Phil Hochberg on revenue generation in Major League Baseball today ~
“Well, interestingly, Major League Baseball is now suffering attendance losses over the past few years, but Major League Baseball is making more money than it ever had because of the media rights and everything . . . everything has just changed so much. It is no longer just radio. It is no longer radio and television. It is not radio, television and cable. It is the Internet. It is the streaming services. It is just everything.”
Andy Ockershausen: This is Our Town. This is Andy Ockershausen. In a conversation with not only a friend, but I would say a world known friend from doing his work as the public address announcer for so many of Washington sports teams that they could hear you all over the world because of the coverage.
Welcome to Our Town, Phil Hochberg.
Phil Hochberg: Thank you Andy. Thank you very much.
Andy Ockershausen: And a local guy that made good.
Phil Hochberg: Well, I don’t know if I made good, the old Frank Sullivan line, the Frank Sullivan picture with the Boston Red Sox. He said, “I’m in the twilight of a mediocre career.” So I don’t know if made good is the right word, but, thanks a lot.
Andy Ockershausen: Well, I had a friend said that but a difference is, I’m in the top three of the mediocres, you know, so I can live with that. But Phil, you went to high school here at Wilson?
Wilson High School | American University | Syracuse | George Washington Law School | Federal Communications Commission Career Start
Phil Hochberg: I did. I did.
Andy Ockershausen: And I had thought you had gone and switched to the University of Maryland, but you didn’t.
Phil Hochberg: No. I went to Wilson and then one semester at American U, and then I transferred to Syracuse. Graduated from Syracuse, came back here, went to GW law school and began practicing law in 1965 with the FCC.
Andy Ockershausen: TC or CC.
Phil Hochberg: FCC.
Andy Ockershausen: The Federal Trade?
Phil Hochberg: The Federal Communications Commission.
Andy Ockershausen: Oh, federal, I know it quite well.
Phil Hochberg: Your friend Dick Wiley.
Andy Ockershausen: Oh yeah. We had a ton of friends on the FCC that was involved. Dean Burch.
Phil Hochberg: I guess you did. Harry was a communications lawyer himself.
Andy Ockershausen: Absolutely. But Phil, I had really never knew about you in those days because my very relationship with you has always been through the sports world, not through the legal world, but you’ve had quite a career in the legal world as both a rep and an adviser, correct, to leagues and sports teams?
Practicing Law 54 Years | Member of Firm to Sole Practioner | NFL, NBA, NHL, Nascar
Phil Hochberg: I have represented, and still do represent the National Football League, the National Basketball Association, the National Hockey League, NASCAR in a very limited area dealing with communications and cable, satellite, copyright, very limited.
People ask me when I’m going to retire, been practicing now for 54 years, and I say that right now I’m looking at 2021 so that I can be able to say I’ve represented the National Hockey League for 50 years.
Andy Ockershausen: Wow.
Phil Hochberg: Which is a pretty good relationship with the client.
Andy Ockershausen: Well, wait a minute. It’s a good relationship anytime. That is great Phil. You obviously have delivered a service that they appreciate. It’s been 50 years.
Phil Hochberg: Yeah. Yeah.
Andy Ockershausen: But you are representing them as a agent or representing them as a lawyer?
Phil Hochberg: As a lawyer representing the league.
Andy Ockershausen: The league, right.
Phil Hochberg: In terms of regulatory and administrative issues and legislative issues affecting the National Hockey League and some of the other leagues too.
Andy Ockershausen: But you operate as a member of the firm. Correct? The whole firm comes to the table then.
Phil Hochberg: Actually, I am the firm.
Andy Ockershausen: “I are the firm.”
Phil Hochberg: Yeah. Fifteen years ago. I set out on my own, been practicing as a sole practitioner for 15 and a half years, and it has been a wonderful relationship.
Andy Ockershausen: Shulman, Rogers is the old firm …
Phil Hochberg: Shulman, Rogers is the firm where I lease space and I have been there leasing space for 15 years. They are wonderful people. I enjoy getting along with them and I am going to continue to practice on my own and lease space from them as a tenant.
Andy Ockershausen: Then you bring all these people to the table, but not all at the same time. You are available for them, obviously.
Phil Hochberg: Right.
Andy Ockershausen: I mean, you’re not the sole lawyer for the NFL.
Phil Hochberg: Oh no, not at all.
Andy Ockershausen: They don’t have a sole lawyer. It’s too big. Correct.
