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Volume 24 No. 112

Leagues and Governing Bodies

With the MLS Cup slated for Saturday, Commissioner Don Garber sat down with's Grant Wahl for a Q&A on the state of the league. Below is an excerpt from their conversation.

Q: What is the status of potential bidders for that expansion team in N.Y.?
Garber: We continue to reach out to the investment community to try to seek somebody who has the capacity to both buy the MLS expansion team and invest hundreds of millions of dollars in the stadium.

Q: Do you foresee yourself signing another contract as commissioner?
Garber: I don't think my work is done. But this has been an enormously difficult and taxing job. ... In the early days we were so focused on ensuring our viability, you almost felt like a fireman running from brushfire to brushfire and didn't have an opportunity to really think about a mid-term plan, let alone a long-term plan. Now we've put a number of things in place that gives us the opportunity to take a step back. ... We'll be launching soon on our rebranding of the league and tapping into the real supporters culture that exists. We are running full speed ahead at SUM with a private equity partner in Providence who's giving us a whole new level of strategic thinking and opportunity, particularly in the media space. The ownership group continues to expand and the new guys coming in have the same passion that the founders have and in many ways a renewed energy that's very empowering.

Q: Do you eventually want to be an owner or investor in this league?
Garber: No. I am an operator. I don't have the financial capacity to be an owner (laughs), and I think I am far more effective trying to think about how do we take this league to the next level?

Q: How do you get TV ratings higher?
Garber: I don't think there's a single answer to that. ... We feel good about our ratings on ESPN and NBC, two great partners who are producing our games at the same level of quality that they produce the NFL or any other program. ... We need to grow scale. We need to get more people to pay attention to our league nationally. ... We'll have multiple bidders on our TV rights when they come up in 2014, and end up with great partnerships with broadcasters who are getting more and more committed to the game.

Q: When does MLS start using goal-line technology?
Garber: I see no reason why we wouldn't continue to look at goal-line technology and find ways if it's affordable to utilize it within the league. At a half-million dollars a system for the handful of times it would be utilized, it's hard to imagine that's a good investment rather than perhaps putting money into other things that might truly improve the quality of our play. ... I would say if I were king (of world soccer) I would be an advocate for instant replay (, 11/29).

TAKING STOCK IN SEATTLE: In Seattle, Joshua Mayers, in regard to the Sounders, wondered, "Does the league's highest attendance produce the league's highest ticket revenue?" Sounders GM Adrian Hanauer said that "as far as he knows, the answer is yes -- though Toronto FC has been close due to higher average ticket prices." Hanauer: "We are certainly near the ... in the top third of franchises in terms of total revenue. I'm not going into details. ... We have had a solid business, but it's not like [Owner Joe Roth] or I are changing our lifestyles based on the cash that this business generates" (, 11/29).

While MLS Galaxy MF David Beckham's impending retirement from the league "doesn't shake the landscape like Kobe Bryant walking away from the Los Angeles Lakers, he has made a significant impact on the state of soccer in the USA in his six years since coming over from his native England," according to David Leon Moore of USA TODAY. And six years on, "all parties are happy with the results." Galaxy coach Bruce Arena said, "He's a player who will be unmatched for many years in this league" (USA TODAY, 11/30). Beckham said of his time spent in the league, "It's been great. It's been a challenge in the first couple of years, but a challenge I knew that I was going to be up against and a challenge I knew I was going to succeed in. Winning the championship last year was for me the icing on the cake on the field." He added, "Off the field, we've done a lot of hard work. Not just myself but the people around the league, the owners around the league, the commissioner, the work that's been done, the academies that have been set up in every MLS team now to bring young players through from a club into a professional situation. They're the kind of foundations that this league needs" (HOUSTON CHRONICLE, 11/30).

