guylaurence

New Rogers CEO Guy Laurence, Formerly of Vodafone

As if panicky Jays fans– among whom I guess I’d have to consider myself after yesterday’s fretting over the price of Jeff Samardzija– didn’t already have enough reason for consternation, over the weekend we had some supreme silliness in the form of a “rumour” of some kind of financial doomsday for the Blue Jays, related to the stepping down of Rogers CEO Nadir Mohamed. Or, more specifically, related to his successor, former Vodafone exec, and notorious budget-slasher, Guy Laurence.

It all seems pretty quaint right now, given today’s news about Rogers’ acquisition of the national rights to all NHL games for the next twelve years. Obviously the company understands the tremendous value of premium sports content in today’s TV and digital media landscape. In fact, that’s precisely what Mohamed– who is indeed still around– said in the press release announcing the NHL deal, explaining that “sports content is a key strategic asset and we’ve been investing significantly to strengthen our sports offering to Canadians.”

Of course, that likely won’t stop Jays fans from getting nervous– just like they did a year ago, when Rogers splashed a lot of cash on their joint purchase, with Bell Canada, of MLSE (and how did that turn out?)– especially in the wake of the weekend’s rumour, which, unfortunately, has already been given far more attention than it deserves.

It began in the curious little corner of the web called Toronto Sports Media, which I’d like to suggest is plenty right there to know not to take it seriously, except that there have been instances where the writer there actually did seem to have something resembling inside information from within the city’s sports media towers– enough that I can’t dismiss what he says entirely out of hand.

That said, uh… I don’t think anybody’s record means a hell of a lot when we’re talking about a “scoop” like this:

The same good folks who tipped me off to the trimmings at Rogers media a few weeks back are telling me that the new CEO of Rogers could be asking for a cut in the Toronto Blue Jays budget as well.

How much, when or even if I can’t say for sure, but I trust those who are telling me enough to pass along to you.

It seems that bottom line is going to be much more important at Rogers and this is one area where things will be watched closely.

Uh… airtight?

I mean, forget the fact that Nadir Mohamed’s retirement doesn’t even begin until December. Forget that the incoming CEO has an entire goddamn empire to think about. Forget that he enters the business at a time when the government is pushing to entice a fourth wireless carrier into the marketplace. Forget that he has to familiarize himself with the company and the Canadian market and our regulatory system. Forget that we’re supposed to believe he’s swiftly gone over the head of Keith Pelley, the president of the Rogers Media division that the Jays operate under, to supposedly demand such cuts. Forget that, according to their corporate website, in 2012 “sports entertainment” represented just a 13% piece of the $1.62-billion revenue pie generated by Rogers Media, which itself was a small part of the company, dwarfed by fellow divisions Rogers Cable ($3.7-billion in fiscal year 2012 revenue) and Rogers Wireless ($7.3-billion). Forget that he, then, probably hasn’t even looked at the Jays budget yet. And forget that, for all intents and purposes, the club’s 2014 budget is basically set already, and that Pelley told the Globe and Mail in September that the change in leadership should have no effect on the Jays’ offseason course.

Forget all of that, and just look at how hopelessly vague and open-ended this all is.

He could ask for a cut of some indeterminate amount at some as-yet-unspecified time, because now Rogers really cares about the bottom line, as opposed to how they were just pissing away money before???

Ewan Ross of Blue Jays Plus does an excellent job of doing some rough math on the expected revenue stream increases the Jays have seen in the last year, which underpins why such talk simply doesn’t make any sense, but I don’t even think that’s necessary! All the worry seems to be centred on utter vagueness and the scawwwwwwy fact that the new CEO has a reputation for cost slashing and is from the UK– where they totally don’t understand anything about the emotional connection fans have with sports teams or its power as an economic engine???– and presumably doesn’t know or care much about baseball. Y’know, unlike his fucking noted baseball fan predecessors Mohamed and Ted Rogers Jr.

Recent layoffs in editorial at Rogers Media are disheartening, but to connect the two, as frightened fans often try to do, is plainly asinine– a point driven home by today’s announcement. The Jays are maybe not the same kind of pillar as the entirety of the NHL schedule, which Rogers now owns, but they’re a huge piece of content, especially for a full third of the year, from May through September.

