SBD/December 21, 2011/2011 Year in Review

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  • The Sports Business Year That Was: A Look Back At '11

    THE DAILY continues our look back at the sports business year of '11. Today, we offer the remaining top stories of the year and five more names that were in the headlines. Also, we present some welcome additions to the sports world and some of the more forgettable moments of the year. We conclude our annual review of the best quotes of the year, and we recount some of the deals that did not come to fruition.

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  • SBD/SBJ's Top Sports Business Stories Of The Year, Part Two

    The SBD/SBJ editorial staff compiled the top sports business stories of '11, in no particular order. Today, we present five of them. See Tuesday's issue for five other top stories.

    The NFL in September announced a $1.8B
    per year deal with ESPN starting in '14

    NFL HITS MEDIA JACKPOT: The NFL revenue machine just keeps on growing. After announcing an eye-popping $1.8B per year deal with ESPN in September, the league neared deals with CBS, Fox and NBC that will see each broadcaster renew its NFL package for at least an average of $1B per year -- an across-the-board increase of more than 60%. Look next for the NFL to carve out another Thursday night package to sell. Thanks to the latest deals, the NFL will wind up generating close to $7B annually in national media revenue starting in ‘14, representing an amazing $220M payout per team.

    NBC GOES ALL IN WITH OLYMPICS: The IOC spent almost three years courting networks to bid on its U.S. television rights. Its decision to postpone the process until ‘11 because of the economy turned out to be a boon for the organization. Just weeks after losing its top exec and Olympic champion, Dick Ebersol, NBC bid $4.4B for the rights through ‘20, blowing away its competitors by more than $800M. The deal gives the IOC financial security for the next decade, and NBC the continuity of keeping the Olympic rings tied to the Peacock. Now, can NBC make its massive bet pay off?

    TIME WARNER CABLE PLANTS A MAJOR STAKE IN SPORTS: When Time Warner Cable picked off the rights to the Lakers early this year, the cable operator sent a message to every sports right holder in a TWC territory: The company is open for business. Under the direction of Melinda Witmer, the company launched a Time Warner Cable Sports division with high-profile executives David Rone, Mark Shuken and Dan Finnerty. There is no doubt that the company has a seat at the table. It has been monitoring the Dodgers bankruptcy, talking about buying Cleveland RSN SportsTime Ohio and helping to launch the Pac-12’s suite of seven channels.

    UFC on Fox financial package reportedly worth
    average of $90M a year for seven years

    UFC FIGHTS TO THE FOREFRONT: The day before a blockbuster event that drew 55,724 fans to Rogers Centre in Toronto in April, UFC President Dana White sounded like Nostradamus. “By the end of this year we’ll do something even bigger,” White said cryptically. “We’re going to blow you away.” Six months later, “UFC on Fox” promos aired prominently during World Series telecasts and on NFL Sundays, hailing a watershed for the hot property. The network’s financial package, which sources placed at an average of $90M a year for seven years, more than doubled the reported $35M a year that the UFC had received from incumbent Spike. Fox’ proven ability to take a fringe sport and expose it to the mainstream was attractive to the UFC, which still sees itself as a property in the early stages of growth.

    FARMERS FIELD TAKES ROOT: AEG’s proposed football stadium in downtown L.A., despite being anything but a definite, pulled off a 30-year, $600M naming-rights deal with Farmers Insurance. Farmers Field still awaits a final funding plan, all the necessary government approvals and, not the least of all, an NFL tenant. But the deal helped reinvigorate a naming-rights market that later in the year saw MetLife align with New Meadowlands Stadium.

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  • People Who Made Sports Business Headlines In 2011, Part Two

    Many brands, execs and ideas caught our eye in ’11. Here are five that, for better or worse, made an impression this year. See Tuesday's issue for five more newsmakers from this year.

