September 20, 2014
George Steinbrenner’s Evil Empire
Posted on Aug 4, 2010
By Mark Heisler
A new heyday followed with the team of Brian Cashman, a young self-effacing GM, and Torre, who won four titles in his first five seasons from 1996 to 2000. By then, Torre, a gracious New York native, was more popular than the clumsy Steinbrenner, which wasn’t a good idea.
If the leadership was Steinbrennerian, the uniformed personnel, exemplified by the poised, classy Derek Jeter, were hard to dislike.
In a typical organizational divide, Yankee players, in Boston for the 2005 opener—where they had begun blowing a 3-0 series lead the previous fall—went to the top step of their dugout to applaud the Red Sox players who had just gotten their World Championship rings.
The YES [Yankees Entertainment & Sports Network] broadcast didn’t show the ceremony. Instead, correspondent Kimberly Jones described it, briefly.
Square, Site wide
If the Yankees had long been the game’s mightiest franchise, it was Steinbrenner, not Jacob Ruppert, who stole Babe Ruth and built Yankee Stadium, who institutionalized their advantage in his last decade, until their rift with the rest of the game yawned like the Grand Canyon.
In the ’90s, the Yankees were only among the leaders in payroll, ranking No. 5-7-6-3-2-2-2-1-2-1.
As recently as 1992, the Oakland A’s, who would inspire the book “Moneyball,” a guide for teams that had little, outspent the Yankees.
As recently as 1998, someone else—the Baltimore Orioles—was No. 1.
In the next 10 years, according to a study by Biz of Baseball’s Maury Brown, the Yankees would spend $1.65 billion.
The No. 2 Red Sox were almost $500 million behind at $1.16 billion.
The Yankees started this season at $206 million—$44 million ahead of No. 2 Boston at $162 million. No one else was within $50 million.
The No. 4 Phillies, who won in 2008 and lost to the Yankees in 2009, were $65 million back at $141 million. As opposed to entertaining illusions about being a peer, they had just dumped Cliff Lee to afford Roy Halladay.
Only three others—the No. 3 Cubs, No. 5 Mets and No. 6 Tigers—were within $100 million of the Yankees.
As Colorado owner Jerry McMorris, whose Rockies averaged 3.7 million fans in their first nine seasons, once noted, they were all the Washington Generals to the Yankees’ Harlem Globetrotters.
With a deft political touch, Steinbrenner forged tacit alliances with the Players Assn., which shared his desire for an astronomical pay scale, and Commissioner Bud Selig, whose good intentions of leveling the playing field were offset by a mild-mannered, consensus-seeking nature that made him a protector of the status quo ... and Yankee domination.
Happily or not for the game, it looks fair, at least in November (that’s how long the World Series runs now), with nine teams winning the last 10 World Championships.
Of course, the Yankees played in four of those and won two, even if that represented an underachievement.
The rest of the season, however, you see a game divided into sellers who hold fire sales for stars approaching free agency, and buyers, led by you know whom.
Noted the passionate but clear-eyed Peter Gammons on the MLB website before this season:
The Yankees don’t get everyone they want, just most of them, like Sabathia, Alex Rodriguez, Mark Teixeira, Mike Mussina, Wade Boggs, Tino Martinez, Johnny Damon, Paul O’Neill, A.J. Burnett and Jason Giambi—to name some more recent ones, not to mention busts like Kenny Rogers, Chuck Knoblauch and Carl Pavano.
The Red Sox, the closest thing to a peer, lose free agents (Boggs, Damon, Roger Clemens, Manny Ramirez). The Derek Jeters, Mariano Riveras and Bernie Williamses remain Yankees as long as the Yankees want them.
The empire is worth billions—plural.
The new stadium was built at a cost of $1.2 billion.
Forbes projects the team’s value at $1 billion.
Yankees Entertainment & Sports is TV’s highest-rated regional sports network. At a projected value of $3 billion-plus, Fortune Magazine suggests it’s “the true gem” of the empire.
YES, privately held by the team with smaller stakes held by Goldman Sachs and former Nets owner Ray Chambers, was discreetly and briefly shopped in 2007, when Steinbrenner’s illness raised succession issues.
With $340 million in revenue the previous year, Fortune suggested its value at $3 billion, based on normal growth and an industry standard of 19 times cash flow ($140 million in 2006.)
YES doesn’t provide financial information, but by 2009, revenue had increased almost 20 percent to $419 million.
The team, itself, is run near the break-even point, with revenue going largely for payroll, luxury tax and the assessment that goes to small-market teams in revenue sharing.
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