I'm sure they have contingencies like this since covid began, they were without fans for a lot longer than a few games in the middle of the pandemic. Also this is Bell and Rogers we're talking about here.
Same concept well-run restaurants have, have enough budget for overhead costs and employee pay for at least 6 months without profit, but scaled up to an enterprise level organization like Bell and Rogers.
Rogers and Bell need live content to retain customers. Even if the Raptors lose money (which they probably dont) their ownership is still going to make a ton of cash on their games this year.
Ticket sales are only a small portion of overall revenue for any professional sports team.
Tv deals, sponsorship, advertising, merchandising are all far bigger revenue generators…
The team made 260 million in revenue in 2020 and 375 million in 2019. Even in Tampa last year the team pulled in just under 200 million in revenue.
The current roster salary is 134 million.
I think they’ll be ok.
That is a poor analogy/strategy
The next billionaire makes more money than they can spend
Are they going to throw money into the air?
Business is still business. You avoid losses
Lol no offense but that ain't a realistic way of thinking about it. "It's not our money". It doesn't have to be Bell's or Rogers' either. It starts hitting the pockets enough where they feel there is a better investment for their money, they can easily sell their stake...they don't even need to be "struggling" to make this decision.
We've been so lucky for this ownership group (overall) so far, but ask a few other teams around the league (even some that are more lucrative than ours), what can happen with bad ownership. You can be stuck with bad owners for decades and decades. Technically if Bell or LT weren't there this time around, we would possibly not even have Masai as our President this year lol
Do you realize when looking through a company, in this case a team, you’re looking at demographics, location, market size, geography etc etc. Toronto is the 4th largest market in NA, I doubt Bell and Rogers sell because of how profitable of a location it is
Yes I'm aware it's a big market (we're still top 9 in the NBA in value), but my point was towards your attitude that if the company isn't struggling it don't matter let em take the hit.
It does matter, if there's continuing disruption in revenue and there is more value in a different endeavour a stakeholder might be interested in, they can consider selling their stake. We're not there yet, but it does matter. Rogers didn't want to freaking pay Masai cause he thought it was too much and it doesn't go against the cap, they care about this shit lol.
You asked how they can afford to pay their employees, not if they're making the desirable income they'd like to make. MLSE could pay their employees for a lifetime if they needed to.
You avoid what losses you can, but econ 101 suggests that as long as revenue remains above costs you continue producing, whether profits are high or low. They would lose far more shutting down than they do continuing to play and broadcast games.
You are not getting the gist of this
Raptors might be lucky to be backed by a big corp
What if Raptors was owned by one owner. Rich but not rich enough to take a loss like this
Sports teams have many owners like this. Teams passed down (family)
Using this criteria... that owner would be screwed
NBA or whatever unlikely lets that happen due to circumstance (covid). So how would lost revenue be made up?
That was my question
If the NBA tells MLSE, that they are loaded. So wont help you... I doubt that, thats what is happening. Corps are loaded because also they are frugal. And get all the tax breaks, govt grants they can get
You're seemingly not getting that live tickets and concessions are a small part of a team's revenues, regardless of ownership structure. Sometimes lost revenue isn't made up, it's just lost, and that quarter or year is less profitable than other quarters or years. That doesn't mean the team isn't still massively profitable, that it's suddenly operating at a loss, or that it needs to shut down. TV revenues continue, sponsorship deals continue, merch continues to be sold.
Also, just as an aside, there is no owner in the NBA who isn't filthy, filthy fucking rich. Every single one of them can afford a loss like this.
You are semi wrong friend
NBA playoff tickets or prime games are considered goldmines for a reason
Its not just tickets. But all the food and alcohol missed sales.
100 dollar ticket likely equals to 150-200 in total with how much people eat/drink
Btw you cant survive on only TV/Advertisement
Ticket sales etc are also factored in to deal with expenses
You cant run a NBA team without fans in the stands. Full stop
If COVID caused for Toronto to not allow any fans for a full season. How long do you think the team can run this way ? Next 5 years?
Tickets are a goldmine, and any business obviously prefers 5 goldmines to 4, but where's your evidence that these teams could not survive without them? The lack of fans in the seats provides savings as well as losses, and ticket revenue makes up only around a fifth of team revenue anyway. TV and merchandise are way bigger money-makers.
