Hockey Civil War as Rangers Sue NHL

The NHL has faced several problems since returning from the lockout two years not the least of which is a lack of a respectable television contract has meant that its national exposure has been significantly curtailed. As a result, it is more important than ever that the league's flagship franchise, the New York Rangers compete successfully on the ice and become a major topic of conversation around town once again. Let's be nice and say that decisions of MSG leadership over the last couple of years haven't exactly been helpful in that regard. Although signings like Chris Drury give reason for hope for this year.

To add to that mix, Friday, Madison Square Garden filed suit against the NHL in US District Court alleging that the league was acting like an illegal cartel in seeking control of the Rangers website and in threatening to fine the club $100,000 a day starting yesterday if the club did not turn over control of the site and the club's merchandising, licensing and advertising. Now, without knowing the details of the league's constitution or governing documents, I don't know the merits of MSG's position, but I will point out that probably the single most important and positive contribution of Bud Selig's time as Commissioner of baseball was the creation of Major League Baseball Advanced Baseball, which owns and operates all of the clubs' websites, MLB's game streaming operations and other digital and technological operations for the baseball and other customers. It has become extraordinarily valuable, far more so than anything that the clubs could have created on their own.

Control over licensing is something that leagues generally hold centrally. Merchandising however is often done on the club level. Surely, level heads would be able to work out some compromise without the spectacle of a club as significant as the Rangers suing the league in federal court. This is not Al Davis we're talking about and is one more example of poor leadership in the commissioner's office. Something needs to be done about Bettman and the sooner the better.

Bucs Profit from USF Sellout

USF host West Virginia Friday night in a nationally televised showdown of Big East football powers that will go a long way towards deciding the Big East title and its representative in the BCS bowls. West Virginia saw its perfect season spoiled last year by USF and will be poised for revenge, while USF will be playing in front of its first sellout crowd ever in Raymond James Stadium, looking to keep the momentum of its dream season and first ever national ranking alive.

That sold out stadium will mean a nice payday for USF - about $1.3 million in ticket sales, nearly twice as much as normal. It will also mean a very nice payday for RayJay's primary tenant, the Tampa Bay Bucs. Under the Bucs lease with the Tampa Sports Authority, the public body that built and owns the stadium, the club gets the lion's share of the profits from the stadium's operations, including the first $2 million in profits from parking and concessions at the stadium from all evens when the Bucs aren't playing, as well as all of the revenue from the naming rights and permanent advertising in the stadium

USF's lease allows it 3,000 parking spaces and the proceeds from temporary advertising it erects on game days. USF does not share in the revenue from concessions.

Despite the lopsided nature of the leases, I don't think USF officials are complaining too much or are making plans to build an on campus facility just yet. For one thing, playing where the Bucs play is a great recruiting tool and RayJay is a great stadium for the players and the fans. while it may not be quite as lucrative as having its own stadium, the costs to build are daunting and USF is not quite at the point where it can expect its fans to take on that burden. Besides, the program is making enough money from its lease of RayJay to justify its continued use. It's a first class stadium that does the Bulls proud and if the Bulls can continue to draw in excess of 40,000 + fans, then it will become a true home-field advantage.

The Power 100

Everybody loves lists. That's why Forbes does the Forbes 400, which just came out and why Fortune originated the Fortune 500 way back when. It's why there is such a thing as the Dow Jones Average and why Guiness publishes an entire book of world records and people do all sorts of crazy stunts just to get into it. So, in that spirit and in the spirit of the fall publishing season, Business Week and ESPN got together to devise the Power 100, the list of the most powerful people in sports. It's not a bad list. It's just like so many things done by the WWWL, media centric, a little light on thought and very, very American. When the heard of FIFA, the man in charge of the world's most popular and prosperous sport comes in 29th, one spot behind the Yankees third baseman, there is something inherently wrong with the poll. When the head of International Olympic Committee comes in 18th, there is something wrong with the voters. But, heh, it's all just for fun, right.

Jay-Z Bidding for Naming Rights to Nets Home

The New Jersey Nets still have two years left in their Meadowlands home before they move to Brooklyn but the naming rights contract on their arena has expired and is now out for bid. Rapper and clothing impresario Jay-Z is very interested in landing the naming rights for his clothing company Rocawear. The rapper is a minority owner in the Nets but the naming rights contract will be determined by the arena's owner, the New Jersey Sports and Exposition Authority. Somehow, I don't think this deal will come anywhere close to the $20 million per year the Nets are getting from Barclays for their new arena in Brooklyn. Bids are due to be open October 4th.

