SportsBiz - The Business of Sports Illuminated: February 2005

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Mark Ament - Insight Community Expert

Monday, February 28, 2005

 

NCAA Academic Standards are Out: Division I Schools are Flunking

Over half of Division I colleges fail to meet new academic guidelines and could lose one or more scholarships in at least one sport according to figures released by the NCAA yesterday. The defending national champions in college football, Southern California, and in college basketball, Connecticut, each fall short of the minimally acceptable Academic Performance Rate, or APR, which we have discussed before here.

Penalties won't be imposed for another year, but that doesn't leave schools with much time to improve their situations. Approximately 30% of football teams fall below the 925 cutoff figure; 20% of basketball; and 24% of baseball teams. The NCAA estimates that the very small squad teams like basketball, golf and cross-country will be better able to meet the threshold by next year and anticipates far fewer penalties against basketball teams than would be expected given today's numbers.

In addition, the NCAA has said it will make exceptions for teams at institutions that serve "economically distressed segments of the population", but has not yet said how that would work.

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Sunday, February 27, 2005

 

Have You Ever Wanted to Sponsor a Pro Golfer?

Aspiring professional golfer Brian Payne is auctioning sponsorship on eBay . In a unique bid to raise money to fund his comeback following a 2004 bout with tendonitis, former Northwestern University golfer Payne is offering the winning bid the opportunity to place a logo on his bag and/or clothes and in return he will donate a portion of his winnings to the charity of the winning bidder's choice. He will also donate a portion of his winnings to two designated charities.

Payne is not yet a PGA Tour member and is playing mostly on the Canadian tour as he tries to qualify for his Tour card. The purses are significantly lower, most are $100,000 and less, so sponsorship is even more important. I wish Brian the best of luck not just with this auction but in the upcoming season.

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Saturday, February 26, 2005

 

Disney Will Sell Ducks

Disney is getting out of the hockey business. In the first transaction of the lockout era in the National Hockey League, Disney is selling the Mighty Ducks of Anaheim to an Orange County technology entrepreneur and his wife, who also control the lease of the Pond, where the Ducks play. The price, however, surely will not make the other owners not terribly happy. The total purchase price is reported to be $75 million, but that includes the Ducks practice facility and merchandising rights to the name and associated trademarks, which you may recall was originally developed for a series of Disney movies. Disney paid an expansion fee of $50 million for the time in 1993.

The sale still needs the approval of the NHL Board of Governors. The new owners would also like to ultimately attract an NBA team to Anaheim and have made unsuccessful attempts at trying to lure the Clippers away from Los Angeles. One other point, Samueli made, in contrast to the new Angels owner, he has no interest in removing Anaheim from the name of the team. At the moment, his intention is to retain Mighty Ducks, but is open to changing that, if the fans want it.

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Thursday, February 24, 2005

 

Could Parity be Coming to Baseball?

The NFL is one of the most successful professional sports organizations in the world for two major and related reasons: television revenue and the equal sharing of that revenue among all franchises. It is that revenue sharing that allows the Green Bay Packers to continue to compete against the big market New England Patriots and allows the league to prosper without a team in the nation's second largest metropolitan area.

Baseball has never before embraced this concept, and as a result, the small market teams are consistently outbid by the Yankees, Mets, Red Sox and Angels for the players those large market franchises really want. The tide however may be slowly and subtly changing in the years ahead. Several years ago, at the urging of the Commissioner, the owners agreed that all revenue for new media sources (read Internet) would be shared equally. At the time, no one thought too much about it. After all, what revenue was there from Internet broadcasts?

Now, however, hints of what to come are beginning to emerge. Baseball has agreed to buy Tickets.com, the major competitor to Ticketmaster, in a deal that will strengthen the competition in the online ticket market, give teams a greater outlet for disposing of excess seats and produce online revenue. The league's online subsidiary operates each of the teams' websites and has begun producing the websites of the minor leagues. Last year, it introduced a subscription service for online broadcasts of games.

The radio broadcasting deal that Major League Baseball signed with XM Satellite Radio was signed with the online subsidiary, thus placing that revenue in the equally divided pot. A deal was recently made with the players union for licensing rights in an attempt to make MLB the force in fantasy baseball.