Yes, during Spring Training and the first month-and-a-half of the MLB schedule the calendar for Rogers-owned channels is going to be crowded, as this mock up tweeted by Sportsnet this morning shows, and has led to some wondering about how the games will be accommodated– A separate JaysTV channel? Launching of a CanCon version of the MLB Network? Moving some games to CBC or another network?

This end of the deal could complicate things for viewers, and potentially increase the cost it’s going to take for some to get the full slate of Jays games for certain cable subscribers, and that’s something we’re going to need to keep our eyes on. But whatever the case, the Jays aren’t going anywhere. And, I strongly suspect, neither is their payroll.

It doesn’t take a whole lot of thought to see why.

I mean, how likely do we really think it is that a company investing so heavily in sports media is going to hire a new CEO that not only doesn’t share that vision, but is going to swiftly dismantle key pillars of what has already been built? How much investment in the club, the stadium, and other sports properties– including this week’s rumblings of NFL interest that has MLSE fingerprints all over it– does Rogers have to make before we stop getting terrified at every turn that the Jays’ budget is about to disappear? Sure, they’ve probably earned our distrust through years of small market thinking, but regardless of who is in charge, this is very, very clearly a new era.

Slashed payroll? I’ll believe it when I see it.

 

Image via Think Quarterly.

Comments (87)

  1. Rogers will make so much money through viewership and media if they start winning, it just doesn’t make sense cutting back now.

    If anything this 5 billion dollar investment in sports is a good sign for the Jays.

    • Agreed. In fact, I’d argue purely from a business sense, the Jays should be looking at a $190 million payroll.

      Think about it; Rogers Media- the Jays corporate overlords (who also have even bigger overlords above them) just spent 5 BILLION dollars to basically own the broadcasting rights for pro hockey in Canada. You can’t tell me that spending an extra $250 million ($50 million a year extra for the next 5 years) for the opportunity to own all of baseball across Canada doesn’t make sense.

      Hell, Rogers is so huge, the $50 million is almost justified as an advertising expense: ‘Welcome to Toronto Blue Jays** baseball, brought to you live from the Rogers Centre, on Rogers Sportsnet. We’ll be right back with starting lineups right after this Rogers commercial.’

      **wholly owned subsidiary of Rogers Inc.

    • It’s a pleasure to find such raliinatoty in an answer. Welcome to the debate.

  2. Although being from the UK he won’t be as familiar with american games, having lived in the UK where people riot and eat and sleep there football (no I do not call it soccer) teams.

  3. I think you’ve convinced me that at least for 2013-2014 the budget nothing much is going to change with the budget. Hopefully that holds true going forward as well.

  4. Oh, and dont forget that Jeff Blair can be a major fucking troll.

  5. Completely off-topic, but man alive, I hope they don’t trade Sanchez and Stroman. I’d much rather them pick up some pieces off the scrap heap than move top prospects. I’m scared shitless of this off-season. Or at least, as scared as I can be given it’s just a fucking sports team.

    • To me, it just doesn’t make sense to trade Stroman. I think, and I think the Jays think, he can be a meaningful-potentially even valuable piece- of the team next year.

      If the Jays truly are in win now mode, they can justify trading Sanchez- whether or not you agree with it.

      I for one, have no problem trading him- even for Samardzija. Sanchez’s trade value is at an all time high.

      Even with the potential he has, the chance that Sanchez becomes an elite starting pitcher is still pretty slim. I’d hazard a guess at maybe 5-10%, and wouldn’t be surprised if it’s lower.

      More likely, in a couple of years time, after a few years of hills and valleys he settles down and becomes a decent 2/3 starter- maybe something along the lines of, oh, I don’t know, maybe Jeff Samardjiza?!

  6. Like I wrote the other day, just look at the most recent quarterly statement for Rogers. The media division is growing nicely on the top and bottom line. This isn’t a division that’s bleeding money. Stoeten, you’d probably know more than I would, but how many of the layoffs were former Score people or Rogers people doing the same thing that Score employees did? There’s always redundancies with acquisitions.