Phil Hochberg: Right.
Andy Ockershausen: Well, when you started in this business, Phil, when you came back to Washington and you finished school and you went to AU and got involved, but the ownership was a different world then than you see now, I mean, completely different. The dollars are boggling now.
Phil Hochberg: In 1969 …
Andy Ockershausen: 50 years ago.
Hochberg 1969 Article on Cable Television in Sports Got NHL’s Attention at the Time
Phil Hochberg: Yeah. Yeah. I wrote an article, which was the first article in a national publication dealing with cable television in sports. And as a result of having written that article, the National Hockey League, they asked me to come up. Would I address their board of governors about cable television in the US. The Philadelphia 76ers were involved in negotiations with a company called Home Box Office, which was just starting and the Sixers did not know anything about cable television. They had hired a lawyer in New York named Louis Nizer who was one of the lions of the bar and they said, would I be willing to work with Louis Nizer? You bet your sweet.
Andy Ockershausen: What a privilege.
Phil Hochberg: Indeed.
Andy Ockershausen: Nizer, what a famous name. So that was your introduction to pro sports, then, as a lawyer.
Stadium Announcer for Washington Senators – 1962 – 1968
Phil Hochberg: As a lawyer. Yeah, yeah. I had in 1962, when our mutual friend Charlie Brotman had left the Senators and they needed somebody to fill in as the stadium announcer. I auditioned and I was the best of a mediocre lot, I guess.
Andy Ockershausen: I would not say that.
To Boston with Westinghouse then back to DC and Private Practice
Phil Hochberg: Well I did that for six years and then I had joined Westinghouse Broadcasting, moved to Boston, came back to Washington.
Andy Ockershausen: You moved to Boston to work for Westinghouse.
Phil Hochberg: They moved me to. Came back here. Went into private law practice.
Andy Ockershausen: I gotcha. That’s an interesting, I want to get back to your work beyond the little firm but back to pro sports and the law firm and talk to it because you are a fountain of knowledge and I want to dig it out as I can.
Andy Ockershausen: This is Our Town. This is Andy Ockershausen with the inimitable Phil Hochberg, the voice of everything that happened in Washington.
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Announcer: You’re listening to Our Town with Andy Ockershausen. Brought to you by Best Bark Communications.
Andy Ockershausen: This is Andy Ockershausen talking to Phil Hochberg about sports in Washington and his legal career, which is fabulous, but we started talking about the early days of cable television and Phil was obviously on the ground floor of working in these arrangements with pro sports teams and that led you to a huge career of advising the sports team.
Law Practice: Administrative Law, Regulations and Legislation| Senator Pastore and Anti-Blackout Legislation
Phil Hochberg: Yeah, it has gone beyond advising. In those days, Andy, the leagues and the clubs did not know anything about cable. And, you know, I was an expert. You know the definition of an expert is a guy from out of town with a briefcase. I had my briefcase and so I was considered an expert.
Andy Ockershausen: A fountain of information.
Phil Hochberg: Yeah. In the meantime, of course, the leagues and the clubs began developing their own expertise and so I kind of scaled back the kind of work that I was doing to a more typical Washington law practice, which is administrative law and regulations and legislation.
I was deeply involved on behalf of basketball and hockey when the anti-blackout law was passed in 1973…
Andy Ockershausen: By the congress.
Phil Hochberg: By congress. Yeah. The legislation as Senator Pastore originally introduced it would have made any league that broadcast on television subject to lifting blackouts. Well, I pointed out, this was before I represented the National Football League, I said, your principal concern is the blackouts that the Redskins are imposing here in Washington. Why don’t you just fashion the legislation to apply to leagues with network contracts and the NFL with its comprehensive network contract was completely different from hockey and basketball. I would like to think that that I was substantially responsible …
Andy Ockershausen: I would assume so. John Pastore, a powerful man.
Phil Hochberg: Indeed.
Andy Ockershausen: There was another congressman from there named Torbert Macdonald…
Phil Hochberg: Torby Macdonald.
Andy Ockershausen: Torby was involved in that and it was all because somebody in the Hill wanted to see the Redskins and they were blacked out.
Phil Hochberg: Right.
Andy Ockershausen: ’73 I remember it vividly, but that led you then to relationships with John Pastore, is a powerful man, but did that become a goal for the other leagues to try to ape the National Football League.
