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Dust2
06-05-2009, 04:44 AM
What is the purpose of the salary cap? parity or contain salary cost?

If it's to contain salary cost, then cap the salary at a percentage of a club's total revenue would do the job just as well. If it's parity, then MLS is hindering the growth of teams with potential for significant growth. Parity means that one year the team could be good, then next okay or even bad, then maybe good/okay/bad again. Without consistency, it is hard to grow your fan base or even to retain your current one.

MLS will have a new collective bargaining agreement starting in 2010. What if MLS use Platini's suggestion that


* Clubs should live within their means and spend the income they have.

* This may mean wages being linked to an audited percentage of turnovers$10 mil revenue club = at most $3.0 mil salary ($7 mil left over)
$15 mil revenue club = at most $4.5 mil salary ($10.5 mil left over)
$20 mil revenue club = at most $6 mil salary ($14 mil left over)
$25 mil revenue club = at most $7.5 mil salary ($17.5 mil left over)
$30 mil revenue club = at most $9 mil salary ($21 mil left over)

In addition, the top revenue earners will share revenue/or pay luxury tax to the small revenue earners to help the small clubs break-even/make a little profit. High revenue earners like NY, LA, Seattle, TFC, Vancouver, Chicago will be able to built upon their success and grow. The assumption is that with higher wages, these top clubs can win a little more than the average MLS clubs on a consistent basis and grow their fan base.

3-5 MLS teams with wages of around $7-10 mil a year will help improve:

1. MLS image/perception at home and abroad
2. MLS quality of play
3. MLS talents
4. MLS success in CONCACAF Champions League and other international tournaments (top MLS teams would be competitive with Mexico's FMF teams)
5. MLS TV rating/revenue
6. MLS attendance, sponsorship and merchandise

p.s. This thread is based on a Bigsoccer thread Salary links to an audited percentage of each club's revenue (with significant revenue sharing)
http://www.bigsoccer.com/forum/showthread.php?t=1050635

if I can not post the link, please delete it.

So what do you guys think? What would be the effect on TFC if MLS follow this proposal starting 2010? Will MLSE finally expand the stadium and lay down grass knowing that its high revenue status would enable the team to win on a consistent basis relative to an average club? Therefore, the demand for tickets will be just as high even if the stadium is 30,000 seats. Will the team be much better at $6 mil in wages compare to $2.3 mil salary cap? Will TFC be more successful in international tournaments?

Jack
06-05-2009, 07:18 AM
The lower revenue teams would fall off the face of the planet under this system.

The league would shrink and die.

rocker
06-05-2009, 07:23 AM
Parity means that one year the team could be good, then next okay or even bad, then maybe good/okay/bad again. Without consistency, it is hard to grow your fan base or even to retain your current one.

I think parity encourages consistency in fan interest.

Why? because you're never out of it.
The reason teams lose fans often in North America is they have no chance at the championship year after year (see the Blue Jays over the past 10 years).

Parity may be frustrating at times, due to ties, but it means all teams' fans have hope.

Secondly, some teams in MLS have been highly successful, year after year, despite parity (see New England or DC United or Houston). These teams are consistently good.

Parity does not force teams to be good, then suck, then be good. It just means you cannot depend upon spending more than the means of your enemies to solve problems. Solving problems means finding people to manage the club who can succeed within the restrictions.

TO me, growing fan interest (as opposed to just retaining it) involves increasing the quality of play across the board. This would be done by increasing the salary cap across the board over many years, until the quality is good enough that it attracts the Eurofan who isn't on board yet because he prefers EPL quality.

I'm also not sure, as you suggest, that having 3-5 bigger clubs based on revenue would "increase the quality of play" in the league. It would increase the quality for those 3-5 teams. But the remaining 15 would not necessarily play better. Actually, they would probably look worse in comparison, since the big teams would waltz in and kick their butts. To me this is not an indication of greater "quality" or more "competitive" teams, but an indication of greater disparity between teams. For example, when Man U beats West Brom 4-0 in the EPL that is a product of a spending disparity, not that Man U is inherently more competitive/quality than West Brom in some pure world of sport (level playing field). It's a sign one team can spend more than the other. Thankfully in England soccer has such deep roots that fans support West Brom even if they get an ass kicking regularly by the big spenders. Not sure that would occur in MLS.

prizby
06-05-2009, 07:29 AM
nuts

zeelaw
06-05-2009, 07:54 AM
The lower revenue teams would fall off the face of the planet under this system.

The league would shrink and die.
QFT :hump:

flatpicker
06-05-2009, 08:19 AM
I agree with Jack.
It sounds like a good idea at first but there would soon be too big a gap between the top and bottom teams.

I think what they should do is find some middle ground on the current cap set-up and this proposed revenue-percentage plan.

I've always thought that stronger teams should be alowed to spend more in MLS.
But there has to be a limit on how far that goes.
So, sure, if a team makes more, let them spend more...
but only up to a certain point so that the little guys still have a shot (even if it is reduced)

Dust2
06-05-2009, 08:46 AM
I agree with Jack.
It sounds like a good idea at first but there would soon be too big a gap between the top and bottom teams.

I think what they should do is find some middle ground on the current cap set-up and this proposed revenue-percentage plan.

