One of the biggest topics of conversation stemming from last week’s MLB owner’s meetings in New York was the fate of baseball in Oakland. While Rob Manfred didn’t make any new friends in the East Bay with his comments about the A’s situation and commissioned Brewers owner Mark Attanasio as chair of the “Relocation Committee,” there was another interesting bit of news that surfaced out of the meetings.
According to The Athletic, MLB and high-ranking team executives discussed the possibility of limiting how much clubs can spend on items not related to player salaries. This could include capping expenditures related to technology, player development, scouting, sports science, and health.
While every professional sport features teams seeking ways to find competitive advantages and market inefficiencies, MLB’s current structure forces the issue even more. Unlike the other major American sports, baseball doesn’t have a salary cap. As a result, you see massive payroll discrepancies across the sport. This season, New York Mets are spending nearly $375 million on player salaries while the Pittsburgh Pirates, Baltimore Orioles, and Oakland Athletics are all running payrolls of less than $100 million.
Whether or not it’s good or bad that the Mets are spending that much and the Pirates, Orioles, and A’s are spending that little is an entirely different discussion. But because small market teams can’t (or claim they can’t) keep up with the large market teams on player salaries, they do try to find edges in other ways, which brings us to the news about MLB potentially capping off-field expenditures.
Over the last handful of years, the quantity of off-field personnel staffers MLB teams employ has grown dramatically. If you were to visit your favorite team’s website and clicked on the front office directory, you’d likely be surprised at how long you might be scrolling down the list. In addition to the staffing, teams are investing more and more into technology. Whether its hitting or pitching “labs,” sensors, machines, devices, etc, players have more tools at their disposal than ever before.
Why is all of this a problem? Well, it’s a fair question. But you have to keep in mind that despite the lack of a salary cap and the disparity of market sizes across the league, MLB still desires competitive balance. While teams like the Rays or the Moneyball A’s might’ve been first on investing in these off-field expenditures, the realities of baseball being a “copycat” industry have led other teams to catch up.
According to the Athletic report, “executives with smaller-market teams have long lamented the task of keeping up with the spending capabilities of larger market teams.” This obviously comes into play with player salaries, but the Major League Baseball Players Association has long held firm against a cap on player pay. Therefore, could owners of low payroll clubs be pushing this cap against off-field expenditures as another avenue to keep up? It’s certainly plausible.
While curbing spending on technology capital might not pose any sort of legal risks for the league, some could come in if employees begin to lose jobs as a result of the hypothetical capping of spending. As mentioned before, teams are employing dozens of employees with titles like “Biomechanical Analyst” and “Data Engineer of Baseball Systems” just to name a few. If those jobs are cut, it could certainly be perceived as “colluding” in regard to hiring practices.
With baseball’s antitrust exemption under fire as a result of cases involving MLB’s contraction of the minor league and recent legislation introduced by state senators, any further leveraging of the exemption might not be viewed positively in today’s environment. You can hear more about the fight to challenge baseball’s antitrust exemption in one of the latest Conduct Detrimental podcasts, where our own Dan Wallach and Justin Mader were joined by renowned sports antitrust lawyer Jim Quinn.
While a cap on player pay might not be coming any time soon to Major League Baseball, it will be interesting to see if the league imposes restrictions on off-field expenditures. Moreover, if it indeed comes to pass, what will the ramifications be? How will large market owners react to caps on how much they can spend? Will it increase parity in the sport? Will the push to overturn baseball’s antitrust exemption only grow stronger? On the surface, I find it peculiar why MLB would go to these lengths, but I understand that the desire to reduce expenses and increase competitive balance are high priorities in the league office. Nonetheless, this is something to watch moving forward.
Brendan Bell can be found on Twitter @_bbell5.
