Business Bits: United Stadium, TV Rights and More

unitedDC United’s efforts to get a stadium built in Prince George’s County took a small step forward with the Maryland House Appropriations Committee approving a bill to fund a study about the project.  United is seeking State and County funds to build a new soccer specific stadium near the Metro in Maryland.  With RFK crumbling and a stadium near the Anacostia River, PG County is likely the best option for United.  The vote is positive, but the 17-7 vote tally is concerning for such a minor measure.  Stadium projects are not popular in this economy and United may find itself without a home if it alienates the District.

UPDATE:  According to this note in the Washington Post, the Study may not go forward after all.  Because of an apparent misunderstanding of the separation of powers, the Legislature has over-stepped its authority and will have to reconsider the bill. 

According to this AP story, Fox Soccer has won the rights to televise Champions League games for the next three years.  FSC beat out ESPN for the rights: a large coup for the soccer-only channel.  At the same time, ESPN is apparently offering cable companies and other distributors the opportunity to accept an ESPN Classic for ESPNU switch. The proposal would move Classic to a sports tier, thereby significantly decreasing its availability.  In recent years, Classic was regularly used to show non-marquee USMNT games.  This switch may either force ESPN to keep soccer on ESPN/ESPN2 or significantly reduce the available viewing audience.

As we have previously reported, MLS has shown a  surprising ability to retain major sponsors in tough economic time.  According to this latest report from the Sports Business Journal, Pepsi is now part of the list of retained companies.  Interestingly, the deal will switch the sponsorship focus from Sierra Mist (which was omnipresent as an MLS marketer), to Pepsi and Gatorade.  MLS has continued to show remarkable resilience with its sponsorships on both a League and Team Level with sponsors like Panasonic and VW staying with the League.

The Morning After: MLS, WPS, USMNT

wpsIt was a big weekend for U.S. soccer fans.  The National Team was in El Salvador for a qualifier, WPS kicked off in Los Angeles and the MLS completed its second week of games.   ESPN2 televised the National Team (after not showing an MLS game this week).  Captain Morgan’s featured prominently as an advertisor (I don’t remember them investing heavily in soccer previously) and there was otherwise a fairly typical mix of national and local advertising.  Heineken and Southwest also purchased ad time.  The crew was on site (as opposed to a booth in Bristol) and the production went fairly smoothly throughout.

FSC televised the WPS opener at 6:00 EST on Sunday.  Mark Rogondino manned the booth for play-by-play.  As a founding partner, Puma featured prominently throughout.  Super Eight Hotels, American Airlines were among the sponsors along with ususal suspects ProActiv and Soccer Shop.  Just under 15k attended the event at the Home Depot; a nice opening for the League’s first game.

League-wide, attendance in MLS was disappointing in week two despite another strong showing in Seattle.  The Rapids and RedBulls opened with less than 12,500 in New York and less than 12,000 in Commerce City.  Columbus raised its championship banner in front of less than 15k.  San Jose sold out for the second consecutive week and about 16k came to RFK for United’s home opener.  Sunday was the most distressing number, with less than 7k showing up at Pizza Hut Park.

It is not terribly surprising that a rainy night in New York for the Bulls’ last campaign at Giants Stadium drew poorly, but the numbers in Colorado and Columbus are fairly disappointing.  The weather wasn’t great in DC either, but for one of the League’s perennial attendance powerhouses, it is a low number.  We have previously discussed the attendance woes in Dallas, but this number is exceptionally bad.  Fans of the team have been clamoring for a change in the front office, and if the sub 10k numbers continue, changes might follow.

The FSC game had the usual mix of Home Depot and ProActiv commercials combined with a fair amount of MLS Works and PassBack spots.  RSL’s broadcast (of  its game against Seatle), was heavily sponsored by KFC, and a local bank.  In San Jose, Amway again featured prominently on stadium singage and a half time interview with the Quakes’ VP of Marketing touched on the new campaign and the addition of a new beer garden and other stadium improvements.  We touched on that campaign here.san-jose

Business Bits: Expansion in Motion, WPS & Montero

mlsTwo years before they kick off, the newly minted franchises in Vancouver and Portland are already competing off the field.  As we reported earlier this week, Vancouver had already sold 5,000 season ticket deposits less than one week after the franchise announcement.  Now, word comes out of Portland that within the first 48 hours of opening up sales, more than 1,000 season ticket deposits have been sold.  For both teams, present USL season ticket holders will have priority ahead of deposit holders, likely adding a couple thousand more to the season ticket rolls.

Fans of both teams already anticipate a heated rivalry on the field.  Off the field, the franchises will forever be compared because of their start dates and geographic proximity.  It will be fascinating to monitor these franchises as they prepare for 2011.  Advertising dollars, ticket sales, broadcast deals and sponsorships will all provide means to compare the franchises for the next two years.