I've always thought that stronger teams should be alowed to spend more in MLS.
But there has to be a limit on how far that goes.
So, sure, if a team makes more, let them spend more...
but only up to a certain point so that the little guys still have a shot (even if it is reduced)

J-league player salary for 2009

http://www.japanesesoccer.net/wordpress/?p=1912
(1) Urawa Reds - 1,250,000,000 Yen = $12.5 mil
(2) Gamba Osaka - $10.5 mil
(3) Kashima Antlers - $8.3 mil
(4) Vissel Kobe - $7.3 mil
(5) Kyoto Sanga FC - $7.0 mil
(6) Oita Trinita - $6.5 mil
(7) Jubilo Iwata - $6.4 mil
(8) Kawasaki Frontale - $6.2 mil
(9) Kashiwa Reysol - $6.1 mil
(10) Shimizu S-Pulse - $5.9 mil
(11) Nagoya Grampus - $5.8 mil
(12) FC Tokyo - $5.6 mil
(13) Yokohama F Marinos - $5.2 mil
(14) Omiya Ardija and Sanfrecce Hiroshima - $5.1 mil
(16) JEF Utd Chiba - $4.8 mil
(17) Albirex Niigata - $3.6 mil
(18) Yamagata Montedio - 250,000,000 Yen = $2.5 mil


1. Kashima Antlers 29 P 12 9 - 2 - 1 18 8 +10
2. Urawa Reds 25 P 13 7 - 4 - 2 17 12 +5
3. Albirex Niigata 22 P 13 6 - 4 - 3 20 14 +6
---------------------------------------------ACL---------------------------
4. Kawasaki Frontale 21 P 12 6 - 3 - 3 23 15 +8
5. Gamba Osaka 20 P 12 6 - 2 - 4 26 16 +10
6. Sanfrecce Hiroshima 20 P 13 5 - 5 - 3 24 17 +7
7. Nagoya Grampus 19 P 12 5 - 4 - 3 16 14 +2
8. Shimizu S-Pulse 18 P 13 4 - 6 - 3 13 14 -1
9. Jubilo Iwata 18 P 13 5 - 3 - 5 20 23 -3
10. Kyoto Sanga F.C. 17 P 13 5 - 2 - 6 12 14 -2
11. Vissel Kobe 17 P 13 5 - 2 - 6 17 20 -3
12. Montedio Yamagata 16 P 13 4 - 4 - 5 15 13 +2
13. Yokohama F. Marinos 16 P 13 4 - 4 - 5 18 17 +1
14. FC Tokyo 16 P 13 5 - 1 - 7 15 22 -7
15. Omiya Ardija 14 P 13 3 - 5 - 5 18 22 -4
------------------------------------Relegation to Division 2---------------
16. JEF United Chiba 12 P 13 2 - 6 - 5 13 19 -6
17. Kashiwa Reysol 9 P 13 1 - 6 - 6 16 27 -11
18. Oita Trinita 4 P 13 1 - 1 - 11 9 23 -14A $3 mil team will still be able to compete with a $6 mil team or a $9 mil team. Just need good GM/coach. The 17th team in wages is currently the third best team in the J-league.


TOP PREMIER LEAGUE WAGE BILLS 2007/08
# Chelsea - £172.1m (£132.9m)
# Manchester Utd - £121.1m (£92.3m)
# Arsenal - £101.3m (£89.7m)
# Liverpool - £90.4m (£77.6m)
# Newcastle Utd - £74.6m (£56.7m) (2006/07 wages in brackets) Source: Deloitte

Newcastle: Fifth highest in wages but still finished 18th and got relegated.

Dust2
06-05-2009, 08:53 AM
The lower revenue teams would fall off the face of the planet under this system.

The league would shrink and die.

Why?

Low revenue team (say $10 mil a year) will only spend $3 mil on salaries. On top of that, the team will receive $2-3 mil a year in luxury tax/revenue sharing. Will they be less competitive? Probably but their revenue will not decrease that much.

Keep in mind that this is the system for 99% of soccer leagues around the world: no salary cap, free spending... (beside MLS, A-league and WPS which all have salary cap).

http://www.bizofbaseball.com/index.php?option=com_content&view=article&id=3035:the-biz-of-baseball-organizational-report-the-new-york-yankees&catid=59:organizational-reports&Itemid=137


The Marlins who have a payroll hovering around $20 million made a profit of approximately $35 million, largely due to revenue sharing. On the other hand, “The Evil Empire” posted an operating loss of $47.3 million, largely due to their player payroll and $100 million paid out in revenue sharing.

Even if the Yankees lose money, they make up for it in the increase value of the team.

trane
06-05-2009, 08:57 AM
I love it. If you do not want smaller teams to shrink and die, ensure a minimum salary subsady to ensure that there is not to large of a gap. But I truly think this is the only way for the league to get better.

Beach_Red
06-05-2009, 08:59 AM
And revenue sharing (or salary cap) doesn't really lead to parity anyway.

The best example is the NFL - that's what MLS wants to be, it's why they hired Garber - and although the NFL has revenue sharing and every team has the same budget, there isn't really parity. The Steelers are better than everyone else.

Okay, I'm kidding, but the Steelers are far better than the Lions. What revenue sharing has done for the NFL is given each team an equal chance - they don't all succeed. But the Arizona Cardinals made it to the Superbowl.

Now, MLS has to grow to the point that most of its revenue is generated from TV and not from gate receipts. The only way that can happen is if every team has an equal chance of winning.

Of course, MLS may go the way of the NHL and just never become a big sport in the US and never get that TV deal.

Dust2
06-05-2009, 09:19 AM
For those that voted that this will hurt MLS total revenue/profit. Can you explain why? The following are the 4 biggest revenue generators for MLS:

Total ticket revenue: Decrease? how so?
Total sponsorship revenue: Decrease? how so?
Total Concession/parking/merchandise: Decrease? how so?
Total TV revenue: Decrease? how so?


---------------------The way I see it is this:

This would encourage teams to develop more revenue streams because more revenue would mean more money to spend on players.

For example: Seattle, which will earn about $30 mil this year, will attract better talents with $9 mil salary budget. As a result, their fan base grow bigger. I wouldn't be surprised if Seattle become the Urawa Reds of MLS with average attendance of 45,000+ per game. In a few years, Seattle could generate $50 mil a year in revenue easily.

