NCAA Settles with Student Athletes

The NCAA has agreed to settle a class action antitrust case filed by former student athletes in California alleging that the failure of the NCAA to approve scholarships that fully fund student athletes expenses constituted antitrust violations. In agreeing to settle the case, the NCAA has agreed to create a $218 million fund to cover insurance and to which student athletes could apply to receive help to cover additional expenses. The settlement also creates a $10 million fund to assist former student athletes to complete their education.

This marks yet another case that the crack legal team at the NCAA has chosen to settle rather than litigate to defeat. Once again the NCAA has had in place policies that could not withstand legal scrutiny. How long and how many millions of dollars will it take before the NCAA faces the reality of life in the 21st century? At least they had the good sense to settle this case and create a fund that can do some good for the athletes that need it.

Coyotes to Sponsor PGA Golfer Finney

The Phoenix Coyotes are looking to the links for marketing and taking their brand across North America. It what is likely a first for any team in North America, the Coyotes have agreed to a one year sponsorship deal with PGA Tour golfer Jeff Quinney, starting with this week's FBR Open in, drumroll, the Coyotes nearly hometown of Scottsdale, Arizona. Quinney, who is in his second year on the Tour, earned more than $1.5 million last year, finishing 41st in the FedEx Cup standings. He won the 2000 US Amateur and is a former Arizona State University golfer. Terms of the deal have not been disclosed.

While a couple of Tour players have had sponsorship deals with the NFL in the past, those with the league as a whole and not individual teams. This is believed to be the first deal done with an individual team. While Quinney is pictured here in a golf shirt with a Coyotes logo, you have to wonder if on Sundays in cool weather, he will come out in a Coyotes hockey sweater. Also, will the Pack and the Snow Patrol be patrolling the sidelines in Scottsdale cheering him and entertaining the crowd?

An Historic Weekend in Israeli Sports

It was a week in Israeli sports that began like many others. Maccabi Tel Aviv won a EuroLeague game at Nokia Arena and looks to be on its way to a top seed in the round of 16. Half a world away, the pride of Israeli tennis, ShaharPe'er had crashed out of the Australian Open singles competition. But this was the calm before the proverbial storm as Saturday dawned bright around the globe.

The appetizer was a sparkling performance by multi-talented striker Yossi Benayoun in a game that reminded everyone exactly why the FA Cup is still a beloved tournament. In a game that saw a team of part-timers composed of bricklayers, taxi drivers and truant officers take twice take leads over Liverpool at Anfield, it took a hat trick by Benayoun to save the Premier League side's reputation, not to mention its place in the fifth round.

In a normal weekend, that would have been the highlight, however, more was to come from Down Under. The aforesaid Pe'er redeemed herself in doubles, making it to the finals, with her Belorussian partner Victoria Azarenka before falling to Alona and Kateryna Bondarenko 6-2, 1-6, 4-6.

The best was yet to come however. Israeli doubles team Andy Ram and Yoni Ehrlich met French doubles team Michael Llodra and Arnaud Clement in the men's doubles final. The Israelis won 7-5, 7-6 completing a run through the doubles bracket in which they did not drop a set, and becoming the first Israeli team to win a Grand Slam event. The pair played before a raucous crowd of Israeli supporters, replete with, and I'm quoting here, "cries of war and shouts to attack the French from the start."

It will be tennis mania in Israel this week as the conquering Aussie Open heroes arrive home accompanied by Maria Sharapova, the Australian Open Women's Singles winner, who is coming to join her Russian Fed Cup teammates ahead of this weekend's match with Israel. Shahar Pe'er will open play with a singles match against Sharapova. I doubt that Israeli tennis has ever had a more eventful eight days.

Liverpool Crisis Resolved as Debt Refinanced

Liverpool's North American owners closed Friday on a much anticipated 35o million pound loan from Royal Bank of Scotland and Wachovia Bank putting to rest for the time being any ideas that the club will be sold to Dubai Investment Corporation, the investing of Sheik Mohammed, the ruler of Dubai.

