That isn't a huge change (up 6% this year). Not an open market, but no limit on bonuses. Why wasn't the spending a lot higher? Since we are discussing the draft, that would seem very relevant since we are talking about why the Astros didn't spend more in the draft. Why didn't everyone spend substantially more with no limit? That is a lot of speculation. International FA record through 2010 was $4.25M. No question MLB teams are willing to spend on near ready ML talent. There is a clear premium in reduced risk and ML-readiness.
I think you see that through the fact that, two years out from the CBA, draft spending is essentially the same while revenues and other spending have exploded through the sport. And while there was no official cap on spending prior to 2012, the commissioners office worked hard to informally keep bonuses down. So prior to 2012 you had a dichotomy between teams like the Pirates, Red Sox, and Royals that didn't care about slot recommendations and teams like the astros and white sox who would rarely, if ever, go above them. The dichotomy is seen through the Astros having to back out of the Drew Stubbs deal and the Pirates giving $5 million to Josh Bell in the supplemental round. So because of the commissioners office's meddling you had a wider range of spending in prior to 2012. So for example in 2012 there were only 3 teams that spent less than 4 million in the draft; in 2011, despite higher overall spending, there were 7 teams that spent below 4 million. A third of the league spent over 10 million in bonuses in 2011 while only four did in 2012. So I'd say the commissioners office holding teams to slot recommendations (which were much lower relative to overall spending than the current slot recommendations) kept overall spending down. But again Id say look to direct comparables. Pitcher Matt White was picked #7 in his draft class in 1996 and used the same loophole as Travis Lee to immediately become a free agent. The # 1 pick in the draft class got a 2 million dollar bonus. The #6 pick, drafted immediately before White, received a $1,415,000 bonus. White signed a $10.1 million deal on the open market. With July 2 bonuses I think that was a market ineffiency that had corrected, or was close to correcting, itself by july 2012. And I agree that risk and mlb readiness are taken into account by teams. Which I think should be taken into account when comparing 16 yr old July 2 signings with draft bonuses.
No you said he overpaid for McCullers which he did not. He overpaid the slot. They drafted him there because they budgeted that they would overpay that slot. Don't confuse overpaying the slot with "overpaying" on his value. They planned and budgeted to overpay that slot because that's what it took to sign him. They didn't overspend the pool. That money was going somewhere, whether it was McCullers or someone else. You said this... I asked you what spending and you retort with overpaying McCullers which is not true, big draft picks from the Caribbean as in one draft pick who was paid drastically under slot, and minor league depth which is a puzzling statement as it pertains to significant spending. Oh no it's entirely material when you say significant spending and then talk about draft picks paid without overspending the pool they were allocated. Seriously, you want to give them credit for signing all their top draft picks? That is silliness. I haven't said anything about being unhappy they didn't spend their full draft pool. I have said I'm unhappy that they haven't signed more international free agents. Of the top 30 international free agents we've signed one and we had the most money allocated for our free agent pool. That is problematic because with the new rules it's the same as not signing your top draft picks. Jurickson Profar and Oscar Taveras, two of the best prospects in baseball, signed through international free agency. Why aren't we hitting that harder? I'd like to know. If it's a money thing, which it may very well be, then everyone should be pissed. A $20million payroll to rebuild, that's fine. Passing on international talent to save money, that's not cool at all
As an A's fan, I thought I'd throw out the idea that there are costs beyond personnel and payroll that any franchise encounters, particularly in terms of international scouting and player development. In the past few years the A's have spent millions of dollars building facilities and hiring scouts/trainers in places like the Dominican Republic. I wouldn't begrudge any sports franchise owner from making money each year. The question is how much becomes too much, in the sense that they are not putting enough back into the product on the field. And in all honesty it looks to me like your owners are making enough profit that it warrants asking the question. Your payroll is ridiculously small and the ownership debt is cheap. Even if they spent an additional $20 million on international scouting, player development, signing draftees, etc. it kind of begs the question as to where the other tens of millions of dollars are going.
