A Miami Fish Story
1. What was Wayne Huizenga’s goal in rearranging revenues, as Zimbalist (1998) claims he did in the Miami Fish Story? How did all the shenanigans cited by Zimbalist contribute to that goal?
It will be money always! Without a new ballpark, he couldn’t make significantly more profits on the team. Besides the ending of his owner tax benefit, he decided to maximize his income by selling it.
According to the article, the goal of Mr. Huizenga’s action in 1997 was to sell the team in the next year and gain more bargain power by showing a ‘red’ financial report. Further, reducing the payroll by trading expensive players. Additionally, bring more value to its cross-ownership, such as Miami Dolphin and sports channel.
2. In particular, how did the revenue shifting due to Huizenga’s cross-ownership of the Marlins’ local cable outlet support his goal?
Wayne Huizenga's deal with Henry included a 10 years extension of the Sports channel contract. Under that contract, the Marlins received rights fees below its market value. While it significantly increased the value of Huizenga’s sports channel from an estimated $85 million to $100 million in 10 years. (The original contract with Smiley was expected to increase to 125 million in 26 years)
3. Did revenue shifting have any other advantages? Under what circumstances?
As I mentioned before, by shifting the revenue Mr. Huizenga credited more revenue and market value to his two cross-ownerships, and got the reasonable excuse to trade players and reduce the payroll in the next year. Furthermore, he will avoid certain among of different kinds of state/federal tax. On the other hand, Mr. Huizenga sold an actual profitable team by offering a price under its actual market value led to control the terms of the deal to benefit other holdings.
4. The article “A Miami Fish Story” suggested that the Florida Marlins did not lose as much money during the 1997 season as...