SBD/November 21, 2011/Leagues and Governing Bodies

Despite League Attendance Increase, Very Few MLS Teams Will Make A Profit In '11

Galaxy paid Keane, Donovan and Beckham over $12M a year combined
MLS Commissioner Don Garber said the '11 season "without doubt ... has been the best year in the history of the league," according to Kevin Baxter of the L.A. TIMES. League-wide attendance “is up 7% to 17,872 per game, better than last season's NBA and NHL averages, and leaving MLS behind only" the NFL and MLB among U.S.-based pro leagues. Nearly one-third of MLS' regular-season matches “sold out this season.” Expansion fees “have increased fourfold since 2007, to $40 million, and will go up again before the league adds a 20th franchise, perhaps as early as 2013.” By the end of next season, 15 of the league's 19 teams "will play in soccer-specific stadiums.” FC Dallas and Crew Owner Clark Hunt: “We've really become a nation that loves the sport of soccer." But Baxter reported despite the high attendance and with revenue “at an all-time high, fewer than one-third of the league's teams will make a profit this season.” Even the Galaxy, “with an estimated value of more than $100 million, will finish in the red after paying more than $12 million in salary to three designated players,” MF David Beckham and Fs Landon Donovan and Robbie Keane. Hunt said, "Major League Soccer is a business. And at the end of the day, profitability is one way the main business is measured. I would just say the needle is pointed in the right direction.” Baxter noted there are “still other choppy waters left to navigate.” DC United, one of the league's original members, “has been unable to secure funding for a new stadium or for needed upgrades at its current home, the deteriorating RFK Stadium, and may be forced to move.” A long-planned expansion that would put “a second team in the New York market, has repeatedly hit snags.” And though Garber “prefers to sing the praises of the league's success stories in Portland, Seattle, Vancouver and Philadelphia, four teams -- including winning franchises in Columbus and Dallas -- are drawing fewer than 14,000 fans a game.” Garber said the league is "trying to do everything we can to be profitable in every market." Garber: "But in some cases, owners have decided to make strategic investments which have affected their profitability. And that's required in any emerging sports league" (L.A. TIMES, 11/19).

SIGNS OF PROGRESS: The AP’s Greg Beacham noted MLS’ TV ratings “rose on each of its platforms this season.” MLS will “appear on the new NBC Sports network next year in a lucrative deal, and the Galaxy announced a reported 10-year, $55 million deal with Time Warner Cable Sports’ new network on Friday -- a tenfold increase on its last deal.” Merchandise sales “also are up, driven by the new layer of star players and MLS’ attention to eye-catching design with an international flair” (AP, 11/18). Garber in a Q&A with SI’s Grant Wahl said, “2011 was arguably the best year in the history of the league on all measures: the respect for the league here and abroad, our attendance and TV ratings, our new deal with NBC, a continually improving quality of play, massive popularity in the expansion markets. It's been a very good year.” On FIFA's new English-language rights deal with Fox for the World Cup, Garber said, “It's the beginning of a new era for soccer programming in the United States. Think of the possibilities for how many more shoulder programs we can have and lifestyle programs and MLS behind the scenes and studio shows and highlight shows.” Wahl noted there have been reports that Garber is “about to sell 25 percent of SUM for up to $150 million to Providence Equity Partners” and asks, “What are the chances of that happening -- and that the money could go back into investing in players?” Garber: “We've never confirmed or denied that. But the fact there have been rumors of a private equity firm investing in SUM speaks to the increased value of soccer in North America. And should something like that happen, the distribution would certainly be used to help grow the game. Shortly we'll be able to comment on it more publicly.” On the possibility of a second team in N.Y. Garber said, “We remain focused on having the 20th MLS team in New York. We've got a full-time staff working on stadium projects. We've hired a number of consultants to help us with land-use issues and fast-tracking the process so we can get it done as soon as possible. We believe we have a number of sites that are viable, but it's perhaps the most difficult market in the world to develop a 13-acre sports project. The issue for us won't be finding a good owner. The issue is whether we'll have a stadium site that will work and provide the environment our fans have come to expect in the stadiums we have across MLS” (SI.com, 11/18).

TIME TO MAKE SOME CHANGES: THE SPORTS NETWORK reported MLS officials yesterday “announced changes to next season's competition format … ahead of the MLS Cup final, including rewarding the best finalist with home field advantage in the 2012 MLS Cup.” The league also announced the playoffs “will again include 10 teams, only next season, five teams from each conference will be guaranteed to advance.” This year, five teams from each conference qualified, “but only the top three automatically.” The fourth- and fifth-place finishers “will play a single knockout match in the first round, but the conference semifinals and conference finals will both be two-game, aggregate-goal series.” The Montreal Impact, “who join MLS in 2012 as an expansion team, will play in the Eastern Conference, which will have 10 teams next year while the West will have the same nine.” The league will “use an unbalanced schedule that will see Western teams play 24 games against their own conference” and Eastern teams “will play 25 games against opponents from their division” (THE SPORTS NETWORK, 11/20).

Championship puts exclamation mark on
Beckham's five years in MLS

HE CAME, HE SAW, HE CONQUERED: The L.A. TIMES’ Baxter writes the Galaxy’s 1-0 MLS Cup win Sunday “may have been most important for Beckham, who needed a title to add an exclamation point to his controversial and transformative five years in MLS, ones in which he brought the Galaxy unprecedented levels of credibility and cash yet couldn’t bring them a title.” Now “he’s a triple-crown winner, with his MLS championship joining ones won” with EPL club Manchester United and La Liga club Real Madrid (L.A. TIMES, 11/21). Baxter also wrote Beckham “has raised MLS’ profile, tripled the Galaxy’s annual revenue and made the league a destination for other international stars.” Garber said, “At some point all players retire and leagues and clubs move on. I don’t think any league or any club can rely too much on one player. I think we’re well past that.” The Galaxy’s potential offer to Beckham is “said to include a sabbatical that would allow Beckham to play for England in the London Olympics next summer as well as an option to own an MLS franchise when he quits playing” (L.A. TIMES, 11/21). In N.Y., John Godfrey wrote “as for his future soccer plans, Beckham has been somewhat cagey, although being part of Britain’s team in the 2012 Summer Olympics is clearly on his mind.” There has been “speculation that Beckham could go home to play next season for Tottenham in the Premier League or to France to play for Paris St.-Germaine in Ligue 1” (N.Y. TIMES, 11/20). Former MLS player and Fox Soccer’s Cobi Jones said, “I think he wanted to expand the game, be an ambassador. Not just for American soccer, but for the game as a whole. To spread it in the United States, one of the final frontiers in the sport, was an ultimate challenge and goal for him.” Jones added, “You have to admit, he’s done a great job of it because people talk about the game in this country all the time now” (ESPNLA.com, 11/18).

VICTORY IS SWEET: In L.A., Bill Plaschke writes of last night’s win, it “wasn't Staples Center, these weren't the Lakers, but the energy, angst and eventual joy shared by a part of this community that is bigger than you think was just as real.” AEG Chair Phil Anschutz “has taken huge heat here for being a lousy sports owner." This championship makes one “think perhaps he is tired of running teams like a real estate salesman, perhaps he is finally getting serious about winning, an important hint considering this is the man who might eventually be the majority owner of the Lakers one day.” AEG President & CEO Tim Leiweke said, "When we built (the Home Depot Center) nobody said it would work, nobody thought the league would last, nobody thought anybody would come. This makes me happiest of all the things we've been involved in because we had to work the hardest" (L.A. TIMES, 11/21).

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