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How much the Giants and other Major League Baseball clubs are worth

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Posted: Saturday, October 27, 2012 12:00 am

During Wednesday night's World Series opening game, the network cameras panned to the San Francisco Giants team store where the line stretched out for 30 yards — literally. Fans eagerly spent $50 for flimsy Giants caps and $195 for jackets. By the time they reached the store, some had already shelled out as much as $200 to park and $1,100 for their Stub Hub tickets.

Since the start of the post-season playoffs, sales of licensed Giants and Detroit Tigers merchandise, both generic and player-specific, have soared. When the team reached the World Series, Tigers items shot up nearly 325 percent. Whether the Giants or Tigers prevail, championship logo T-shirts and jerseys will be on the market within hours.

The U.S. economy is stagnant, 22 million underemployed/unemployed Americans struggle to make ends meet and home equity remains in the Dumpster. But when it comes to money in baseball, the sky's the limit.

Game 1's starting and winning pitcher was the much maligned Barry Zito, who in 2007 signed a $126 million seven-year contract with the Giants. Since then, Zito's name has become synonymous with inflated baseball salaries.

Few fans realize that to even the lowliest baseball franchises, astronomical salaries like Zito's are chump change. Baseball is a multibillion-dollar monopoly that virtually prints money. The Giants' current market value is $643 million, with an $8.8 million operating income, a 17-percent increase from 2011. The team has sold out every seat in its 43,000 AT&T Park since Oct. 1, 2010; it raised ticket prices in 2011 and again in 2012.

As rosy as the financial picture is for the Giants, it ranks only ninth on the Forbes Magazine list of most lucrative baseball franchises. The New York Yankees, with a $1.85 billion valuation and a $10 million operating income, lead the league, to put it in baseball parlance, followed by the Los Angeles Dodgers, Boston Red Sox, Chicago Cubs, Philadelphia Phillies, New York Mets, Texas Rangers and Los Angeles Angels.

During 2011, the average Major League Baseball team's valuation rose 16 percent to an all-time high of $605 million. Aggregate revenue for the league's 30 teams climbed to an average of $212 million.

The national pastime is flourishing thanks to cable companies' desire for live baseball programming. The ultimate cable model is a team that owns an equity stake in a regional sports network because that generates two revenue streams, cable fees and advertising, and gives owners greater financial flexibility.

The premier RSN example is the mighty New York Yankees, which controls 34 percent of the YES Network. In 2011, YES earned an eye-popping $224 million in operating income and paid the Yankees $90 million in rights fees.

If you think that the Yankees worry that they may have to eat a large portion of the over-the-hill Alex Rodriguez's remaining five years on his $30 million per year contract to get rid of him, forget it.

Not only is the lucre abundant for owners, but there's much more dough on the way. In August, MLB and ESPN announced the largest broadcasting deal in history as the two entities reached an eight-year, $5.6 billion agreement through 2021.

Baseball's huge financial windfall has enriched owners and players beyond their wildest imaginations. Still, eliminating day games from the World Series is a minus, especially for young school-age fans or East Coast viewers who can't handle the 3-hour long games, slowed by multiple commericals, that end around midnight. For the business of baseball, the cash register's ring overwhelms every other concern.

Joe Guzzardi is a member of the Society for American Baseball Research and the Internet Baseball Writers Association. Contact him at guzzjoe@yahoo.com.

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