The new Cubs radio deal is not "ground breaking," even though the Cubs brass tout it as modern tablets from Mount High.
But what the deal shows should put a shiver down the spines of Cubs fans.
The centerpiece of the deal was not the Cubs. Read that sentence again. Not the Cubs.
What was stressed at the press briefing was the "50-50" deal on putting on concerts at Wrigley
Field, Crane Kenney said. The Wrigley concert business is not included in baseball's revenue sharing agreement, so the Ricketts want to maximize this revenue stream. Rumors had it that the Cubs were looking for an all-cash component, but the radio deal includes more than just the team.
"There is a cash
component, there's also a joint venture on the music side that is truly a
50-50 partnership between them controlling talent and promotions and we
controlling the venue. And there's the marketing aspects. To have
access to this platform in this market, even before carrying our games,
they cover 65 percent of our market, that's power we've never had to
promote tickets and everything else we do here. So this was a
multi-layered agreement with all sorts of elements to it. But cash is
obviously important, too," Kenney said.
The new deal has unknown amount of cash for the broadcast rights, plus a revenue sharing agreement with CBS for concerts or ticket sales.
Take a moment to digest the last part of the deal. CBS is not a talent agency. CBS is not a booking agency. CBS is a local AM and FM radio conglomerate, which plays a variety of music on its airwaves. The Cubs marketing department must have wet their pants with the possibility of "free" advertising across all the CBS radio "platforms." But that barter concession does not necessarily equate to new revenue.
There still are night concert restrictions at Wrigley Field. Again, in the land of miscommunications, the Ricketts and Cubs management may think their new plan will amend those restrictions but no one in the city has acknowledged that request. Ricketts does want to skirt the field concert restrictions with "plaza concerts" in the triangle area (complete with open beer sales). How one is going to control plaza concerts with ticket sales in the middle of public streets is going to be impossible. One could stand across Clark Street and hear the concert just as well as person near the front gate at Clark and Addison.
CBS had the same ratings books as WGN did in proposing their bids. WGN was losing money (reportedly $6 million per season). Some games last season got a ZERO rating. So, no radio executive worth his position would bid more for radio rights that trend toward low, unprofitable ratings and demographics. So, one can comfortably assume the Cubs will be receiving less in radio broadcast rights under this new deal.
But what about the concert revenues? That goes to the Cubs, too? It does not. Wrigley Field is owned by a separate legal entity. The Cubs are merely a "tenant" at Wrigley Field. Ricketts is looking for more revenue to pay for his non-Cubs projects, like the commercial-hotel complex across the street. The concert revenue has nothing to do with the Cubs.
This deal reinforces what I have been saying for years that Ricketts main purpose now is to transform Wrigley Field into a year round entertainment venue. The Cubs are merely one act in this venue. The new revenues are going to go to the new real estate ventures and not into the Cubs payroll and operations.