Vancouver, Toronto, NY, LA Galaxy could be a Seattle II. Vancouver sold out 5000 season ticket deposits within 48 hours and they could open more seats in their stadium like Seattle. Toronto could expand its stadium to 40,000 and still sold out. Remember, there are 15,000 on the waiting list. Imagine Toronto with a team of $9 mil instead of $2.3 mil. Same with New York and Los Angeles. (LA generated $36 mil revenue in 2008 according to Forbes). Teams can built upon off-the-field success into in the field success which in turn create more revenue. This circle/cycle could go on and on.

These increase in attendance from LA, NY, TFC, Seattle, Vancouver, Chicago, Philly will be much greater than the decrease in attendance from RSL, Denver, KC, San Jose, Columbus...Keep in mind that many ticket buyers attend games as a 'nice day out.'

Sponsorship is directly link to how popular a team is. Increase attendance = increase in sponsorship.

Concession/parking revenue is linked to attendance/ticket revenue therefore if total attendance increase, so will total revenue from concession/parking. Merchandise will increase because MLS will sell more jerseys, Direct Kick, mlstv etc...due to higher interest in the league. This is the direct result of better success in CCL and Superliga, better talents from the several teams that have $7-10 mil wage budget.

TV revenue will increase because MLS will have better players and attractive matches featuring big clubs. Imagine a $10 mil wages Galaxy vs. $10 mil wages NY or Toronto or Seattle or Vancouver or Chicago or Philly.


Keep in mind that with 4-6 teams having $7-10 mil wages, MLS will get more talents to stay (like Dempsey, Altidore, Bradley, Adu, Bocanegra etc...) and attract better talents from abroad particularly in South America. Not to mention be competitve against Mexican clubs who have about $7-15 mil wages depending on the team revenue.

Garber stated that only 1 out of 3 existing soccer fans in the USA follow MLS. MLS needs to get some of these 2 out of 3 fans interested. Many of these fans follow 'big clubs' whether it is from Mexico, England, Spain, Italy, Argentina, Brazil. They will definately give MLS 'big clubs' a viewing on TV.

Have you thought about the potential of TFC?
40,000 seats stadium with grass: $50 mil revenue ($15 mil wages). Win a little more than the average MLS team on a consistent basis.

Yohan
06-05-2009, 09:28 AM
MLS is a league troubling to find a lousy one million bucks in profit per team.

let's keep that in mind

Dust2
06-05-2009, 09:30 AM
Top 30 Footballers (US$)

Japan

*1 - N. Takahara (Urawa/Japan) - 1.74 million
*3 – Tulio Tanaka (Urawa/Japan) - 1.20 million
*5 - Yuki Abe (Urawa/Japan) - 1 million
*5 - Y. Nakazawa (Yokohama FM/Japan) - 1 million
*9 - Y. Endo (G Osaka/Japan) - 920K
10 - S. Narazaki (Nagoya/Japan) - 860K
10 - T. Fujita (Nagoya/Japan) - 860K
19 - M. Ogasawara (Kashima/Japan) - 780K
19 - K. Suzuki (Urawa/Japan) - 780K
21 - Y. Konno (FC Tokyo/Japan) - 760K
21 - N. Yamada (Urawa/Japan) - 760K
26 - Y. Kawaguchi (Iwata/Japan) - 720K
27 - M. Motoyama (Kashima/Japan) - 710K

Brazil

*2 - Ponte (Urawa/Brazil) - 1.63 million
*4 - Franca (Kashiwa/Brazil) - 1.09 million
*5 - Juninho (Kawasaki/Brazil) - 1 million
*5 - Edimilson (Urawa/Brazil) - 1 million
10 - Danilo (Kashima/Brazil) - 860K
10 - Alex (Urawa/Brazil) - 860K
10 - Lucas (G Osaka/Brazil) - 860K
10 - Bare (G Osaka/Brazil) - 860K* sold during season
10 - Roni (Yokohama FM/Brazil) - 860K
10 - Lopes (Yokohama FM/Brazil) - 860K* (Loan)
21 - Fernandinho (Shimizu/Brazil) - 760K
21 - Reinaldo (JEF United Chiba/Brazil) - 760K
27 - Marquinhos (Kashima/Brazil) - 710K
27 - Denis Marques (Omiya/Brazil) - 710K

Others

10 - F. Johnsen (Nagoya/Norway) - 860K
21 - Kim Nam-Il (Kobe/Korea) - 760K

Urawa ($12.5 mil players wages)

Top 8 earners:

N. Takahara (Urawa/Japan) - 1.74 million
Tulio Tanaka (Urawa/Japan) - 1.20 million
Yuki Abe (Urawa/Japan) - 1 million
K. Suzuki (Urawa/Japan) - 780K
N. Yamada (Urawa/Japan) - 760K
Ponte (Urawa/Brazil) - 1.63 million
Edimilson (Urawa/Brazil) - 1 million
Alex (Urawa/Brazil) - 860K

J-league attendance (no salary cap, clubs can spend if they have the money).

1993 - 17,976
1994 - 19,598
1995 - 16,922
1996 - 13,353
1997 - 10,131
1998 - 11,982
1999 - 11,658
2000 - 11,065
2001 - 16,548
2002 - 16,368
2003 - 17,351
2004 - 18,965
2005 - 18,765
2006 - 18,292
2007 - 19,081
2008 - 19,278

MLS will make much more financial sense since the wages will only be at most 30% of total revenue. Keep in mind that Germany's Bundesliga has similar regulation where a club can't spend more than 55% of its turnover (revenue).

Dust2
06-05-2009, 09:34 AM
MLS is a league troubling to find a lousy one million bucks in profit per team.

let's keep that in mind

MLS future profit will depend on teams with potential for significant growth:

Galaxy, Red Bull, Seattle, TFC, Vancouver, Philly, Portland, Chicago, Houston. What MLS should do is allow these teams to generate the revenue/profit. The best way to ensure high revenue is to have these teams win a little more than the average club on a consistent basis.

