March 18, 2022

Major League Baseball Finally Turns the Page

By Thomas Calhoun 

Lockouts in sports tend to be messy, but this year's lockout almost broke the record books. The 2022 Major League Baseball lockout occurred because the MLB Collective Bargaining Agreement from 2017 expired this year and a resolution had to be met in order for the season to take place. The Collective Bargaining Agreement, often referred to as the (CBA), is an agreement between The Major League Baseball Players Association and Major League Baseball describing the rules of employment and financial structure of the game. When both sides were not able to come to an agreement, the players were locked out of the league and essentially unemployed. 

In this case, the owners wanted to extend the playoff season because it would provide the teams with more money while the players would see little to no increase in pay. This would mean more games played for the players and still not being able to reap the benefits of postseason revenue. The players union wanted a bit more, but all requests seem justifiable. For starters, there has been a shrinking percentage of revenue going to the players because the MLB had been using so-called “creative accounting methods'' to show why the players' salary is fair. Players also wanted to have more stake in their own free agency decisions and provisions to protect prospects and their salaries in the minors so that they can be brought up at a reasonable time. The union also wants to see tanking addressed, teams are often forced to tank their season in order to gain draft picks and therefore benefit from the league's revenue sharing. All the players want from this is to see that teams are incentivized to win again and pay players their fair share. Finally, the playoff expansion issue. The players' main concern is that teams won’t try as hard during the season because as long as they reach the playoffs, they can make all of the money back from TV revenue. 

Now that the lockout is over, what does this mean for the players and the brands that are involved? For starters, let's take a look at how the players were affected. The players got a lot of what they wanted, beginning with increased pay for younger players, which will help the league continue to develop talent. They also received a universal designated hitter, which previously was reserved for only players in the American League. The playoff terms met at the middle ground with a twelve-team tournament versus the proposed fourteen. The players also received financial based incentives from the league such as centralized bonuses for pre-arbitration players that would be based on performance; a measure that will decrease anti-competitive behavior. When all is said and done, the players got what they deserved and ownership will still be able to make the millions that they have been making for decades. 

So we see how the lockout affected the players, but what did the brands and sponsors get out of this? Big news came out this week about MLB uniforms being able to wear advertisements on their jerseys. We have seen the National Hockey League (NHL) and National Basketball Association (NBA) do this over the past couple of years and it has been a huge revenue generator for all organizations. According to an article from Chicago Business, branding on NBA jerseys will return a whopping $225 million to its teams this year. This gives brands a tremendous opportunity to promote themselves on top of a previously existing brand. However, we come back to the same conversation of certain teams being able to take advantage more than others. For example, the New York Yankees are going to have larger sponsorship deals than the Baltimore Orioles, which in return will give them the ability to sign better players. This is similar to the NIL discussion in college athletics in a way because the larger organizations will inevitably attract more revenue. It also brings the topic of fans remaining loyal to a company rather than the team they have always followed. There are many different crossroads like this when you bring outside money directly onto the team's uniforms. Many people are opposed to it because they think it will affect the integrity of the game, but I say it is just the game evolving. If you don’t keep up, you are going to be left in the dust. This should be something that excites fans because the more money you can pump into a team, the better the franchise will become. 

Over the last few years, we have seen baseball fade out as “America's game” and lose popularity to sports like basketball or football, and the lockout certainly did not help. According to a poll from the Los Angeles Times, 6 out of 10 Americans said they did not describe themselves as baseball fans, and out of those that described themselves as fans, 6 out of the 10 said the lockout made them start to lose interest. Attendance has been falling year after year despite the lockout, with 2019’s average attendance sitting at just over 28,000, the lowest number since 2002. Fans have the largest influence in sports, if they aren't at the game or watching on TV, then no one is making money. The lockout lasted 99 days and it is a bit embarrassing when you consider that a 44-year-old Tom Brady’s retirement was over quicker than the MLB could give its employees a fair shot. However, I think there are a few things that can be done to restore the love in America's greatest game. For starters, the implementation of sports betting all over the country is growing sports, even for people who aren't really fans. Companies like DraftKings are building sportsbooks into stadiums like Wrigley Field in Chicago and Bet MGM at Nationals Park in DC. This will drive traffic to the ballparks and help make baseball more fun to all generations, above 21 years old of course. I do think that expanding the postseason is good for baseball, it may be tougher on the players but it will keep fans more engaged. 

At the end of the day, Major League Baseball was walking on very thin ice with this lockout and had Opening Day been canceled, the ice may have broken. However, Players received a lot of what they deserved and the fans can rest easy for five years until the new CBA deal is up.

Sources

  1. https://www.chicagobusiness.com/sports/new-mlb-deal-brings-sponsor-patches-player-uniforms-first-time
  2. https://www.nytimes.com/2022/03/10/sports/baseball/mlb-lockout-ends.html#:~:text=It%20took%2099%20days%20of,day%20scheduled%20for%20April%207.
  3. https://www.latimes.com/sports/story/2022-03-08/mlb-lockout-most-fans-losing-interest-in-baseball-los-angeles-times-surveymonkey-poll#:~:text=Impact%20of%20MLB%20lockout,fewer%20games%20as%20a%20result.&text=Poll%20taken%20March%203%2D7,said%20they%20were%20baseball%20fans.
  4. https://www.baseball-reference.com/bullpen/Collective_bargaining_agreement#:~:text=The%20Collective%20Bargaining%20Agreement%20
  5. https://www.cbssports.com/mlb/news/mlb-lockout-timeline-of-cba-negotiations-between-mlbpa-and-owners-as-lockout-ends-after-three-months/

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