    In addition to that here’s a line from a National Post article on the deal:
    “Rogers said it expects the deal to be immediately accretive to its media division’s operating profit.”.

    • The layoffs were mostly in the print division, having seen a massive decrease in print ad revenue.
      Sign of the times.Digital media content.

      • So, you’re saying it’s Stoeten’s fault?

        • I’m sure we can blame him for something in all this, maybe all of it.
          In fact, the more I think about it, It’s got Stoeten’s fingerprints all over it.
          Does Stoeten secretly advise the Board of Directors at Rogers?
          Hmmm.

      • There was a great article about it in the Financial post, talking about optimizing “print” media content across multiple platforms. I suspect that the same underlying philosophy is at play with sports content.

        I was wondering if Stoeten would post a piece about this, and I’m glad he did. At this point, they are Rogers is considering putting hockey games on City TV because the cost of Hollywood content is so high. I would imagine they may do the same with baseball. It seems to me that he sports content is valuable enough as an asset that it wouldn’t make a lot of sense to start starving a so called golden goose.

        • @GSMC
          I’m not an expert, but everything I read says that sports in general are the best content to broadcast.Most people watch sporting events live and those events last for hours.Once a passion is developed in the fanbase,well thats a lot of eyes.

          • @Radar

            Yeah, that’s the thinking behind it. The content is cheap relative to other TV content. It will also make their share of wallet stickier on the wireless front and digital content front.

            It seems to me that sales for tickets, concessions, and paraphernalia is almost incidental.

            • Another part of it is the additional content that is now broadcast.
              5 years ago would anybody have listened to a Bison’s broadcast on the Fan?
              Pregame shows,postgame shows,baseball central,they even rebroadcast 92/93 WS games.

              Hard to imagine that just a few short years ago you couldn’t watch all the games on TV because they didn’t bother to broadcast them.

            • Now that Day 2 of the International Emergency Medicine Teaching Course is done and dusted, we can rieevw all the tweets from a big day of learning about learning. Remember to follow events as they unfold on Twitter by using the #IEMTC12 hashtag and recap Day 1 here.

  7. That Guy just looks like a pompous windbag.

  8. So Rogers is paying 5 billion for a product the NHL gives away in the USA. Well done. Now buy me some FAs

    • Wow and I do mean wow.

    • Agreed

      • The whole story is just a big who cares? Other than the Rogers guys patting themselves on the backs on the radio now, why do I care? It’s Rogers spending money on a sport I don’t care about.
        And now I have to listen to Jeff Blair kiss bettman’s ass on the radio. Great.

        • Seriously?
          Rumors like the one Stoeten mentions in the post have just been shot to hell.
          Rogers values content and rightly so.
          But the content needs to be relevant, otherwise you’d be watching 7 channels broadcasting darts.
          The new CEO won’t be slashing the Jays budget. Not because he’s in love with baseball but the revenue produced by the content across ALL the Rogers platforms.
          The Jays budget will still need to be spent wisely but it will be spent.That bodes well for the team.

          • Damn straight! I’d love it if this meant spending up to luxury tax threshold. Why not, right? We’re probably headed that way anyway – think about it, with options upcoming on EE, Bautista, Dickey and Buehrle, Reyes long term and contract extensions due in the next couple years on Rasmus, Santos, Janssen and Morrow, not to mention guys that will be arb eligible in Loup and Lawrie among others, and potentially doling out 4-5 year contracts this off-season and maybe next, we’ll be sitting in the $140-$160 million range payroll-wise anyway. Might as well go all the way with it.

    • amen!!!

    • Actually, the NHL is getting $2 billion over ten years in the US.

      Combined with the Canadian deal, they are getting about $7 billion. In comparison, the NBA’s TV deal was $7.4 billion for 8 years. The gap is closing.

  9. Thanks for posting this Stoeten.
    It’s important to keep the naysayers at bay.

    I’m waiting for the first to comment.
    “they just spent 5 billion why don’t they just give Cano 300 mil”

    • They should definitely do that.
      Assuming of course that their future team payroll has no upper limit and it won’t restrict future moves at all.
      … which is totally conceivable, right?

    • Funny how the very next comment after yours was basically a slightly moderate form of what you were talking about!

    • how about 5/$150?