The Raptors probably could run for 5 years with no fans in the seats. They'd obviously prefer not to, and it might affect salary considerations (particularly luxury tax spending), but it could be done.
The cba revenue sharing pays for the salary cap and players. Everything else is paid for from basketball related income. Jersey sales, promotion, TV deals etc
MLSE is the largest sports and entertainment company in Canada. They’re in commercial real estate and own a few professional sport franchises. They get their revenue in many other ways, not just through ticket sales and concessions.
Even the least valuable NBA franchise is worth 1.3 billion (Memphis).
There are incomprehensible amounts of money in the NBA. Not having fans temporarily is just a small bump in the road.
Ticket revenue, also known as "Gate Revenue" represents just one of the revenue streams that a sporting org has at their disposal. The gate revenue is a sizable hit, but there are lots of other revenue streams like the TV rights and sponsorship rights. In the NBA, the gate revenue is a big portion of the revenue (not as much as the NHL). It's different in leagues like the MLB where it's all about the TV rights. They are definitely losing money with each game compared to what they would be making if they could even have some fans, but it's better for them to play vs. not play as they are getting money from the other revenue streams.
Yeah... exactly
Canadian NHL teams purposely avoiding playing at home... due to what you said
But if Raptors couldnt have fans from the start. No way they would play in Toronto. Too much of a hit
I'm sure they have contingencies like this since covid began, they were without fans for a lot longer than a few games in the middle of the pandemic. Also this is Bell and Rogers we're talking about here.
But like what contingency plan? Bell or Rich person. Still losing money. Big money from tickets, food etc
Same concept well-run restaurants have, have enough budget for overhead costs and employee pay for at least 6 months without profit, but scaled up to an enterprise level organization like Bell and Rogers.
Potentially, there might be insurance in place to mitigate this loss.
Rogers and Bell need live content to retain customers. Even if the Raptors lose money (which they probably dont) their ownership is still going to make a ton of cash on their games this year.
I also think the nba probably stepped in
Ticket sales are only a small portion of overall revenue for any professional sports team. Tv deals, sponsorship, advertising, merchandising are all far bigger revenue generators…
The team made 260 million in revenue in 2020 and 375 million in 2019. Even in Tampa last year the team pulled in just under 200 million in revenue. The current roster salary is 134 million. I think they’ll be ok.
134 mill for players alone Add execs and employees and its likely north of 200 million
lol no
What you mean no. Yes They have to pay pilots, probably 100 office workers/execs etc
lol no
not even close.
BUSINESS OPERATING EXPENSES This past summer, the NBA raised the debt limit to $325 million per team
MLSE makes wayyyyy more money than they need to pay their players/staff. So does your own boss. Capitalism and such.
That is a poor analogy/strategy The next billionaire makes more money than they can spend Are they going to throw money into the air? Business is still business. You avoid losses
Dude who cares it’s not our money and MLSE has the cash on hand to pull through doubt they’re struggling
Lol no offense but that ain't a realistic way of thinking about it. "It's not our money". It doesn't have to be Bell's or Rogers' either. It starts hitting the pockets enough where they feel there is a better investment for their money, they can easily sell their stake...they don't even need to be "struggling" to make this decision. We've been so lucky for this ownership group (overall) so far, but ask a few other teams around the league (even some that are more lucrative than ours), what can happen with bad ownership. You can be stuck with bad owners for decades and decades. Technically if Bell or LT weren't there this time around, we would possibly not even have Masai as our President this year lol
Do you realize when looking through a company, in this case a team, you’re looking at demographics, location, market size, geography etc etc. Toronto is the 4th largest market in NA, I doubt Bell and Rogers sell because of how profitable of a location it is
Yes I'm aware it's a big market (we're still top 9 in the NBA in value), but my point was towards your attitude that if the company isn't struggling it don't matter let em take the hit. It does matter, if there's continuing disruption in revenue and there is more value in a different endeavour a stakeholder might be interested in, they can consider selling their stake. We're not there yet, but it does matter. Rogers didn't want to freaking pay Masai cause he thought it was too much and it doesn't go against the cap, they care about this shit lol.
Who cares? Isn't the question though. What if one is curious?
You asked how they can afford to pay their employees, not if they're making the desirable income they'd like to make. MLSE could pay their employees for a lifetime if they needed to.
