Talk about a poor return on your investment.
With the baseball season winding down, the Los Angeles Dodgers have to be considered one of the most disappointing teams of the 1999 season, on the field and at the bottom line.
Despite an $80 million payroll the second largest in baseball the club failed to make the playoffs for the third year in a row. Heading into their final three-game series in Houston against the Astros last weekend, the most games the Blue Crew could possibly win was 79 or slightly more than $1 million per victory.
This is not what Rupert Murdoch's Fox Group intended when it purchased the Dodgers from Peter O'Malley in the spring of 1998 for $311 million. But despite the small bang Fox got for its buck this year, the team is expected to keep its huge payroll intact next season.
That's because it's imperative for Fox to keep one of most successful teams in sports popular and thus keep raking in millions on merchandise, advertising and television ratings.
Rick Welts, president of Fox Sports Enterprises and interim head of the Dodgers since firing President Bob Graziano last week, said the team remains committed to spending money on high-priced free agents until it can develop its own talented players.
"If this was a one-year business plan then it wouldn't really be smart, but Fox believes in this as an interim step until we can develop our farm system," he said. "The conclusion no matter what is to do what it takes to be competitive."
Thanks to several expensive player deals last year, the Dodgers will lose money this season, Welts said. But he has no regrets about those contracts, which included the record seven-year, $105 million contract awarded to free agent pitcher Kevin Brown last year.
"We had to go out and acquire talent at the top end of the market through free agency," he said. "As a result, we knew we couldn't turn a profit and we have to live with that."
Welts wouldn't comment on personnel moves planned for the off-season, except to say that he and General Manager Kevin Malone will evaluate the situation and see whether to go after available free agents.
While there are relatively few top free agents coming on the market at the end of this season, the story will be different a year from now. The two biggest available names then will be outfielder Ken Griffey Jr. and shortstop Alex Rodriguez, both of the Seattle Mariners. Both could command long-term contracts of $150 million or more, and both names have been linked to the Dodgers.
"We'll look at every possible option," Welts said. "And we're not just looking at one off-season, but a couple of years from now as well."
Since purchasing the Dodgers, Fox has generated more controversy than enthusiasm, in the process damaging the team's image.
Last year's trade of superstar catcher Mike Piazza and the subsequent firing of General Manager Fred Claire and Manager Bill Russell served notice that things would be different than they were when O'Malley owned the team.
The termination of Graziano, who served in the Dodger organization for 14 years, may have further eroded the public's faith in the team's future.
"The loss of Bob Graziano is really important because he was identified by everyone as knowing about the Dodgers' history and tradition," said David M. Carter, principal of Sports Business Group, an L.A.-based marketing firm. "He was protective of the brand a brand which Fox has managed to step all over in the past year."
Welts joined Fox on July 1 after a long career as an NBA executive, brought in by Murdoch lieutenants Peter Chernin and Chase Carey to assume direction of sports operations. Although a newcomer to the Dodgers, he disputes the notion that Fox has tarnished the team's image. But he said more could be done to improve community support for the team.
"All we can do is improve in every aspect. We have to do better on the field, and that makes up for a lot," he said "But we could do more in community service. It's part of the tradition, and it's good business."
He also took issue with the notion that stability is inherently good, saying that the way O'Malley ran the Dodgers, while admirable, would not cut it in today's more corporate sports world.
Welts said the team's future president may not necessarily be a baseball expert, but someone with sports experience who understands the bottom line as well.
The four American League teams heading into the playoffs have among the top five payrolls in that league, led by the New York Yankees at about $85 million. The two National League teams guaranteed a playoff spot have the second and third highest payrolls in their league, behind the Dodgers. Of the three teams battling for the last two spots, only one the Cincinnati Reds are among the leagues' bottom feeders, with a payroll of only $33 million.
"There has been a fairly significant correlation between payroll and success," Welts said. "But there will certainly be an asterisk by our names this year."
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