      • Listening to PTS yesterday with I think Rosenthal ( caught it midway) Cano’s demand of 310/10 was made mid season. He says the current Yank offer is 165/7 and JayZ is looking around for something better.
        Dunno if thats true. but kenny is usually a reliable source.

        • i like the idea of higher AAV on lower term, not that he has any reason to accept that and play on the aluminum infield

          • Generally players tend to go for the longer term deal with the lower AAV.
            Generally…

            • totally agree. just wondering if huge AAV lets them save face (highest AAV in baseball) and get a huge AAV and get one more big contract at 36

        • 165/7 seems really low to me.

          Just a really rudimentary $/WAR calc:
          Assuming he accumulates 28WAR over the next 7 years, that’s a pedestrian 5.9M/WAR. The league avg $/WAR over the life of the contract will probably be closer to the 8M range I’d think so there would be a ton of extra value there.

          Not a huge fan of evaluating FAs like that but it’s a decent starting point to suggest that 165/7 is pretty damn low.

      • Maybe 7 years 210M would get him here.

        Unless he falls off a cliff, I’m guessing someone would take him 2 or 3 years into that contract – after we’ve won a WS and are going with a younger team.

        He helped Edwin become a god. Maybe he could turn JP into a replacement level catcher.

        • I’d sign him in a second for 210/7. I’d think that’s pretty damn reasonable contract to get him on. Of course, I don’t necessarily believe the Jays would offer it and – if they did – it wouldn’t be matched by the Yankees but you’re ballparking where I’d be comfortable spending the money were I the GM.

  10. given this massive NHL deal, adding $35 million to the Jays’ payroll is a drop in the bucket and really a must so they can solve their modest roster issues through free agency and not further damage their long-term success and financial health through further prospect trades.

    overpay to get Jimenez here for 5 years. get Infante here too. there might even be left to sign Pierzynski or Navarro on a modest one or two year deal. the Jays don’t have to go nuts, the roster already looks pretty good but I just fear what another series of prospect heavy trades would do to the franchise’s future.

  11. My distrust is focused on Keith Pelly. He’s the one that’ll be filling the new CEO in on the monetization of the Jays activities and he’s a straight up business man that sees sports as a great vessel for financial gain but I’m not convinced he’s too concerned about the team actually winning.

    Last season was a definite success for the Jays. They may have played terribly but they increased profits, increased attendance, increased media hype…they won in every way except on the field and that’s the victory I see them continuing to chase down.

    • Disagree. I would think they are smart enough to realize that without some on-field success those other successes will not last.

    • This comment misses the point that the only reason that the Jays increased attendance etc is because there was suddenly the very real prospect that the Jays might be able to win. Take that away and attendance and profits dwindle again. How is cutting payroll and not caring about winning going to create optimism and bring people to the stadium? If there is one lesson management would have learned from 2013 it is that Jays fans will respond and spend when their team is seen to be a real contender again. I expect management is aware that no matter what AA does this offseason, fans will likely not buy tickets as far in advance this year as they did last year. Once bitten twice shy. But if the team is in serious contention in June and July, and optimism is in full force again, the place will be packed. The only way for managment to create that scenario is by caring about winning, and by extension, spending what that takes. It makes no sense whatsoever to expect a payroll cut.

      • Bingo

      • Finally somebody that truly understands the landscape of Toronto and it’s sports fans.

        Toronto (with exception to Leafs fans) is a bandwagon city. If something is hot or exciting and generating interest, people will flock to it.

        I think it’s the same reason Rogers has been trying to pursue NFL (their own NFL team) for all these years. NFL “lights” is the penultimate platform.

    • When it comes to the Jays, Rogers will listen to Beeston much more than Pelly.
      IMHO.
      Beeston has followed through with his public pronoucements.If the Jays shit the bed again it won’t be from a lack of work by Beeston and AA.
      Even 2013 is more on the players and injuries than Beeston and AA putting the team together.

    • They HAD increased profits, increased attendance, increased media hype because the off-season moves put the Jays in a good position to win. If they stop trying to be competitive people will lose interest. They ain’t the Leafs.

    • And you base this, of course, on absolutely nothing.

