The Cleveland Indians lost tens of millions of dollars in 2020 and will have to cut payroll, meaning more callups from the minors.
The Cleveland Indians lost a lot of money in 2020, according to Tribe President Chris Antonietti. The biggest culprit is obviously the lack of fans, which can make up to 24% of the team’s yearly earnings. With that note being a huge zero for 2020, there’s no way that guys like Brad Hand and Carlos Santana come back. While people often like to cite the team’s “worth” being at $1.6 billion, what people don’t seem to realize is that number is not indicative of the amount of money on hand to spend.
The Cleveland Indians in 2019 were the 25th team in total value out of the entire Major Leagues. It has one of the smallest and least dedicated fanbases in baseball and fans justify their lack of investment because “the TV deal is so good”. Except, it’s not.
TV revenue for the Indians is capped at around $47 million a year under its current deal, while ticket revenue could be two if not three times that number. That’s why it’s so important to get people to the venue. The Indians by far make more money from walk-up fans for the year than they ever would on the television deal.
FanGraphs projects that the Indians check in at No. 22 and are slated to earn $47 million in their deal with SportsTime Ohio.
The Indians deal was signed in 2013, meaning that in about three years, the Indians will be looking at a drastically smaller number for its TV deal.
Speaking to the media on Tuesday, Antonetti spoke about how the coronavirus pandemic cost the MLB billions of dollars in revenue, which in turn impacted the Indians to the tune of tens of millions of dollars. Since the Indians are already at 25th in terms of value in the MLB, this will hurt them more than others.
The goal, Antonetti said, is to field a contender still for 2021. That said, names like Brad Hand, Carlos Santana, Cesar Hernandez, Oliver Perez, and Domingo Santana could be done with the team. Not to mention Francisco Lindor, who called off negotiations before the season started and stopped returning management’s phone calls.
That means names like Josh Naylor could find every day work for 2021, and callups could see Bobby Bradley, Jake Bauers, and Nolan Jones on the everyday roster.
As for Lindor, the last thing fans heard about him was him spewing out some dribble about how the Indians could afford him, simply because Forbes gave them a value of $1.3 billion without Lindor realizing that number is value, not cash available. Antonetti addressed that.
The economics of baseball are pretty complicated. The TV deal is one component of it. The reality is we didn’t take in any money from our local market. We didn’t sell any tickets. We didn’t sell any concessions. There wasn’t parking revenue. Our corporate partnership dollars were severely impacted. The reality of the finances in baseball in 2020 is that the industry lost billions of dollars and as a team we lost tens of millions of dollars. That puts us in a really difficult financial position that will take us years to recover from.
Baseball is notorious for its awful revenue sharing system, and with baseball being the only major team sport in the US with no salary cap or minimum, these types of issues will continue to pop up. The Indians aren’t in a strong enough marketplace to warrant giving Lindor a $300 million contract, nor has he shown he’s really all that valuable to warrant such an exorbitant number.
The Tribe have shown to be a smart and cunning franchise since Antonetti took over and have largely been in the playoff race ever since. The Indians will remain competitive even if the payroll gets slashed. They’re too well managed not to be.