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August 26, 2013

The 2013 Houston Astros Are The Most Profitable Team In Baseball History

by Jared

For the third straight season, the Houston Astros are well on their way toward finishing with the worst record in Major League Baseball. They finished with a pathetic 56 wins in 2011 and took a tiny step back with 55 in 2012. The 2013 Astros would need to win 14 of their last 33 games to improve upon the previous two seasons. Don’t bank on that happening.

Yet, somehow, the 2013 Astros are the most profitable team in MLB history. According to Forbes, Houston is on pace to make an estimated $99 million in operating income this year. That number is roughly the same amount that the last six World Series champions made combined. That’s right, combined.

Naturally, most of it has to do with payroll. The Astros are paying out roughly $21 million in salary and bonuses this season. Starting pitcher Erik Bedard is the highest-paid player on the team in 2013 with a salary of $1.15 million. He is the only player who will make over $1 million. Last year, before Jim Crane purchased the team, the payroll was roughly $56 million higher.

But the fact that 64 MLB players are making more this season as individuals than the entire Astros roster doesn’t account for their entire profit margin. The team also has one of the best television deals in baseball. Comcast SportsNet Houston is paying the Astros $80 million per season to show their games, which is $50 million more than previous teams were paid before Crane. They also bring in an additional $40 million from other TV and radio deals.

The Astros own 45% of CSN Houston. Forbes also pointed out that the network has had trouble signing deals with local cable and satellite providers since it launched last fall. They lost $63 million last year, a large portion of which had to be absorbed by the Astros. Even if the Astros had to take on $21 million of that loss, they would still have an estimated operating income of $71 million. That number is the highest in MLB history.

You get the point. The Astros are making a ton of money and spending next to nothing on players. That can infuriate a fan base, but Crane insists the team is building a strong enough farm system where they will be in the top five or 10 in payroll once they have to start paying their homegrown talent. He has also introduced policies that allow fans to bring their own food and drink into the stadium, so it could be worse (I guess?).

That being said, a payroll of $21 million is pathetic. You can grow a farm system while still bringing in worthy players, and the Astros obviously have the money to do it. If Crane doesn’t start spending it soon, Houston fans will become more restless than they already are.

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