October 13, 2011

Wins and Money

YFSF makes an interesting observation about John Henry:

Henry says in response to a question about what he knew of that storied team (the Yankees of the EPL before Manchester United became the Yankees of the EPL), he states that he “knew virtually nothing about Liverpool Football Club nor EPL [the Premier League]”. Henry may be playing dumb here, but in our mind there is a bit of revelation in this admission, and it should inform our view of this ownership: the Red Sox is not a sentimental holding for him. They are a commodity. When Henry perceives that maximum value has been extracted, he will move on. He will sell. The team is primarily a vehicle for revenue generation (and secondarily a vanity toy, of course). Henry is a financial tool, and we ought not think he is a fan like we are. He will do what he can to make the most money and he will move on, and whatever wreckage he leaves in the wake of that revenue extraction will be ours to inherit as fandom’s collateral damage. Our trust has to be that Henry sees successes on the field as inextricably linked to revenues, but that may not actually be the case now or in the future. At some point maximum value will be reached, and at that point we are guessing Henry will look for another investment. We cannot expect or rely on the idea that John Henry cares about winning. He cares about money. For 8 years those two cares have been entwined. Those years will surely end.

Of course, Henry is likely to extract the most value if the team is healthy and drawing fans. If the wreckage results in 25,000 fans a a game instead of sellouts, then I’m not sure he realizes as much value. Then again, look what happened to the Astros, as the lame duck owner refused to invest in the team.

3 thoughts on “Wins and Money

  1. rbj

    Businessman invests in a team to make money? Stop the presses!

    Steinbrenner made a $10 million investment in the Yankees, turning that investment into a property worth $1 billion +. And winning a bunch of championships to boot.

    I guess Saux fans are unhappy with finally winning 2 WS for the first time in 86 years. May they stay forever in third place.

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  2. Scooter

    You make good points, Mr. Pinto. I’m also not sure how much John Henry’s lack of soccer knowledge can tell us about his attitude toward his baseball team.

    Both you and the YFSF author know much much more about Henry than I do, of course. And there’s certainly some truth in what he/she says.

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  3. Mike-n-Ike

    At least Henry seems to have sufficiently good judgment to let experienced baseball executives run the club. On the other hand, Uncle Drayton, (who inherited a grocery distribution business) fancied himself a baseball executive and micromanaged the Astros into standings oblivion.
    Henry seems more like a latter day Walter O’Malley; a businessman who knows how to build value and whose business just happens to be sports. That approach worked for me as kid growing up a Dodger fan, I’m betting it continues to work for the Red Sox too.

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