BECKS' SUCCESS: USA TODAY's Moore in a separate piece notes Beckham's first couple of years in the league "were rocky, but the Beckham era draws successful marks for results on and off the field." SportsCorp President Marc Ganis said, "It was an excellent deal in that the MLS in many parts of the world was considered a joke." Univ. of Oregon Warsaw Sports Marketing Center Dir Paul Swangard said, "Beckham just brought a big spotlight. The league was ready for the notoriety that Beckham was going to bring and will be just fine without him" (USA TODAY, 11/30). However,'s Avi Creditor wrote it would be "shortsighted to look back on the entire six years with rose-eyed goggles." Former Galaxy coach Frank Yallop's time in charge was "followed by an even more tenuous regime" under former coach Ruud Gullit, and "while Beckham was on loan at AC Milan, he expressed his desire to stay with the Rossoneri permanently." Yallop said, "Talk about a fantastic move by [AEG President & CEO] Tim Leiweke and the group here. But a brave move from David. It was a big move. He was at the top of his game when he came here, and I think that was a brave move" (, 11/29). In Toronto, Kurtis Larson writes during the MLS Cup media session, it was "as if Beckham himself wasn't comfortable with the non-match material ahead of the biggest date on the MLS calendar -- one that seems slightly overshadowed by the league's first Designated Player, for whom the rule was made, deciding to take his talents elsewhere." Beckham said, "I think it's up to other people to decide what my impact on the game has been. ... When I go back to England and Sky Sports is talking about the Galaxy, Seattle and Red Bulls, there's interest now. If that's what I brought to this league, great" (TORONTO SUN, 11/30).

OWNERSHIP BECKONING? Beckham called into "On Air With Ryan Seacrest" Thursday morning and discussed plans for purchasing an MLS club. Beckham said, "That will obviously comes into play now. It only came into play once I finished playing here. I’m excited about that. My commitment when I came here six years ago was to take this league to another level, and my commitment stays the same. I might not be playing here but I will become a owner of a franchise and it’s something that I’m excited about. We’re close to a decision on that, but I can’t say it right now." Beckham also said he has a restaurant "in the pipeline" in collaboration with celebrity chef Gordon Ramsey (, 11/29). MLS Commissioner Don Garber said of Beckham, "I think he would be a great member of the MLS ownership. He's a serious guy. I don't think people understand what a business mind he has. He's always thinking about marketing, about branding, about everything that makes a successful business. I think he'd be a great addition to MLS." Beckham said, "Off the field, we've done a lot of hard work -- not just myself, but the people around the league. They're the kind of foundations that this league needs. That's what happens in Europe, in the best leagues in the world. And the future is going to be bright" (AP, 11/29).

NHL Deputy Commissioner Bill Daly said the league and NHLPA broke off the mediation process after only two days because “the presiding mediators concluded that the parties remained far apart, and that no progress toward a resolution could be made through further mediation at this point in time.” In N.Y., Pat Leonard writes, "To illustrate just how far apart the parties remain, the NHL and union couldn’t even agree on the mediation’s result" (N.Y. DAILY NEWS, 11/30). In L.A., Helene Elliott reports since federal mediators could not resolve the dispute, the league on Thursday "proposed putting the stalemate directly in the hands of players and owners." After Thursday's talks, NHL Commissioner Gary Bettman "proposed arranging a meeting that would exclude executives on both sides and allow owners and players to have an unfiltered exchange of ideas." The NHLPA did not immediately respond but "was expected to raise the idea during a conference call Friday with players." Many NHLers have "taken part in negotiating sessions, but only a few owners have participated" (L.A. TIMES, 11/30). Daly said of the idea, "We want to find a way to get to a deal. Nothing else has worked. The commissioner felt that we might as well propose something different. We will see how they respond." ESPN N.Y.'s Katie Strang wrote the bottom line is that "there is no end in sight" (, 11/29). In DC, Stephen Whyno wrote there is "no reason why mediators could not intervene in the process again, but for now the sides will go back to regular collective bargaining talks" (, 11/29).

WHAT HAPPENS NEXT? The CP's Chris Johnston noted with "no end to the standoff in sight and players set to miss their fourth paycheque on Friday, speculation is expected to grow about the possibility of the union decertifying or disclaiming interest" (CP, 11/29). However, in Ottawa, Bruce Garrioch notes reports indicate that NHLPA Exec Dir Donald Fehr "can no longer decertify because of the timing." It could mean the NHLPA "files a Disclaimer of Interest." Under that scenario, Fehr "would no longer lead the players and it is quicker than decertifying." The tactic was "used in the NBA dispute" (OTTAWA SUN, 11/30).'s Joe Haggerty wrote, "Perhaps there will be a number of NHL owners who will decide to press for an end to the lockout, which has cost both the league and the players millions of dollars." But, "more likely, the next step will probably be a discussion of potential 'nuclear options' for each side." NHLPA decertification "chatter has been gaining in volume among the players over the last week." Similarly, there have been "rumblings the NHL owners are ready to pull the $211 million 'make whole' offer from the table" (, 11/29). SPORTING NEWS' Jesse Spector wrote the owners "keep playing a waiting game, with a growing sense that the lockout will end only when the owners are good and ready to end it." But it "feels like the NHL's readiness has little, if any, connection to what actually happens at the bargaining table short of total NHLPA capitulation" (, 11/29).

