Here's Why MLB Owners Will Avoid A Lengthy 2027 Lockout

[Matthew Nethercott]

Image courtesy of Brad Penner-Imagn Images

Major League Baseball's impending lockout has implications for more than just the play of the game. Financial rules are going to change, probably not the way people think, with a salary cap and floor system, but probably with harsher luxury penalties and possibly a soft floor system. None of this is confirmed, mostly educated guesses based on how these negotiations have played out in the past.

Why? The owners seem to be going all-in on imposing a salary cap, but at what true cost? Major League Baseball has not missed regular-season games due to a labor war since the start of the 1995 season was delayed. Many are confident that there will be missed games in 2027, but I think we're all missing the mark. 

Almost surely, there will be baseball in 2027, and it's likely there will be games played before Memorial Day. The reason for this cavalier confidence in a resolution, even when the sides are worlds apart, is the impending TV rights deal. 

About the Deals

MLB currently has media rights deals with FOX, TNT, NBC, Netflix, and ESPN, and all of them expire at the end of the 2028 season. FOX and TNT (soon to be merged with CBS Sports) carry a majority of the postseason games, and their deals will be vital. Netflix and ESPN both have contracts for MLB special-event games, like the Field of Dreams game and, of course, ESPN's random Tuesday Yankees/Red Sox game. And, of course, NBC just concluded its first season taking over "Sunday Night Baseball" (and was very good, I might add), and holds the rights to the Wild Card round of the postseason.

The reason this is important is that if baseball misses 60 or more games in 2027, the deal will extend through the 2029 season, an extra year, according to The Athletic.

MLB Commissioner Rob Manfred's plan has always been for baseball to become less of a regional sport in terms of TV, like the NFL is, which would mean more games on national TV and less on individual teams' regional sports networks, and quite possibly the elimination of RSNs in baseball altogether, which should also eliminate blackouts. 

MLB will paint this change as fan-friendly because it will be much easier to find, access, and watch games across platforms, whether you are watching on cable or on streaming. Don't let that deter you from the fact that the owners will benefit significantly from the new deals and distribution. 

It's no coincidence that teams that could not resolve issues with their RSNs in recent seasons have been welcomed with open arms under MLB's umbrella. The writing is on the wall.

So, with all the doom and gloom we will hear and digest as the real labor war begins in just under two months, remember, the motive for all this always has been and will be money. Missing games could jeopardize the future of the sport (like baseball turned a blind eye to PEDs in the '90s to get people to buy in again) and could hurt owners financially, which we all know would not be in their best interest. 

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[beckmt]

I think the writer is missing the mark here.  Players have been mad for years about the teams like the Marlins, Twins, Reds, Pirates, Tampa Bay, Brewers, Guardians,  and some others who have always spent below the median on payroll.  They are not going to get a floor without a cap.  And I don't put it beyond the owners to try and split the players by cutting 1/3 - 1/2 of the teams, which would give the players the cap, but eliminate many major league jobs (while improving the product).  I cannot see anything working without both a change to the player acquisition model and a change to free agency model.  Players do not seem to want to give in the free agency (except to improve their earnings), so am finding it hard to see what players will give up in return for their gains.  Should be interesting. 

[bean5302]

There is a 0.00% chance the owners cut teams. It's not in the realm of reasonability. Not only is MLB attempting to expand right now, but cutting 1/2 the teams would never pass voting by the owners themselves, and even if that happened, the ownership of the 50% of the remaining teams would have to come up with $30 billion of liquid assets to buy the current owners out. It's just not happening. Cut your market in 1/2, cut your revenue, cut your expansion plans, lose $30 billion in buyouts, gut the value of the teams which do still exist, eliminate any public interest in the game.

Far more likely to see an 90s NFL style lockout with scrub players or the cancellation of an entire season if the owners are truly committed to breaking the MLBPA with a salary cap.

Owners also want a floor, and probably more than players do. The profitable teams like the Dodgers and Yankees are furious at teams like the Rays. In fact, getting ousted from the playoffs with their own money has probably brought the Yankee's ownership fury to a head as the Yankees have been on public record about this for years. The Rays literally design their team to live off the free money the profitable teams produce in revenue sharing. That playoff exit has to be infuriating. 

 

 

[TNtwins85]

6 hours ago, bean5302 said:

There is a 0.00% chance the owners cut teams. It's not in the realm of reasonability. Not only is MLB attempting to expand right now, but cutting 1/2 the teams would never pass voting by the owners themselves, and even if that happened, the ownership of the 50% of the remaining teams would have to come up with $30 billion of liquid assets to buy the current owners out. It's just not happening. Cut your market in 1/2, cut your revenue, cut your expansion plans, lose $30 billion in buyouts, gut the value of the teams which do still exist, eliminate any public interest in the game.

Far more likely to see an 90s NFL style lockout with scrub players or the cancellation of an entire season if the owners are truly committed to breaking the MLBPA with a salary cap.

Owners also want a floor, and probably more than players do. The profitable teams like the Dodgers and Yankees are furious at teams like the Rays. In fact, getting ousted from the playoffs with their own money has probably brought the Yankee's ownership fury to a head as the Yankees have been on public record about this for years. The Rays literally design their team to live off the free money the profitable teams produce in revenue sharing. That playoff exit has to be infuriating. 

 

 

I truly wish that we get a Rays/Brewers World Series in the same year everyone thinks baseball will end because of the gap between payrolls. Everyone has been force fed a salary cap is the only way to fix sports for 40 years. All great teams in baseball (and football for the some different reasons) are built on depth aka young players. Contrary to everyone’s thoughts of the big headlines every winter. Youth drives the game, not salaries. Older stars are more marketable but young players provide the runway.