Also today, owners Tom Hicks and George Gillett unveiled a design for a new 71,000 seat stadium and indicated that work can be begin immediately with a portion of the proceeds of the loan. Although the stadium capacity exceeds the 60,000 for which Liverpool has approval, the stadium design fits within the approved footprint so no trouble in gaining approval for the new design is expected.


Finally the fate of Rafa was put to rest as Hicks announced that he would fill out the remaining 21/2 years of his contract. Acknowledging some communication issues, Hicks said they would be addressed and that Benitez's job was not in danger. That should calm some of the fan unrest as should the assurances that the club is now on firmer financial footing and that the ownership issues appear to be settled, even though Gillett was not in evidence in person, by phone or by signature on any of the public statements.

Business of Winning

Hot on the heels of my recently released Greatest Franchises in Pro Sports, CNBC comes along to confirm my somewhat controversial (at least according to the comments at Armchair GM) choice of the top franchise, the New England Patriots. Sunday night at 10:00 PM Eastern, the business network will feature Touchdown! The Patriots and The Business of Winning, a one hour look inside the franchise and at owner Robert Kraft and at how the Pats have become one of the most profitable teams in pro football. Here's the CNBC preview video, which is an interview with Tom Brady about Robert Kraft and an interview with Kraft:

http://www.cnbc.com/id/15840232?video=628214215

Carnival of the Capitalists

This week's Carnival of the Capitalists is hosted by Mike from PartnerUp, the social network for entrepreneurs. Get over there and check it out as he has some great posts up worthy of your time.

Curlin Horse of the Year; Will Continue Racing

The Curlin story gets better and better. Bought as a yearling for $57,000, this time last year he had different owners, a different trainer and had yet to make his first start. Last night he was named Horse of the Year and Three Year Old Male Champion. While accepting the award, majority owner Jess Jackson announced what most in the audience already suspected, the colt would be kept in training for racing in 2008, with the first major objective likely to be the $6,000,000 Dubai World Cup on March 29.

Curlin, winner of the Preakness, the Jockey Club Gold Cup and the Breeders Cup Classic was a runaway winner of Horse of the Year, winning 249 of the 262 votes. He was an even more emphatic choice as Three Year Old Male Champion, winning all but three votes, which went to Kentucky Derby winner and runner-up in the voting Street Sense.

Jess Jackson is to be congratulated for the wins but more importantly thanked for keeping the colt in training. It's very rare these days to pass up the sure money that keeps from retiring three year old winners to stud immediately after the big wins of their three year old campaign. More and more often, they don't make it through their three year old season to the late summer or fall races much less kept in training at four. For racing to keep growing, fans need horses to identify with and that comes from the ability to market racing's stars for longer than a couple of months at a time. Curlin was a wonderful story last year and it's great that we will be able to follow him for another year. Let's hope that he is put to good use and the tracks racing establish don't waste this golden asset that Jess Jackson and the other owners have just placed in their laps.

NFL Will Play Games in Canada, England in O8

The NFL will almost certainly approve the Buffalo Bills plan to play at least one home game in Toronto next season and will return to London for another regular season on the heels on the successful debut this past season. The Tampa Bay Buccaneers lead a list of four teams likely to play in the game. The Bucs owner, Malcolm Glazer is also the owner of Manchester United in the English Premier League. According to ESPN, the other three teams under consideration are the Chiefs, Saints and Seahawks.

While this past season's game was played in the new Wembley Stadium, the site of next season's game has not been decided, with Wembley one of several options under consideration. It is likely that Man U's home Old Trafford is one of the sites, as I think would be, Arsenal's home, Emirates Stadium.

The 10 Greatest Pro Sports Franchises in the World Plus One

I was reading an article in the Ottawa Sun the other day that listed the greatest pro sports franchises and thought that this might be a fun exercise. The Sun professed to consider only excellence and money in compiling its list but in truth, it considered history, provincialism and Canada's national game. Any list that includes the Edmonton Oilers on a list of the current top 10 franchises in pro sports is suspect at best. Here, then is my list of the top 10 professional sports franchises, based on performance, both on the field and at the bank:

10. Los Angeles Lakers. It's hard to argue with the Lakers history of championships and they are the NBA's second most valuable team

9. FC Barcelona. The pride of Catalonia is perhaps Europe's most exciting team; where every major soccer club in the world makes millions from jersey sponsorship Barca is flush enough to pay a charity (UNICEF) to appear on its jersey.

