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On this day: A look at how George Steinbrenner’s purchase of the Yankees changed the business of MLB

Vincent Frank
George Steinbrenner Yankees
Photo by Pepi Stojanovski on Unsplash

Perhaps, late-great New York Yankees owner George Steinbrenner is best known in pop culture for his likeness being used on “Seinfeld.”

Others look at Steinbrenner’s 47-year tenure as the Yankees’ owner as being drama-filled and somewhat disappointing compared to prior to his purchase.

That could all be correct. But there’s something else to focus on now that we’re celebrating the 47th anniversary of Steinbrenner and his Yanks. It’s all about the economy, stupid!

The premise: Steinbrenner joined with former CIA agent and CBS executive E. Michael Burke to purchase the Yankees from CBS for a cool $10 million on Jan. 3, 1973.

  • That $10 million is the equivalent of $57.93 million in 2020 dollars. This is absolutely insane to take into account, even when we look at inflation.
  • For comparison’s sake, there are currently four members of the Yankees earning more than that $57.93 million. That includes Gerrit Cole and Giancarlo Stanton making a combined $659 million over the life of their contracts.
  • When looking at that $659 million figure and translating to 1973 dollars, the number comes out to $113.76 million.
  • You read that right, two players, converted to 1973 dollars, are earning more than 11 times what Steinbrenner and Burke paid for the Yankees.

The staggering numbers: According to Forbes, the Yankees are worth a cool $4.6 billion. That’s good enough for No. 2 in the entire sports world behind the NFL’s Dallas Cowboys ($5 billion).

  • Putting this into perspective is absolutely crazy. If we were to look again at 1973 dollars, that’s the equivalent of $794 million.
  • The very same Forbes estimate notes that half of MLB teams are currently valued at $1.5 billion or less ($258.9 million in 1973 figures).
  • This means that, when accounting for inflation, the Yankees are valued at a 79 times higher clip than when Steinbrenner purchased the organization.

The media: A deal during the spring of 2019 represents just how much of an empire “The Boss” built in North America’s largest media market.

  • A partnership that included Amazon, Sinclair Broadcasting and the Yankees finalized a deal to purchase the YES Network for $3.5 billion back in March.
  • The overall deal, which included The Walt Disney Co., was for a whopping $71.3 billion. A previous agreement between the Yankees and Fox included the latter owning 80% of Yes Network. The deal included New York’s baseball the right of first refusal if Fox ever sold it. Fox did, and here we are.
  • What does this all mean? The Yankees don’t even have a regional contract. They legitimately own the network that their games are broadcast on locally.
  • This just goes to show us the business side of baseball changed with Steinbrenner and Burke purchasing the Yankees.

On the field: Outside of the Billy Martin days and some struggles in the 1980s, Steinbrenner’s Yankees were contenders.

  • From 1973-2010, the Yankees won seven World Series titles and earned a trip to the Fall Classic 11 times.
  • Sure there were some issues relating to Steinbrenner’s ownership mentality and hands-on approach. He was a divisive figure during his time.
  • But when you combine on-field success with Pinstripe brand “The Boss” was able to build up, he becomes an absolute legend 47 years after purchasing the Yankees for what would now be a three-bedroom house in Lower Manhattan (not literally).

In his own words

“Baseball is not just a sport anymore; we are a business. We are show business. To compete for the entertainment dollar, particularly in New York, you have to have more than nine guys playing baseball; you have to have an attraction. And I have tried to do the best job I possibly can to give my fans an attraction.”

Well put, Mr. Steinbrenner. These words ring truer now almost 10 years after your death than they did when you were recreating baseball’s business model.