The low revenue teams can still be profitable because they can only spend 30% of their revenue on wages and they receive $2-3 mil a year from luxury tax. The high revenue team will be profitable because they only spend 30% of their revenue on wages and sharing $2-3 mil a year is a good tradeoff in order to spend more and therefore increase the chance of having a good team.

Yohan
06-05-2009, 09:41 AM
MLS future profit will depend on teams with potential for significant growth:

Galaxy, Red Bull, Seattle, TFC, Vancouver, Philly, Portland, Chicago, Houston. What MLS should do is allow these teams to generate the revenue/profit. The best way to ensure high revenue is to have these teams win a little more than the average club on a consistent basis.

The low revenue teams can still be profitable because they can only spend 30% of their revenue on wages and they receive $2-3 mil a year from luxury tax. The high revenue team will be profitable because they only spend 30% of their revenue on wages and sharing $2-3 mil a year is a good tradeoff in order to spend more and therefore increase the chance of having a good team.
seems like you're trying to go for a short term, high risk business model.

i think your plan would make MLS end up something like SPL, and I don't think that's what we want in MLS

Steve
06-05-2009, 09:43 AM
For those that voted that this will hurt MLS total revenue/profit. Can you explain why? The following are the 4 biggest revenue generators for MLS:

Total ticket revenue: Decrease? how so?
Total sponsorship revenue: Decrease? how so?
Total Concession/parking/merchandise: Decrease? how so?
Total TV revenue: Decrease? how so?


---------------------The way I see it is this:

This would encourage teams to develop more revenue streams because more revenue would mean more money to spend on players.


Sorry, but I think you're sadly mistaken. How is allowing teams to spend more a better motivator to increase revenue than the current motivator, namely making money? I know there is revenue sharing, but the owners still get to keep a significant portion of gate revenue, so do you really think an ownership group is going to say "well, before, when I increased my revenue I didn't have to (or have the option to) increase my cost, but now that I can spend more of my revenue I totally want to make more!". That's not how it works.

As for how it would hurt MLS profits, I think it's been explained before, but think about it this way: How would you feel if, instead of TFC being one of the "haves" we suddenly became a "have not"? How would you feel if, no matter what we did, we would never win MLS (nor even finish in the top 4)? Would you still be as happy? Would you still go to as many games? Even if you would, do you think that holds true for all TFC fans?

Lower revenue teams are already holding on by the skin of their teeth. They do not have the history to ensure strong support if they are doomed to be a loser for life. They would just fold up shop. Eventually you don't have enough teams to support a league, and the league goes under.

Again, I wonder if you would be making the same arguement if you thought there was a possibility that TFC would not be one of the "big spenders".

trane
06-05-2009, 09:49 AM
The problem in the present system is that the markets that have growth potential, and that could push the league forward, as held back, and also risk becoming inconsequential. A better team, could mean a stadium of 40, 000, with at least 20, 000 seasons seat holders, if not more. Plus a higher TV viewership. But you will not get that at the present quality of footy.

Dust2
06-05-2009, 09:50 AM
TO me, growing fan interest (as opposed to just retaining it) involves increasing the quality of play across the board. This would be done by increasing the salary cap across the board over many years, until the quality is good enough that it attracts the Eurofan who isn't on board yet because he prefers EPL quality.

The problem is that MLS can't increase its salary cap by much. Even if it increases its salary cap by $800,000 a year. It would take 10 years to have a $10 mil salary cap. By then, Mexican clubs could be at $30 mil a year.


I'm also not sure, as you suggest, that having 3-5 bigger clubs based on revenue would "increase the quality of play" in the league. It would increase the quality for those 3-5 teams. But the remaining 15 would not necessarily play better. ~4 teams would have $6-9 mil a year
~8 teams would have $4-6 mil a year
~6 teams would have $2-3 mil a year

The quality would increase because MLS will get better talents. For a team with $9 mil a year, it could get FIVE $1 mil player and still have $4 mil to spend on the rest. That would be better than spending $7 mil on one player like Beckham.

The actual salary spent by MLS by team in 2009 look like this:

Galaxy $9 mil total
Chicago $6 mil total
New York $5 mil total
Seattle $4 mil total

or something like that.


J-league player salary for 2009

http://www.japanesesoccer.net/wordpress/?p=1912
(1) Urawa Reds - 1,250,000,000 Yen = $12.5 mil
(2) Gamba Osaka - $10.5 mil
(3) Kashima Antlers - $8.3 mil
(4) Vissel Kobe - $7.3 mil
(5) Kyoto Sanga FC - $7.0 mil
(6) Oita Trinita - $6.5 mil
(7) Jubilo Iwata - $6.4 mil
(8) Kawasaki Frontale - $6.2 mil
(9) Kashiwa Reysol - $6.1 mil
(10) Shimizu S-Pulse - $5.9 mil
(11) Nagoya Grampus - $5.8 mil
(12) FC Tokyo - $5.6 mil
(13) Yokohama F Marinos - $5.2 mil
(14) Omiya Ardija and Sanfrecce Hiroshima - $5.1 mil
(16) JEF Utd Chiba - $4.8 mil
(17) Albirex Niigata - $3.6 mil
(18) Yamagata Montedio - 250,000,000 Yen = $2.5 mil

Pts Pld W D L GF GA GD
---------------------------------------------------------------------------