      • Not quite based on nothing, not quite based on something I’m privy to discuss publicly.

        I’m hoping RADAR is right. AA and Beeston certainly have the Jays best interest in mind. Like I said, there are many different forms of victory for Rogers. They could drop a load of cash again and, possibly, be contenders to win a Series or two. Or they could drop a lot less and be contenders to win games. Obviously they have to get better than they were last year to keep people’s attention. Fingers crossed that AA is keeping things as low key as possible.

  12. has anyone seen this interactive Blue Jays lineup at ESPN?

    http://espn.go.com/mlb/features/marketcentral/_/name/tor/toronto-blue-jays

    They sure know how to make a guy feel weak up the middle

    • i have, and will look again in a few months…..hi everyone lol

      • I LOVE grenadine in coke! It’s best from On the Border (although I don’t know if you even have those in CA). I like Cherry Coke too, but this kind is SO much beettr!

  13. One thing that’s being missed here is the cross-promotion the Jays will now get on hockey broadcasts early in the season. If anything, this is so much better for the Jays now.

  14. You are on fire Stoeten!

    I have such angst about this offseason already. I keep telling myself that AA is making a concerted effort to under-promise and lower our expectations to the basment so that when he makes his big splashes it will really shake the city.

    Right?

  15. All this having been said, I wish we did not have corporate owners. At least not these corporate owners. Another beer company would be nice. Those guys need a winner for their brand and will act accordingly. Rogers need content for their brand and will also act accordingly. It’s not the lack of money I object to so much as the spend/save/spend/save cycles. It would be nice to have some consistency.

    • I’m no expert on this, but the old CBA and revenue sharing deals probably had more to do with mediocrity and lack of spending around here.

      Stoeten has covered this several times.

    • A beer company like Interbrew?How soon we forget.Sport teams are most valuable to media companies.The RSN’s of the Dodger,Angels,Rangers etc. push dollars into budgets.Successful sports teams with large fanbases will push more dollars than a beer company’s promotional vehicle..

      • Good point! Let me rephrase… ‘a canadian beer company…’

        I agree that media corporations like to have successful sports components. But if you recall–which I do because I’m older than Grandma Moses–the old days when Labatts were in charge, they really did spend money on the Jays as soon as the team looked like it could be a winner. When the Jays won the WS they had the highest payroll in baseball. Then everything kind of went to shit in the Interbrew deal and we never seemed to recover. It’s true that over the years Rogers have loosened the purse strings a bit, but they never seemed to loosen them enough. They gave up a bit of money but never enough to compete with Boston and NY. At the same time the team never sucked badly enough to get high draft picks like the Rays did.

        I am not a fan of the one player with an albatross contract method. I don’t want Cano coming here. But sometimes over the past years I’ve listened to all the shit about prudence and ‘we’ll spend when the team shows us it’s worth spending for’ and it makes me want to put a fist through my Rogers cable box. I felt pathetically grateful to hear that they were willing to take payroll up to around $150M. But they could spend double that and the Jays would still be a decimal point on the end of one of their balance sheets.

  16. I’d be interested to see the Jays actual books. I’d be willing to bet they made a pretty penny last year.

    • The books would do you no good. Any decent accountant can make them look any way you want.
      Whether the Jays make money or not, is a moot point.
      The content produced for the media arms of Rogers is where the money is.

  17. Does anyone realize that broadcasting sports will quickly become the only thing people will really watch on tv? With the rapidly growing digital content distribution of television shows and movies, the only thing people will continue to tune into tv for is for the live sports. Acquiring and ensuring that there is a large fan base will be key to the survival of television broadcasting stations and providers of the future. Rogers is ahead of the game in their acquisition of the only televised media that will survive the next 10-20 years.

    • Will it? Or will streaming services like MLBtv cut out the middle man and start to incorporate advertising as well? Sure, games are blacked out in regions where the game is already being broadcast on tv but it’s already easy to bypass that problem and access anything you want.

      • Good point. I didn’t realize you could get around the blacked out games. I got MLB.tv a couple years ago, but didn’t renew because I couldn’t watch the Jays live. But also, I believe Rogers bought the NHL version of the same thing as well when the acquired all the rights, so they have that covered.