    METS OWNER FRED WILPON: Wilpon’s Bernie Madoff hangover continues. Wilpon won a legal victory reducing his potential liability from other Madoff victims, but a promising equity deal with hedge fund manager David Einhorn fell apart. Still strapped for cash, Wilpon at once faces declining attendance at Citi Field amid diminished on-field hopes, he has had to decrease ticket prices for the third straight year, and just saw perhaps his best player sign with rival Miami.

    DEWEY & LEBOEUF GLOBAL LITIGATION CHAIR JEFFREY KESSLER: Kessler was a controversial voice of the players in the NFL and NBA labor talks, serving as outside counsel. As a young lawyer, he pioneered the strategy of unions decertifying in order to gain access to antitrust laws as a weapon during labor disputes. That strategy largely played out again with this year’s NFL and NBA talks, and helped push negotiations toward a resolution.

    INTERNATIONAL SPORTS MANAGEMENT AGENT CHUBBY CHANDLER: The engaging and outspoken agent had a roller-coaster year that saw him develop perhaps the deepest roster of global stars and become the talk of golf. Through his ties on the European Tour, Chandler has built a roster that includes Darren Clarke, Charl Schwartzel, Louis Oosthuizen and Lee Westwood. But the usually chipper ISM leader was stung when Rory McIlroy dropped him in October.

    ACC COMMISSIONER JOHN SWOFFORD: Swofford pulled off the surprise of the year when he lured Syracuse and Pittsburgh, two flagship schools, out of the Big East. At a time when expansion was in season and the ACC might have appeared vulnerable to the SEC, Swofford went on the offensive and secured a 14-school roster that solidified the conference’s future and enabled it to go back to the negotiating table with ESPN.

    WARRIORS PRESIDENT & COO RICK WELTS: In May, respected industry veteran Rick Welts grabbed the national spotlight by becoming the first high-profile sports exec to announce he is gay. Later in the year, Welts made more news by leaving his job as president of the Suns and accepting a similar post with the Warriors, saying he wanted to align his personal and professional life. He now looks to create strong business results in a market with great upside.

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  • Welcome Aboard: New Additions To The Sports Business Landscape This Year

    This year saw many new additions to the scene, whether it be expansion teams, inaugural events or stars looking for a change of scenery. Here are a few of the new kids on the block that caught our attention.

    KICKING THINGS OFF: The MLS Timbers became the hottest ticket in Portland, selling out all 17 home games. The expansion team brought the league a great amount of buzz, creating the latest iteration of the Cascadia Cup with the Whitecaps and Sounders and one of the loudest venues in the league. The team currently boasts a season-ticket waiting list of more than 5,000 fans. Not bad for a rookie.

    JET PROPELLED: Winnipeg’s NHL rebirth came in June when fans bought 13,000 season tickets following the announcement of the sale of the Thrashers to True North Sports & Entertainment. Jets fans enthusiastically chanted Gary Bettman’s name upon return to the ice and bought up the team’s new colors and military-inspired logo gear. The city is so wrapped in Jets fever even other entertainment venues noticed a decrease in sales.

    CRABCAKES AND CARBORATORS: IndyCar hit the Inner Harbor Labor Day weekend with the inaugural running of the Baltimore Grand Prix, and while the series had high hopes for the event, the results exceeded their expectations. An estimated 150,000 people attended the three-day event, and driver Tony Kanaan said, "I've never been to a place for the first time that was this crowded and the fans were passionate." The series immediately signaled its desire to return next Labor Day, though event organizers currently face large debt.

    MetLife paying as much as $20M a year to
    put name on New Meadowlands Stadium

    JERSEY SCORE: MetLife picked up one of the highest-profile naming-rights deals in U.S. sports, as it put its name on New Meadowlands Stadium. The deal is for as much as $20M a year, no small change but a drop from the $30M some analysts projected the stadium would command when it opened in ’10. MetLife admitted one of the reasons it pursued the deal was for the media exposure leading up to the ’14 Super Bowl.

    PRINCE ALBERT: The Angels showed the nation how the west hopefully will be won and shocked the baseball world by signing Albert Pujols to the second-largest contract in MLB history. The deal is expected to bring needed exposure to the team through a boost in ticket sales and an expected bump in merchandise sales. Pujols also is the largest pawn yet in the Angels’ quest to take advantage of the Dodgers’ struggles and gain market share in L.A.