1. Kashima Antlers 29 P 12 9 - 2 - 1 18 8 +10
2. Urawa Reds 25 P 13 7 - 4 - 2 17 12 +5
3. Albirex Niigata 22 P 13 6 - 4 - 3 20 14 +6
---------------------------------------------ACL---------------------------
4. Kawasaki Frontale 21 P 12 6 - 3 - 3 23 15 +8
5. Gamba Osaka 20 P 12 6 - 2 - 4 26 16 +10
6. Sanfrecce Hiroshima 20 P 13 5 - 5 - 3 24 17 +7
7. Nagoya Grampus 19 P 12 5 - 4 - 3 16 14 +2
8. Shimizu S-Pulse 18 P 13 4 - 6 - 3 13 14 -1
9. Jubilo Iwata 18 P 13 5 - 3 - 5 20 23 -3
10. Kyoto Sanga F.C. 17 P 13 5 - 2 - 6 12 14 -2
11. Vissel Kobe 17 P 13 5 - 2 - 6 17 20 -3
12. Montedio Yamagata 16 P 13 4 - 4 - 5 15 13 +2
13. Yokohama F. Marinos 16 P 13 4 - 4 - 5 18 17 +1
14. FC Tokyo 16 P 13 5 - 1 - 7 15 22 -7
15. Omiya Ardija 14 P 13 3 - 5 - 5 18 22 -4
------------------------------------Relegation to Division 2---------------
16. JEF United Chiba 12 P 13 2 - 6 - 5 13 19 -6
17. Kashiwa Reysol 9 P 13 1 - 6 - 6 16 27 -11
18. Oita Trinita 4 P 13 1 - 1 - 11 9 23 -14The 3rd best team in the J-league has the second to worst salary budget.

TorontoBlades
06-05-2009, 09:50 AM
^ they should NOT get what they already do with the present quality of footy

Dust2
06-05-2009, 09:56 AM
seems like you're trying to go for a short term, high risk business model.

How is it high risk?

SALARY would be capped at 30% of each club's total revenue thus ensuring profitability for all MLS clubs (with small clubs receiving luxury tax revenue of $2-3 mil a year).

For comparision sake, NHL salary is 56% of its total revenue (60% for NFL). 62% for Premiership, 71% for Serie A and a whopping 82% for the Championship.

http://newsimg.bbc.co.uk/media/images/45861000/gif/_45861464_wage_big5_466.gif



i think your plan would make MLS end up something like SPL, and I don't think that's what we want in MLSA $3 mil MLS team can still compete with a $9 mil MLS team. With the right GM, coach, draft and youth system, I wouldn't be surprised if a $3 mil team make the playoff over a $9 mil team. Look at Newcastle (the 5th highest wages in EPL and got relegated).

In the SPL, it's $80 mil player budget of Rangers/Celtics vs. $5 mil player budget of club ____ fill in the blank here. Trust me, MLS will not turn into that.



---------------------------

Club Debt (£ms) Turnover (£ms) Wages (£ms) Wages/turnover

Arsenal 416 223 101.3 45%

Aston Villa 73 75.6 50.4 66.6%

Blackburn Rovers 17 56.4 39.7 70%

Bolton Wanderers 52 59.1 39 67%

Chelsea 701 213.6 149 68%

Everton 39 76 44.5 59%

Fulham 197 53.7 39.3 73%

Hull City (2007 figures) 1 9 6.9 77%

Liverpool 280 (est) 159 80 (est) 50%

Manchester City 147 82.3 54.2 66%

Manchester United 699 256.2 121.1 47%

Middlesbrough 93 48 34.8 73%

Newcastle United 106.2 100.8 74.6 74%

Portsmouth 57.7 70.6 54.7 78%

Stoke City 2.3 11.2 11.9 106%

Sunderland 69.2 63.6 37.1 58%

Tottenham Hotspur 65 114.8 52.9 46%

West Bromwich Albion 8.9 27.2 21.8 80%

West Ham United 36 57 44.2 76%

Wigan Athletic 66.4 43 38.4 89%


TOP PREMIER LEAGUE WAGE BILLS 2007/08
# Chelsea - £172.1m (£132.9m)
# Manchester Utd - £121.1m (£92.3m)
# Arsenal - £101.3m (£89.7m)
# Liverpool - £90.4m (£77.6m)
# Newcastle Utd - £74.6m (£56.7m) (2006/07 wages in brackets) Source: Deloitte


Bundesliga regulation mean that each club can't spend more than 55% of its total revenue on wages. As a result, they are profitable and their debt is extremely low compare to Europe Big 3 leagues.

Yohan
06-05-2009, 10:03 AM
How is it high risk?

SALARY would be capped at 30% of each club's total revenue thus ensuring profitability for all MLS clubs (with small clubs receiving luxury tax revenue of $2-3 mil a year).

For comparision sake, NHL salary is 56% of its total revenue (60% for NFL). 62% for Premiership, 71% for Serie A and a whopping 82% for the Championship.

http://newsimg.bbc.co.uk/media/images/45861000/gif/_45861464_wage_big5_466.gif


A $3 mil MLS team can still compete with a $9 mil MLS team. With the right GM, coach, draft and youth system, I wouldn't be surprised if a $3 mil team make the playoff over a $9 mil team. Look at Newcastle (the 5th highest wages in EPL and got relegated).

In the SPL, it's $80 mil player budget of Rangers/Celtics vs. $5 mil player budget of club ____ fill in the blank here. Trust me, MLS will not turn into that.



---------------------------

Club Debt (£ms) Turnover (£ms) Wages (£ms) Wages/turnover

Arsenal 416 223 101.3 45%

Aston Villa 73 75.6 50.4 66.6%

Blackburn Rovers 17 56.4 39.7 70%

Bolton Wanderers 52 59.1 39 67%

Chelsea 701 213.6 149 68%

Everton 39 76 44.5 59%

Fulham 197 53.7 39.3 73%

Hull City (2007 figures) 1 9 6.9 77%

Liverpool 280 (est) 159 80 (est) 50%

Manchester City 147 82.3 54.2 66%

Manchester United 699 256.2 121.1 47%

Middlesbrough 93 48 34.8 73%

Newcastle United 106.2 100.8 74.6 74%

Portsmouth 57.7 70.6 54.7 78%

Stoke City 2.3 11.2 11.9 106%

Sunderland 69.2 63.6 37.1 58%

Tottenham Hotspur 65 114.8 52.9 46%

West Bromwich Albion 8.9 27.2 21.8 80%

West Ham United 36 57 44.2 76%

Wigan Athletic 66.4 43 38.4 89%


TOP PREMIER LEAGUE WAGE BILLS 2007/08
# Chelsea - £172.1m (£132.9m)
# Manchester Utd - £121.1m (£92.3m)
# Arsenal - £101.3m (£89.7m)
# Liverpool - £90.4m (£77.6m)
# Newcastle Utd - £74.6m (£56.7m) (2006/07 wages in brackets) Source: Deloitte