FRESH APPROACH:'s Pierre LeBrun wrote Bettman "offering to bench himself is some kind of curveball." This one "caught everyone off guard." LeBrun: "If I'm in the NHLPA ... I'd agree on doing this only if all 30 owners are invited to join if they so choose. I'd go further. I'd request that Jeremy Jacobs also join Bettman on the bench." It is time to "get some fresh voices with a fresh approach." At this point, the process "requires it" (, 11/29). In New Jersey, Andrew Gross wrote, "To me, it seems the league’s attempt to get the owners and players together is an attempt to drive a wedge between Fehr and the union. My guess would be, if this proposed meeting does come off, the players would emerge more unified than ever" (, 11/29). In Minneapolis, Michael Russo wrote it is "clear at this point that the league doesn't believe it'll ever get a deal done with the Fehrs standing in the way" (, 11/29). YAHOO SPORTS' Nicholas Cotsonika wrote the new offer seems "like a PR move." It seems "like another negotiating tactic designed to go around" NHLPA leadership. But they have "got to try, at least under certain conditions" (, 11/29).

FACE TO FACE: In Boston, Steve Conroy writes word of the proposed meeting, "which would essentially pit businessmen against players, reeked to some of a public relations maneuver by the owners." One player agent sarcastically said, "Yeah, why not? Let’s be honest. It’s clear that the owners don’t respect the players, so I’d have no problem putting any of my guys in a room with them.” Conroy notes many are "anxiously awaiting" the NHL BOG meeting on Wednesday in N.Y. If there is "a challenge to the leadership" of Bruins Owner and BOG Chair Jeremy Jacobs, and that of Bettman and NHL lawyer Bob Batterman, "it is believed it will show itself in that meeting" (BOSTON HERALD, 11/30). In Newark, Rich Chere writes it is "likely now that there will not be a breakthrough in negotiations until after" the BOG meeting (Newark STAR-LEDGER, 11/30).

KEEPING BUSY: In Buffalo, John Vogl noted despite the lockout, the Sabres "do not plan a reduction in staff or salaries at the present time." The organization has "not discussed trimming hours or employees." In place of their "normal hockey-related jobs, Sabres employees have spent time doing charity work or learning how the organization works" (, 11/28).

Fueled by a 9% increase in overall revenue to $3.4B during the '11-12 season, the average NHL team is "now worth $282 million, 18% more than a year ago," according to Mike Ozanian of FORBES. The increase in revenue and value "speaks to the league’s ability to raise ticket prices an average of 5% last season." But the "spread between the rich and poor teams is dramatic." The five most valuable teams are worth $605M on average, while the five least valuable are worth just $145M on average. But the sport’s three most profitable teams -- the Maple Leafs, Rangers and Canadians -- "accounted for 83% of the league’s income, while 13 of 30 teams lost money, before non-cash expenses and interest payments" (, 11/28). FORBES' Chris Smith noted the Sharks were the "best team for the buck over the last seven seasons," generating 25% more "efficient player spending than the average team." The team also "hasn’t broken the bank to do it, averaging an annual payroll of $49 million, just beneath" the league average of $51M. The second-best team per dollar spent was the Red Wings. They were "ranked among the top ten teams in player spending in five of the last seven seasons." In perhaps the "least surprising outcome of all, the Toronto Maple Leafs ranked dead last" with 23% "worse than the average team." While the Maple Leafs have "ranked among the top 12 in player costs in five of the last seven seasons," the team has "failed to make the playoffs even once in that time" (, 11/28). In Montreal, Pat Hickey noted the NHL has "estimated that as many as 18 teams are losing money, but 13 is a significant number and so are the total losses" of $123.3M. With the exception of the Sabres and Islanders, the "other losing teams are all in markets where you are unlikely to find a frozen pond." It is "interesting to note that each of the seven Canadian-based franchises made at least" $11M (Montreal GAZETTE, 11/29).

