Rogers Communications is reaping financial benefits as the Toronto Blue Jays compete in the World Series after securing a 14-year, $500 million deal with first baseman Vladimir Guerrero Jr. Sports analysts view Guerrero as a crucial factor in the team’s World Series journey.
Economists specializing in sports emphasize that despite the hefty investment in Guerrero, the returns for Rogers are substantial, particularly if the team advances to the World Series. Victor Matheson, an economics professor at the College of the Holy Cross, estimates that the revenue generated from World Series ticket sales alone could cover Guerrero’s salary.
Rogers, being the owner of the team and the stadium, benefits not only from the Jays’ performance but also from ancillary revenue streams such as concessions, merchandise sales, and broadcasting rights through Sportsnet, the network that airs most Jays games in Canada. The company reported a 26% increase in media and sports revenue in its recent quarterly earnings.
CEO Tony Staffieri envisions the Blue Jays, along with control of Maple Leaf Sports and Entertainment, as a key growth pillar for Rogers beyond its wireless and cable businesses. The company anticipates further revenue growth from the Blue Jays’ playoff and World Series appearances.
However, there are risks associated with such a massive investment. Matheson warns that a prolonged downturn in the team’s performance could pose financial challenges for Rogers, especially with Guerrero’s long-term contract. Despite these risks, economists like Duane Rockerbie suggest that Guerrero’s star power can attract fans and drive additional revenue streams for Rogers beyond baseball operations.
While some critics raise concerns about the financial implications of Guerrero’s contract, others like sports analyst Steve Glynn support Rogers’ investment in securing top talent. Glynn believes that fans and customers ultimately foot the bill for such deals and acknowledges Rogers’ ability to navigate financial challenges while expressing optimism about the team’s future.
Glynn also notes that unlike baseball, hockey’s salary cap restricts teams from excessive spending on players, making it challenging to buy championships. However, he humorously adds that the Toronto Maple Leafs face additional challenges due to historical superstitions associated with the team.