Thankful things: could TV deals give Diamondbacks $110m+ payroll in 2014?

To help save money, Fox now required players to carry the cameras covering their games... - Jeff Gross

Since it's Thanksgiving week, we'll take a look at things for which the Diamondbacks should be (more or less) grateful this week. We start with the prospect of a nice windfall coming their way next year, which could help significantly increase team payroll.

"We're at a place now where this year's payroll is likely to be at or maybe above the highest amount of money ever spent on a Diamondback team in its history."
-- Ken Kendrick

The previous mark dates from the 2002 season, when the team spent almost $103 million. That would be a big increase, considering the 2013 payroll was just over $86 million, but as we documented earlier this month, the team is already on the hook for more than that next year. Even after the decision to let Tony Sipp go, the D-backs will pay almost $90 million to 15 players on their roster who are under contract or eligible for arbitration. With replacements for Eric Chavez and Wil Nieves still to be signed, if we budget $4 million for that pair, and the balance of the roster spots at league-minimum ($500,000 in 2014), that would take the total to $97.8 million.

Given Kendrick's remarks, this would mean at least another $5 million can be taken on board, but the actual tally might be rather more. That's because a source of income for the Diamondbacks is about to get a significant boost. There's been a lot of discussion over local television rights, and how some teams have hit the jackpot with recently renegotiated contracts. Most notably, the two LA teams have deals worth well into nine figures, which makes the Diamondbacks' current package, a mere $31 million, seem like small change. That contract expires after next season, and there's expectations it will bring an increased revenue stream for 2015 and beyond.

However, that's not the only TV deal from which Arizona benefits. There are also the two national packages: one for regular-season games with ESPN, and another with TBS and FOX for the bulk of post-season coverage. To start with the former, in August 2012, MLB and ESPN signed off on a new deal, covering the eight seasons beginning in 2014, and worth $700 million per year, double the existing agreement. Part of the hook was that ESPN got back into the playoff business, getting to cover one of the wild-card games, as well as rights to any tiebreakers, and also expanded coverage on Baseball Tonight.

But, wait! There's more! For the TBS/FOX deal also ran out after this season as well, and a couple of months after the ESPN agreement, an extension with the same partners was also negotiated. And it blew away the ESPN deal, being worth a staggering total of $6.8 billion over the same eight-year period. Starting next season, that will include additional coverage of Saturday national games for Fox, though in a bright spot, those games will no longer be blacked out for MLB Extra Innings or MLB.TV viewers. It replaces the deal which had covered the previous seven years, worth about $3 billion.

Put the two together, and as of next year, MLB's central fund will be receiving $1.55 billion per year from the three companies, about $770 million more than it did this season. As with all such national deals, the revenue will be split evenly across the landscape, without regard to market size or other revenue. As commissioner Bud Selig put it, "This is just a deal baseball made, and as a result it comes to us nationally and goes out equally to all 30 clubs." Doing some sums on the back of a deeply-discounted Ian Kennedy jersey, it means the Diamondbacks will receive about an additional $26 million next year.

Now, there's absolutely no obligation for the team to spend all - or even, any of - that extra money on payroll. They could use it on other departments of the team, take it out as "profit," discount every ticket bought at Chase by ten bucks, or fill the pool with dollar bills, so Yasiel Puig will feel at home the next time the Dodgers visit. But assuming it is available for salary, adding it to the currently-funded $86 million, would give us a total of $112 million potentially in the bank for 2014. That's about $14 million more than the current figure for the season, as calculated in my opening paragraph.

It's not a strong free-agent class, in the areas where the Diamondbacks are probably looking e.g. corner outfield and starting pitching, though ESPN's Jim Bowden suggested (Insider subscription, I think) suggested that we should "Sign Nelson Cruz to a three-year, $48 million deal," saying "Despite his involvement in the Biogenesis scandal and subsequent 50-game suspension, Cruz is a good clubhouse presence." Er.... I think more likely, is that the additional cash could allow the D-backs scope to execute a trade which requires them to take on additional salary obligations.

We'll see what the coming months may bring, but it does seem, on the basis of the above, that funds may be a little more available than have generally been supposed.

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