Craig Tomarkin / the japanese insider

MLB FOREIGN EXPANSION

by Craig Tomarkin

It all started when the Montreal Expos debuted in 1969. They made their first and only post season appearance in strike shortened 1981, with a 60-48 record. Andre Dawson and Gary Carter were the team's hitting stars and they managed to beat the Phillies three games to two in the opening playoff series. In Game 5, Steve Rogers pitched a shut out for them against Steve Carlton to win it. They were unable to outlast the Dodgers in the next series though as Fernando Valensuela allowed only 3 hits in 8 2/3 innings to beat them 2-1 in a thrilling come from behind Game 5 victory. As of 2002, we are still waiting for them to make a World Series appearance.

The Toronto Blue Jays were the second foreign team to join the MLB in 1977. Again, a team from Canada. This franchise proved to be stronger than the Expos. They first made the playoffs in 1985 and again in 1989. The team soon became a force, making the playoffs three straight years from 1991 to 1993. The last two seasons they won back to back World Series, establishing them as the first foreign team to build an MLB dynasty.

Who will follow as the next foreign team? Will it be another team from Canada or will another country step to the plate?

As it stands, two Canadian cities vy as likely candidates, Vancouver and Calgary.  Among non Canadian cities, Monterrey Mexico is the most likely site today. Several others woulda, coulda, shoulda been next up if not for povery, governament or distance from the U.S. mainland.

The list below describes the opportunities and hindrances for each foreign city studied.

Canada, British Columbia, Vancouver - Opportunity: Natural rival for Seattle and gives teams two stops on the swing to the Northwest. Hindrance: Only has about 2 million people, which is not much local fan support. They probably need to replace BC Place Stadium. It's a dome that seats roughly 60,000 and has a terrible hard turf problem. They campaigned to get a team in the 1980's. Maybe they will try again?

Canada, Calgary - Opportunity: They were close in 1980 when the Seattle Mariners almost moved there. Hindrance: Desire.

Cuba, Havana - Opportunity: They love baseball and have ample fan base. Hindrance: Totalitarian Government and poverty

Dominican Republic, Santo Domingo - Opportunity: They love baseball and have ample fan base. Democratic Government. Hindrance: Too Poor

England, London - Opportunity: Large, wealthy population. Hindrance: Interest in baseball is questioned

Japan, Tokyo - Opportunity: Ideal. Hindrance: Too far away. Competition with NPB.

Japan, Osaka - Opportunity: Ideal. Hindrance: Too far away. Competition with NPB.

Korea, Seoul - Opportunity: They love baseball and have ample fan base. Hindrance: Too far away

Mexico, Monterrey - Opportunity: They love baseball and hosted a MLB game on opening day. Hindrance: If any, it's mostly logistics.

Mexico, Mexico City - Opportunity: The inaugural games in 1999 and 2001 sold out.. Hindrance: Altitude. The ball would fly out of there in a way that would make Coors field look tame. They could put in deep outfield walls to take away home runs, but it would increase batting averages and doubles. It's tough.

Phillipines, Manila - Opportunity: They love baseball. Hindrance: Too far away.

Puerto Rico, San Juan - Opportunity: They love baseball and have ample fan base. Hindrance: Too Poor

Venezuela, Caracas - Opportunity: Progressive and cosmopolitan city. Ample fan base. Hindrance: Government unsettled, poverty

Many of the cities listed as possibilities have poverty as the fatal flaw. Is there any way around the problem? There would be, even in the poorest countries, if gate receipts and concession sales didn't mean nearly as much as broadcast revenue, because then it only matters if those foreign games are attracting a TV audience that advertisers are willing to support. At first blush, using current MLB cities as a guide, it doesn't look good. Media support and sales of merchandise accounted for a little less than half of the revenue during the period of 1990 through 1996.