On Developing Legal Representation of Sports in Washington DC
Phil Hochberg: Yeah. In those days, the practice of representing sports interests in Washington really didn’t exist and I kind of fell into it and developed it. Over the years it has become, you know, a way of practice here in town. A lot of lawyers making a lot of money representing the professional and the collegiate interests.
Andy Ockershausen: Yeah. The NCAA is in that with both feet now. Correct?
Phil Hochberg: Yes, they are.
Andy Ockershausen: Well, once you got the things rolling and you got the individual teams having their own little networks and so forth, they really needed your expertise.
On Passage of Copyright Bill in 1976 | Tax Exemption for Priority Seating Plan Contribution to Colleges
Phil Hochberg: That is correct. They developed their own expertise and there wasn’t any need for an outside Washington lawyer. So for my own practice, I focused on regulations, FCC regulations, and and legislation. The passage of the copyright bill in 1976. In 1988 I represented the Division One A athletic directors in getting an exemption to allow them to write off… I don’t want to mischaracterize this. If you made a contribution for a priority seating plan, in 1986 congress had said these were completely taxable. You could not write anything off. In 1988 we got an exemption for the colleges, so that 80% of what you paid could be deducted as a business expense. That has now gone away with the 2017 tax legislation.
Andy Ockershausen: They changed it again. Well, how about the contributions like Clemson had that deal where you pay $10,000? That was their bid, wasn’t it? I pay 10 a year. Well now it’s $10,000 right? Is it deductible now?
Phil Hochberg: Well if in fact it is for college purposes, charitable purposes. Yes. If on the other hand you get the benefit of a priority seating plan, it’s not deductible. So what the colleges have done is to fashion plans where you can still get a …
Andy Ockershausen: Deduction.
Phil Hochberg: Right.
Andy Ockershausen: Well that is all big dollar now that the colleges are also into the big dollar world. And I want to talk to you about that Phil because you have seen it from the outside for 55 years. The whole world has changed when it comes to athletics and colleges. I mean what goes on now just boggles my mind. The money that comes in to the schools and the players get nothing. I don’t even think the coaches get it really, near enough.
On What College Coaches Get Paid Today
Phil Hochberg: Nick Saban at $9 million a year, he gets paid.
Andy Ockershausen: Oh my God.
Phil Hochberg: But yeah, I think likewise that you’d be surprised at the amounts that college coaches are getting paid. Assistant coaches as well as the head coach.
Andy Ockershausen: But it is all money from television revenue basically, not the ticket sale.
Major League Baseball Making More Money Than Ever Despite Attendance Losses
Phil Hochberg: Well, interestingly, Major League baseball is now suffering attendance losses over the past few years, but Major League baseball is making more money than it ever had because of the media rights and everything, Andy, everything has just changed so much. It is no longer just radio. It is no longer radio and television. It is not radio, television and cable. It is the Internet. It is the streaming services. It is just everything.
Andy Ockershausen: How could you keep up with this. You have been on the cutting edge for 55 years. What a change.
Phil Hochberg: Yeah.
Andy Ockershausen: I am going to talk to you about your work with athletes and your representation of celebrities and this is Our Town, a fascinating discussion with the Phil Hochberg who knows it from the inside. This is Andy Ockershausen. We will be right back.
Announcer: You’re listening to Our Town with Andy Ockershausen.
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Announcer: You’re listening to Our Town with Andy Ockershausen brought to you by Best Bark Communications.
Andy Ockershausen: This is Our Town. This is Andy Ockershausen and Phil Hochberg and I are having a wonderful conversation about sports and rights and what has happened to the dollar. It has exceeded any expectation of yours, I’m sure Phil.
Phil Hochberg: Yeah, yeah, yeah.
Andy Ockershausen: You had no idea it was going to be like this.
Phil Hochberg: Nobody did, nobody.
Andy Ockershausen: Well, Jack Kent Cooke thought so for a while.
Jack Kent Cook and LA Kings
Phil Hochberg: Mr. Cook, you know, was one of the original cable television owners in Canada. He moved the Kings to Los Angeles.
Andy Ockershausen: The hockey team.
Phil Hochberg: He created the Kings in Los Angeles, figuring that all of the relocated Canadians would come out to follow. Yeah. He found that the reason the team wasn’t successful is he found out they all hated hockey.
Andy Ockershausen: They found out after the fact, of course, but Phil, thinking about your relationship with Jack Kent Cooke and the Redskins, but you were the voice of the PA announcer of the Washington Redskins for so many, many, many, many years and all of us who were involved with you one way or another, you were part of WMAL even though you were not getting paid for that, but your voice was on air continually doing the PA of the game. That to you was a labor of love.