Bundesliga regulation mean that each club can't spend more than 55% of its total revenue on wages. As a result, they are profitable and their debt is extremely low compare to Europe Big 3 leagues.
all of the leagues you have listed have a HUGE TV contract, which allows those teams to spend money on large wages.

MLS still relies on tickets at the gates for profitability. Fans dont want to see losing teams.

Until you can get some other sort of revenue to replace tickets at the gate as main source of revenue, I dont think your model would work for MLS

Beach_Red
06-05-2009, 10:25 AM
The problem in the present system is that the markets that have growth potential, and that could push the league forward, as held back, and also risk becoming inconsequential. A better team, could mean a stadium of 40, 000, with at least 20, 000 seasons seat holders, if not more. Plus a higher TV viewership. But you will not get that at the present quality of footy.


But there's no guarantee that increased "quality of footy" will mean increased revenue.

Look, this is America we're talking about. "Quality" rarely translates into sales - look at the movie business.

But the biggest problem with this kind of argument is that there's just too much competition for sports dollars in America. You're fighting over a hundred years of baseball tradition and the most successful sports league in the world in the NFL. If MLS takes it slow and can grow in every market in the US it can get that TV contract. If it goes too fast and has teams trying to outspend each other it'll go the way of NASL.

Really, when thinking about MLS in America, think about NFL Europe. Could it have been successful?

Soccer will become big in the US when the US can compete on the highest level. When US born and trained players are at the top level, the sport will be.

It took baseball decades to start bringing in players from other countries and basketball is still dominated by US players.

A soccer league full of foreign players - even if they are the best in the world - won't sell to Americans. And really, why should it?

trane
06-05-2009, 10:34 AM
^ All I know that if the footy stays at this level for the next decade, the level will support will either stay the same or receed in this market. People can follow almost any club in the world, at some point if you do not show them that what is played here is a reasonable level of football, they will either stop or never start following the team.

druid
06-05-2009, 10:56 AM
Platini's salary cap was intended to keep the big clubs solvent while remaining at the top of the heap. It's the only solution that he could have foisted without having the big clubs walk out and create a European super league ditching the smaller clubs and local FAs. Same old big club/big league appeasement from UEFA that butchered the Champions League.

Since the MLS has none of those problems I can't see how the solution will fit.

trane
06-05-2009, 10:57 AM
^ But the MLS has a problem that UEFA does not-------------shite play.

Pookie
06-05-2009, 11:39 AM
This is the biggest problem I have with your model.

Big $ will attract better players and improve fan interest/revenues
With the exception of Beckam, how many people are flocking to see Blanco play? Or Angel from New York? Those players earn $2.7M and $1.5M respectively.

They play to crowds of between 10k-11k at home.

Why are those salaries significant? The average salary in the EPL is just over $1.25M. Only 3 MLS teams turned an operating profit last year according to Forbes Magazine and of those that did, none did so significantly (TFC was in at $2.1M).

For you to attract a quality European Player (in this example) you are going to need to entice them. Those are the kinds of players you'd get.

European players do not dream of playing for the MLS Cup or the CONCACAF Champions League. They dream of Primera, or EPL, or Bundesliga titles. Of FA Cups, of UEFA Championships. They dream of being in their own national spotlight to play on a World Cup team.

It would be like a Canadian kid with the talent opting to play in Europe over the NHL. It would be very rare.

Besides, you'd never get a player from Italy over here... the fake grass hurts too much when they dive :hide:

Improving the quality of play is a long term challenge. You do that by developing better local players and giving them a professional option. It's not a lost cause, more kids play soccer than hockey in Canada and certainly throughout North America.

The MLS structure is envied by a number of leagues around the world. Revenues are shared for the greater good of the league. All teams, even ours, have a chance to qualify for the playoffs in any given year. Costs are contained and someone with deep pockets does not have an advantage over other struggling clubs.

Have a look at some of the economics in the EPL. Many of the clubs outside of the big 4 are in trouble. They can't compete and the collective value of their assets is declining as who is going to buy a team that has little chance to win (well, with the exception of MLSE)?

Even the big 4 are mounting massive debts to pay these outrageous salaries and transfer fees.

The MLS model works. It's not sexy. It's not a quick route to rival the big leagues but it works. Stay the course.

OneLoveOneEric
06-05-2009, 12:01 PM
MLS's biggest concern should be raising the overall level of play, not keeping all teams equal, IMO.

trane
06-05-2009, 12:07 PM
^ Agreed. That is it in a nutshell.

Beach_Red
06-05-2009, 12:48 PM
MLS's biggest concern should be raising the overall level of play, not keeping all teams equal, IMO.

And the level of play is rising - look at the players that came from the NCAA draft this year - just not fast enough for some people.

Like every other pro sport in America, the success starts with the NCAA. That's where local fan bases are really built.

The NHL is a regional sport in the US that has made no inroads despite having pro teams throughout the south (Phoenix is not the only team in serious financial trouble). The NHL is only really successful where NCAA hockey is also successful.

The NHL tried this top-down approach of bringing the highest level of hockey in the world to markets where there was no hockey at all. It's working - a little, but it's taking a long time. The level of play isn't a significant factor.

MLS has a big advantage over the NHL - millions of kids playing soccer in every state in the US.