However, the major piece to this whole puzzle is probably still several years down the road. As broadband access becomes the norm, MLB is likely to introduce online webcast of local games and move local television revenue away from each team and into the pot to be shared equally. The impact of that move would be enormous. The Yankees took in over $50 million in local television revenue last year; the Royals took in $6 million. You can readily see the impact sharing the revenue will have on competition.

When the time for a decision about these revenues comes, it is likely that baseball will choose to share equally. It operates by majority rules and there are more clubs who stand to gain by that decision than lose. Besides, there is always football to look to for an example of how to be both a competitive and a financial success. See Tim Marchman's New Republic article here for a more complete explanation of this theory.

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Monday, February 21, 2005

 

2012 Olympics - The Big 5 Strut their Stuff

There are five cities in the running to host the 2012 Summer Olympics and it is doubtful if there has ever been a more powerful lineup of potential host cities. The five remaining hopefuls are Madrid, Moscow, London, New York and, the presumed favorite, Paris. Currently, the International Olympic Committee Evaluation Commission is on an inspection tour of the candidates. This week's stop is New York, having arrived yesterday fresh from London.

At each stop, the host city pulls out the stops in entertaining the Commission as well as presenting its case for the Games. In London, the British brought out the Queen. In New York, the secret weapon may well be Mayor Bloomberg. Don't laugh. By all accounts, he has taken to his role as Olympic shmoozer in chief and the Olympic poobahs have taken to him.

In a more serious vein, however, New York has indicated that this will be its last bid and there will be no attempt at 2016 as is customary for losing Olympic bids. Much of this may be laid to the political firestorm that the Mayor has faced in trying to win approval for the Westside Stadium plan , whereby a new stadium would be constructed for the Olympics and the Jets on abandoned railyards on the west side of Manhattan at a cost variously estimated at up to $1.2 billion. New York's bid may be in serious jeopardy if the Mayor is not able to convince the Commission that the stadium will be built if the Games are awarded.

Much time remains before the final decision is made in July at the IOC meeting in Singapore. There will be ample opportunity for all five cities to engage in extensive lobbying efforts between now and then. With the caliber of cities involved in this round, and with arguably the two media capitals of the world in London and New York, you can be assured that the bid process will receive far more media exposure this time around than ever before. While Paris remains the slight betting favorite, if New York can solve the stadium issue before July, my own feeling is that the Games will come to the Big Apple. However, if the stadium is still caught up in NYC politics, then I wouldn't be surprised to see it come down to a battle between the British and the French.

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Saturday, February 19, 2005

 

NHL - Canceled for good

No progress was reported after all day talks today involving the league and the players, so it now appears that the season is actually cancelled for good this time. The AP story can be found here.

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Buyer of Vikings Has Resume Issues

Rescue Fowler, the man who leads the group that just signed an agreement to buy the Minnesota Vikings, released a resume in connection with his introduction to the Minnesota press that was filled with items that were not exactly true. The items included his field of study at the University of Wyoming, his playing career in the NFL and the CFL and his participation in the Little League World Series.

His resume claimed a degree in business when in fact he graduated with a degree in social work. He claimed to have played in both the NFL and the CFL although he never lasted beyond the training camps of the Bengals and the Edmonton Eskimos, respectively. He also claimed to have played in the Little League World Series but it turns out to have been a tournament in Southern California.

Fowler has since apologized to the fans and media of the Twin Cities and pledged to be more careful and observant in what goes out in his name. What effect this will have in the NFL's review of his application for ownership remains to be seen, but I can help but think that this surely won't be seen to be a positive. After all, this same error filled resume was sent to the NFL as part of his application for ownership approval. Not a good way to start Rescue.

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Is Hockey Back?

The NHL and the players union are back at the bargaining table today in a late bid to resurrect the recently cancelled season. Reports are that the agreement has been reached on a $45 million salary cap largely negotiated by former players, now owners, Wayne Gretzky and Mario Lemiuex. The union and the league are meeting today and an announcement is expected later this afternoon.

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Thursday, February 17, 2005

 

Conference Realignment, Cont.

