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By Spike Eskin
PHILADELPHIA (CBS) – Local television deals have been a revenue source for Major League Baseball teams for a long time, but in recent years, the amount of that revenue has skyrocketed.
New deals for MLB teams have changed the economics of baseball as a whole, as sports are one of the few things that are watched live, instead of timeshifted. Live television watching means commercials that get seen, instead of sped through on DVR.
It’s been well-reported that the Phillies, whose television deal concludes after the upcoming season, are one of the next teams in line for one of those big deals. That deal could be on the horizon.
A report from Howard Megdal on Sports On Earth, the Phillies are likely to sign their new television deal within the next 30 days. The amount of that deal, Megdal says, will have a lot to do with how the team operates this off-season.
“Consider what the new revenue is likely to be. Under their current deal, which expires after 2014, the Phillies make $35 million per season,” Megdal says. “This is low by virtually any standard. The San Diego Padres, for instance, make $60 million per year on their television deal. The Rangers are on a new deal at $80 million per season. The Angels check in at $147 million per year. And all three also received equity stakes in the sports networks paying the team.”
According to Forbes, the Phillies have the 41st most valuable sports franchise in the world, valued at $896 million.
How that increased revenue affects the Phillies payroll will be interesting. The Phillies had one of the top payrolls in baseball this past season, but have been careful to not top MLB’s luxury tax threshold. Increased television revenue could mean increased spending, like it did for the Los Angeles Dodgers. It would also be interesting to wonder if the signed TV deal would make the Phillies more confident and secure in their ability to try and rebuild, with the pressure of signing the deal out of the way.
The Phillies have just under $120 million committed to just seven players for the 2014 season.
A hearty thanks to The Good Phight, who noticed Megdal’s report in the first place.