I hate the stupid DP rule, but if they're going to have it they should have a special designation for US players. Beyond requiring a cetrain number of US players on each roster, the US "stars" shouldn't count against the cap, or something like that.

I_AM_CANADIAN
06-05-2009, 01:24 PM
The lower revenue teams would fall off the face of the planet under this system.

The league would shrink and die.
Yep. 30% is way too much. I'd love to see spending actually linked to revenue, but this isn't Europe. It'd never work in MLS.

Dust2
06-05-2009, 05:38 PM
I agree with Jack.
It sounds like a good idea at first but there would soon be too big a gap between the top and bottom teams.


No it won't. A $3 mil team can still compete with $9 mil team. Not as competitive but it won't be like the SPL where a team has a player budget of $80 mil (Celtics/Rangers) and the rest have an average player budget of around $5-8 mil (yup, higher than MLS $2.3 mil). Look at the J-league.

J-league player salary for 2009

http://www.japanesesoccer.net/wordpress/?p=1912
(1) Urawa Reds - 1,250,000,000 Yen = $12.5 mil
(2) Gamba Osaka - $10.5 mil
(3) Kashima Antlers - $8.3 mil
(4) Vissel Kobe - $7.3 mil
(5) Kyoto Sanga FC - $7.0 mil
(6) Oita Trinita - $6.5 mil
(7) Jubilo Iwata - $6.4 mil
(8) Kawasaki Frontale - $6.2 mil
(9) Kashiwa Reysol - $6.1 mil
(10) Shimizu S-Pulse - $5.9 mil
(11) Nagoya Grampus - $5.8 mil
(12) FC Tokyo - $5.6 mil
(13) Yokohama F Marinos - $5.2 mil
(14) Omiya Ardija and Sanfrecce Hiroshima - $5.1 mil
(16) JEF Utd Chiba - $4.8 mil
(17) Albirex Niigata - $3.6 mil
(18) Yamagata Montedio - 250,000,000 Yen = $2.5 mil


The third best team in the league right now is the second to last in spending and the dead last team in spending is doing reasonably well.


Pts Pld W D L GF GA GD
---------------------------------------------------------------------------
1. Kashima Antlers 29 P 12 9 - 2 - 1 18 8 +10
2. Urawa Reds 25 P 13 7 - 4 - 2 17 12 +5
3. Albirex Niigata 22 P 13 6 - 4 - 3 20 14 +6
---------------------------------------------ACL---------------------------
4. Kawasaki Frontale 21 P 12 6 - 3 - 3 23 15 +8
5. Gamba Osaka 20 P 12 6 - 2 - 4 26 16 +10
6. Sanfrecce Hiroshima 20 P 13 5 - 5 - 3 24 17 +7
7. Nagoya Grampus 19 P 12 5 - 4 - 3 16 14 +2
8. Shimizu S-Pulse 18 P 13 4 - 6 - 3 13 14 -1
9. Jubilo Iwata 18 P 13 5 - 3 - 5 20 23 -3
10. Kyoto Sanga F.C. 17 P 13 5 - 2 - 6 12 14 -2
11. Vissel Kobe 17 P 13 5 - 2 - 6 17 20 -3
12. Montedio Yamagata 16 P 13 4 - 4 - 5 15 13 +2
13. Yokohama F. Marinos 16 P 13 4 - 4 - 5 18 17 +1
14. FC Tokyo 16 P 13 5 - 1 - 7 15 22 -7
15. Omiya Ardija 14 P 13 3 - 5 - 5 18 22 -4
------------------------------------Relegation to Division 2---------------
16. JEF United Chiba 12 P 13 2 - 6 - 5 13 19 -6
17. Kashiwa Reysol 9 P 13 1 - 6 - 6 16 27 -11
18. Oita Trinita 4 P 13 1 - 1 - 11 9 23 -14

Dust2
06-05-2009, 05:54 PM
This is the biggest problem I have with your model.

Big $ will attract better players and improve fan interest/revenues
With the exception of Beckam, how many people are flocking to see Blanco play? Or Angel from New York? Those players earn $2.7M and $1.5M respectively.

They play to crowds of between 10k-11k at home.



A team with $7-9 mil in wages will be able to put together a team that win a little more than the average MLS teams on a consistent basis (year after year). This consistency will allow the team to built upon its success and grow. And yes, a $9 mil team will provide MLS fans with better talents than a $2.3 mil team. And yes, it will improve interest/revenue for that team.

Take NY RB for example. Next year, they start in a 25,000 stadium that is the best in MLS. They could generate around $30 mil in revenue. If they use 30% of that on wages, they would have a budget of $9 mil.

They can get FOUR players who are as good as Angel and use the other $4 mil on the rest of the team. Would this team be good enough to be playoff contender? I would say yes. Would this team be good enough that some existing soccer fans in New York who ignored MLS before to check it out? I would say yes. All the team need is 15,000 of these fans out of a 2 million soccer fans living in New York to attend games to sell out the stadium.

Seattle increase its capacity to 32,500 and still sold out in a matter of days. In the first few hours of going on sale, Seattle sold over 60,000 tickets for Chelsea. If Seattle win more consistently because it uses 30% of its revenue (or $9 mil) on getting FIVE $1 mil a year players and the other $4 mil on the rest of the squad, I wouldn't be surprised if Seattle can sell out 40,000 seats. Vancouver have the potential to do the same.

Same with Toronto (with an expanded 35,000 grass BMO), DC United (with SSS) Galaxy.

Dust2
06-05-2009, 06:01 PM
Yep. 30% is way too much. I'd love to see spending actually linked to revenue, but this isn't Europe. It'd never work in MLS.

I hate to break it to you but MLS spending is directly link to revenue ever since the leagues started in 1996. It's call the Salary Cap.