8. Detroit Red Wings. The Wings are the most successful recently of the Original Six hockey teams and have the third highest value in the league behind the Leafs and the Canadiens so they get this spot almost by default despite their current attendance issues.

7. Boston Red Sox. Two World Series in three years puts the curse to rest for good. Fans fill charming Fenway, while brilliant ownership maximizes available revenue streams for a franchise value of $724 million.

6. Manchester United. As much a worldwide brand as a soccer club, Man U has been having renewed success on the pitch under the ownership of the Glazer family. The club is the most valuable soccer club in the world at $1.45 billion although annual revenue is surpassed by Real Madrid.

5. Dallas Cowboys. On field performance is beginning to catch up with the team's off field tabloid performance. As the team prepares to move into a new stadium in 2009, the value of the club rises to $1.5 billion making it the most valuable professional sports franchise in the world.

4. New York Yankees. A century plus winning tradition unequalled in any sport, the Yankees are synonymous with winning, not to mention with making and spending prodigious amounts of money. Franchise value is estimated to be $1.2 billion.

3. Real Madrid. The most successful soccer team in Spain and Champions League history, Los Galaciticos have also become a global marketing powerhouse. Current franchise value is $1.036 billion.

2. Tiger Woods. On his way to becoming, if he is not already, the greatest golfer who ever lived. Tiger is about to become the first individual athlete to ever earn $1 billion. His stated goal for 2008 is to win the Grand Slam and while that may be audacious, everyone takes him seriously.

1. New England Patriots. Football has not seen a dynasty like this since the Vince Lombardi Packers and that was a far different age. The Patriots are almost otherworldly, they are that much better than everyone else whether they win in two weeks or not. Estimated franchise value is a bit short of the Cowboys at only $1.2 billion but that is due to Gillette Stadium's age compared to the yet to open Cowboys Stadium.

Oh, yeah, the plus one:

College Program: UCLA: No school has ever had a major sport run like the UCLA basketball program had under John Wooden, but that is not why I selected the Bruins. It is not the biggest program - Harvard fields more teams; Ohio State grosses more money. No, UCLA simply leads the nation in the excellence of its athletic programs over the long haul where it counts the most: 100 NCAA team championships, 121 total national championships. It simply doesn't get any better than that.

Sports Business Carnival

The 8th edition of the Sports Business Carnival is now up at Take a Peck. Get over there and check it out.

The Hornets: Coming to a City Near You in 09

David Stern is a consummate marketer. He may have been trained as a lawyer and got his job because he used to the NBA general counsel, but he has kept it so long and earned the reputation he now has because he is focused above all on the image of the NBA and its players and marketing them to its sponsors and potential sponsors. That is why it is important to not take his pronouncements about the state of the league too literally. While he delivers his annual State of the NBA speech at the All Star Game Weekend in February, he previewed it recently in traditional Stern speak:

"Well, our finances are good and up," Stern said. "Our basketball is great. Some of our teams are struggling at the gate — we have a half a dozen teams or so that are having some problems — but at the same time, we have 15 teams that have sold over 10,000 season tickets. So it is really a double tale, so to speak. But overall, business is great, ratings are strong, and attendance remains very strong."

However, if you read through the lines, so to speak, you can see the real problem, one we have visited before: New Orleans. While the Hornets proudly announced recently a new lease for New Orleans Arena that supposedly keeps them in the city through 2014, what it really provided owner George Shinn was something that he has craved since the end of the first season in town - a way out. The new lease provides that the Hornets may terminate the lease and leave town following the 2008-09 season if they do not draw an average paid attendance of 14,735 for the final five months of this season and all of next season. They are not off to a good start - in the eight games played from December 1 through the January 10 announcement of the deal, the Hornets averaged 12,215.

