NEWSLETTER
Chicago Cubs Owner and Chairman Tom Ricketts spoke with the Sports Business Journal today, getting into a range of topics. He rarely does the public interview thing, so whenever we get a chance to hear from Ricketts directly, I’m interested.
Whatever your perspective on the Ricketts Family as owners of the team (miles better than the Tribune Company, but whatever), one thing I have always appreciated about Tom Ricketts is that he clearly has a sophisticated understanding of baseball operations, even as he intentionally keeps himself out of that side of things and lets his baseball guys handle it. He probably *could* get more involved, but he’s smart enough to know what he knows, and also to know what he doesn’t.
Still, he has a sense of what’s going on around the game, and with the under-the-hood needs of his organization. To that end, candor here about how the game has transformed over the last half-decade, and how the Cubs fell behind but are trying aggressively to catch back up now to be back at the top of the market on player development:
On our opening #SBJDealmakers panel, Cubs Chairman Tom Ricketts said the way teams are built is changing: "The next wave is player development. Once you draft a player, what can you do to make that player the best he can be?" pic.twitter.com/0CJcmMTer7
— Sports Business Journal (@sbjsbd) December 4, 2019
Ricketts spoke about the decision to move away from a multi-team Regional Sports Network to their own network, pointing to the benefit for the fans (though, I mean, let’s be clear: the Cubs would not go in this direction if they weren’t betting it would ultimately be financially advantageous to do so):
Cubs Chairman Tom Ricketts on why the team started its own sports channel: "The best way to serve our fans, and the best way to bring out the Cubs story, was to be more independent." #SBJDEALMAKERS pic.twitter.com/uX9A5wr8qX
— Sports Business Journal (@sbjsbd) December 4, 2019
The interesting bit there, to me, is the explicit acknowledgement that the traditional cable model is “under pressure,” but the organization still felt it was the right way to go at the moment. I do think the biggest part of that conversation was the unspoken part: with local streaming rights returning to the teams, it was all the more critical for a big player like the Cubs to control their own channel, rather than be on a multi-team network. I don’t know that we’ll see a lot of a la cart subscription options to Marquee in the immediate future, but perhaps for people in the Cubs’ territory who don’t otherwise have access to Marquee? The Cubs can elect to monetize those users via some kind of direct subscription now, and it all stays in the organization.
Ricketts recounts the battle with the rooftops, and the hurdle of Chicago politics (clearly, the Ricketts Family was not prepared for that uniquely … challenging world):
What was Cubs Chairman Tom Ricketts' steepest learning curve? "Chicago politics. I used to joke that the only way I thought I would meet an Illinois politician was if I somehow ended up in prison." #SBJDEALMAKERS pic.twitter.com/RVCbxDRRNI
— Sports Business Journal (@sbjsbd) December 4, 2019
This is not necessarily new, and without the video to provide context I suspect something is lost, but yes, renovating Wrigley Field – and developing the surrounding area – has been a very expensive enterprise:
Cubs Chairman Tom Ricketts, on the cost of Wrigley Field renovations: “We probably missed our budget by around 100%.” #SBJDEALMAKERS pic.twitter.com/NmYZ89gPih
— Sports Business Journal (@sbjsbd) December 4, 2019
I don’t think Ricketts is looking for any sympathy there, nor would he get any – instead, I think it’s more of a reminder that the Cubs’ owners paid for the renovation and development without public money, which is a rarity in the last 30 years. Because of that investment, however, the value of the area – and of the organization – is really going to be a long-term benefit to the owners. That is to say, I wouldn’t look at statements like that as pre-emptive excuse-making about team spending. I think it is more just a general business point.
Obligatory reminder: the Ricketts have said from thing one that revenues that come into the organization, after expenses, will go straight into baseball operations. So the better the organization is doing on the revenue side (you would expect that is only going to get better with the renovation/development complete and with the new network launching), the better it is for baseball operations.