% +/-
Maple Leafs
Red Wings
Blue Jackets

DOUBLE-EDGED SWORD: In Columbus, Aaron Portzline wrote what Forbes concludes is what the NHLPA "has been trumpeting since Day 1 of the NHL lockout ... that revenue sharing is an absolute must to get the NHL healthy and thriving, to avoid having lockouts every eight seasons" (, 11/28). The GLOBE & MAIL's David Shoalts wrote while the "accuracy" of Forbes' numbers "can be either questioned or cited by NHL commissioner Gary Bettman, the owners and managers depending on the point they are trying to make, the figures generally serve as a ballpark indicator of the NHL’s financial condition" (GLOBE & MAIL, 11/29). In N.Y., Mark Everson wrote Forbes' estimate "vividly demonstrates why the owners have put such faith" in Bettman. When he became NHL Commissioner in '93, a franchise "could be bought for some $40-50 million" (N.Y. POST, 11/29). In Montreal, Stu Cowan wrote, "If I was a player I'd have two words on my lips for the owners after reading the Forbes report: revenue sharing." If it came down to a "players' vote on a take-it-or-leave-it offer they would accept because the majority would want to play hockey (and get paid) ... but the Forbes report might help make that vote very close" (, 11/28).

ACCURACY IN QUESTION: The GLOBE & MAIL's Shoalts in a separate piece notes both MLSE President & COO Tom Anselmi and former President & CEO Richard Peddie "questioned the accuracy" of Forbes' numbers, as "NHL executives do every year." Peddie "wondered about 'the huge inflation' in the Leafs' value from a year ago." But the "disparity in value between the top and bottom clubs drives home one of the key points" NHLPA Exec Dir Donald Fehr and his negotiators have made throughout the lockout. Peddie would "like to see the NHL move toward the NBA’s system, which has each club contribute 50 per cent of its annual revenue, minus some expenses, into a pool." He said, “(The NBA) is proving the whole league can make money." But Peddie added that the NHL "cannot afford that type of system ... until it, too, turns a collective profit" (GLOBE & MAIL, 11/29).

MARKET WATCH: In Ft. Lauderdale, Craig Davis notes the Panthers, "not surprisingly among the lower echelon, nonetheless moved up two spots in 2012 to 24th with a slight increase in value" to $170M. Forbes attributed that to "better performance by the team that produced the first playoff appearance" since '00. Forbes stated that despite a 6% boost in attendance, the Panthers ended $12M in the red, because the team’s "gate receipts were among the league’s lowest due to huge giveaways of tickets." The Panthers also "ranked last in local television audience with just 13,400 viewers per game" for '11-12. Forbes noted that the Panthers "will benefit from a more lucrative cable deal beginning this year along with the 10-year extension on the naming rights deal with BB&T that is expected" to net the team $37M (, 11/28). In L.A., Helene Elliot noted Forbes stated that the Ducks' "operating loss of $10.8 million was the league's fourth-largest last season and attributed that to the team's failure to make the playoffs and the lack of an NBA co-tenant at the Honda Center" (, 11/28). In California, Eric Stephens wrote beyond what Ducks Owner Henry Samueli "says publicly about his sports business -- and that's a rarity -- we won't truly know how the club does on the bottom line." It certainly is "well above" the $75M that the Samuelis paid in '05 when they bought the team, "but that doesn't take into account how much they've spent or made in revenue over the last seven years" (, 11/28).

The judge overseeing the bounty lawsuits on Thursday asked the sides by Monday and Tuesday to answer questions on whether NFL Commissioner Roger Goodell could penalize players for what were legal hits under NFL rules. The questions Judge Helen Berrigan posed seemed to suggest she is questioning whether the penalties are enforceable under the collective bargaining agreement. Berrigan in an order Thursday wrote, “[A]ssuming as undisputed the testimony by the New Orleans Saints players and coaches that only `legal hits’ were used to intimidate and/or injure opposing players, the parties shall brief the following: Does Articles 43 and 46 of the CBA exclude discipline by the Commissioner for `legal’ contact?” She also asked the parties, “Does the CBA give the players and coaches adequate notice as to what conduct could be sanctioned as `conduct detrimental?’ In other words, is that portion of the CBA ambiguous, hence unenforceable?” Goodell has based his penalties on his power given to him in the CBA to punish players for what is deemed conduct detrimental to the game. The order comes as former Commissioner Paul Tagliabue is hearing the appeal of the penalties handed down by Goodell to the four former and current Saints for allegedly placing bounties on opposing players.