Craig, this is very interesting. Ted, or his people, clearly have thought a lot about where TV programming is going, as have others in the industry. He's right that commercials are becoming a less effective vehicle for promotion -- people really are tuning them out, with or without TiVo. But that just means the advertisers will find other ways to sell you their stuff. And they're remarkably creative.

Product placement, for one thing, is flying below a lot of people's radar: not just traditional placement, as when Pottery Barn paid a bundle (and made more) to have Rachel shop there on an episode of Friends, but idea placement, like when The West Wing featured anti-drug storylines in order to gain a government subsidy. And this from a show that took pride in its projection of a conscientious liberal president. What do you suppose The Man Show gets paid to say and do?

Now combine this with Ted's observation that live programming is one of the last remaining valuable TV properties, and consider the unpleasant prospect of product placement meeting your nightly news. In fact, you don't need to imagine it. Does anyone remember seeing, a few years back, a little end-of-the-news-hour cute story on the guys who wash the Skydome roof? I think it was on CFTO in Toronto, and it featured interviews with the high-rise cleaners who soap down the roof to keep it so sparkly white. Entertaining little feature -- paid for and produced entirely by Sunlight detergent, which provides the soap used to clean the roof. True story.

So all I can say is, listen critically to your news and sports broadcasts in the near future. What you're hearing might be a paid commercial announcement.

I seem to remember something along the lines of a new owner being able to 'write-off' a big chunk of the expenses with a team for the first 3-4 years? Is this Tax advantage only in the US? (a US tax code thing?). Am I out to lunch?

No benum you're not out to lunch. At least not at this time of day anyway..:-)

Here's an article from Baseball Prospectus on the subject. This talks about loopholes within the US Tax code. I don't know how the Blue Jays tax arrangements work.

I read somewhere else (I think BP) that baseball fiddles its figures so that it appears that it is making losses.

In case one of our readers doesn't already know this, Rogers owns Sportsnet, which carries the majority of TV games, and The FAN 590, the flagship radio station. So every time somebody reads the scores, rolls the highlight reel or takes a call from some guy in a car, it's also product placement for their Jays brand, Blue or otherwise.

Given the direction this team is going, it will soon be profitable on its own, in addition to generating even more income when the media advertising rates go up. Thanks to Ted for deciding that a competitive team would be smart business, and to Paul Godfrey for hiring someone who knew how to build a winner on a budget.

There's still room for improvement. I wish Rogers would buy the building, and the broadcast announcers are mostly terrible. Also, we could use a starting pitcher for the pennant race.

And let's face it: the real question is not whether the Jays will ever be profitable. (In fact, I doubt the Rogers-owned Jays will ever be profitable... on paper.) The real question is whether the Jays + Sportsnet + the FAN will be profitable. Because the Jays broadcast rights are largely accounting fictions, I'm sure. The ballclub is in-house programming for Rogers, and in return Rogers provides them with a budget. I think Rogers will want to own the Jays for as long as Rogers sees a market for Toronto-centric sports programming.

I have to wonder when all this attempting to stretch the value of the core product will result in Jays-TV along the same lines as Leafs/Raptors-TV. Who is MLB's primary fan base right now? I'm supposing it's Males-over-30. Who has disposable income to spend on extra digital cable channels? Males-over-30. Since the NBA is still establishing it's fan base in Canada, it's certainly more viable than Raptors-TV. I'd watch.

"Even the food concessions, the food's not very good and it's too expensive." - Ted Rogers, discussing how they are working to perfect the whole Jays experience

Yes and yes, Ted! This interview is fascinating, maybe moreso for myself since I'm both in the Communications industry and a Jays fan. It's clear that Ted is perfectly content with the Jays not making money hand over fist, in part because of the possible, nearly unmeasurable, impact that owing the Jays will have on the community's opinion of Rogers, the corporation. This could be slightly scary if you're a Rogers shareholder but extremely good news for Jays fans. I think Ted's in for the long haul.

Dr. B wrote:

I read somewhere else (I think BP) that baseball fiddles its figures so that it appears that it is making losses.

Dr. B (the stories did appear on BP), you are likely referring to Doug Pappas's business of baseball articles:
http://roadsidephotos.com/baseball/labor.htm

For other articles here is the link to his main page.
http://roadsidephotos.com/baseball/index.htm

For those who don't know Doug is the Chairman of the SABR Business of Baseball Committee.

The articles are a bit of a slog (only because there are 8 of them, not because of the writing) to get through but are very insightful.

Let us hope for the continued good health of one Ted Rogers. I have a friend who used to work for Rogers (this was a couple of years ago though) and the sense he got from the folks who are at the company going into 2002 was that they didn't believe in the Jays as a smart business venture. It seems to me that the company outside of Rogers and Godfrey isn't that stoked about having the team. And it's hard to argue that with the loss figures they posted the first two years (whether fudged for not).

However, the team has gotten a lot cheaper, appears competitive, and they'll win a significant number of fans back and gain noteriety by the end of this year. If they sneak into a wild card or even within a few games of a wild card, that should mean a lot for attendance next year...although trading away certain players could again be taken the wrong way by fans as it was pre-2002. As long as the company sees changes towards the positive side, they'll ride out the storm.

I thought there was an interesting quote from JP where he said something like "If they say they let's start spending...I'm going back with Billy. I'm here because I want to build." Although I agree with him in principle, it's hard for me to understand why a GM wouldn't want to be blessed with a higher budget. Imagine where this current team could be with another veteran starter and a little better of a bullpen. For instance, spending another $500K to get Kerry Ligtenberg instead of Jeff Tam.

Delgado is only here for another year and you're already going to lose Stewart...there's no guarantee that the Jays will be able to keep up a dominant offensive performance without Delgado so if I were them I might try a little bit harder to strike while the iron is hot in 2004 rather than wait for 2005-2007 for young pitching to develop or fail.

It's clear that Ted is perfectly content with the Jays not making money hand over fist, in part because of the possible, nearly unmeasurable, impact that owing the Jays will have on the community's opinion of Rogers, the corporation. This could be slightly scary if you're a Rogers shareholder but extremely good news for Jays fans.

Well, the lack of profits can be disturbing to shareholders, but as long as the value of the enterprise keeps going up (and have you ever heard of a baseball team being sold for less than was paid for it?) those blows are cushioned to some degree. What matters to shareholders most is that share value continues to go up, and any synergies that the Blue Jays generate in other parts of the Rogers Communications enterprise definitely help the shareholders.

It's good to have smart owners.

Coach,

The Yankees have the biggest budget this side of the Pentagon, but they can't seem to get good announcers, either. Maybe it's just me, but I think John Stirling and Michael Kay are a worse duo than nuts and gum (together at last!).