    BREAK ON THROUGH: It took a long time for the Ontario government to finalize MMA legislation, but UFC’s debut foray into the province was nothing short of spectacular. More than 55,000 fans flooded Rogers Centre for UFC 129 in April, bringing in a record gate of C$11.5M. The event was so successful that UFC made a return visit in December, drawing 18,000 fans to Air Canada Centre.

    THE VOICE: Former Red Sox manager Terry Francona entered the Fox booth during the ALCS having broadcast just one game in his career, but his two-game stint as a pinch hitter for Tim McCarver resulted in a slew of positive reviews. Words like “sharp,” “relaxed,” “a great listen” and “terrific” rolled in from all corners. Francona will have a regular spot on the dial next year, serving as an analyst on ESPN’s “Sunday Night Baseball.”

    KANSAS CITY, HERE WE COME: Livestrong Park, MLS Sporting KC’s new home, has been hailed for its focus on technology with QR codes on the seat backs and Cisco’s new wireless Internet access system. The soccer-specific stadium served as a launch pad for the U.S. women’s national team’s post-World Cup tour and next year will host U.S. Olympic qualifying tournaments for both CONCACAF and the U.S. Soccer Federation prior to the London Games.

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  • Maybe Next Time: Deals That Did Not Get Done During '11

    Every year, there are many prospective deals that sound great at the outset, but fall apart before completion. Here are a few of those would-be deals that stood out in '11.

    Meruelo reportedly refused to meet economic
    conditions placed on deal by the NBA

    KINGS WITHOUT A CASTLE: All signs pointed to the NBA Kings relocating to Anaheim earlier this year after failing to come to terms on a new arena in Sacramento. Ducks Owner Henry Samueli made a strong push and offered lucrative incentives to lure the team to Honda Center. But following relentless lobbying from Sacramento Mayor Kevin Johnson, and perhaps a nudge from Commissioner David Stern, the Maloofs decided to give it one more shot in Sacramento.

    DEAL GOES SOUTH: Atlanta Spirit indefinitely pulled the Hawks off the market after an agreement with Alex Meruelo fell apart. Both sides agreed to walk away after the L.A. businessman reportedly refused to meet economic conditions placed on the deal by the NBA. Without any serious bidders lined up, the Hawks again enter the ’11-12 season facing ownership uncertainty.

    MISSING THE GREEN: The LPGA’s annual stop in Springfield, Ill., came to an end after tournament organizers failed to find suitable corporate backing. But it was not for lack of trying. Officials spent about 10 months looking for a replacement for State Farm, which ended its 19-year association with the tournament last June. They floated the idea of bringing on a consortium of sponsors to make up for State Farm’s absence, but ultimately the tough economy proved to be too much.

    LEAVING LAS VEGAS: The Izod IndyCar Series will bypass Las Vegas Motor Speedway next year after this season’s finale ended in the tragic death of Dan Wheldon. Track owner SMI agreed to a buyout for the ’12 season, and the final year of the three-year deal is expected to be reviewed later.

    Red Bull ended its backing of its two-car team
    piloted last season by Kahne and Vickers

    RUNNING ON LOW: Red Bull bowed out of team ownership in the NASCAR Sprint Cup Series, ending its backing of its two-car team piloted last season by Kasey Kahne and Brian Vickers. Red Bull started the operation in ’07 and found little success on the track before pulling the plug. The energy drink maker decided it was not getting enough bang for its buck, admitting it struggled to reach the coveted young demo through its stock car racing efforts.

    BLOCKBUSTER NIGHT: NBA Commissioner David Stern stepped in and nixed a potential blockbuster trade that would have sent Chris Paul from the league-owned Hornets to the Lakers. There was immediate outrage from media pundits and players, claiming Stern had overstepped his authority. Paul eventually landed with the Clippers, but not before Stern created an “appearance of impropriety.”