The fallout from the ACC raid on the Big East continues as newly independent Temple searched for a home for its football team and the Mid American Conference looks to replace departing member Marshall and football only member Central Florida. It appears that the MAC is now engaged in extensive discussions with Western Kentucky about joining the league for all sports and with Temple about a football only membership. Western, who is currently a member of the Sun Belt in all sports but football, would have to move up to Division I-A in football. The school is now engaged in studying the cost ramifications of that decision.

Western currently spends $2 million on football, while most MAC schools' football budgets are in the $3-5 million range. The principal cost increase is due to the 20 extra scholarships that Division I-A schools award. It is the move to Division I-A that may be attractive to Western however, despite the added cost. Division I-AA football is a money-losing proposition even for a program as successful on the field as WKU, the winner of the national championship in 2002. With few television appearances, and little payment for those appearances, the opportunities to generate revenue are very few when compared to their larger, more well known brethren. In fact, a run deep into the championship playoffs only adds to the expense. Western's national championship cost the university an additional $100,000 in postseason expenses.

Temple's fate would seem to be bound up in WKU's hands, as it's hard to see the MAC adding Temple without WKU joining as a football playing member as well. Otherwise, adding Temple would unbalance the league and not really achieve anything positive for the conference. It may be a bit hard for the folks in Philly to swallow, but their fate rests in the hands of the good folks of Bowling Green, Kentucky.

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Wednesday, February 16, 2005

 

It's Official

The National Hockey League today became the first major league sport in North America to cancel an entire season due to labor issues. Commissioner Gary Bettman announced today that the league officially cancelled the season during an afternoon new conference after the league and the players union were unable to bridge their differences over the instiution of a salary cap. Although significant progress had been made in the 36 hours leading up to today's announcement, the two sides were still quite far apart in basic economics and neither side had even begun to address some of the more fundamental problems plaguing the play of the game itself. We will now all watch a spring and summer of fits and starts of negotiations probably leading nowhere until the calendar turns towards next season. At that point, negotiations will again begin in earnest, but the players will be worse off than they are today and will have a very difficult time accepting that fact.

Meanwhile, hockey fans will be left with having to find their hockey fix somewhere else. The AHL provides one alternative. Forgetting about hockey and reading a good book or a good blog provides another good alternative. What I suspect that the owners and players will find out next season is that the fans have found a whole host of good alternatives and will not have missed hockey all that much. It will be the unwelcome reality that hockey is not the fourth major league sport after all. In fact, when or if it comes back, it may not even be the fifth. Hockey may find that it ranks in the sports fan's consciousness somewhere behind soccer and ahead of curling. It will not be a pretty sight.

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Stories, Continued

The NHL deathwatch continues as the 11:00 am deadline has come and gone with no agreement despite movement last night on both sides. They remain millions apart on the salary cap and Bettman's 1:00 pm press conference to announce the cancellation of the season is, as of this posting, still on.

Yesterday, Murray Chass continued his assault on the credibility of the New York Yankee front office and I commend his article to you. I don't know who is telling the truth here and we may never know for sure, but it looks more and more like Murray may be on to something.

More later as developments warrant.

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Tuesday, February 15, 2005

 

NHL Deathwatch - Still on Life Support

As the Wednesday news conference deadline approaches, news of a secret meeting last night surfaced. At that meeting, a potential breakthrough in negotiations may have been achieved between the NHL owners and players union, but it may have been too little, too late. The union agreed to the salary cap the owners have been demanded and the owners agreed that the there would be no linkage between the cap and league revenues. However, they were still $12 million apart on the team level cap with no further negotiations publicly scheduled before Commissioner Gary Bettman's scheduled Wednesday news conference to announce the season officially cancelled. So, all you Red Wing fans, don't go order your octopi just yet. It's going to be another night of top secret negotiations I suspect and we'll all just have to wait and see what happens in the morning.