As we have previously discussed, the WPS kicks off this weekend from the Home Depot Center.  The Washington Post is reporting that more than 10k tickets have been sold for the L.A. Sol/Washington Freedom opener. The game will be nationally televised on FSC and the rest of the League will open the following week.  Check out our interview with WPS Director of Communications Robert Penner for more on the WPS’ business model and expectations.

Colombian Fredy Montero made a big splash on the field in his debut last week.  The performance was so impressive that Seattle fans were already dreaming of multiple MVP awards, or the possibility of a large transfer fee.  An article in the Seattle Times suggests that neither may come to pass.

According to the article, Montero is on a one year contract stemming from a loan agreement.  Seattle GM Adrian Hanauer acknowledged to the paper that Seattle only controls Montero for one season (despite Montero leaving the door open to a second year).  MLS typically orchastrates its loan agreements with an option to buy,  so a one year loan without such an option would be rare.  Nevertheless, a young player with such promise will be a hot commodity on the transfer market, and there are reports that MLS owns some percentage of Montero’s sale rights, thereby affording the League a chance to recoup some money on a Montero transfer. sounders

MLS: A Peek Behind the Curtain

mlsFew sports leagues guard their finances more closely than MLS, but efforts to bring a franchise to Portland brought many long hidden numbers to light.  In a report prepared  by HVS, many MLS financial numbers became public for the first time.  The report is here.

The report projects MLS finances from 2011 (when Portland enters the League), until 2015 and aggregates data from past seasons.  Total  MLS stadium revenues for 2011-2015 are projected at $14-15 Million per year.  This includes ticket sales, advertising, naming rights, concessions and more.

The report also addresses season ticket sales for 2007 and 2008 with Toronto the high (16,641 in 2008) and Chivas the low (837 in 2008).  The report does not include Seattle’s 22k for 2009.  Most teams fall in the 3-5k range, but the League did show a 26% increase from 2007 to 2008 (including the addition of San Jose in 2008).

Because the report focused on the viability of a stadium in Portland, many of the numbers focus on seating, concessions, merchandise and other game day items. Around the League, Club prices range from $5,000 (both L.A. teams) to approximately $1,000.  Suites range from $154,000 per year (Galaxy) to $21,000 per year (KC).  Some teams sell suites by the game, while most offer only annual purchases.

Stadium naming rights are also discussed; The Home Depot Center is a $70 million deal for 10 years, while Pizza Hut Park is $25 million over 20 years.  Dick’s Sporting Goods Park is a $40 million two year deal and Rio Tinto is a $1.5-$2 million dollar annual deal (for 15 years)The report also projects annual ticket sales in Portland (well below the mean), ticket prices, revenue from non-soccer events and more.

This is a facinating picture of the League’s current, past and future finances. Based on these numbers, the City of Portland and presumably investors in Vancouver, Portland, Philly and St. Louis were eager to buy into MLS.  The report makes for fantastic reading (in its entirety) and will definitely make for interesting conversation.

What are your thoughts?  Are their numbers in the report that surprise you?  Impress you?  Let us know.

Business Bits: Invasion of the Super Clubs

milanFour of the World’s largest soccer clubs will be touring the U.S. this summer in the “World Football Challenge”  The event boasts Inter Milan, Chelsea, Club America and AC Milan in a series of matches across the U.S.  Venues include the new Cowboys’ stadium, Foxboro and Palo Alto.  The event is run by Creative Artists.

Summer tours by big time clubs have become an annual ritual, as European teams gear up for their new seasons in the comfortable weather of North America.  The tours typically include some MFL and MLS competition, participation in the MLS All-Star Game and draw great numbers every year.  The popularity of these events continues to show the reach of the World’s Game in the U.S.  MLS has to harness these fans and convince them to keep coming for the MLS product.

After trying to package their AC Milan friendly with the season opener, the Galaxy are already selling the game as a stand alone event.  That is a pretty disappointing circumstance for the League’s most visible franchise.  Opening night attendance was very poor for the Galaxy despite the effort to pair the match with the Milan game.  The team is also offering a $1 beer and hot dog promotion prior to their next home game.

Newly designated expansion franchise Vancouver has announced that it has already sold its initial allotment of 5k season ticket deposits; the deposits were snapped up in less than 48 hours.  According to the team, the new deposits will slot in line behind current Whitecap season ticket holders in the rush to reserve season seats.  Remarkably, kick-off for the MLS version of the Whitecaps is still two years away.  bc-place

WPS: Interview with Robert Penner

wpsOn March 29, Women’s Professional Soccer will kick-off its inaugural season with a nationally televised match-up at the Home Depot Center.  Pitting the Los Angeles Sol against the Washington Freedom, the opening match will feature Brazilian star Marta and U.S. National Team scorer Abby Wambach.