    STOP THE VIOLENCE: The Raiders and 49ers put a stop to their annual preseason game after violence erupted during this season’s exhibition tilt at Candlestick Park. Local police supported the move in the aftermath of a chaotic scene that included two fans being shot, 12 arrested and dozens more ejected from the stadium. The incident also further complicated the possibility of the two rivals sharing a new Bay Area stadium in the future.

    FIGHT FOR YOUR RIGHT: Fight fans are still waiting for the world’s best pound-for-pound boxers to square off against each other in the ring. Manny Pacquiao and Floyd Mayweather Jr. had plenty of box office hits this year, but an agreement on a mega-fight that is sure to break PPV records remains elusive. For a sport still struggling to regain its stature in America’s sports landscape, nothing would move the needle like a showdown between Pacquiao and Mayweather.

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  • They Did What?!? The Moments Of The Year That Made Us Shake Our Heads

    No year is complete without a few scenarios occurring that people would like to have back. Here are a few of the things that made us say, "Really?"

    Rodriguez sponsored Vita Coco despite being
    major investor in rival company Zico

    E-5: Coconut water brand Vita Coca in June announced it signed Yankees 3B Alex Rodriguez to an endorsement deal. Harmless enough, right? Sure, unless you’re a major investor in Vita Coco’s rival, Zico. A-Rod’s business manager was quick to say his client only endorsed Vita Coco after Zico began making its product from concentrate. But here is the kicker: Zico has footage of Rodriguez drinking the product from concentrate -- and endorsing it.

    HAMMERIN’ HANK: Hank Williams Jr. had become a fixture on “MNF” after singing the opening theme song for more than two decades, but that came to a screeching halt after he compared President Obama to Adolf Hitler. The ensuing firestorm caused ESPN to quickly drop the singer for his mindless comments. ESPN’s Dan Le Batard summed it up best by saying, “A friendly piece of advice I think we should all know by now. … Stay away from the Hitler stuff.”

    UNLUCKY IN KENTUCKY: Despite the hype and ticket sales leading up to Kentucky Speedway’s inaugural NASCAR Sprint Cup race in July, the actual event was less-than-ideal and left countless fans sitting in traffic instead of watching the race. Even more inexplicable than the traffic itself was the three-day delay between the disastrous event and the apology issued by Kentucky Speedway officials. “I’m sorry” will not fix infrastructural issues, but it is definitely a must during any PR nightmare.

    MARKETPLACE OF IDEAS: Steelers RB Rashard Mendenhall got himself in some hot water after he tweeted his unpopular opinion regarding Americans’ jubilation in the wake of Osama bin Laden’s death. Mendenhall backtracked quickly -- but not before endorser Champion cut him loose, refusing to honor the remainder of his endorsement deal. It remains to be seen whether Mendenhall will have the last laugh -- he is suing Hanesbrands for the remaining $1M owed to him under the deal.

    KIDS, COVER YOUR EYES: The NLL Boston Blazers’ halftime show during a January game at TD Garden featured scantily clad dancers competing to see who could give the team’s mascot, Scorch, the best lap dance. The racy stunt made the rounds on YouTube and outraged many fans, forcing the team to issue an apology.

    THIS SEAT TAKEN? Four hundred fans were left without seats for Super Bowl XLV at Cowboys Stadium after temporary seating areas were not completed in time for the big game. The NFL offered every form of compensation it could think of -- free tickets, complimentary travel, attendance at a Super Bowl of choice -- but it still was not enough for some fans. The ticket fiasco capped off a less-than-memorable week in Big D, as a freak ice storm paralyzed much of the area.

    Kurt Busch (l) was dropped by Penske, while
    Kyle's sponsors suspended his final two races

    BAD BOYS, BAD BOYS: The Busch brothers continued to make headlines in ’11, but for all the wrong reasons. Kyle Busch’s road rage during a Camping World Truck Series race ultimately led sponsor Z-Line Designs to ask Joe Gibbs Racing to replace Busch for the Nationwide Series finale. Sprint Cup sponsor M&Ms followed suit, putting Busch in the pits for the final two races of the year. Meanwhile, brother Kurt’s expletive-riddled outburst against a pit road reporter in Homestead was enough for Penske Racing to drop the driver.