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Monday, February 14, 2005

 

NHL Final Countdown

NHL Commissioner Gary Bettman has scheduled a news conference for Wednesday at which time he is expected to officially announce the cancellation of the season. It will be the first season in which the Stanley Cup has not been awarded since the winter of 1919 when flu epidemic then sweeping through North America cancelled the finals between the Seattle Metropolitans and the Montreal Canadiens. Despite meetings over the weekend with a federal mediator and a last gasp meeting today, it appears that the season is lost. I have written a little about the ramifications of this unprecedented lost season, but the truth is we're all speculating. Nothing like this has ever happened before and hockey's place in the American sporting landscape has always been unique anyway, which makes any analysis of this season even more difficult.

I intend to return to this topic in the near future for a little more in-depth analysis. For now, I leave you with a couple of thoughts. Assuming that the season is indeed lost, I think the Sun Belt expansion/relocated teams will be facing some serious difficulties when hockey returns. In fact, it would not surprise me to see a return by one or two of them to Canada. The old line hockey towns will not suffer, except in the short term. If the NHL is smart, the league will use this to contract and in that event, hockey will ultimately emerge stronger for having gone through this.

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Landmark Day for the NFL

Today is potentially a landmark day in professional football. Reggie Fowler announced today that he has a deal to purchase the Minnesota Vikings from Red McCombs for a reported $625 million. If approved the other NFL owners, Fowler will become the first black principal owner in the NFL. Fowler, who is reported to be worth around $400 million, played football at the University of Wyoming and in the NFL for the Cincinnati Bengals. Other members of his ownership group are reported to be local car dealer Denny Hecker and East Coast real estate investors Alan Landis and Zyggi Wilf. Once he is approved as an owner, Fowler will have to tackle the Vikings stadium issue. McCombs has not been able to get a new stadium approved and that is a major reason for his sale of the team (not to mention the estimated $375 million profit he might make from the sale). The Vikings are in desperate need of a new place to play and McCombs has pretty well worn out his welcome in the Twin Cities. A site for a new stadium has been located in suburban Blaine but local opposition has been building and Fowler will have his work cut out for him.

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Saturday, February 12, 2005

 

Steroids, Continued

Okay, so I said I wasn't going to spend much time discussing steroids but this is one postscript to the story that falls well within our normal discussion topics. It seems that the advertising community is way out in front of not only the baseball but probably the fans. You won't be seeing the usual number of World Series champion Red Sox players endorsing products this spring and summer as advertisers are pulling back from using baseball players to endorse products for fear of being stuck with a steroid user and the attendant publicity. As Barry Bonds tries to overtake first Babe Ruth and then Hank Aaron in the career home run race, the publicity associated with that feat would normally give him great endorsement opportunities. However, in this climate and with the charges swirling around the BALCO grand jury proceedings and the Jose Canseco book, don't expect to see Barry Bonds urging anyone to buy a Happy Meal anytime soon

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Friday, February 11, 2005

 

Steroids and Giambi's Contract: What Did the Yankees Know?

I never planned to write about the baseball steroid scandal. Frankly, I thought it has already grown tiresome. Every sportswriter and talk radio host in America has written or talked about it endlessly now for weeks or months on end and for what. We all know that baseball has no intention of doing anything to clean up the sport. Not with Comissioner Bud "I See Nothing, I Hear Nothing" Selig and Union Leader Donald "It's All A Lie Spread By the Greedy Owners" Fehr in charge of the game. No, the latest leak from Jose Canseco about who is using just doesn't interest me anymore.

However, today a story came along that I decided was worth discussing, since it touched on all the elements we like to cover here: sports, law, business and even a little journalism for good measure. In today's New York Times , Murray Chass wrote a column accusing the Yankees of agreeing with Giambi to remove from his contract the clause allowing the club the right to suspend him, stop payment on the contract, terminate the contract or convert it to a nonguaranteed contract in the event he was found to use steroids. Now this provision is supposedly in the Standard Player Agreement of every Major League player. So what would possess the Yankees to agree to remove it?

Let's examine this logically. You're the Yankees general manager and you're in a meeting room with Arn Tellem, Jason Giambi's agent. You have all but concluded negotiations to bring Giambi to the Yankees and you are starting to get excited because in your mind, he is the missing piece of the puzzle to bring the Yankees the next World Series. Tellem looks up and says "Wait, there's just one more item. We need to remove this language about steroids." You stop and stare at him, probably open-mouthed because what can you say? Do you agree? Is the World Series worth having an admitted user on the team, because there's no disguising the motive behind the question?