New Orleans was probably too small market to support a NBA team when the Hornets first moved there. The corporate base was virtually non-existent and the population size was marginal at best. Then came Katrina and the all of the ownership's best hopes for the franchise moved to Oklahoma City. Well, not really, they actually moved to Houston, Atlanta, Memphis and other places scattered throughout the South. Mostly, they left New Orleans and didn't come back and what was once a marginal NBA city at best, became a marginal D League city. The best intentions of the league notwithstanding, the Hornets tenure in New Orleans can now be accurately measured - it ends at the end of the 2008-09 season and the only remaining question is what unlucky city gets to receive a good team with lousy ownership - can anyone say Seattle Hornets?

Let's just swap the Hornets for the Sonics and move the Hornets back to OKC. Seattle gets to keep its team. The Sonics owners get a team in OKC where they live and Seattle has to put up with Shinn which I guess is what they get for not agreeing to a some sort of deal on an arena.

TBS to Operate NBA Digital Assets

The NBA has an extensive multimedia operation under the umbrella of NBA Entertainment. It includes the popular website nba.com, the digital cable and satellite network NBA TV (which is having carriage issues similar to the Big Ten Network although the NBA is not demanding that any cable operator carry it on basic cable), League Pass as well as other broadband and wireless operations. The league has operated the assets itself out of the NBA Entertainment office and its performance has been, well, lacking to be kind.

As part of the most recent television rights deal, the NBA granted extensive digital rights to its cable partners Turner and ABC/ESPN. This week, the NBA and TBS announced that TBS would take control of all of the NBA digital assets and apparently, according to at least one former employee, it comes none too soon. The league and TBS will jointly sell advertising which is probably the best use of NBA personnel. The NBA has excellent relations with its sponsors and can be expected to best leverage those for the benefit of the digital platforms. TBS will bring its extensive national contacts to the table for additional advertising and sponsorships.

This would appear to be one of those rare deals that truly is a win-win. The NBA gets out of doing something it was apparently not doing well and turns it over to experts in the field. It can leverage the expertise of long-time partners. Just don't expect to see any real journalism show up on nba.com. Remember, it's sponsor driven.

FIFA and European Clubs Sign Peace Deal

After years of tension, nasty press conferences, threats and lawsuits, peace has come to European soccer. The big European clubs that comprised G14, the mathematically challenged group that consisted of 18 of Europe's largest and most successful soccer clubs signed a peace agreement with FIFA and UEFA yesterday, reaching agreement to players called up for national team duty and on the two most contentious issues separating them. FIFA agreed to pay compensation to the clubs for injuries that occurredFIFA and UEFA agreed to sit down and discuss more "equitable" distribution of television revenues between the clubs and the federations.

In return, G14 agreed to drop its two pending lawsuits. In addition, FIFA agreed to establish a new advisory body composed of about 100 European clubs that would be added to the formal governing structure. It would have no authority but would be a formal body and would be consulted on matters. That alone was a major concession as FIFA has always been resistant to club influence on its matters. The G14 organization will dissolve later this month.

Settling the compensation issue is a major step forward. Clubs deserve to be compensated for releasing players who are injured while on national team duty and then returned to the club only to sit out for months. You only have to look at the Michael Owen situation to see the problem - he was injured while with England and lost for most of the season while Newcastle fell out of all European competition. It cost the club millions. Some compensation is warranted and will go a long ways towards ending the club v. country battles that now take place.

ESPN Buys Stake in NBA China

Forget all the hype about ESPN being independent journalist covering stories. If there ever was any semblance of journalistic integrity in the operations of ESPN, the recent actions of the corporate parent have blown that idea out of the water. First, the WWWL goes and buys a stake in the Arena Football League in lieu of, or in addition to, broadcast rights, in order to give itself an upside kicker in value produced by televising the no longer upstart minor league football league. Immediately, it begins promoting AFL football on SportsCenter and across all ESPN media outlets as if Arena League were the fifth or sixth, depending on how you count MLS, another WWLS televised product, major sport.

