There hasn’t been much to like about Guaranteed Rate’s takeover of the naming rights for the former U.S. Cellular Field. It’s not like U.S. Cellular was a beloved local business, but changing corporate sponsors midstream reopened some old wounds for an equally ugly name, an uglier logo and enough jargon from both sides to chew through a Costco-sized pack of batteries for our BS detectors.
We’ve been receiving drips and drabs about why it made sense for the White Sox, even though Guaranteed Rate pretty much inherited the $20 million or so remaining on U.S. Cellular’s deal with no new money going to the club. U.S. Cellular no longer had customers in the Chicago market, which meant that the company had no greater need or desire to support the White Sox beyond the existing deal. Guaranteed Rate also bought the naming rights of the home plate club, which had gone unsponsored for the last three seasons, in a separate deal. The Illinois Sports Facilities Authority was taken off the hook for improvements over the last three years, giving the Sox incentive to negotiate a new stadium deal at the end of it.
Each of those aspects represents an improvement over the previous arrangement on the White Sox’ ledger, but it wasn’t the slam-dunk home run that made the Guaranteed Rate partnership more palatable or sensible to those who aren’t on the payroll.
Thanks to the Chicago Tribune, now we can fill in one key blank that changes the math more. Finally, it’s the mobile provider that finally has to pay out the nose for ending a contract early.
Chicago White Sox left fielder Melky Cabrera made $14 million this past season.
That's also about what it cost U.S. Cellular to drop its name from the home of the Sox, the wireless company said Friday.
The Chicago-based company said its third-quarter earnings were dinged — to the tune of $13 million — as a result of expenses from ending its naming rights agreement early.
So we can match it up against the originally reported terms and missing variables:
The documents say U.S. Cellular will pay a portion of the $20.4 million still owed on the company's 2003 agreement, but the amount is not stated. Without that figure, it is impossible to tell how much Guaranteed Rate actually will pay to hang its name on the publicly owned stadium.
The authority considers those details to be confidential to the White Sox and its partners, said Anthony J. O'Neill, the agency's general counsel.
U.S. Cellular bought the naming rights for what had been the new Comiskey Park for $68 million in a deal that ran through 2028. The annual value of that 26-year deal was $2.6 million, though the payments were condensed into 20 annual installments of $3.4 million ending after 2022.
The new deal lasts for 13 years with an average annual value of $1.9 million, but the structure of the payments has not been disclosed.
The portion is nearly two-thirds of the remaining figure, so perhaps simple subtraction tells us what Guaranteed Rate has to pay, or maybe there’s some overlap (the structure of the payments would help here). We also still don’t know how it will affect the experience of the average ticketholder, but White Sox fans did see — and still get to enjoy — the fruits of the first naming-rights deal, and perhaps the upfront chunk of change alters the immediate math some. If Guaranteed Rate wants to cozy up to White Sox fans, it should wait for an opportunity to slap its branding on something like a James Shields DFA.
(The conclusion of this post has been reworked after finding the detailed account of the original terms.)