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Each year just before Opening Day, Team Marketing Report (TMR) releases the "Fan Cost Index" (FCI). According to TMR, the FCI "tracks the cost of attendance for a family of four." This year, TMR says this hypothetical family's day at the ballpark would cost an average of $155.52. The price would range from $108.83 in Montreal to $263.09 in Boston. If this sounds high, you're right. TMR defines the FCI to include two average-priced adult tickets and two average-priced children's tickets--but also two small draft beers, four small soft drinks, four regular hot dogs, two programs, two of the least expensive adult-sized adjustable caps, and parking for one car. In short, while it might reflect how much a family that decides on the spur of the moment to go to their one game of the season might spend, it far overstates the cost for most fans, who can easily eat before the game, sit in the cheap seats and skip the souvenir caps.

If this sounds high, you're right. TMR defines the FCI to include two average-priced adult tickets and two average-priced children's tickets--but also two small draft beers, four small soft drinks, four regular hot dogs, two programs, two of the least expensive adult-sized adjustable caps, and parking for one car. In short, while it might reflect how much a family that decides on the spur of the moment to go to their one game of the season might spend, it far overstates the cost for most fans, who can easily eat before the game, sit in the cheap seats and skip the souvenir caps.

One of the biggest weaknesses in the FCI is its use of "average-priced tickets" as a benchmark. By using the price paid by season-ticket holders for a particular seat, even if the price is higher when the seat is sold on a per-game basis, the FCI understates the cost of tickets for the average fan. Moreover, in many markets the "average-priced ticket" is irrelevant to the actual options available for casual fans attending a game on short notice, who must either buy from scalpers or wind up in the cheap seats. Last year 10 clubs sold fewer than half their available tickets, while the Giants, Cubs and Red Sox played to over 90% of capacity.

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February 12, 2004 12:00 am

Breaking Balls: Mailbag Fun

0

Derek Zumsteg

Last week's column got some fine feedback. Let's get right to it: "I'm a little confused by the venom directed at the Cubs over their (admittedly farcical) attempt to pretend they're not simply scalping their own tickets. If they were honest about what they were doing, would it really be that bad? Airlines do similar things with their tickets - they charge more for some tickets (last minute purchases) and less for others (Saturday night stayovers) because they know that business travelers will pay more than family vacationers. Why shouldn't baseball clubs also price discriminate?" -- SC The problem everyone has with the Cubs isn't that they're selling their own tickets for more, it's something else entirely: 1) They're breaking the law for profit; 2) They're doing it for the express purpose of avoiding revenue sharing with other teams. The second one seems petty compared to the first. That the Tribune Company would construct a giant scheme to scalp their own tickets illegally--with a law on the books that says "Don't do what you're about to do"--because it would make them money is appalling. On the spectrum of crime, it's not as if they're serving poisoned milk to school-children who don't subscribe to the Tribune, but it's still pretty heinous.

Pricing

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Not long ago, a Chicago judge tossed out a lawsuit against the Cubs, who had set up their own company to scalp their tickets. They'd done so on the grounds that (essentially) by being two parts of the same company, it wasn't like it was the same company doing it, as prohibited by the law. Explanations readers suggested for that finding ran from stark judicial incompetence all the way to the Tribune Company getting one of those Wrath of Khan creatures into the judge's ear somehow. Meanwhile in the gray, gray, gray state of Washington (contrary to our reputation, it's only rained a couple of times this winter: October-December, then it snowed, December-January, then it snowed again, then January through today), where local government isn't quite as corrupt as Chicago but is racing to catch up, judicial insight flared.

Meanwhile in the gray, gray, gray state of Washington (contrary to our reputation, it's only rained a couple of times this winter: October-December, then it snowed, December-January, then it snowed again, then January through today), where local government isn't quite as corrupt as Chicago but is racing to catch up, judicial insight flared.

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It took me two weeks to wipe the surprised look off my face after I found out the Cubs got off. The Honorable Sophia Hall found on behalf of Wrigley Field Premium and the Chicago Cubs and dismissed the suit in what, I have to say, is one of the strangest decisions I've ever followed. There's a law on the books in Illinois that says if you hold an event, you can't scalp your own tickets. The Cubs and their parent company, the Tribune Co., seeking to get around this law, set up a shell company, Wrigley Field Premium, with their own people, their own accountants running the books. They allowed the shell company to buy $1 million in tickets, then sell them at insane prices. Now, I don't practice law, but that's illegal. It's also Chicago, though. What's weird is that the judge agrees with everything everyone's said about the suit up until the point where she has to declare them guilty. Reading the opinion, it's all there: "WFP is a subsidiary of the Tribune Company (p. 9)." In March 2002, this brand new ticket broker was allowed to purchase $1,047,766 of tickets (incidentally, go ahead and try that as an actual unaffiliated business and see what the Cubs tell you). The opinion contains a nice little history of how Tribune formed it, the corporate officers overlapped, how WGN provided Premium free advertising...it's crazy. And it contains this gem (on p. 13): "From the beginning Ball Club and Premium did not keep secret they were both owned by Tribune Co. [...] To dispel possible confusion, Premium's employees were instructed to tell customers that Premium is not a part of Ball Club." Gee, that's not concealing ownership, or anything.

It took me two weeks to wipe the surprised look off my face after I found out the Cubs got off. The Honorable Sophia Hall found on behalf of Wrigley Field Premium and the Chicago Cubs and dismissed the suit in what, I have to say, is one of the strangest decisions I've ever followed.

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In my first Breaking Balls column, I wrote about how to run a team to avoid revenue sharing (and in the process, make your team a net drain on the system, rather than pay in). It didn't take long for a team to find a way to do this that I hadn't thought of. The Chicago Cubs, who already do the undervaluing-your-media-rights thing for their superstation, have opened up a whole new avenue I hadn't even considered. The Cubs sell tickets at cost to "Wrigley Field Premium," a ticket broker down the street. Premium sells these tickets for an outrageous mark-up. Greg Couch, of the Chicago Sun-Times, has written some great columns on this I'd recommend if you're interested. He reported that while a Cubs-Yankees game was sold out ("Obstructed view only") from the Cubs, Wrigley Field Premium was selling them for insane markups--$1,500 for a primo $45 seat. The Cubs and WFP are the same company: A Cubs VP is the President of WFP. The Cubs are contracted to do the books for WFP. And WFP gets to return tickets they don't sell.

The Chicago Cubs, who already do the undervaluing-your-media-rights thing for their superstation, have opened up a whole new avenue I hadn't even considered.

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During the regular season, I can see where MLB might fail to get the national deal they'd like. But what's happening this post-season is a disaster.

I love the playoffs. Yeah, I complain about the announcers and the scheduling that seems to favor a particular team (say, the Diamondbacks) every year. But I also tape games I can't get out of work to see, or if they conflict. During the regular season, you can pick out particular games you really want to see, great pitching matchups or any game with Barry Bonds. During the playoffs, they're all good games, and some of them are awesome.

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