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SBD/Issue 72/2005: Year In Review
Stories Of The Year
Published December 23, 2005
We continue our look back at the year in sports business. Here are the top-ten
stories of 2005.
1) DEALING WITH DISASTER: From the tsunami to HURRICANE
KATRINA, the supposed life and death struggles on our playing fields were
marginalized by the destructive power of Mother Nature, and sport was tested to
provide a positive rallying point to help communities rebuild. The business implications
of these disasters are clear, especially for the future of the NFL and NBA in
New Orleans, and the ripple effect a franchise free agency could have on open
markets and the footprint of both leagues. But more than rescheduling games and
renovating buildings, the natural disasters were a human crisis, where sports
was forced to evaluate where it fits, where it helps, where it leads. It tested
—- and will continue to test —- the leadership skills of many, specifically commissioners
PAUL TAGLIABUE and DAVID STERN, who will determine
what role their leagues will play in a rebuilt New Orleans.
2) NHL STANDS ITS GROUND: The NHL started the year by canceling its season and vowing not to back down from its demand for cost certainty in its next CBA. Commissioner GARY BETTMAN figured the union would crack, and he was right. By the summer, players were ready to end the 310-day lockout, and they handed the league an uncompromised victory. However, success will not be measured on paper, but on whether the league can use the new CBA to drive growth.
3) STEROIDS COMMAND THE HEADLINES: The use of steroids and
performance-enhancing drugs dominated the news cycle as Congress repeatedly called
league commissioners and labor leaders to Capitol Hill and questioned their testing
and discipline efforts. The debate led to public embarrassment for both MARK
MCGWIRE and RAFAEL PALMEIRO, as much of the discussion focused
on MLB. Congress sent a clear message: Toughen up your testing and rules
or we’ll do it for you. MLB heard the call, and finally got the MLBPA to
agree to adopt tougher penalties.
4) BIG PLANS FOR THE BIG APPLE: When N.Y. lost its Olympic bid in July, it also killed the Jets’ dream for a Manhattan stadium. But that was the only project not to make it past the planning stages this year. Plans moved forward on an unprecedented building boom -— a new home in Brooklyn for the Nets, on Long Island for the Islanders, in the Bronx for the Yankees, in Queens for the Mets, and nearby Newark for the Devils. After the failure to develop a West Side Stadium, the Jets then partnered with the Giants in what will be a first -— a jointly developed and operated two-team facility across the river at the Meadowlands.
5) NFL’S GAME PLAN PAYS OFF: Instead of sticking with tradition in its latest TV talks, the NFL moved the pieces around and carved out rights packages that will provide even greater riches. NBC signed a six-year, $600M annual deal for a Sunday night package, while ESPN will pay $1.1B annually for eight years for “MNF.” Still unknown is who will end up with a new Thursday/Saturday package being pitched by the league. Once that deal is cut, the league will move on to talks about its national Internet rights.
6) THREE STRIPES TAKES A VECTOR: In a deal that rocked the retail rack and posed a new threat to Nike, ADIDAS announced a $3.8B plan to acquire REEBOK. But more is at stake than what will be on the shelves at sporting goods stores. Reebok holds apparel deals with the NFL, NBA and NHL, and a footwear license with MLB. Those deals won’t automatically transfer to adidas. Instead, the company will have to negotiate new agreements with the leagues, something that could end up costing adidas millions. The leagues could even bring in a rival bidder such as Nike to drive prices up.
7) NATIONALS TAKE THE FIELD: MLB returned to the nation’s
capital for the first time since ’71, and by most measures the debut of the NATIONALS
was a success. TONY TAVARES oversaw a tremendous business transition to
get the team up and running at RFK Stadium; the team was in the mix for most of
the season; ticket sales hit 2.7 million, up from 749,000 the Expos in Montreal;
and corporate sponsorship sales were strong. But not all was smooth. The league
has had a contentious lease negotiation with the notoriously difficult DC Council,
and that has stalled MLB’s search for new ownership.
8) OLN MAKES A PLAY FOR SPORTS RIGHTS: Until this year, Outdoor Life Network was the place you’d go to learn the best way to bag a 10-point buck or hook a trophy bass. That was before Comcast decided to transform it into a national sports network, a destination that may some day challenge ESPN’s supremacy. The first step was a simple rebranding of OLN, and then landing rights to the NHL. But led by JEFF SHELL and GAVIN HARVEY, there is a bigger catch out there. OLN has been tracking a piece of the Thursday/Saturday package being shopped by the NFL. It’s clear that Shell and Co. have established OLN as a new player in the marketplace.