Oooo let's play semantical frog-hair splitting games! Yay! I am well aware that they overpaid the slot in order to get McCullers at his value. The point is--they overpaid. Would that have happened in Drayton's tenure? Drayton cut back--dramatically--on development and draft spending, and it was a *huge* part of the deterioration of this franchise. Holy crap! They planned to overpay! How cheap!!! I didn't; but thanks anyway for the advice. I guess I thought that detail was obvious. Cheap bastards. It doesn't always go somewhere. Have you already forgotten some of the Purpura-led drafts? The multiplied millions left on the table then? They hit the ball out of the park with that draft. I'm sorry you don't seem to understand that the scouting presence in the Caribbean that it took to notice guys like that one draft pick, as well as the guys we've signed from Mexico and the scouting presence in Asia, costs *money*. I wonder if you were one of the guys moaning so loudly back when Drayton cut these efforts? If so, that would be just awesome irony indeed. Seriously, do you know how many picks weren't signed this year? Or last? Do you remember when the Astros failed to sign any of their first three picks? This year they signed their top fourteen. That is very, very good. They traded three of those slots. Additionally, if we've signed one of the top 30 FA, and there are 30 MLB teams, how is that underperforming?
Couple things: - How is the "ownership debt" "cheap"? Not a challenge; I really don't know. That said, even if it is "cheap", why is it a bad thing to aggressively pay it down (assuming they're doing that; none of us knows). - Dude is in year two of his plan. I'm not passing judgment for another year. After that, if he goes all McMullen then I'll join the growing crowd of birdies who only seem to know the word, "cheep". - It doesn't "beg" the question; it raises the question. Sorry; pet peeve. I get all anal about that and about apostrophe abuse.
http://www.forbes.com/sites/maurybr...ros-most-profitable-ever-a-massive-strikeout/ Forbes against Forbes? [rquoter]Erroneous Story Claiming Houston Astros Most-Profitable Ever A Massive Strikeout[/rquoter]
That's Bizball Maury. He's been super critical of Crane...but he absolutely trashes the article this thread is based on. Great read.
SNL Kagan, which Alexander quoted for the “most profitable, ever” story has said separately, “CSN Houston ‘has been a bust.’” Indeed, the Astros have pulled back from trying to make any carriage deals this year, and will try to make something happen… in 2014. That's nice to hear.
It was a good read (to explain to the public the reasoning behind having a low payroll)... but he doesn't really provide much backing to the finance side other than "CSN has been a bust" and "all RSN's have startup fees". Again, it all comes down to the TV deal. It apparently will be what separates us from being a small-market team to being a mid-large market one.
I am extremely curious on who makes more money at the home games in regards to the Astros, Texans and Rockets. Astros 81 home game-?$ Texans-8?$ Rockets-41?$
They overpaid one slot because they underpaid the previous slot. So what? You want to give them credit for significant expenditures because the money they saved on Correa they spent on McCullers? That's ridiculous. No I understand that costs money, I also understand it's in their business interests to find the best players possible and I'm not going to slap them on the back for just doing what is prudent for a baseball franchise. If you don't spend money on scouting you don't get the best talent and if you don't get talent you don't win and in Houston if you don't win people don't care about your product. It's in their own interests to spend that money. That they weren't doing it before is why the franchise ran itself into the ground. It doesn't take a billionaire to figure that out. I'm not going to slap Crane on the back for doing what all successful franchises are already doing. You said top picks, not just picks. I believe one first round pick didn't sign this year, the Blue Jays pick? What's that a 96% sign rate? Congratulations Astros, you're in the 96%. I sure do and they got blasted for it. I dont' grade Luhnow against the incompetence of Purpura's draft signing bungling. Everyone scores well in that comparison. Because we had the most money to spend!!!!!!!
Luhnow was a good hire because it gave him the chance to do what he's already proven he can do... build a minor league system. That being said, this regime is doing exactly what they are supposed to do... rebuild a horrible minor league system. So far, they have done a great job of that. While I won't take rebuilding the system from scratch for granted... the achievement is somewhat mitigated by having the most slot money now going on 3 years in a row, the #1 pick three years in a row, and the most international money. Not saying that "any" GM or ownership group would succeed with these factors... but anybody who would fail at turning around a system with these resources at their disposal would be open for some serious criticism about job competency. Next step of plan is to translate the minor league success to the big leagues... if that succeeds, I expect many more teams to emulate the Astros tank-fest strategy (especially if they are indeed still making a profit these years).
If more teams do this, it could bring contract value down... and the players association is powerful enough in baseball to force such a floor.
This has been mentioned on BP and elsewhere, but I haven't seen it here. For your consideration: There are 2, and only 2 parties who have access to MLB financials. One is the League itself, the other is the Union. Do you think for a minute that the Astros could pay a historically low payroll while at the same time reap historically high profits, and the MLBPA would say nothing?