Seattle Sues Sonice to Enforce Lease

The City of Seattle filed suit against the Sonics yesterday in King County court asking the judge to enforce the city's lease with the Sonics for Key Arena and prohibiting the Sonics from leaving Key Arena before the end of the lease in 2010. The city filed suit in response to the Sonics' ownership filing of a request for arbitration of their claim that the lease permitted them to move the team out of Seattle before the 2008-09 season because the city has breached the lease. The Sonics claim is that Key Arena is an inadequate facility.

The City claims that the lease language is clear and the team is bound to fulfill its lease obligations throughout the lease term. In addition, the city believes that the lease clearly provides that arbitration of many issues may be available to the Sonics but the length of the lease term is not one of them. A copy of the city's complaint is available here. The City has hired former US Senator Slade Gorton to represent it. Gorton, for the oh so reasonable fee of $685 per hour (must be nice), does have significant experience in keeping Seattle teams in town. As Attorney General, he filed suit when the Seattle Pilots left town, which was a significant factor in the Mariners being awarded to Seattle and was instrumental in preventing the departure of the Seahawks under former owner Ken Behring. Still, $685 per hour? If a deal can be brokered to keep the Sonics in town, it will be money well spent.

BlogPoll Ballot

Here's my ballot for this week's BlogPoll. No changes at the top; several new/old faces at the bottom:

Rank	Team	Delta
1	Southern Cal	--
2	LSU	--
3	Florida	--
4	West Virginia	--
5	Oklahoma	--
6	California	--
7	Oregon	--
8	Ohio State	1
9	Rutgers	2
10	Boston College	2
11	Texas	2
12	Wisconsin	2
13	Kentucky	7
14	South Carolina	--
15	South Florida	--
16	Missouri	1
17	Cincinnati	1
18	Clemson	1
19	Penn State	11
20	Arizona State	3
21	Purdue	3
22	Alabama	6
23	Virginia Tech	3
24	Hawaii	2
25	Miami (Florida)	1

Dropped Out: Louisville (#21), Arkansas (#22), Washington (#25).

Tickets By Cellphone

Watching CNBC this morning and Darren Rovell is reporting on a new program that MLB has started for delivery of tickets to your cellphone. The process is just the same as buying your ticket online with the added step of logging in your cellphone brand, model and phone number.

It's only in effect for a few teams so far - the Nationals, A's and Rangers that I know of, but from Rovell's experience, expect it to be adopted by most, if not all, clubs next year. He bought a tickets, it was sent to his phone, the bar code was scanned at the gate and he was seated with no problems at all. It was a remarkably smooth process and there is no danger of losing the ticket, unless, of course, you lose your phone. From baseball's standpoint, it cuts down on scalping, since MLB gains greater control over the ticket distribution by eliminating the paper tickets. In addition, this form of ticketing provides Tickets.com a higher service fee for the convenience factor, which falls to MLB's bottom line as Tickets.com ia a wholly-owned subsidiary of MLB.

A-Rod and the Cubs

There is no end to what people will publish when they don't care to fact check stories. Sunday, New York Magazine published a story in which the author, Will Leitch of Deadspin fame, alleges that A-Rod's agent Scott Boras has identified the buyer of the Cubs and begun negotiations with him for a free agent contract. The contract will be worth at least $30 million, a portion of which will be deferred into an ownership share of the team.

There is only one problem with that scenario: it violates Major League Baseball rules which prohibit any baseball player owning an interest in any team or having a contract that awards him an interest in a team either currently or at any team in the future. So, assuming that Boras knew who the next owner of the Cubs was going to be, something that the Tribune Company will not admit to knowing, the proposed contract could never be approved by the Commissioner's Office, a fact which Mr. Leitch should have known. I can only assume he was trying to create a splash and a noisy sensation and just didn't care how true it was. There are different standards for blogs and major magazines and both Leitch and New York Magazine know better.

A-Rod may end up with the Cubs, but he won't end up owning a piece of the Cubs. He is more likely however end up staying in the Bronx. At this point, I think it is likely that the Yankees will meet his asking price and he'll stay in New York where I think he would like to play out his contract. He may still opt out, but only to test the market and ultimately to make a deal to stay in the Bronx.

