George Steinbrenner created business model for team owners

To many team owners and sports executives outside of baseball, George Steinbrenner was more than the top man at the New York Yankees.

He was the quintessential New York model.

“He turned the Yankees into the New York Yankees Corporation,” said Eddie DeBartolo, a close friend of Steinbrenner’s and former owner of the San Francisco 49ers. “He put them in a place beyond anybody’s reachability. It transcended baseball.”

Steinbrenner, who died Tuesday of a heart attack, headed a small group of investors who bought the struggling Yankees from CBS in 1973 for roughly $10 million. The franchise is now worth an estimated $1.6 billion.

In 2001, Steinbrenner, along with Goldman Sachs, started the YES (Yankees Entertainment & Sports) Network, which now is said to be worth more than $3 billion.

Looking to capitalize on new revenue streams, Steinbrenner in 1997 struck an unprecedented 10-year, $95-million sponsorship deal with Adidas, which allowed the shoe and apparel company to advertise in highly visible areas of Yankee Stadium and link its name to that of the team. To protect the deal, Steinbrenner filed suit against each of the other 29 teams and MLB properties, challenging on antitrust grounds the longstanding agreement under which clubs equally share revenue from licensing and sponsorships. The maneuver worked and the case was settled out of court, to Steinbrenner’s advantage.

David Boies, Steinbrenner’s attorney, said the Adidas deal in particular blazed a trail for the rest of baseball to follow.

“That was a level of money that nobody was even thinking about in the mid-’90s,” Boies said. “I think it took the visibility of baseball merchandising and the money that could be garnered to another level. The order of magnitude changed.”

That type of entrepreneurial prowess made Steinbrenner a polarizing figure but also an enormously successful one, someone who spared no expense when it came to winning.

“From a person with my perspective, he was an inspiration in the area of doing everything possible — within the rules — to win,” Dallas Cowboys owner Jerry Jones said in an e-mailed statement.

“George redefined professional sports ownership with his vision, his ability to build a champion, and a passionate approach that lifted the visibility and popularity of his franchise and his sport.”

Said Paul Swangard, managing director of the Warsaw Sports Marketing Center at the University of Oregon: “Steinbrenner was ahead of his time in going into this league and finding a wonderfully undervalued asset and then taking it to where it is today. Now you have leagues filled with Steinbrenner-type owners and ownership groups, those who have strong goals to maximize their business.”

Just as Steinbrenner did with the Yankees, Jones has aggressively marketed the Cowboys, sometimes rankling his fellow NFL owners by cutting deals outside the structure of the league, most notably pacts with Pepsi and Nike. He also built the ailing Cowboys into one of the richest franchises in sports, and last season opened a $1.2-billion stadium, just as Steinbrenner was cutting the ribbon on his $1.5-billion Yankee Stadium.

The Cowboys and Yankees combined to form a catering company call Legends Hospitality that services both teams’ stadiums. It is designed to service other venues as well.

“I took pride in calling him a friend, an advisor, an inspiration and later a business partner,” Jones said.

“We have lost a true leader in sports, someone who not only saw the big picture but helped create the scene on the canvas.”

Because the NFL shares team revenue in a far more comprehensive way than MLB, Jones and his fellow owners could not go to the lengths Steinbrenner did to elevate his club above the others. But they have been creative in pushing that envelope whenever possible.

“In some ways, George Steinbrenner moved the needle,” said Robert Kraft, owner of the New England Patriots. “But he also crossed the border at times. There’s a fine line there.”

Kraft counted Steinbrenner as a friend and received a handwritten letter from the Yankees owner when the Patriots won their first of three Lombardi Trophies in early 2002.

“It was the nicest letter, praising us for the turnaround and making the right personnel decisions, even when they weren’t the most popular decisions at the time,” Kraft said.

“We both want to win. We do things different, stylistically, but the bottom line is we want winners running the show.”

Dallas Mavericks owner Mark Cuban has embraced Steinbrenner’s style, one that calls for spending as much as it takes to win, not shrinking from the spotlight, and taking an active — sometimes meddlesome — role in the day-to-day operation of the team.

“I’ve always been a huge fan of Mr. Steinbrenner,” Cuban wrote in an e-mail. “He lived to win and made no apologies for it. Even when he wasn’t so popular with fans and the league. I can’t help but admire him.”

Steinbrenner was widely known (and lampooned) for his quick temper, impulsive decisions and bullying style.

“He was popular in New York, but I don’t think he did as good a job in managing his image elsewhere,” said marketing professor George Belch of San Diego State’s sports MBA program. “He did what was best for the Yankees. Not what was best for Major League Baseball.”

Others saw a softer side of Steinbrenner.

“The image of him as a very demanding boss is a true image, but it’s only part of the story,” Boies said. “I saw a side of him that was very warm, a very loyal friend.”

Steinbrenner was born and raised in Cleveland, and he still has family there. Consequently, he would buy a luxury suite for Browns games each season for his relatives to use, always making sure it was stocked with food and drinks.

“We offered him a courtesy discount on the suite, but he never took it,” recalled Carmen Policy, former president and minority owner of the Browns. “He always treated it as if we were doing a favor for him, when he was the one paying for the suite.”

Policy, formerly the top executive for the 49ers, said there were clear parallels between the way Steinbrenner and DeBartolo ran their franchises. Steinbrenner was close friends with DeBartolo, and, for that matter, Raiders owner Al Davis.

“George Steinbrenner went after the best players, paid the best salaries, and expected people to win,” said DeBartolo, whose 49ers won five Super Bowls. “If you don’t model yourself after him, who the hell do you model yourself after?”

sam.farmer@latimes.com

david.wharton@latimes.com