Brian Cashman, the Yankees General Manager answered that question today several times. He went on ESPN radio at least twice that I heard to deny the New York Times story. He told Dan Patrick this afternoon, "We're covered on steroids". Earlier, on Mike and Mike in the Morning, he told the audience that it just didn't make any sense to have done what Chass alleged and categorically denied that the Yankees had done so. I, for one, happen to believe Cashman. I just don't think the Yankees would be reckless enough to waive the clause in the contract ahead of time nor do I think the Major League office would allow them to do so, despite their total impotence when it comes to drugs.

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Future of NHL: Skating on Thin Ice?

With the end of the NHL season about to be officially declared lost, ESPN's Darren Rovell takes a interesting look at what the future may hold for some NHL teams. While all teams are expected to survive the lockout itself, some may not survive the return to play next year, especially if the season doesn't start on time due to an extension of the lockout into next year.

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Thursday, February 10, 2005

 

Ever Want to Put Your Name on an Arena?

The home of the Boston Celtics and, if the NHL ever comes to its senses and returns to the ice, the Bruins, the Fleet Center, is now seeking a new long-term naming rights sponsor. Its current naming rights holder Fleet Bank has been purchased by Bank of America and has bought its way out of the naming rights deal in place. While it seeks a long-term deal, the owner of the Fleet Center has found a novel way to stir interest in the name of the arena. You can put your name in lights by purchasing naming rights for a day on, where else, eBay. Hurry! Don't miss your chance to have Boston talking about you for a day!

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Wednesday, February 09, 2005

 

Violence Threatened in the Takeover Fight For Manchester United

English soccer fans have worldwide hard-earned reputation for hooliganism. Usually, that reputation has been earned by the actions of fans taken before, during or after games, or, on occasion, while traveling to watch their favorite team play. It now appears that they have reached a new low.

Malcolm Glazer, the owner of the Tampa Bay Bucs, is the largest owner of shares of Manchester United Soccer Club, which is a publicly traded company and quite possibly the most valuable professional sports franchise in the world. It is certainly the most valuable professional soccer club in the world. Glazer is attempting to take over the club, much to the dismay of its fans, who do not want to see control of their club fall to an American.

It now appears that the campaign to keep Man U out of Glazer's hands has taken a darker turn. A shadowy group of Man U supporters has issued threats to Glazer and members of the Manchester Union organization who are willing to cooperate with him or sell their shares to him, warning that they "will be ruthless" in protecting the club. The police have been informed and are investigating.

This is obviously an extreme example of the emotional opposition that the bid by Glazer for control of the world's most recognized team has engendered. Just the other night, a group of Man U supporters staged a peaceful demonstration in the parking lot at Old Trafford and several groups of supporters have tried to organize share buying campaigns. The problem, of course, is that although Man U is publicly traded, not enough of the shares are in the public float for any type of public buying campaign to be successful. Too many of the shares are controlled by a small group of people, so that should Glazer convince that small group to sell their shares to him, he will soon wind up owning football teams on both continents.

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Fulmer Revisited

A few details of Phil Fulmer's new contract at Tennessee were published and in addition to his guaranteed $2 million plus a year, it appears that the Volunteer coach is in line for various incentive bonuses that could add as much as $250,000 to his annual take should UT win the BCS champioship.

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Saturday, February 05, 2005

 

NBA Franchise Relocation - Not So FaaaNtastic

I was reviewing the most attendance figures for the NBA season to date and I was particularly struck by the attendance in Memphis, New Orleans and Charlotte. Those cities being, of course, the where franchises have relocated in the case of the first two and in Charlotte's case, the home of the league's newest expansion team. You would think that cities with new teams would still be excited about their teams and would be turning out to watch no matter how the teams perform on the court. However, that does not appear to be the case.