Get your A-Rod Fathead Here

Derby Rematch

If you're a horse racing fan, check out the Kentucky Cup Classic next Saturday at Turfway Park. It's a Grade II event at 1 1/8 miles contested over the Polytrack. Why should you care? Because it features Kentucky Derby winner Street Sense and runner-up Hard Spun in what is shaping up to be little more than a match race.

Both horses are using the race as their final prep for the October 27 Breeders Cup Classic to be run this year at Monmouth Park in New Jersey. Since there are a slew of graded stakes races next weekend and the following weekend around the country prepping for the Breeders Cup, it's going to be tough for Turfway officials to find horses to take on the Derby duo. Turfway is hopeful of getting a five horse field but is doubtful of much more. Don't expect much of quality in the field besides these two but it will be great fun to watch them fight it out on the lightning fast Polytrack surface.

The Jake May Get a New Name

While the Indians battle the Tigers for the Central Division and a spot in the playoffs, the suits have been quietly trying to peddle naming rights to the Tribe's home field. For the last three to four months, Indians' executives have been seeking new naming rights sponsors for Jacobs Field as the existing deal has about run its course. Not yet finding a deal they like, the club has hired IMG to conduct an international search for a new naming rights deal.

It's hard to guess a value for the Jake, as it's an existing stadium unlike almost all of the recently concluded naming rights deals, which were for newly constructed facilities. Depending on the length of the deal, the Indians should be able to receive at least $3- 4 million. The average price in 2006 was $5.25 million, but that number was abnormally high due to the freakish nature of a year in which there were three deals for new stadiums or arenas in metropolitan New York City completed, Citi Field (Mets), Prudential Center(Devils) and Barcalys Arena (Nets). Any deal in New York skews the market just because of its size. Also, an older arena is always going to be priced lower because it faces the built-in discount of "brand loyalty" by folks just naturally referring to it by its old name. That is a discount worth several hundred thousand dollars a year.

In an interesting analysis at the Biz of Baseball, Kurt Hunzeker attempts to construct a mathematical model for calculating the loss of value in naming rights by becoming the second holder. He has constructed a formula that he believes can be applied to derive the percentage loss in value so that any potential naming rights holder should know what to bid. It is consistent with the idea that Jacobs Field is worth less to the next holder as a result of the brand value already established. No matter who buys the rights to the Jake, it will be the Jake to people in Cleveland for as long as the Indians play there.

Drug Testing Comes to Golf

It looks like professional golf has decided to join the major leagues and the 21st century of hypodermic needles and pissing into little cups. Yes, drug testing is coming to the PGA Tour and the European Tour. After a year in which an educational drug program was conducted in Europe, the European PGA Tour will begin testing its golfers for performance enhancing drgus, including HGH, in accordance with the somewhat absurd standards of the World Anti-Doping Agency beginning with the start of the 2008 season.

The PGA Tour will adopt the same drug testing standards as the European Tour but will likely delay implementation for an additional year to allow for a year's worth of education of the Tour's golfers. That will give John Daly an entire 12 months to dry out before he has to piss in a cup. PGA Tour Commissioner Tim Finchem had been saying for months that golf doesn't have a drug problem and therefore doesn't need testing but apparently has been convinced that it may have a public relations problem if it doesn't begin testing. He had professed the belief that drugs, including HGH, could not help a golfer so why should the Tour test. I guess he has never seen any of his players drive for over 300+ yards.

Adoption of a strict testing policy in compliance with WADA standards could open the way for golf to return to the Olympics after an absence of almost a century.

Is Arsenal Now in Play?

Arsenal has been long rumored to be the subject of a possible takeover and those rumors first gained currency when billionaire Stan Kroenke, owner of the Colorado Avalanche and the Colorado Rapids bought an interest in the club in April. He now owns about 12%. However, up til now. he has not been looked up on particularly favorably and most of the other owners have refused to discuss the potential of a sale of their shares to him.

However, that may be changing and the impetus for that change was the purchase this week of up to 21% percent of the club by Uzbek businessman Alisher Usmanov. For whatever reason, and I won't hazard a guess, the Arsenal board seems to favor Kroenke and, according to the Telegraph, the board will meet with Kroenke next week in London to discuss his future role with the club. While a partnership with the Rapids has previously been announced, rest assured these discussions relate to the possible takeover of the club by Kroenke. In the matter of a few short days, Stan has been transformed from an outsider with whom the board did not want to be seen sharing so much as a cup of tea to the likely new chairman and majority stockholder. It's really amazing what fear and loathing can do for a man.

Will John Canning Be the New Mr. Cub?

