It’s been known for some time that the Philadelphia Phillies, on a below-market local television deal, could see their financial circumstances change dramatically once a new deal is signed.
According to a source with knowledge of the talks, the deal is expected to be completed within the next 30 days. That’s going to matter a great deal for how the team operates this winter.
Consider what the new revenue is likely to be. Under their current deal, which expires after 2014, the Phillies make $35 million per season. This is low by virtually any standard. The San Diego Padres, for instance, make $60 million per year on their television deal. The Rangers are on a new deal at $80 million per season. The Angels check in at $147 million per year. And all three also received equity stakes in the sports networks paying the team.
The Phillies, however, play in Philadelphia (you may have heard), which is the largest single-team market in MLB. Their new deal will be for many times what they are currently making. Phillies ownership can lock in what that will be, and set budgets accordingly.
The result should be an active offseason for a Phillies team that already has $118.5 million on the books for 2014, committed to seven players: Ryan Howard, Cole Hamels, Cliff Lee, Chase Utley, Jonathan Papelbon, Jimmy Rollins and Mike Adams.
While the Phillies aren’t likely to blow past that $189 million luxury tax threshold, the line serving as de facto salary cap for every team east of Los Angeles, that still gives the Phillies plenty of room to get involved in the bidding on players like Jacoby Ellsbury and Shin-Soo Choo in the outfield, or even rotation pieces like Tim Lincecum.
There’s also finally a sense of realism about the limitations of Ryan Howard, which could lead to top prospect Maikel Franco seeing time in a platoon with Howard at first. Franco is adequate at third, according to scouts, and would also provide a righty bat to pair with Cody Asche at third.
Still, between Franco, Asche and Howard, the Phillies seem satisfied at the infield corners, while they’re betting on a bounce-back season from Jimmy Rollins at short, and a return to health from Chase Utley at second, who signed to a two-year extension this summer.
There is no such satisfaction with Ben Revere, whose defense did not impress and whose arm seems to limit him to left field in the team’s eyes, while Domonic Brown is expected to return to the trading block, despite his breakout 2013 season.
It is the outfield where the Phillies want to spend, and spend big. This television deal, coming as it does early in the offseason, should allow the Phillies to blow past the $140 million they spent on payroll this past season. It also provides a boost to revenue above and beyond the league-wide additional national TV revenue, which begins in 2014 with the new television contract.
And it should more than make up for the more than 550,000 drop in attendance from 2012 to 2013, the second-biggest downward slide in the big leagues, trailing only the Miami Marlins.
The Phillies intend to reverse that, and the best way to do so is by spending, and spending big. A new local television deal will help to make that possible.