- The Washington Times - Sunday, January 16, 2005

It’s common for minor league baseball to be obscured by the bright lights of its major league counterpart, and it happened yet again last week.

Lost in the front-page news of the majors’ new drug-testing policy, Major League Baseball and Minor League Baseball (formerly the National Association of Professional Baseball Leagues), the umbrella organization for the minors, announced a 10-year agreement that promises a radical alteration of how minor league clubs are operated and marketed.

The new pact guarantees at least 160 affiliated minor league teams will be in existence through 2014, makes several key changes to revenue sharing between major league clubs and their affiliates, puts minor league games on the majors’ forthcoming TV network and turns over all Internet operations for the minors to the wildly successful MLB Advanced Media.

“This will enable us to take the two halves of this industry and form one force moving forward to provide the facilities and venues necessary for player development to ensure Major League Baseball stars of tomorrow but also enhance and provide stability to our clubs in the business of doing baseball,” said Pat O’Conner, Minor League Baseball’s chief operating officer.

Some fans might think a minor league makeover isn’t necessary. The affiliated minors last year set an attendance record of 39.8million, a turnout burnished by reasonable ticket prices, increased fan access to players and a hustling style of play occasionally absent at the major league level. Minor league merchandising is still riding a decade-long wave of success, and fantasy leagues increasingly are using minor league components.

But beneath the veneer of goofy nicknames, kids running the bases and $5 tickets, a darker fiscal reality exists. Fifty-one percent of minor league clubs lose money, and 75 percent of net income for all minor league baseball comes from the top 16 clubs. Total debt carried by minor league clubs, primarily through the construction of stadiums, grew by 67 percent between 1993 and 2003.

And just as Major League Baseball and the players union are now trying to heal decades of divisiveness, the minors are seeking to overcome a fractious past with the majors. In 1990, the minors openly threatened to break up a 90-year association with Major League Baseball, and given the marked growth since then of rival independent leagues not affiliated with the majors, distrust still exists in some corners.

“In 1992, when I took over, we had a very tense, tough relationship with the National Association,” Major League Baseball commissioner Bud Selig said. “That’s probably an understatement as you’d all agree. We’ve come a long way, and, just to have completed this agreement, I’m proud of both parties.”

Fixing both the finances and politics of the minors means enlarging the entire industry and doing so with the aid of Major League Baseball. And that makes the Internet component of the new deal particularly important. MLB.com will feature minor league ticket sales, real-time statistics, game audio and video and merchandise sales.

Those elements will combine to form a critical tool for all minor league clubs to expand marketing far beyond their home areas.

“We’re really looking forward to that,” said Stan Brand, vice president of Minor League Baseball. “We have every hope this will be a very positive development. Licensing already has been a success, and now we’re putting much more resources into marketing and dissemination of our games.”

The affiliated minor league clubs also have agreed in the new deal to increase the ticket tax paid to their parent franchises. Largely derided by minor league team owners when it was introduced in 1990 and doubled to 10 percent in 1997, the ticket tax helps offset player salaries paid by the parent clubs.

By agreeing to a further increase in the ticket cost, the minors received a 10-year covenant from Major League Baseball that it will not seek to shed clubs in a cost-saving measure, and the deal makes the two entities true business partners.

“The long-term stability is very important to us,” Brand said. “And that extra ticket tax money is going into [Major League Baseball’s] central fund. We’re potentially talking about a $150million pool of money to grow the game. We feel that is very significant.”

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