I've discussed the sale of the Cubs in this space before and expressed the thought that it's a done deal and all but signed, sealed and delivered to John Canning, Jr. but now no less an authority than the Chicago Tribune, like the Cubs, owned by the Tribune Company and essentially a house organ in these matters, now believes the fix is in. The Deal.com has now also weighed in on the striking similarities between the Cubs sale and the inside deal that delivered the Red Sox to John Henry.

So, should Cubs fans care that Canning ends up with the team? Well, aside from the owner not being Mark Cuban, Canning is probably not that bad a choice. He is obviously well connected to baseball and understands the dynamics of the game and its economics. He is a Chicagoan and understands the city and its fans. If the John Henry analogy is complete, he can break curses and deliver a World Series too.

BlogPoll

After an absence of a couple of weeks, I have managed to get my blogpoll ballot in on time this week and here it is (ignore the delta as there I didn't submit a ballot last week):

Rank	Team	Delta
1	Southern Cal	25
2	LSU	24
3	Florida	23
4	West Virginia	22
5	Oklahoma	21
6	California	20
7	Oregon	19
8	Penn State	18
9	Ohio State	17
10	Wisconsin	16
11	Rutgers	15
12	Boston College	14
13	Texas	13
14	South Carolina	12
15	South Florida	11
16	Alabama	10
17	Missouri	9
18	Cincinnati	8
19	Clemson	7
20	Kentucky	6
21	Louisville	5
22	Arkansas	4
23	Arizona State	3
24	Purdue	2
25	Washington	1

Dropped Out:

Keeneland Auction Down: Warning Sign for Economy

This week has marked the first week of the annual September sale of thoroughbred yearlings at Keeneland. The first two days of the sale are the time when the best yearlings of the sale, which include the best yearlings brought to market anywhere in the world, are sold. These are the days marked by the sale of yearlings that fetch millions of dollars, particularly if it is a colt that happens to catch the fancy of both Coolmore and Sheikh Mohammed of Dubai.

This year the first two days were down from last year rather precipitously. Gross receipts were down 20% from last year while the average selling price fell from $564,383 to $431,386. The median price, however, remained steady at $300,000.

So, what does this mean? Does it portend bad things for the horse racing or breeding market or is it a sign of bad news for the economy? Is it just a one time anomaly? Perhaps it is just that since Sheikh Mohammed, a major driver of the top range of the market, reduced his purchases from $60 million last year to a mere $2o million this year, but it may also signify a tightening of the spending habits of the super rich in response to the credit crunch we experienced this summer. If that is the case, it may just be a forerunner of the consumer tightening which we can expect this fall, as the effects of the credit make their through the economy.

This year did mark the return to Keeneland of Clarence Scharbauer Jr., the owner of Alysheba, who purchased a half-sister to Preakness and Belmont winner Afleet Alex on the first day of the sale for a mere $1.4 million. Scharbauer had been absent from Keeneland for 11 years but returned following the death of his wife, in part as a way to cope with his grief. Good luck to him with his new filly.

The Green Monkey Debuts Today

The long anticipated debut of a world record colt is today at Belmont but first a word about the paucity of posts this past week or so. I just haven't been feeling up to writing for a bit plus the High Holidays rolled around the last couple of days. I'm feeling better now so hopefully the pace of posting will pick up and return to normal. Anyway, on to Belmont Park.

The Green Monkey, who was purchased last year as a 2 year old for what was then a world record price of $16 million, will make his long anticipated debut today in the fourth race at Belmont. Plagued by in jury since his purchase, his racing career has been postponed and he has missed both his two year old year and essentially almost all of his three year old year. He will debut in a six furlong dirt race for maidens, three year olds and up.

UPDATE: In a six horse field, The Green Monkey finished third in a fast paced race, one that was probably much too quick for him. Afterwards, trainer Todd Pletcher sounded none too surprised or unhappy with his effort:

“I didn’t think he ran that badly. He got a good position even though it took him a few strides to get there. No real excuse. Obviously, he is a first-time starter and these horses have run before. He didn’t do anything wrong; he just couldn’t quite get there.”

Disney A Sell as ESPN Profits Squeezed

Now, this blog doesn't usually get into investment recommendations and I don't plan on making a habit of it, but I came across an interesting article that I thought I would bring to your attention since it involves the one company that most of it can't live with it and can't live without. Yeah, you guessed it - none other than those crazy, ever maddening folks from Bristol, the WWWL itself, ESPN.