        • I subscribe to a service called Unblock Us. It’s about $5/month and lets me “relocate” to anywhere in the world. Gets me access to american netflix as well. Content providers acting local on a global platform is pretty funny but I’m sure they’ll be switching things up to take advantage of this opportunity once big contracts expire (or maybe not).

  18. My question/concern:
    Outside of the Jay’s coverage, major league baseball is an afterthought on Rogers – there is no post game show to speak of after Jay’s games that provides any insight to any of the other teams in the league. There is virtually no intelligent discussion of the league/players/issues during the season.
    Historically, the Roger’s playoff broadcasting schedule has been awful (anyone else remember them showing the Hooters swimsuit contest in October 2008, instead of the promoted Red Sox vs Angels game? Ok, few of you will remember that one, but it happened). What will we see in Sept/Oct – meaningful MLB games or hockey?
    My fear is that baseball coverage outside of the Jays will continue to be absent, and that we’ll now have access to fewer MLB games on television – where will those MLB playoff games be found when hockey is on?

    • For the sticklers: the game was actually on October 7, 2007 – Rogers responded to my complaint in 2008.

      • What may happen for non-Jays MLB games is that they go to TSN and TSN2 who will now have no hockey at all to broadcast and will need something resembling premium content to try to combat the strong hockey schedule on the various Rogers networks.

        The Jays will still be on Rogers-owned properties, which may include City once all the NHL scheduling kinks are worked out. But you can bet none of those Jays games will be on Bell networks either.

        And didn’t you enjoy Blue Jays Xpress? Lol…

        • I could also maybe see CBC incorporated in some way into the carrying of Blue Jays games, similar to the way that they will continue Hockey Night in Canada (i.e. all Saturday night hockey games involving Canadian hockey teams will be broadcast on CBC or a Rogers channel, all under the HNIC nameplate. Rogers takes on all operating expenses and all revenue, so CBC is not on the hook for funding rights fees with taxpayer money).

          I could imagine some Jays games (especially Wednesday nights in April/May or meaningless Sept/Oct games) ending up on CBC, while Rogers networks carry mid-week hockey broadcasts. This would be a win for the Jays as the CBC has a wider reach to viewers across Canada (building the Jays brand), and the CBC would win as they pick up some cost-free CanCon for a portion of their broadcast schedule (good for taxpayers too!).

  19. You are correct. Rogers are not going to cut the Jays’ payroll. In fact, it will go up as far as the luxury tax, if necessary.

  20. It makes sense that AA is attempting to move MB. As a fan, I would hate to lose him for ’14 because he’s a durable, quality pitcher in the AL East and we need pitching. He’d be difficult to move because of the contract but in the right situation, perhaps a three way deal with the Jays’ taking on some of this salary, it might make sense. I know TO was not a destination for MB last winter but he came up, went about his business and was very professional.

  21. What’s Parkes’ going on about, with the 43k pay cut to go work for Buzzfeed?

  22. I read Toronto Sports Media sometimes. The guy is an atrocious writer, but does seem to have some inside info, to a degree.

    He had that ‘Rogers may be looking to scale back its sports media division’ a couple months ago. The result? Some layoffs in Ottawa and Halifax, and The Fan fired Barb Digiulio. Then a month later they spent $5 Billion on the NHL.

    So he may be hearing something, but it hardly seems conclusive. And after Rogers did this with the NHL… hard to see them cutting costs on the Jays.

    • The TSM site has slipped recently as the person operating it has been living in Seattle for the past three years. He is in the process of moving back to TO and has vowed to step up the content of the site. Had he been in TO this week, I’m almost certain his content wrt the Rogers-NHL deal would high volume and high quality.

      He seems to have had some excellent inside knowledge in previous years with respect to the media scene in TO (especially with respect to HR changes at the various radio stations). There was some great work there when Fan 590 went through a ton of changes as it morphed into Sportnet Fan 590 about three years ago.

  23. …and actually, with the stories about MLSE looking at plans for building a billion dollar NFL stadium… it makes the likelihood of a Jays cut back seem even less.

    What a crazy time for the Toronto sports landscape, really.

Leave a Reply

Your email address will not be published. Required fields are marked *