy spring training, with out throwing inside to Joe Pepitone or punching out Mickey Mantle.

Well, its all fun and games until Lerner gets hit in the face with a fly ball (Nationals Journal, The Post).

“I’ve never seen blood gush that fast out of someone,” said one Nationals player.

Lerner is okay after some stiches, but it was the kind of night for the Nats (The Post). They were down 10-1 to New York Mets (Luis Atilano was terrible (CSN Washington), giving up 7 runs, 6 earned over 4 1/3 innings) when I finally got to turn on the game in the sixth and I decided to do other things. They actually put up a fight and scored another 6 runs and had a chance to tie with Adam Dunn up and the bases loaded, but could not come through.

Nyjer Morgan says he’s starting to feel like last year. That would be good, because he’s been pretty bad this season.

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Nats should be candid about how many group sales were made to Philly

Nationals Park infiltrated by Phillies fans on opening dayThe Post
Whether the Washington Nationals acted in good faith selling Opening Day tickets is really a moot point. It is possible that the Philadelphia Phillies fans group ticket buys simply snowballed before anybody figured out that Washingtonians would be left out of an opportunity to buy Opening Day tickets — they sold out in 7 minutes in the public sale. There may not have been anything they could have done about it. The Lerner Family and Stan Kasten do not get the benefit of the doubt though, not after Kasten begging Phillies fans to come to last year’s opener on Philadelphia radio and not after two consecutive 100+ loss seasons.

The article above reveals that one ticket agent, Bree Parker*, sought out one Phillies fan group and sold them over 500 tickets. The team should reveal how many more times this happened. They don’t have to of course, but transparency with fans and other stakeholders is the most responsible way to handle the situation. Additionally, we need to get Kasten and the Lerners “WWTLD” bracelets — What Would Ted Leonsis Do?

In his book “The Business of Happiness” Leonsis talks about building communities and uses the Capitals as an example. For the last several years, that fan community has been a happy one, for the obvious reason that they are winning, but also in large part because the people running the Caps have been open about what they are doing. Making Caps fans happy is the franchise goal which has translated to record-breaking ticket and merchandise sales. When bad things have happened, Leonsis has faced the music which has built up trust in the Caps brand. The Nats would do well to learn this lesson.

In summation, hey Nats — people want to like you, maybe LOVE you, so don’t make them feel stupid for being a fan. It is just good business.

By the way, with less than a week before Opening Day 2005, I was able to get four together at Citizens Bank Park for the first official Nats game. Just sayin’

About that Philly fan invasion – DC Sports Bog, The Post

How Philly fans overtook D.C.Nats Insider

*Parker was very helpful setting up my group ticket buy for my bachelor party in 2005.

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