NEWSLETTER
We talk often about the relationship between Chicago Cubs competitiveness and attendance at Wrigley Field, and what that means for dollars available to the front office, but we talk a lot less about the relationship between competitiveness and TV ratings, as that would relate to dollars available to the front office.
I think part of the reason is that the chain of dollars actually reaching something you care about – for example, Cubs payroll – is a lot more indirect.
It’s something like … viewership translates to ratings, translates to advertisement levels and rates, translates to some direct revenue to the network, but also translates to more viewers wanting the channel, translates to better carriage deals from cable and satellite operators, translates to a better ability for Marquee to pay its broadcast rights agreement fees to the Cubs, translates to more revenue certainty for the Cubs, translates to better forward-looking baseball operations budgets, but also translates to some profits for Marquee’s owners, which may translate to more money for baseball operations, and so on and so forth. It’s complex. Which isn’t to say attendance and gameday revenues aren’t complex, too, but it’s just a lot easier to see that path.
I’ve already lost many of you by this point, because it’s just not a sexy topic. But it matters to the bottom line.
No, I don’t mean Marquee’s bottom line or the Chicago Cubs’ bottom line or the Ricketts Family’s bottom line (although it does matter to those things); I’m talking about YOUR bottom line as a fan of an organization that claims it will make revenue available to baseball operations after expenses are paid. So, more revenue – in theory – means more money for Jed Hoyer and Co. to spend on improving the thing you actually care about: Chicago Cubs performance on the field.
You can see the chicken and the egg there, by the way. Better attendance and better TV ratings will mean more dollars, indirectly, flow to the front office … but better performance on the field is really the only way to actually generate better attendance and better TV ratings. I tend to think there’s going to be some “choosing the chicken” this offseason – spending real money to improve on-field performance – but I don’t think anyone outside of 1060 West Addison can guarantee fans that fact. We have to wait and see.
Anyway, much of that is prelude to the news drop here, which gives us an even better sense of just how much the Cubs’ degraded performance the last couple seasons has stung the multi-year launch of Marquee, a network joint owned by the Cubs and Sinclair:
It seems like 56% is a massive ratings drop, especially given the starting point was a pandemic launch where enthusiasm had already waned by the time games started airing. Per the Tribune article, it puts the Cubs’ ratings back to where they were in 2014, before the last rebuild started to bear fruit. I guess maybe that’s weirdly encouraging, since Marquee catches a lot of flack? As in, the Cubs and Marquee aren’t actually doing any worse than they were in 2014, when the broadcast rights were spread across NBC Sports Chicago, WGN-9, and ABC-7?
Of note in the piece, the Tribune reports that the broadcast rights deal – the fees Marquee pays to the Cubs for the rights to broadcast their local games – is for $90 million per season, up from a reported $60 million in the pre-Marquee days. If those figures are accurate, the Cubs bumped from middle-of-the-pack to top eight or so (tough to do in the current environment), which ain’t too shabby. Well, it ain’t too shabby if you use that financial boost to your divisional advantage.
Keep in mind, though, we don’t know how long the broadcast rights deal is for, or how long the carriage deals that prop it up are for. It’s conceivable – likely, even? – that some of those carriage renewal talks could begin very soon (sometimes these deals are for as short as three years, which would be, well, now). It would be imperative, then, for the Cubs to get performance up BEFORE those talks begin.
All the more reason for the Cubs and Marquee to really, really want a competitive product on the field sooner rather than later. They don’t want to blow up the long-term to make it happen, but I don’t think that urgency should be underestimated. And if they’re trying to launch a direct-to-consumer streaming option at the same time? Where they need consumers to REALLY want to buy the product, while also not pissing off the cable providers that know they might lose subscribers in the process? I mean, come on. The Cubs really need to be good. Soon. It’s just business at that point.
So, your takeaway from all of this should be, in my opinion, similar to the attendance stuff: yes, Cubs ratings are impacted when the team is not competitive, and yes, it could create deficiencies in available dollars for baseball operations. But given certain market realities and the shifting streaming landscape, it seems particularly critical for the Cubs to be competitive SOON if their owners – and Marquee – want to be in the best financial position possible going forward. The idea that the owners don’t care if the team is good because they’re just cashing checks may or may not have been true in the days of Tribune ownership, but in the post-World-Series, post-cord-cutting, post-peak-entertainment-options era? That is just not true. The Cubs need to be good for the real dollars to flow.
There’s a whole lot more in the Tribune piece if you really like to get into the weeds on this stuff. I do.
