MLS Expansion: Portland?

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As part of an occasional series of posts on MLS expansion contenders, I thought it worth taking a look at Portland’s efforts to join the League in 2011.  The bid centers on a proposal to upgrade PGE Park, the home of a minor league baseball team and the Portland Timbers of the USL.  According to the folks at mlsportland.com, a $40 million upgrade will take PGE to MLS standards.

Interestingly, the driving force behind the Portland bid is Merritt Paulson, son of the former Secretary of the Treasury.  Paulson is seeking $85 million in public money to support the bid, renovate the stadium and construct infrastructure.  Given the economic climate, and his father’s prominent role in the bailout, there is no small irony in Paulson’s leading the charge for a raft of public money.

Soccer has been successful in the City of Roses at the USL level and as a “one sport town” Portland is an attractive market.  This is especially so, when that one sport is the NBA (with only a small amount of schedule overlap).  Using Columbus as a model, there is good reason to believe that a Portland franchise backed by big money and a solid stadium, can succeed.

The bid was recently rocked by scandal, when Portland mayor Sam Adams, a strong proponent of the bid, admitted to an inappropriate relationship with a teenage female.  With franchise announcements expected in about a month, it will be interesting to see whether the Mayor’s problems will drag down Paulson’s efforts.  Portland has long been a soccer hotbed, and with Seattle entering the League in 2009, there is great potential for a natural rivalry.

I think Portland is a great fit.  I’ve long believed that medium markets like Columbus, Salt Lake City and San Jose are perfect locations for MLS franchises. Yes you need the big cities, but in New York and Boston, MLS is barely a blip on the sports landscape.  In smaller cities, the teams are a focus of local medial and a source of community pride.

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T.V. Tidbits: US/Mexico TV Ratings & Red Bull Rights Deal

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MLS ratings may be flat, but the U.S. National Team continues to draw well on TV.  In televising the  US/Mexico clash on Wednesday,  ESPN2 logged a .8 rating (over a million viewers) setting a new record for a World Cup Qualfier.  Add in the more than 5.5 million viewers on Spanish Language TV and close to 7 million people in the States watched the 2-0 US win on television.  As we have said before, there is a big audience for soccer in this country, MLS just needs to find a way to capture those eyeballs.

msg Meanwhile, according to reports, the NY Rebulls have signed a three year rights deal to televise Red Bull games on the MSG network.  While financial terms were not announced, New York fans will be pleased to have a destination for local broadcast of at least 20 games.  The deal also includes a studio show and Shep Messing!red-bulls2

DC United Moving to P.G. County?

In a recent story of Maryland, it appears that D.C. United is moving closer to a full time move to Prince George’s County. United currently plays in crumbling RFK Stadium and has been trying for years to get financing to build along the Anacostia River at Poplar Point.  According to reports, United pays $1.3 million annually to rent out RFK, but does control concessions and parking.  Would the move to Maryland really be benficial?

Obviously, it all comes down to money, and Victor McFarlane has quite a track record in real estate. In this econmic climate can P.G. County make an attractive pitch to bring the team?  MacFarlane must think so.   A press conference is scheduled for Monday according to the Washington Post, so we will keep an eye on the situation. 

 Many United fans are upset by a potential move to the suburbs, and I tend to agree (compare the attendance/atmosphere in Dallas and Toronto to see the importance of an urban fanbase).  However, P.G. County is on the Metro, so perhaps United will get the best of both worlds.

MLS to Miami? Does South Florida deserve a second chance?

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When MLS officials announced the next round of expansion, St. Louis, Montreal and even Portland were among the favorites to land the new franchises.  Passed over in the prior round of expansion, St. Louis, lead by Attorney Jeffrey Cooper, landed a stadium deal and big name investors like Albert Pujols.  Nevertheless, MLS has long had concern about Cooper’s financial stability.

When Montreal  and Atlanta dropped out of the race (leaving Portland, Ottawa and Vancouver among the possibilities) the Gateway City seemed almost guaranteed a spot for 2011.  Then a dark horse entered the race in the form world famous F.C. Barcelona.

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The Spanish powerhouse combined with Marcelo Claure and Florida International University to     submit a bid to bring MLS back to South Florida.  As MLS fans well know, the Miami Fusion entered the League as an expansion team in 1998 and were contracted just four years later.  That background, combined with South Florida’s rather weak history of supporting its teams (Florida Marlins anyone?), has lead many to scoff at any move back to the Miami area.  Add in the lack of a Soccer Specific Stadium (the team would share with the FIU Football team) and the Miami bid seems like a sure loser.

However, the leadership of MLS seems to disagree.  Apparently wowed by the glam of FC Barcelona and the billions in Claure’s pockets, the league seems eager to embrace South Florida.  Commissioner Don Garber just announced that if the Miami bid is accepted, the team would start play in 2010, a year ahead of schedule and at the same time as Philadelphia.