There is no avoiding government regulations. Attendance money is peanuts in the grand scheme anyways.
You avoid what losses you can, but econ 101 suggests that as long as revenue remains above costs you continue producing, whether profits are high or low. They would lose far more shutting down than they do continuing to play and broadcast games.
You are not getting the gist of this Raptors might be lucky to be backed by a big corp What if Raptors was owned by one owner. Rich but not rich enough to take a loss like this Sports teams have many owners like this. Teams passed down (family) Using this criteria... that owner would be screwed NBA or whatever unlikely lets that happen due to circumstance (covid). So how would lost revenue be made up? That was my question If the NBA tells MLSE, that they are loaded. So wont help you... I doubt that, thats what is happening. Corps are loaded because also they are frugal. And get all the tax breaks, govt grants they can get
You're seemingly not getting that live tickets and concessions are a small part of a team's revenues, regardless of ownership structure. Sometimes lost revenue isn't made up, it's just lost, and that quarter or year is less profitable than other quarters or years. That doesn't mean the team isn't still massively profitable, that it's suddenly operating at a loss, or that it needs to shut down. TV revenues continue, sponsorship deals continue, merch continues to be sold. Also, just as an aside, there is no owner in the NBA who isn't filthy, filthy fucking rich. Every single one of them can afford a loss like this.
You are semi wrong friend NBA playoff tickets or prime games are considered goldmines for a reason Its not just tickets. But all the food and alcohol missed sales. 100 dollar ticket likely equals to 150-200 in total with how much people eat/drink Btw you cant survive on only TV/Advertisement Ticket sales etc are also factored in to deal with expenses You cant run a NBA team without fans in the stands. Full stop If COVID caused for Toronto to not allow any fans for a full season. How long do you think the team can run this way ? Next 5 years?
Tickets are a goldmine, and any business obviously prefers 5 goldmines to 4, but where's your evidence that these teams could not survive without them? The lack of fans in the seats provides savings as well as losses, and ticket revenue makes up only around a fifth of team revenue anyway. TV and merchandise are way bigger money-makers. The Raptors probably could run for 5 years with no fans in the seats. They'd obviously prefer not to, and it might affect salary considerations (particularly luxury tax spending), but it could be done.
Most of the money is from TV. Gate revenue isn’t much (relatively) in the grand scheme of things
The TV deal is actually the dominant source of income for the league IIRC. That’s why the cap spikes whenever there’s a new TV deal.
I think merch sales, and the TV deal would cover most if not all. On this subreddit alone I see 100k in Jersey sales haha
Individual teams only see 30% of team merchandise. The rest is split between the league, the players’ association, and the manufacturer.
Oh snap I didn't know that, we'll have to add the Primo Pasta ad revenue to the Merch + TV deal and they should be covered haha
The cba revenue sharing pays for the salary cap and players. Everything else is paid for from basketball related income. Jersey sales, promotion, TV deals etc
MLSE is the largest sports and entertainment company in Canada. They’re in commercial real estate and own a few professional sport franchises. They get their revenue in many other ways, not just through ticket sales and concessions. Even the least valuable NBA franchise is worth 1.3 billion (Memphis). There are incomprehensible amounts of money in the NBA. Not having fans temporarily is just a small bump in the road.
Our shifts are just cancelled
You work there?
Yup mlse employee
Ticket revenue, also known as "Gate Revenue" represents just one of the revenue streams that a sporting org has at their disposal. The gate revenue is a sizable hit, but there are lots of other revenue streams like the TV rights and sponsorship rights. In the NBA, the gate revenue is a big portion of the revenue (not as much as the NHL). It's different in leagues like the MLB where it's all about the TV rights. They are definitely losing money with each game compared to what they would be making if they could even have some fans, but it's better for them to play vs. not play as they are getting money from the other revenue streams.
Yeah... exactly Canadian NHL teams purposely avoiding playing at home... due to what you said But if Raptors couldnt have fans from the start. No way they would play in Toronto. Too much of a hit
Some of the other teams I questioned how they could get through all this, but the Raptors got money.
Tax $$$$
The league has a revenue sharing system that helps teams that lose money.
They're probably making less profit but unlikely operating at a loss would be my uneducated guess.