“Voice of the Redskins” for 37 Years – Some Benefits
Phil Hochberg: Oh, absolutely. Absolutely that.
Andy Ockershausen: I remember you had spotters. I remember the whole thing.
Phil Hochberg: Yeah. In 2001 the team decided they wanted to go in a different direction. You know that is the catch phrase.
Andy Ockershausen: Ninety-nine is when Mr. Cook bought the team. In 2001 they decided to do something…
Phil Hochberg: No in ’99 is when Snyder bought the team. Dan Snyder. Cooke died. Yeah.
Andy Ockershausen: So Dan Snyder wanted to go a different direction, whatever that means, but there was a lot of controversy about it, but it did not stop the ticket sales. People still showed up and the Redskins really were the losers because they lost that voice. And I think that was important to the fans. I mean it, we always brag.
Phil Hochberg: Andy, when somebody spends $800 million, which now is a token for a professional football franchise, but when somebody pays $800 million, you are allowed to do what he wants. While I would love to come back, that ain’t going to happen.
Andy Ockershausen: No, I know.
Phil Hochberg: They did put my name up in the stadium.
Andy Ockershausen: We were involved because we own the rights. We paid them money and we were tight with them and in our broadcast team had some notoriety and I loved your voice. I loved you being a part of it because we believe the Redskins were to us was so important because the town embraced them in a lot of different ways that doesn’t exist anymore. Maybe money has changed that.
Phil Hochberg: Well, also it is a function of baseball coming back. Baseball was gone from from 1971 till 2005. Hockey developed, college basketball, the success of Georgetown, the success of Maryland. And so the love, if you will, for the Redskins had some outside influences.
Andy Ockershausen: Absolutely.
Phil Hochberg: But they’re our team and …
Andy Ockershausen: Life goes on. I don’t know if you are still… you are probably not a season ticket holder anymore.
Phil Hochberg: I have a lifetime pass from the Redskins.
Andy Ockershausen: With a seat or just a pass?
Phil Hochberg: The press pass, but a lifetime pass.
Andy Ockershausen: Good for you. Can you see the difference in the size of the stadium? It opened up huge. It is becoming a much smaller venue and then I guess they figured out they can’t sell all the tickets. It is too much. It is more than competition. That’s too big.
Phil Hochberg: Laying aside the AT&T stadium in Texas. Okay. What has happened in professional sports is that they are narrowing the size of the stadium. Look at baseball, the…
Andy Ockershausen: You are right, I know that, what you are saying, 40,000 is a home run. Yeah. Yeah.
Phil Hochberg: 40,000 would be a huge crowd for baseball. It is a function, I think of the pressure that they want to bring on the ticket buyer that in football for example, if you have a stadium that seats 75, 80, 90,000 people, you don’t have to worry about buying a season ticket.
Andy Ockershausen: You will always be able to get in, yeah.
Phil Hochberg: If the stadium seats 60,000 and think of RFK, 55,000 seats and sell out and you could not get a ticket. I mean the tickets just were not available.
Andy Ockershausen: It is a big huge waiting list that does not exist anymore.
Phil Hochberg: Right.
Andy Ockershausen: I think the Ravens were planned right. They planned a stadium that was commensurate with their fan base. They did not try to do 100,000. They did about 62 I think, 65. Raven’s is a beautiful stadium. I am sure you have been there. It is very fan friendly, whatever that means. But I love the stadium. This other stadium is too big. Anyway, Phil, so you lost that opportunity to continue into the future, but you were with the Redskins when they were winning Super Bowls. In the years when the stadium rocked and this thing and doing your work, then you got into players or you were starting representing players. Did you not?
Phil Hochberg: I represented some of the 1965 Washington Senators, not in contract negotiations because in those days you went in and whatever the boss said you are going to make is what you got. I did some work for Epstein and Ken McMullen and outside interests. I got into a talent representation and my principal client now is a local broadcaster or sports broadcaster named Steve Buckhantz.
Andy Ockershausen: I am going to talk about that because the sports world has changed again in the nation’s capitol and we are going to come in and you have been there, you have seen it up and down, the good, the bad and the ugly. This is Andy Ockershausen. This is Our Town. We will be right back.
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Announcer: Our Town with Andy Ockershausen.
