Pro sports call timeout to settle some old scores

October 02, 1994|By Jon Morgan | Jon Morgan,Sun Staff Writer

During the next few months, it's conceivable that fans in this sports-crazed nation will be reduced to watching athletes slapping contract proposals rather than pucks, slam-dunking salary caps instead of basketballs and swinging lawsuits instead of Louisville Sluggers.

Three of the nation's major-league sports are in the midst of some of the most contentious contract negotiations in their histories. Players in the fourth, football, are publicly grousing about their collective bargaining agreement, which was reached last year after six years of bitter strife.

Even the Jockeys' Guild contract expires at the end of this year, raising the prospect of picket lines at racetracks.

What has become of sports in America? In a word: money.

Leagues, once the province of weekend athletes and vaudevillian team owners, have long outgrown their pastoral adolescence. A professional cadre of managers and sophisticated players unions are now fighting over the bounty of franchises worth up to $200 million each.

"Years ago, you used to watch the scoreboard, not the bottom line. But there wasn't much of a bottom line to watch," said Art Modell, who bought a controlling interest in the NFL's Cleveland Browns in 1961.

Not anymore. Had the baseball season ended with an out, instead of a strike, the 28 teams would have brought in about $600 million from tickets, $800 million from TV and radio, and $85 million from merchandise sales. When combined with all other baseball revenues, it brings the total to nearly $2 billion.

Combined, the four big leagues earn nearly $6 billion a year from television. Sales of hats, shirts and other team-related merchandise top $10 billion a year, and corporate sponsorships are running at about $2.4 billion, according to the Sports Business Daily.

Players have enjoyed the riches. A top baseball player can earn $7 million a year for the same job that 30 years ago paid $40,000.

The Major League Baseball Players Association has grown into one of the nation's richest labor organizations, with $80 million a year in revenues and an executive director who earns $1 million a year.

"This is our livelihood. Now there's so much money at stake, you really have to hold your ground for fear the other side will take advantage of you," said Orioles pitcher and union representative Jim Poole, who was slated to earn a salary of $270,000 this year.

"Money always creates tension," said Edward W. McCaskey, chairman of the NFL's Chicago Bears.

Turning point for future

This year's bruising labor fights could determine the balance of power between players and owners for decades to come, said William B. Briggs, an adjunct professor of law and associate professor of industrial and labor relations at Cornell University who has consulted for the NFL Players Association.

"I don't think it's coincidence all this is happening at the same time," he said.

If the owners of hockey and baseball can persuade their players to accept a salary cap tied to team profits, as those in basketball and football have, values of franchises will explode, he said.

But there's more than greed at work, Mr. Briggs said. As in the auto and steel industries, the sports business has matured to the point that there is plenty of money and the workers and managers have gotten better at fighting for it, he said.

"The people running teams are no longer former players and nephews of the owners, and they do have to run them as businesses," Mr. Briggs said.

The new breed of owners, who recruit their accountants before their starting pitchers, see worrisome trends.

A growth industry?

"I think there is a realization that the profligate, wholesale growth that has characterized sports over the past 20 years is a thing of the past," Mr. Briggs said.

One result: Cost containment has crept into the clubhouse. But team owners are finding it hard to squeeze players in an industry generating record profits, he said.

"In some ways it's easier to deal with a flat-line industry or an industry in decline. . . . Where you have the uncertainty of a growth industry, you have more additional pressures," Mr. Briggs said.

The National Basketball Association persuaded its players to accept a cap on team salaries in 1983, when it was on the verge of bankruptcy.

Now the league is one of the great success stories of the past decade, and the players are looking to shake off the cap, while the owners want to tighten it. The start of the season could be in jeopardy.

The ensuing fight and those in other leagues are also complicated by a slew of legal and economic peculiarities not faced by other industries.

Antitrust, for example. The leagues see themselves as an association of teams, not subject to antitrust laws that limit cooperation between competing companies. The players see the teams as competitors who shouldn't be allowed to collude on pay rates.

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