New England Sports Ventures, which owns the Boston Red Sox, has just gotten bigger on a minor scale.
An arm of the New England Sports Ventures with John W. Henry as controlling owner, Fenway Sports Group, (“an innovative, sports-oriented sales and marketing operation“) has announced a controlling (majority) stake of the Salem Avalanche, a Class-A minor league baseball team used by the Houston Astros.
Fenway Sports Group (FSG for short) owns Roush Fenway Racing (a NASCAR team co-owned with Jack Roush), FanFoto and Red Sox Destinations and now the minor league team of the Avalanche. They also provide consulting and marketing services to the Red Sox, MLB Advanced Media, Boston College Athletics, Deutsche Bank Championship, AVO Pro Beach Volleyball, F.W. Webb, Labatt USA, EMC, Stop & Shop, CVS and Verizon Wireless.
Why is this important?
Well, because ever since its inception, New England Sports Ventures has looked for other ways to raise capital in order to both turn a profit and invest it in the company. Since all Red Sox-related revenues are subject to revenue sharing and then invested in a MLB-wide pool which is then equally disbursed to all clubs, there is not much avenue for profit there (unless you’re the Marlins).
FSG changes that, as well as the yearly concerts that are played on Fenway soil and wreck the outfield for a few weeks. (And NESN, too.) These are not Red Sox-related profits so they are not subject to MLB rules and regulations. Not only is FSG providing an invaluable service in terms of expertise in the area, they are also generating dollars for Henry, New England Sports Ventures and the Red Sox.
Without these concerts, without FSG and without the other satellite operations going on, the Red Sox would not be able to compete as extensively as they do. The payroll would be lower, the community service would be lower, the marketing (Red Sox Nation) would be smaller. This additional revenue stream is what allows the Red Sox to have an obscene payroll.
Whether or not we should have an obscene payroll is irrelevant. What matters is we have owners dedicated to allowing the Red Sox to have an obscene payroll as opposed to a certain team in Florida that just punted the 2008 season, will boast as its highest paid player an average reliever and who should move as fast as possible because it’s clear that its fanbase is not interested in supporting its team. (Sorry, the last link is ESPN Insider only, but Rob Neyer pulls no punches: the Marlins don’t succeed because its fanbase won’t support it — historically.)
In other news, Eric Gagne signed with the Milwaukee Brewers for one year at $10 million. He’ll bring back a supplemental first-round pick, allowing us to potentially draft the next Clay Buchholz (he was the supplemental first-rounder in 2005 for Pedro Martinez).