9) NO GAIN IN NFL LABOR TALKS: If you were looking for a scrap in previous
labor negotiations, the NFL was the last place you’d go. The current CBA
has been renewed four times since ‘94. Now, however, the relative harmony of past
talks has been replaced by early saber rattling. The league’s current labor deal
expires after the ‘07 season, so there’s still plenty of time to find common ground.
But the league and teams are far apart on how much money to share with players,
and how much to share with lower-revenue teams in smaller markets.
10) NBA DRESSES UP ITS IMAGE: The NBA made many changes leading up to, and as part of, its new CBA that ensure labor peace for another six seasons. But no provision was more reported on than a new dress code that struck at the heart of the image issues facing the league. The NBA essentially had three weeks of coverage solely on the way their players looked off the court, and the debate was tinged with calls of racism and stereotyping. On the court, the league began handing out fines to players who wore their shorts too long, which resulted in the players’ union questioning whether the league had gone too far.
Return to top
 |
| Hurricane Relief Story Dominates Sports World |
2) NHL STANDS ITS GROUND: The NHL started the year by canceling its season and vowing not to back down from its demand for cost certainty in its next CBA. Commissioner GARY BETTMAN figured the union would crack, and he was right. By the summer, players were ready to end the 310-day lockout, and they handed the league an uncompromised victory. However, success will not be measured on paper, but on whether the league can use the new CBA to drive growth.
 |
| Palmeiro’s Positive Steroid Test Casts Doubt On Career Accomplishments |
4) BIG PLANS FOR THE BIG APPLE: When N.Y. lost its Olympic bid in July, it also killed the Jets’ dream for a Manhattan stadium. But that was the only project not to make it past the planning stages this year. Plans moved forward on an unprecedented building boom -— a new home in Brooklyn for the Nets, on Long Island for the Islanders, in the Bronx for the Yankees, in Queens for the Mets, and nearby Newark for the Devils. After the failure to develop a West Side Stadium, the Jets then partnered with the Giants in what will be a first -— a jointly developed and operated two-team facility across the river at the Meadowlands.
5) NFL’S GAME PLAN PAYS OFF: Instead of sticking with tradition in its latest TV talks, the NFL moved the pieces around and carved out rights packages that will provide even greater riches. NBC signed a six-year, $600M annual deal for a Sunday night package, while ESPN will pay $1.1B annually for eight years for “MNF.” Still unknown is who will end up with a new Thursday/Saturday package being pitched by the league. Once that deal is cut, the league will move on to talks about its national Internet rights.
6) THREE STRIPES TAKES A VECTOR: In a deal that rocked the retail rack and posed a new threat to Nike, ADIDAS announced a $3.8B plan to acquire REEBOK. But more is at stake than what will be on the shelves at sporting goods stores. Reebok holds apparel deals with the NFL, NBA and NHL, and a footwear license with MLB. Those deals won’t automatically transfer to adidas. Instead, the company will have to negotiate new agreements with the leagues, something that could end up costing adidas millions. The leagues could even bring in a rival bidder such as Nike to drive prices up.
 |
| Baseball Returns To Nation’s Capital |
8) OLN MAKES A PLAY FOR SPORTS RIGHTS: Until this year, Outdoor Life Network was the place you’d go to learn the best way to bag a 10-point buck or hook a trophy bass. That was before Comcast decided to transform it into a national sports network, a destination that may some day challenge ESPN’s supremacy. The first step was a simple rebranding of OLN, and then landing rights to the NHL. But led by JEFF SHELL and GAVIN HARVEY, there is a bigger catch out there. OLN has been tracking a piece of the Thursday/Saturday package being shopped by the NFL. It’s clear that Shell and Co. have established OLN as a new player in the marketplace.
 |
| NBA Makes Waves With Implementation Of Dress Code |
10) NBA DRESSES UP ITS IMAGE: The NBA made many changes leading up to, and as part of, its new CBA that ensure labor peace for another six seasons. But no provision was more reported on than a new dress code that struck at the heart of the image issues facing the league. The NBA essentially had three weeks of coverage solely on the way their players looked off the court, and the debate was tinged with calls of racism and stereotyping. On the court, the league began handing out fines to players who wore their shorts too long, which resulted in the players’ union questioning whether the league had gone too far.
