Date: 10.30.2000
DANIEL BURKE OBSERVES THAT Barbara Walters, the newscaster (and a former employee in his old life) hasn't got much of an arm. Burke, former chief executive of Capital Cities/ABC, is now the owner of the Portland, Me. Sea Dogs, a minor league baseball team. He invited Walters to throw the opening pitch at a Sea Dog home game: "She tried to throw it, but the ball slid off her hand and dribbled toward third base," recalls Burke. The crowd went crazy anyway. Walters, along with special guest Barbara Bush, were at a home game Burke marketed as Barbara Night, in which everyone named Barbara got to meet the two Barbaras. That's minor-league marketing from a major-league guy.
Burke is the irascible half of a famed duo (Thomas Murphy was the other half) that over a period of 35 years turned a couple of TV stations and a radio station into the Cap Cities/ABC empire. Disney bought the company in 1996 for $19 billion. Burke was on the board but he had retired as chief in 1994, when he pursued another dream, owning a baseball team.
Over lunch in the 22nd-floor executive dining room of the ABC building in Manhattan, Burke, now 71, tells us how he became hooked on baseball: "My dad took me to the games when I was a kid. It was the only time I had my dad all to myself." Burke has also had a love affair with Portland, where his family has vacationed for more than 40 years. (Quite a family, which includes a brother who ran Johnson & Johnson and a sister who was a group vice president at Avon.) So when the Eastern League expanded in 1994, Burke stepped up to the plate, paying $3.5 million to establish the Portland Sea Dogs, a double-A affiliate of the Major League Florida Marlins.
There are approximately 180 minor league teams affiliated with Major League baseball. In the Eastern League, of which the Sea Dogs are one of 12 teams, attendance has jumped to 3.8 million from 301,000 in 1978. In the season just ended the Sea Dogs sold 377,000 tickets.
What's behind this renaissance? "It's affordable, accessible, and the quality of baseball is very high," says Burke brusquely, before he gets up from the table to look out the window. While he admires the view of Manhattan's West Side, he says that a family of four can attend a Sea Dogs game for $25. To see a Major League team would cost between $150 and $200, including parking and food.
"In 1950 there were ten times as many minor league teams than now," Burke says. "Then something happened, and that something was television. Teams folded, and in the 1970s you could pick one up for a couple of hundred thousand. We newcomers pay a great deal more. It's not the best investment I could ever make, but I didn't do it for that reason." Clearly not. When the Sea Dogs were formed, Portland agreed to build a stadium for $2.7 million. But they had underestimated the cost and Burke had to pony up another $2.5 million to complete the project.
Mr. Nice Guy? Burke also voluntarily raised his lease payments to the city, from $65,000 a year to $115,000. "I didn't want our team to exist at the expense of the school system. I'll brain you if you make this sound like a charity!" This man played hardball for four decades with television unions, ad buyers and station brokers, so he does not want to look like a softie now.
How would a hard-nosed businessman look at this venture?The Sea Dogs gross nearly $4 million a year from gate, concessions, signage, souvenirs and a small amount from TV and radio. On that the team ekes out a small profit. You could probably do better on Treasury bills. But there is the prospect of a capital gain. It cost Burke $3.5 million for the right to a franchise. Last year another double-A team, the New Britain, Conn. Rock Cats, sold for $6.5 million.
What does Burke bring to the game? "Nothing, nothing," he says. He gets up to look out that window again and finally grumbles: "I taught Charlie [Eshbach, his general manager] how to budget. I always felt in business that budgets were the best way to get people to buy into a sense of purpose and to understand how all the pieces fit together." Eshbach prepares a monthly operating statement so that Burke gets every number. What does Burke tell Eshbach? "That I ought to keep payroll down," Eshbach later told me. What a surprise. Burke and Murphy ran Capital Cities with 12 employees at its headquarters.
With a little more coaxing Burke begins to talk about similarities between the media business and baseball. "To an exaggerated degree, they both rely on very scarce talent. TV relies on personalities, writers, producers, directors. If you came out to see the 50 or so pilots ABC reviewed for fall, you'd wonder how 30 of them got financed. But it's residue from an initial process that started with probably 1,000 ideas. The networks don't lack resources and determination, but talent is too scarce. The same applies to baseball."
Both are driven by numbers. Says Burke: "At Capital Cities/ABC we would get Nielsen's reports of each night's programming the next morning by 10 a.m. In baseball, performance is measured every single day in terms of hits, runs, attendance, concession sales–just the same way it's brutally measured in television." Burdened with injuries, the team managed to win 13 of their last 14 games to finish the season with 71 wins and 70 losses. Still, the team sold out its 6,800-seat stadium for half the home games.
A few years ago Burke helped his son Frank buy the Chattanooga Lookouts for $3.8 million. Will there be more baseball investments? Burke shakes his head. "I can't afford it."
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