The latest evidence of the WWWL's lack of journalistic integrity comes with the announcement that corporate parent Walt Disney Co. has joined with four Chinese investors to purchase an 11% stake in NBA China from the NBA. The stake is valued at $253 million, giving the Chinese operations of the NBA an enterprise value of $2.3 billion. The Chinese investors include Li Ka-Shing, a Hong Kong billionaire, China Merchants Bank Co., Bank of China Ltd. and Legend Holdings Ltd. Bringing on Chinese investors is a wise move by the NBA as it helps secure the business within the Chinese bureaucracy. Capturing the attention of the WWWL is also beneficial for the NBA as having ESPN as your business partner, rather than just your broadcasting partner certainly assures you of more favorable coverage across the whole of ESPN's platforms, no matter how much the company may deny it. For Disney, it is no doubt a good business deal with enormous upside as basketball is well loved in China and the NBA is going to be huge. It just doesn't do much for the stateside journalistic independence it likes to pretend it maintains.

NASCAR Scores Big Win Over Ky Speedway

A US District Court judge in Kentucky handed a big win to the Frances family in an antitrust battle with the Kentucky Speedway over the awarding of lucrative Sprint (formerly Nextel) Cup dates. Judge William Bertlesman dismissed the lawsuit brought Kentucky Speedway against NASCAR and International Speedway Corp, saying that Ky Speedway had failed to make a case.

The suit was filed more than two years ago alleging that NASCAR and ISC had violated federal antitrust laws by conspiring together in the awarding of Sprint Cup racing dates. NASCAR is wholly owned by the Frances family and ISC is a public corporation controlled by the Frances family. A more detailed discussion of the complaint can be found in my original post on the case.

Judge Bertlesman basically cast the case as one of a jilted distributor, saying that: "a producer of a product is free under current antitrust laws to select its distributors and to refuse to deal with would-be distributors, no matter how worthy or deserving they may be."

While the owners of Ky Speedway may appeal, and have indicated that they will, their real option at this point is to buy a track that has a Sprint Cup date and move it to Kentucky. Their most recent attempt to do that, New Hampshire International Speedway, was frustrated by the other NASCAR behemoth, Speedway Motorports Inc, which swept in and bought it at the last minute last November.

2008: The Webcast Olympics

If you are like me, you have grown a bit tired of the tape-delayed Olympics broadcast by NBC over the last several Olympiads. I know all about the time zone factor, but the suits at NBC give the American people no credit for any desire to see live events and persist in packaging everything in a neat and tidy tape delayed four hour event each night.

This summer, NBC and Microsoft have finally come to their senses and will offer live streaming on the web of virtually every event. In addition, they will offer most every event on demand as well. The two will split advertising revenue, which I suspect will be considerable. Knowing the success that CBS has had with streaming March Madness last year, I'm sure this will be a huge hit. I for one expect to watch far more of the Olympics online than on TV.

College Basketball's Most Valuable School - Its' a Tobacco Thing

The North Carolina Tar Heels are undefeated and sitting atop both the AP and USA Today polls as the new year dawns and conference play opens in college basketball. The Heels are also atop another ranking of college basketball programs: Forbes list of the most valuable programs.

Forbes compiles this list based on four factors. These four are contributions made by the basketball program to four different areas. Those areas are: money generated by basketball that goes to the institution for academic purposes, including scholarship payments for basketball players; athletic department (the net profit generated by the basketball program retained by the department); conference (the distribution of tournament revenue); and local communities (incremental spending by visitors to the county during the regular season that's attributable to the program).

The top of the list shows the dominance of basketball in tobacco country as 4 of the top 5 are in North Carolina and Kentucky, with UNC at number 1 followed by Kentucky, Louisville and at number 5, Duke. UNC is valued at $26 million. Louisville is the most profitable, at $17.1 million, on $23 million in revenue. NC State is the poor cousin of tobacco road, coming in 13th on the list, valued at only $13.6 million.