Memphis is the only one of the three whose attendance rate is above 90% of capacity and above the league average of 87.8%. Much of that may be attributed to the opening of the Fed-Ex Forum, the Grizzlies new home, this season. The other two teams are faring much worse. New Orleans is averaging a mere 81.4% of capacity, while, in its former home in Charlotte, the brand new Bobcats are averaging a pitiful league low 63%. I guess there really was a good reason for the Hornets to leave.

Overall, attendance is about on par with last year as the league is up about 1%. The teams with the strongest attendance, based on average of capacity are Dallas, Miami, Detroit and Sacramento, each of whom are sold out for every game and more. The presence of Shaq in Miami is obvious as the Heat's average attendance is up 32.9%.
The league has not seen much benefit from the NHL lockout in terms of attendance but most cities with franchises in both leagues had strong NBA attendance to start with or, as in the case of Atlanta, relatively weak attendance in both sports.

So, in the end what can we take away from this? Was the NBA too quick to move the Hornets or too quick to replace them? I think that perhaps choosing New Orleans as a destination was the decision the league may come to regret. It is a small market that has not taken to the team and if the team does not start winning soon, the city may never adopt them. It's a football town with plenty of other entertainment options. I'm a little surprised at the Bobcats but then Charlotte is a college basketball town. It may take a few years and a lot of work on the owner's part to win over that city. There was plenty of bad blood left behind when the Hornets left.

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A challenger for ESPN?

It appears that Fox is seriously looking at launching a new national cable and satellite sports network that would pose a direct challenge to ESPN. In his annual state of the NFL speech, conveniently timed to follow the State of Union speech by only two days, Paul Tagliabue said that the league was giving consideration to being part of the launch of a new network.

It seems to me that only Rupert Murdoch would think about taking on ESPN at this point and he would only do it if he had a solid NFL package as an anchor for the new network. The football package under discussion would be a new Thursday/Saturday night package and would give Fox instant credibility and a reason for cable operators to carry his network.

The true test for viability however is what other rights he is able to cobble together to fill all those programming hours. Fox is Major League Baseball's network partner and I'm sure that Fox would try to outbid ESPN for cable rights whenever that contract is up for renewal. Most collegiate basketball and football contracts are rolling out in the next two years. The ACC just renewed their contract with ESPN, but the other 5 BCS conferences should all be up for renewal soon. Bidding could get interesting.

Fox has tried this once before with the collection of the regional Fox Sports Nets. The difference this time is that it appears Fox is going to launch a single national network rather than a collection of regionals focused on local rights with some national programming. With the ramping up of CSTV, the market is starting to get crowded. It will be interesting to see if Fox actually launches the channel, If Murdoch goes forward, I expect the television landscape to change dramatically. ESPN is the most profitable division of the Disney empire and they will not suffer an entrance to their turf without a major fight.

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Friday, February 04, 2005

 

Is There Really An End to George's Wallet?

It appears that the 2002 collective bargaining agreement and the changes it made in baseball's finances may have the desired effect of bringing Yankees' spending to Earth. Surprisingly, while the luxury tax and revenue sharing have had an effect - witness the Yankees inability to make much of an impact in the signing race for Carlos Beltran - it was actually the much less noticed provision dealing with debt service that was probably the more important calculation in the minds of the Yankee brass.

The Yankee payroll, with the addition of Randy Johnson is now at a mindboggling $200 million, and they are paying a luxury tax of 40%. On top of that comes a revenue sharing bill with poorer earning clubs and you can guess that despite the Yankees' earning potential, they may well have a not insignificant debt load.

Forbes Magazine estimate of the magnitude of the Yankees EBITDA loss in 2003 would put them so far out of compliance with the mandated debt service rules, that they would be forced to cut payroll in 2006 when the grace period for compliance with the rule expires. It will be fascinating to watch Steinbrenner in a role he is totally ill suited to play - cutting and slashing payroll and casting off stars to meet an artificial standard while the hated Red Sox and Mets are buying up free agents. It could be a fun off season in New York next year.