    HIT THE ROAD, JACK: Women’s soccer got a big boost this year with the U.S. national team’s run to the World Cup finals. But magicJack Owner Dan Borislow successfully ruined the fun when he got his team terminated by WPS. After much bickering with the foul-mouthed owner, WPS finally decided it could not take it anymore and sent Borislow packing.

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  • Words To Live By: Quotes Of The Year, Part Two

    "The real baseball fans have been sitting at home, cussing out their TV, cussing out the Pirates. Now, they don’t feel embarrassed. They can come out to our games."
    -- Pirates P Joel Hanrahan, on the team holding the second-largest attendance increase in the NL through the middle of July.

    "If Nike, which has built its entire golf division around him and his brand, walks away from him, that's rock bottom."
    -- Golf Channel's Gary Williams, on whether Tiger Woods' marketability can get any lower after losing his deal with Tag Heuer.

    "I had two problems. I had a partner that went bananas and the second problem is that the economy kicked us in the balls."
    -- Former Lightning co-Owner Oren Koules, on his tenure with the club from '08-10.

    "We really have no one in charge, by the way. Anybody who thinks the NCAA is in charge has got their head in the sand.
    -- Former Big East Commissioner Mike Tranghese, on the current leadership void in college athletics.

    "You can get two sources to say the moon is made out of green cheese."
    -- Orioles President of Baseball Operations Andy MacPhail, on a USA Today story citing two sources as saying that MacPhail plans to leave the organization after his contract expires Oct. 31.

    "Maybe I’ll call Stephen Colbert and see if he’s ready to pick up another sport.
    -- USA Team Handball GM Steve Pastorino, jokingly referring to Colbert's financial support of U.S. Speedskating.

    "It’s a five-letter word: S-T-R-I-K-E."
    -- Fox' Tim McCarver, following Rangers 2B Esteban German striking out during the seventh inning of Game One of the World Series.

    "I should probably have another press conference right now to resign. Because my popularity is definitely going to be at an all-time high right now."
    -- Cubs President of Baseball Operations Theo Epstein, at his introductory press conference.

    "If you’re watching this right now and you’re really hammered on your couch saying, ‘Wait a minute, wow, wow! Wait a minute’ -- these highlights are a year old."
    -- ESPN's Scott Van Pelt, while highlights from the '10-11 NBA opening night aired.

    Usually we sit in a room, watching the ticker on the bottom of the TV, watching the big names going here and signing there. Now we look at the ticker and it’s our name we’re seeing.
    -- Marlins Special Assistant to the President Jeff Conine, on the team’s activity during the MLB Winter Meetings.

    When we have disagreements, we just think about the money and we feel better.
    -- Stanford AD Bob Bowlsby, on the Pac-12 pooling and sharing media rights among all member schools.

    You’re fighting a bully, man. David Stern’s a bully. You can’t really go up against him, man.
    -- Nets G Deron Williams, on the NBA Commissioner vetoing the trade that would send Hornets G Chris Paul to the Lakers.

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  • NBA, NFL Lead U.S Leagues On Twitter, Facebook; Lakers, Celtics Rank As Top Teams

    The NBA and NFL are the top U.S. sports leagues in terms of social media followers (Facebook + Twitter) as '11 comes to a close, while the Lakers, Celtics and Yankees top the list of teams. Compared to April '11, MLS saw the biggest gains among the major pro leagues, up 74.9%. In terms of percentage gains for clubs since April, the NBA-champion Mavericks and Hornets saw the biggest gains, up well over 300% during that period. Listed below are the top five teams ranked by number of social media followers through Dec. 13, along with figures for respective leagues (THE DAILY).

    % CHANGE
    Red Sox
    Red Wings
    Red Bulls


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