Baseball Trading Card Monopolies: Brought to you by Topps

Posted on December 7th, 2009. Written by Emmett Jones.

Just a few weeks ago, I wrote about how Topps Inc. had been dropped by the NFLPA regarding football trading card licensing.  How does Topps bounce back?  By becoming the exclusive trading card licensor for Major League Baseball,

Major League Baseball this week announced an exclusive deal with Topps to produce baseball cards featuring minor league players, broadening a relationship that could bring some much-needed clarity to the collecting hobby.

The baseball card collecting hobby was once big business but has declined since the early 1990s in part because too many products were cluttering the marketplace. According to MLB, there were more than 90 baseball card products released in 2004, making it hard for collectors to keep track and impossible for retailers to keep up.

“You can’t collect stuff that never shows up on the shelf,” said Howard Smith, MLB’s senior vice president of licensing. “We were absolutely drowning the retailer, and we were killing ourselves.”

Smith said overall licensing revenue this year will be about flat because of the slow economy. But in the decade he has been with MLB, there has been year-over-year revenue growth in every licensing segment – except one.

“The only business that declined over the same period was trading cards,” he said. (via Tim Lemke @ Wash. Times)

Its no secret that the trading card market has struggled in recent years and MLB has decided that a return to simplistic roots is the right approach.  Of course, the exclusive deal with Topps insures that another long time baseball card creator, Upper Deck, is left out in the cold,

In an effort to reduce clutter in the marketplace, MLB cut its partnerships to two companies, Topps and Upper Deck, but the sales trends didn’t change, Smith said. Baseball eventually struck an exclusive deal with Topps after being swayed by Michael Eisner, the former Disney CEO who bought the card manufacturer in 2007.

One big downside to the deal is that Upper Deck, a company that has produced cards since 1988, now has no rights to use official team names and logos on their cards.

Of course, anytime consumers hear the word exclusivity, one of the first things they think about is a rise in prices.  Topps being the only creators of baseball cards meaning that Topps has autonomy to set prices as they please, due to their lack of competition.  Of course, when you’re in a market that has been ravaged like the baseball card trading market, I seriously doubt that Topps would have a strategy that would even remotely resemble price gouging.

At least, not until the market picks back up.

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