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Thursday, February 03, 2005

 

The Marketing of Tom Brady

In an interesting article on ESPN.com, Darren Rovell provides an insight into the marketing of Tom Brady. Unlike most athletes, Brady carefully controls his off=field activities choosing his endorsements with an eye to what he can bring to them and what they can bring to him, as well as making sure that nothing interferes with his training or his game. While he earns a great deal from his endorsement activities, he attempts to do nothing that will set him too far apart from his teammates. He remains the consummate team player on the ultimate team. It is this sense of team that has always set the Patriots apart and is what has led them to build the only current dynasty in pro sports.

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Alabama Booster Convicted

In what is widely believed to be an unprecedented decision, a federal court jury in Memphis has convicted an University of Alabama booster of buying a high school player by bribing his coach. The actual charges were conspiracy to commit racketeering (by breaking state bribery laws), crossing state lines to commit racketeering and arranging bank withdrawals to cover up a crime after the booster paid $150,000 to a Memphis high school coach to insure that a defensive linemen went to Bama. Today, the jury also decided that Logan Young, the now convicted booster, must forfeit $150,000 to the federal government. A sentencing hearing will be held later. Young faces up to 15 years in jail although federal sentencing guidelines would call for a much lighter sentence.

Now, you might rightly ask why is the federal government using the RICO statute against an athletic booster and exactly what is RICO anyway? Well, I'm not going to spend the time on a detailed explanation because Greg at the Sports Law Blog has done a great job at explaining it here. The remaining question is whether this will have any lasting impact on improper recruiting.

That, I suppose is the great imponderable. We would all like to think that the fear of winding up like Mr. Young would intimidate future boosters from going out and buying players for good old State U, but I think the reality is probably going to be much different. After all, the death penalty handed down to SMU years ago had no effect on recruiting or any other NCAA violations. In fact, it seems that the only effect the closing of SMU's football program for one year had was on the NCAA. It so frightened the institution, it has never come close to handing the penalty to anyone again, despite actions that were much more severe than any that SMU committed.

Now, admittedly, we are dealing with the federal government and the criminal code here not the notoriously weak NCAA, but the principle may be the same. The feds may not have a lot of time on their hands in the future to deal with wayward boosters, what with the war on terror, the violations of the Patriot Acts, snooping around libraries, well you understand. Anyway, I just don't think this will be a high priority of the Bush Administration Justice Department in the future, unless perhaps it's a booster in Norman, Oklahoma.


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Tuesday, February 01, 2005

 

NFL positioned to hold line as America's national game

In an excellent article in the Baltimore Sun, Ed Waldman examines the economics behind the rise of the NFL. After reviewing how the NFL has achieved the financial success that has enabled it to become America's true national game, he examines its future.

Most observers attribute the resounding success of the NFL to four basic factors: television, scheduling, revenue sharing and gambling. It was the crucial 1961 decision to share television revenue equally among all teams that has allowed Green Bay to compete against the Giants, while baseball's Yankees have made a mockery of free agency by out spending anyone and everyone for whomever they want to sign. It is football's 16 game schedule that makes every game important and focuses fans attention, as well as concentrates betting attention.

The advent of the computer age as well as internet gambling has increased interest in the NFL. More fans wager with offshore gambling establishments. Fantasy football leagues have exploded due to the ready availability of leagues and information online . The NFL cooperates by making sure to release all necessary information about players condition during the week before games.

Will the NFL's success continue? It is likely to continue for the foreseeable future, unless the owners succumb to their own greed. Art Modell, the former owner of the Ravens and Browns believes that greed is the "one element that could destroy the NFL." The true key to the success of the NFL is the revenue sharing and giving in to the push by several owners, pricipally Dan Snyder of the Redskins and Jerry Jones of the Cowboys, to end it, could prove fatal. We have seen in other pro sports, notably baseball what happens when television revenue is not shared equally. I can't urge the NFL owners strongly enough not to give in to these guys for whatever short-term and shortsighted reasons they may be putting forth. Whatever the reasons, in the long run, it will only damage if not destroy the financial underpinnings that make the NFL the best professional sports organization in America.

The likely successor is soccer due in large part to the overwhelming majority of young people playing soccer in this country and the world wide love affair with the game. As immigration continues, and the Latin population continues to grow, I expect that the market for professional soccer to grow exponentially. Will it overtake the NFL in the next 10 years? Unlikely, but it very well might do so in the next 50.

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