Earlier this week a story posted on Forbes’ website how the Houston Astros were set to take in a record of $99 million in operating income. The story spread like wildfire, based on the headline. We had it here on The Big Lead. Eventually it bounced around everywhere on the web. Keith Olbermann even cited the story to label Houston owner Jim Crane as the ‘Worst Person in the World’ Monday night on his debut show back on ESPN.
On Thursday, Forbes — the originator of the $99-million figure — published a rebuttal to the original story written by Dan Alexander. In the new story, written by Maury Brown, it outlines how the methodology that went into the original story was flawed and writes in no uncertain terms that the Astros are not the most profitable team in baseball history. Brown closes by calling his fellow Forbes’ writer’s post, “a massive strikeout.”
Beyond statements from the Astros and club president Reid Ryan saying that the article was factually incorrect—something that could smack of protectionism—the fact is, the Astros are not the most profitable MLB club in history. As well, they are most assuredly not even the most profitable this year. In a case of ensuring that as the initial story weaves its way across the internet to other media, thus creating revisionist history, here are the reasons why the story is not only off-base, it has to be classified as grossly inaccurate.
Brown’s rebuttal takes a double-barrel approach. First, he picks apart the basic premise that the Astros are profiting in the range of $80 million thanks to their new cable deal with Comcast. The big point of contention is Comcast’s SportsNet Houston channel hasn’t been picked up by local carriers and is losing money. It’s a lot of number wrangling that you can read about in the story written by Brown. In short, there is profit to be made through the Astros cable deal, but not as of yet.
The bigger issue, one that most people didn’t seem to notice once they saw in bold big letters: $99 MILLION PROFIT, is that Houston owner Jim Crane and general manager Jeff Luhnow have stripped the team on purpose to rebuild it from the ground up. Four of the Astros minor league clubs made the playoffs with the possibility of two more. It’s a smart decision to invest in player development and build the franchise back through the farm system rather than looking for quick fixes by over-paying for middling veterans in free agency. Yes, Crane is profiting, but there is a reason why the Astros only have one player at the moment (Erik Bedard) on a salary over a million.
We’ve reached out to Alexander through email to get his thoughts on the Brown’s rebuttal. Alexander said he was working on a follow-up and it would be posted “soon.”
[UPDATE: Here's a link to Alexander's second story this week on Houston's finances.]
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