Thurm: On the Astros’ major league payroll and profitability
From SABR member Wendy Thurm at FanGraphs on August 30, 2013:
This week started with some hullabaloo when a Forbes contributor published a column claiming that the Houston Astros were the most profitable team in MLB history. Contributor Dan Alexander did some pretty simple math in concluding that the Astros would clear $99 million in “operating revenue.” “They have become so profitable thanks to slashed payroll expenses and soaring television revenues,” Alexander wrote.
But another Forbes contributor — Maury Brown, of the Biz of Baseball — refuted Alexander’s column. Brown explained the Astros “soaring television revenues” aren’t so soaring because CSN Houston — the new regional sports network the Astros and the NBA’s Houston Rockets own — isn’t carried on any cable or satellite service in the Houston area other than Comcast. Indeed, we reported last month that cable and satellite companies are using new technology to determine how many customers tune into local sporting events and for how long. AT&T U-verse used that information in deciding to forgo carrying CSN Houston. That’s left CSN Houston well short of projected viewership and revenue from carriage fees.
Brown also takes his Forbes colleague to task for describing the Astros and owner Jim Crane as profiteers. Crane hasn’t stripped the major-league payroll down to $13 million as a means to make quick cash, but as part of a system-wide rebuilding process.
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The question then becomes: When will the Astros start spending again on their major-league roster and how much will they spend?
Read the full article here: http://www.fangraphs.com/blogs/when-will-the-astros-start-spending-on-the-major-league-payroll/
Originally published: August 30, 2013. Last Updated: August 30, 2013.