Count me among the unconvinced.  The “beloved” Miami Dolphins strugle to sell out their games, the Panthers are barely a blip on the Miami scene and Marlins are an annual embarassment.  Why would MLS be any different? The idea of 9,000 fans snoozing through Sunday afternoon game in 110 degree Miami August heat, is a nightmare scenario for supporters of the Leage.   MLS may love the idea of Barca dumping money into its coffers, but like Chivas before them, I see little chance of a big time soccer power adjusting to life in Major League Soccer.  League rules will not permit “Barca USA” to serve as a farm team of the parent club or as a way station for up and coming talents.  MLS should have no interest in serving as a marketing opportunity for the Spanish Giants.  As much as Barca might love the idea of selling jerseys in North America, I think the League would be far better served  taking $40 million from St. Louis and and Portland in 2011.

Should Beckham Be Released from MLS Contract to Join AC Milan?

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With David Beckham’s long rumored transfer to AC Milan seemingly imminent , it is worth examining the implications of the move.  First, a little background:  Beckham came to the L.A. Galaxy on a “free” in 2007 after finishing out his contract with Real Madrid.  While the exact terms have always been sketchy, it has long been understood that Beckham signed a five year deal including less than $50 million in guaranteed money, with most of the remaining $200 million wrapped into jersey sales and image rights.  Most importantly (for purposes of the move to AC Milan), there is an “opt out” clause that lets Beckham walk away from Major League Soccer after three years (November, 2009).

After the 2008 season, Beckham (with MLS’ blessing), secured a short term loan deal to AC Milan until March, 2009. His stated reason for taking the loan was to stay in shape for the upcoming world cup qualifying.  He was expected back with L.A. in plenty of time for the season opener at the end of March.  While in Italy, Beckham proved himself capable at playing at the highest level, and soon, AC Milan was banging down MLS’ door for a full transfer.

Given the forces at play, it seems unlikely that MLS will hold onto Beckham.  Selling him for a reasonable sum now would certainly seem to trump letting him walk for free in November.  However, a whole host of sponsorship deals and television contracts were signed with the understanding that the world’s most famous athlete would be wearing Galaxy colors.  Given the economic climate, it is not unreasonable to suspect that some of these companies may come back to the League looking for money.  Herbalife got far more than even they thought, when Galaxy jerseys sporting their logo became the “must have” uniform worldwide.  With Beckham gone, those sales are sure to plummet during the last three years of their (no surprise) five year deal.

beckhamFor MLS, the departure of Beckham is a definite mixed bag.  There is certainly an argument that his two years raised awareness of MLS to new heights both nationally and internationally.  MLS is now part of the worldwide soccer landscape and is part of the U.S. mainstream sportsvernacular.  Attendance increased league wide during his two years, especially during Galaxy away matches.  On the other hand, TV ratings stayed flat and the impression that Beckham is fleeing MLS could be taken as a black eye for the league.  There is a good discussion of both sides of this issue with sportswriter Stefan Fatsis on NPR.

I tend to think now is a good time for Beckham to be moving on.  When he came to MLS, the move was derided as a sunny retirement in L.A. for an aging superstar.  Fans of the European game refused to believe that a talented European would choose to play in the States if he was good enough to play across the pond.  Two years later, teams are clamoring for Beckham’s services, and MLS has become a destination for international talent and launching pad for budding Americans like Jozy Altidore, Clint Dempsey and Michael Parkhurst.

Off the field, I think the benefits of Beckham have peaked.   MLS raked in huge amounts of money with ticket sales, jersey sales and TV deals.  Arguably, the surge in soccer stadium construction is partly attributable to the Beckham effect and the upcoming changes in the Collective Bargaining Agreement will definitely be impacted by the increased interest in MLS.  There is no use keeping a player who wants to leave (and who can do so soon).  MLS will be best served selling Beckham for $15-20 million and perhaps reaping some additional benefits from AC Milan.  They can then turn that case into more players and as a crutch to ride out the economic storm.

UPDATE: According to Soccer By Ives, MLS has given L.A. and AC Milan until Friday to resolve the potential Beckham transfer:  http://www.soccerbyives.net/soccer_by_ives/2009/02/mls-ac-milan-has-friday-deadline-to-buy-beckham.html

With sponsorship deals under negotiation and tickets being sold, it only makes sense for the League to press.  They don’t want to get caught with sponsors claiming some sort of breach.

MLS retains Panasonic as Primary Sponsor

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In a sign that MLS is still a valuable commodity among sponsors, the League announced that Panasonic has re-upped for a three year run as the “Official Consumer Electronics” partner of MLS.  Goal.com

Given the econmic climate, long term sponsorship deals are an important source of ongoing revenue. Given the amounts of scrutiny aimed at publicly traded companies and the pressures on companies to cut back on high profile advertising and events (think about the uproar over CitiField), big name sponsors may be harder to come by.   This is especially so in light of recent news that Panasonic was shedding 15,000 jobs over the next 13 months. According to Sports Business Journal, the deal is valued at almost $3 million per year.  http://sportsbusinessjournal.com/article/61493

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