According to Bloomberg, ESPN has so overpaid for rights in the years to come, that its profits picture will be compromised and that is a major problem for the cable division of parent company Disney. Rights fee going into effect in 2009 will increase expenses by $1.02 billion a year, just in time for subscriber agreements with the major cable operators to take effect that cap increases in subscriber fees. Since ESPN constitutes 70 percent of the cable unit's revenue, you can see how this might impact the parent's profitability. The cable unit contributes 46 percent of the parent's operating earning, so the profligate spending of ESPN President George Bodenheimer on Nascar, MLB and the NFL is coming to roost.

Disney's stock has had a nice run last year, increasing by 42 percent in the first 15 months following the appointment of Robert Iger as CEO and the departure of Michael Eisner. However, it has hit the proverbial wall here of late, up only 1.8 percent year to date. With these numbers ahead, the stock doesn't look like one headed for much of a near term run either.

Vegas Sportsbook to Take NFL Fantasy Bets

Station Casinos, Las Vegas' fifth largest sportsbook, will be the first to start taking bets on fantasy football this fall. The casino announced this week that it would begin taking the bets this season on the performance of 16 players selected by the sportsbook's managers. So, just in case you weren't getting enough action managing your team all week and compulsively checking your stats, you can lay a little action on whether Reggie Bush will score 16 points on Sunday. All betting will be done on an over/under basis. The NFL had no comment, but can't be too pleased about this. It has tried to assert some measure of control over fantasy leagues. although not to the same extent as Major League Baseball, and this extends the concept farther afield. For that reason, and the fact that it is removed from the camaraderie aspect of fantasy sports that makes them so appealing, I think this game may not be the hit that Station Casinos may think it will be. My guess is that bettors will prefer to bet on the team results rather the fantasy gimmick and play the fantasy game with their buddies.

Horse Racing and Slots

There was an interesting article in this morning's Courier-Journal discussing the opening of a new racetrack in Erie, Pennsylvania. Now, normally the opening of a track in a community like Erie would not be a particularly noteworthy occasion. It would be a minor league track which would feature horses that would be racing in a generally eastern based circuit, perhaps drawing also from Mountaineer Park in West Virginia.

What caught my eye in this article is the number of major trainers with stables at Churchill Downs and in New York who were shipping horses to Presque Isle. The reason: daily average purses of $500,000 spread over 8 races, fueled by slot machines. This compares to a daily average at Turfway Park, for instance of $140,000 over 10 races. Turfway is a northern Kentucky track, which is admittedly minor league but is frequented by trainers based at Churchill Downs and Chicago's Arlington Park, with the perhaps the lesser horses in their stables. (That said, however, Derby and Travers winner Street Sense is expected to make his next start at Turfway as he preps for the Breeders Cup) Turfway is known for an exceptionally safe Polytrack artificial surface.

The story here is simple. Slots are fueling purses at Presque Isle, as they have at Mountaineer Park and other tracks around the country. For Kentucky and Maryland tracks to compete in the national marketplace for horses, particularly at the lower levels. it is imperative that both states adopt some form of gaming that will allow the tracks to funnel some gaming revenue back into purses. Simply put, without gaming revenue, the horse industry in Kentucky and Maryland, a major industry in both states, is in grave danger.

Dazed and Blue

What a way to start September. As many major powers do, Michigan thought they had bought themselves an easy opening game opponent in I-AA Appalachian State. Somebody forgot to check their record. The two-time defending I-AA ( OK, the FCS in politically correct NCAA parlance, but I refuse to use that nomenclature and so does everyone else, including the Appy State coach) champions walked into the Big House and walked out with one of the biggest upsets in NCAA history. Michigan? The Wolverines began the search for Lloyd Carr's successor within five minutes of the final gun.

For the most part, around the rest of the country form held, which just puts the Wolverines loss in even starker relief. Forget the top 5, Michigan will be lucky to still be in the top 25 when the rankings come out after Labor Day. The only good news is that nobody outside Michigan got to see this game as it was shown on the Big Ten Network. Since Insight is the only cable system of the top 6 to have reached a deal with the BTN, and it has subscribers only in Ohio, Illinois, Indiana and Kentucky, none of which featured the game on the BTN channel delivered to its subscribers, the game was only available to Direct TV subscribers. I wonder how Comcast feels now. What was clearly one of the most exciting and historic games of the season was seen in few homes outside core Big Ten country. I hope it was broadcast back to Boone.