Rising from the ashes of the WUSA, the WPS is seeking to gain a permanent foothold in the U.S. sporting scene.  A  national TV deal, a partnership with MLS and a reduction in team costs are all part of the “new model” .  WPS director of communciations Robert Penner was kind of enough to chat with footiebusiness.com about some of the business aspects of the WPS.  Mr. Penner is a veteran of sports media and marketing and has worked with the A.T.P.,  U.S. Open and NBC.  Most recently, Mr. Penner worked with Puma, a founding partner of the WPS.

Footiebusiness.com: Who does WPS view as the target demographic? When affiliating with the League, who are your sponsors looking to reach?

Robert Penner: Our core demographic is of course the young female soccer player age 8-18 who plays at the club and recreational level, but we also want to reach their parents, fitness-minded women in their 20s, 30s and 40s, as well as soccer fans in general. With our world class product and athletes on the field, we think we can accomplish that. The sponsors that we have met with and those that have signed on with WPS, know that we can help deliver this hard-to-reach demographic to them through many different activation platforms.


FB: How does the media relationship with FSC differ from the media model pursued by the WUSA? What efforts are being made to secure local TV deals?

RP: First, we wanted a network that spoke to the core of what our league stands for, in this case world class soccer – so FSC was a great fit for us. In addition, we wanted appointment television so our fans know exactly when and where they can watch WPS every week. FSC has made the commitment to promote our league across their various media partners and online, so that was important to us. At the local level, we are working with two potential regional television partners and hope to know our regional TV schedule very soon.


FB: How closely will WPS work with MLS? What are the advantages/disadvantages of a close relationship?

RP: We have gained a tremendous amount of insights from MLS. They are our sales arm through our agreement with SUM, so officially we are business partners on the sales side of things. In other areas, there are overlapping synergies with operations for some teams and several teams share stadiums such as Chicago, Bay Area and Los Angeles. DC United and the Washington Freedom have announced several doubleheaders and our new franchise in Philadelphia has had a lot of discussions with the MLS Philadelphia franchise that is coming on board next year. There’s a lot we can learn from MLS, they’ve done a great job building their league to where it is today 13 years after their launch.


FB: What are the League’s goals/expectations for attendance/ratings in the first two years?

RP: We’ve said all along that we want to keep our expectations in check and we are shooting for 4,000-6,000 fans per game for the opening season, which we think is reasonable and will still make our league model profitable.


FB: We have heard about Amway’s deal with the Sol. Who is responsible for securing jersey sponsorship (i.e. the teams or the League)? Can we expect additional announcements about such sponsors prior to the season?

RP: Team shirt deals, the inventory on the front of the jerseys, is for sale by the teams. From what we’ve heard there have been some other fruitful discussions so we are hopeful that there will be other announcements over the course of the season.


Thanks to Robert Penner.  WPS opens play this weekend on FSC.

Business Bits: Expansion in St. Louis & the Monday After

st-louisWith MLS announcing Portland as the League’s 18th Expansion Franchise, St. Louis appeared to be the big loser.   Since the announcement, Commissioner Garber worked hard to dispel that belief.  In an article published in the in St. Louis Post-Dispatch, Mr. Garber indicated that the League would work hard to steer investors to join Jeffrey Cooper’s bid.  We have written about Mr. Cooper’s bid before, and noted the League’s frustration with the lack of financial backing; it appears that the League is now going to work hard on Mr. Cooper’s behalf.

Mr. Cooper is a bridesmaid again, despite a solid stadium deal and a city with a strong soccer history.  With one more round of expansion scheduled for the coming years, he is running out of time to cement a team for the Gateway City.

Week one of MLS action is complete, and League wide, attendance was just OK.  Houston, Dallas and Chivas brought in about 16k, while KC and San Jose sold out their smaller parks.  Seattle was a sell out on Thursday night with more than 32k and the Galaxy brought in 18k (probably the most disappointing number of the weekend) for the Sunday game.   The Crew/Dynamo match-up of the last two Cup winners was also surprisingly lightly attended.  Dallas was higher than anticipated, but the presence of Blanco may have been a contributing factor.

The League debuted their new MLSlive features this weekend and the product seemed to work well.  For less than $20 for the season, the package is a fantastic bargain.  Direct Kick was free this weekend as part of the League’s annual preview.  With the price again at $79 for the season, this is also a great deal.  These packages do not include the games broadcast nationally on ESPN, FSC and Telefutura.  Interstingly, the local broadcasts prominently displayed advertising in the upper corners of the screens, adspace not used by EPSN2.  For the matchup on Telefutura, occassional screen advertising was present, but only for infrequent interludes.  Gildden, Nakita and Addidas were among the prominent stadium signage around the League. mls