This is Andy Ockershausen. This is Our Town and Phil, do you represent some athletes in negotiation with teams and with communities, team and leagues?
Phil Hochberg: I am not in any contract negotiations. To the extent that they feel they have got a legal problem, I am happy to look over the contract, but to negotiate contracts, I am not going out there getting them.
Andy Ockershausen: You are not selling them.
Phil Hochberg: Right.
Andy Ockershausen: They come to you.
Phil Hochberg: Right.
Andy Ockershausen: And if they would like to have some legal advice and so forth. Some of the names that you’ve had are very important to the community, but only in this advisory capacity. Correct?
Phil Hochberg: Only as a counsel lawyer.
Andy Ockershausen: How did you do with hockey players? Did you have any?
Phil Hochberg: None. I have a problem, a potential problem that to the extent that any player wanted to retain me, I might have a conflict in terms of representing the leagues themselves.
Andy Ockershausen: I got you. Or the teams.
Phil Hochberg: Or the teams, right.
Andy Ockershausen: You can not be in the middle on that. Do you have any particular league’s that is better to do business with than others or…
Phil Hochberg: They are all wonderful, Andy. As long as they pay their bills.
Andy Ockershausen: And the percentages is good. So what do you foresee for the future of the whole idea that the sharing of dollars now, and I guess half NFL broke that thing. They get a percentage of the gate and they divide that up amongst the players. Are all sports doing that now?
Baseball’s Salary Cap and the “Luxury Tax”
Phil Hochberg: Basketball, hockey, football, all have similar approaches. Baseball does not. Baseball has attempted to limit players salaries. Perhaps that’s the wrong phrase to use, by adopting the luxury tax. In other words, do not pay the ballplayers more than $204 million. Otherwise it is going to cost you extra when you exceed that amount. And so that is a disincentive to raise players’ salaries.
Andy Ockershausen: But they all have a cap.
Phil Hochberg: Baseball does not. I mean baseball’s cap is the luxury tax. You are allowed to go over it. But if you do, you are going to get taxed.
Andy Ockershausen: It is a comparison. Maybe paying the tax is worth it to get the product.
Phil Hochberg: Perhaps. Perhaps.
Andy Ockershausen: And then they find that out down the road. I noticed that their Phillies or we were doing this broadcast before that, but the Phillies are in town with the $330 million star that left Washington. And there was no ceiling. It just boggles my mind. It is worse in basketball. But some of these guys got $30 million just to sign for one more year.
Phil Hochberg: Well it is like what you are making out of this show.
Andy Ockershausen: A fortune. Yeah. Ha. Ha. We can not pay the rent but the show has been great for us because we have had a chance to talk to people important in Our Town. You are one of the most important, believe it or not, Phil, you are well respected around, I know that well and around the leagues and you’ve lasted a long time and I hope you don’t back off, do you?
Phil Hochberg: I hope not.
Andy Ockershausen: Charlie and I are still going strong and always will be. You know, that’s the whole thing. And I serve with you on the board of … you are in so many groups with the hall of fame that we started several years ago and it’s been fun and recognize some people that have been forgotten, frankly, and putting them back up front. Phil, it has been a wonderful experience for me.
Phil Hochberg: I know you and Charlie were instrumental in creating that and I am delighted to be a part of it.
Andy Ockershausen: Well, because you bring a lot to the table. My memory, a memory, you know what we are talking about. And we go way back with that to again named Bob Sigholtz. He used to run the stadium, we started a hall of fame.
But Phil Hochberg, this has been a great conversation and thank you so much for sharing your thoughts with us. And I would hope that you remember that this is a podcast, not a broadcast, but we are all in this together and I am so happy for Our Town and so happy for you because you belong in Our Town.
As far as I am concerned, you are a Washingtonian and thank you for being you and I look forward to seeing you soon. And if we can help in any way, we will do it.
Phil Hochberg: Okay. Thank you.
Andy Ockershausen: This is Andy Ockershausen. This has been Our Town.
Announcer: You’ve been listening to Our Town, Season 5, a Hometown favorite with your host Andy Ockershausen. New Our Town episodes are released every Tuesday. Special thanks to Ken Hunter, our technical director, and to WMAL Radio in Washington DC. Follow Our Town on Instagram, Twitter and Facebook. If you haven’t yet, go to Apple Podcasts and subscribe and don’t forget to rate and review our podcast. Join us next Tuesday for another Our Town conversation. Thanks so much for listening.