Based on baseball business data from 1990 through 1996 revenue was as follows:

Gate Receipts: ............37% of revenue ($21 MM per team)
Media: .........................42% of revenue ($23 MM per team)
Stadium: ......................16% of revenue ($ 9 MM per team)
Other: ............................5% of revenue ($ 3 MM per team)

Total Revenue was $56 MM per team

But it was not always this way. Interestingly 1990 versus 1996 revenue trended the wrong way for foreign expansion hopefuls. Over the seven year period studied, media and other revenue dropped from 56% of revenue to only 42%, as follows:

                                          1990                                     1996
Gate Receipts: .....37% ($17 MM per team) .....39% ($26 MM per team)
Media: ..................51% ($26 MM per team).....38% ($25 MM per team)
Stadium: ...............11% ($ 6 MM per team) .....19% ($13 MM per team)
Other: ....................5% ($ 2 MM per team)..........4% ($ 2 MM per team)

What changed? Average player salaries increased for one thing.

Year        Avg Salary
1990........$0.6 MM
1996........$1.2 MM
2002........$2.4 MM

So, is it feasible for a team in a poor country to survive financially? It will depend on the whole picture, but the gate matters and rising player salaries hurt.

There is a bright spot in all of this. Averages are misleading. In 1996, two of the three weakest gate revenue teams had league average media support and were fiscally viable teams. the table shows that Detroit and Oakland made up for weak gate revenue with strong media.

                     GATE       MEDIA
PIT N........... $12.3.........$17.7 *Pirates had lowest total rev $39.9
DET A.......... $12.4........ $24.7
OAK A .........$12.5........$25.2

Interestingly, strong gate receipts do not always indicate strong media support. In 1996, two of the four strongest gate revenue teams had less than league average media support and less media support than two of the three weakest gate receipt teams.

                     GATE       MEDIA
BAL A ..........$51.0.........$30.6
CLE A.......... $48.0.........$21.6
COL N..........$46.0.........$22.8
NY A............$42.6.........$69.8 *Yanks had highest total rev $133.3

(Source: Anyone who wants it can down the raw data from this analysis at: http://baseballguru.com/bbdata1.html. Plus, you might want to check out the Salaries and Business section of the baseball guru site for more stuff or for stuff I post long after this article was posted. If anyone has this data from 1997 forward, PLEASE advise me!! I would like to update this part of the analysis.)

If the poverty hurdle can be solved, we still must gage international interest to make this a reality. Is there enough foreign talent to make it work?

In 2002, about half of all minor leaguers were born outside of the 50 U.S. states. This has driven the MLB ratio of foreign born players up every year. By 2002, nearly 25% of U.S. Major Leaguers were born outside of the 50 U.S. states, representing 17 countries in all.

Then, we must gage whether or not these are top teir players or just guys who pad the leagues depth charts. Decide for yourself with the following evidence, players born outside of the 50 U.S. states won six MVP’s from 1996-2001:

2001 - Ichiro Suzuki, AL (Japan)
1999 - Ivan Rodriguez, AL (P.R.)
1998 - Juan Gonzalez, AL (P.R.) and Sammy Sosa, NL (D.R.)
1997 - Larry Walker, NL (Canada)
1996– Juan Gonzalez, AL (P.R.)

Pedro Martinez, AL (D.R.) won three Cy Young Awards: 1997, 1999 and 2000. He's a top candidate in 2002 as well.

Further, nine members of the Hall of Fame were born in foreign countries:

England: Pioneer, Harry Wright
Dominican Republic: Juan Marichal and Roberto Clemente,
Panama: Rod Carew
Venezuela: Luis Aparicio
Canada: Fergie Jenkins
Cuba: Tony Perez and Martin Dihigo (who played in foreign leagues, never MLB)

These are the 128 MLB All-Stars through the 2001 season, who were born outside of the 50 U.S. states. The list was sorted alphabetically by country of origin and player name. States. Players in BOLD face are in the Hall of Fame.

Baseball's Thrity Greatest Foreign Players (who never played in the MLB)

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