The Commish Speaks: State of the League

Every once and a while, our business coverage dovetails with more traditional coverage of MLS.  Today is one of those days.  Commissioner Garber gave his annual State of League address and highlighted some important business changes.  We thought we would address some of these here.

The address started with the Commissioner noting the importance of the league presenting a new champion in 2010.  Garber stated that soccer is now “mainstream” following the USMNT performance in South Africa.  He discussed the opening the PPL Park and Red Bull Arena and noted that Philly was the 4th most attended team in the league and noted the importance of supporters groups.  He also suggested that there has been a recognizable increase in interest and awareness in New York for the Red Bulls.  He also discussed the new DP rule and how it has increased awareness of MLS.

He also mentioned that there are now 20 homegrown players that have seen first team play through the new program.  “They are the future of our league” and stated that MLS is the only North American sports league where young players can train “in the shadow of the stadium” where they will make their professional debuts.

Sponsorship business has grown (as it has every year).  The consumer products business is up 15%.  Two new big international sponsors, Continental and Castrol were added this year.  He also stated that new jersey sponsors are coming and that he thinks all teams will have a jersey sponsor within a year.  $20-30 million dollars in revenue for the clubs earned through this source.

He also suggested that caps will be dropped on home grown player signings.  Salary budget increased 15%.  Most clubs spend $3.5 million to $4.5 million in salary budget that doesn’t include allocations. Allocations are now up to $10 million dollars in 2011.  This money is used to “goose” the salary budget.  Rosters increased to 30 players for the first team.  Spots 25-30 are for players 24 years and younger and those players will not count against the budget.  Reserve division announced.  It will include 10 games and an 8 game playoff.

34 game regular season starting in mid-March with MLS Cup on November 20.  There will be one stand alone “first kick” match. Salary budget space will be increased for teams making the knockout rounds of Champions League.  Unclear if this applies to 2010. All CCL teams will get additional budget space.

Portland and Vancouver are doing well in ticket sales and commercially.  Two new stadiums coming next year.  KC, Vancouver and PGE Park (two are renovations).   Believes that TV footprint will expand in Canada.  Focused on new team in New York.

Good discussion about TV ratings.  Its not about marketing according to Garber.  It has to do with schedule, broadcast quality and promotion.  7 of the best ratings were post-World Cup.  Said ESPN will have a major promotional effort behind the game. League is engaged with FSC about renewal.  MLS is also discussing with Versus and others regarding soccer broadcasts.

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