In Europe on the other hand, spending is never linked to revenue (unless you're the Bundesliga). Clubs spend as much as they can get away with. The Championship spent a very unhealthy 82% of its turnover on wages.

Is it fair or just that a $30 mil revenue team be subjected to the same $2.3 mil hard cap as a team that only have $8 mil in revenue?

30% is too much? Okay, how about 27% then? or whatever percentage number MLS think will make MLS teams break-even/profitable.

flatpicker
06-05-2009, 06:10 PM
I have said on numerous occasions in this forum that you gotta spend money to make money.

As long as the gap isn't allowed to get too big between the top and bottom teams then I am all for new ways to increase the cap.

I think leagues benefit from having some stronger clubs.
It generates bigger rivalries, and increases hatred for the big spenders (which makes for better atmosphere at games)

I do think that more fans would come out to see a visiting side if they new it had a big payroll and big stars (by MLS standards)

The 30% of revenue idea is a good start, but there would have to be a limit to how far that goes, based on how much money the poorest team brings in.

Dust2
06-05-2009, 06:12 PM
For those that haven't click on the BigSoccer link, here's a very interesting number for you:

MLS 2007 Wages/Turnover Ratio estimate: 24.95%
Total MLS wages in 2007 according to MLS Player Unions: $41,418,825
Total Turnover (from Forbes): $166,000,000

Team Base Guaranteed
LA 8,056,189 9,179,949
RBNY 4,334,616 4,896,657
Chicago 4,185,826 4,464,613
KC 2,429,925 2,625,550
Colorado 2,322,114 2,431,764
Houston 2,215,849 2,292,049
RSL 2,173,437 2,607,531
Toronto 2,130,520 2,453,708
DC 2,003,278 2,163,103
NE 1,992,948 2,087,948
Dallas 1,992,804 2,285,629
Columbus 1,807,199 2,044,449
Chivas 1,750,375 1,885,875

The wages number do not include things like medical/dental benefits, player insurance etc...

Total yearly wages that MLS pays its players 2009: $47,786,225.48 ($3.2M per team)
http://www.mlsplayers.org/salary_info.html

Dust2
06-05-2009, 06:19 PM
I have said on numerous occasions in this forum that you gotta spend money to make money.

As long as the gap isn't allowed to get too big between the top and bottom teams then I am all for new ways to increase the cap.

I think leagues benefit from having some stronger clubs.
It generates bigger rivalries, and increases hatred for the big spenders (which makes for better atmosphere at games)

I do think that more fans would come out to see a visiting side if they new it had a big payroll and big stars (by MLS standards)

The 30% of revenue idea is a good start, but there would have to be a limit to how far that goes, based on how much money the poorest team brings in.

Remember that MLS will have luxury tax/revenue sharing in this model. Otherwise, small club owners will never go for this. They want to be profitable too.

MLS could include the luxury tax revenue as a source of revenue for the small revenue earners. For example, a team that earns $10 mil a year also get $3 mil a year in luxury tax. This team total revenue will be $13 mil. The 30% calculation will be from this number. Their player budget will be $3.9 mil instead of $3 mil. They can spend up to 30% (those that don't want to spend that much can spend less).

For example, it could be like this: (it will be up to MLS theexact mechanisms of luxury tax and who will pay/benefit and by how much)

$10 mil revenue club = at most $3.0 mil salary ($7 mil left over)
$15 mil revenue club = at most $4.5 mil salary ($10.5 mil left over)
$20 mil revenue club = at most $6 mil salary ($14 mil left over)
$25 mil revenue club = at most $7.5 mil salary ($17.5 mil left over)
$30 mil revenue club = at most $9 mil salary ($21 mil left over)

After luxurytax / revenue sharing, the $30 mil club will have $18 mil left (after a penalty of $3 mil).
After luxury tax/ revenue sharing, the $10 mil club will have $10 mil left (after a gain of $3 mil)

Dust2
06-05-2009, 06:36 PM
Sorry, but I think you're sadly mistaken. How is allowing teams to spend more a better motivator to increase revenue than the current motivator, namely making money? I know there is revenue sharing, but the owners still get to keep a significant portion of gate revenue, so do you really think an ownership group is going to say "well, before, when I increased my revenue I didn't have to (or have the option to) increase my cost, but now that I can spend more of my revenue I totally want to make more!". That's not how it works.

I agree. Teams will seek to increase revenue because it will make them more profitable. And a more successful team on the field will help generate revenue at a higher rate. Spend money to make money.Also, the appreciation in club value. The more money you generate, the higher worth your team will be. Also, clubs can spend up to 30% of their total revenue. They don't have to spend that percentage. This will ensure profitability.

The current $2.3 mil hard cap is hindering the growth of teams with great potential for growth (Seattle, Vancouver, TFC, NY, LA). Give these club a consistent winning team and see MLS total revenue increase.


As for how it would hurt MLS profits, I think it's been explained before, but think about it this way: How would you feel if, instead of TFC being one of the "haves" we suddenly became a "have not"? How would you feel if, no matter what we did, we would never win MLS (nor even finish in the top 4)? Would you still be as happy? Would you still go to as many games? Even if you would, do you think that holds true for all TFC fans?The majority of ticket buyers in some MLS markets are only casual fans. They go for a nice day out. Winning to them is not that important, an entertaining evening out is. Also, you overestimate the disparity in salaries will have on the standing. A $3.9 mil team ($10 mil revenue) can still compete with a $9 mil team ($30 mil revenue). Just need to be resourceful. The draft will help a little. [/quote]


Lower revenue teams are already holding on by the skin of their teeth. They do not have the history to ensure strong support if they are doomed to be a loser for life. They would just fold up shop. Eventually you don't have enough teams to support a league, and the league goes under.

Again, I wonder if you would be making the same arguement if you thought there was a possibility that TFC would not be one of the "big spenders".Here's the thing: low revenue teams can depend on high revenue team for revenue. They will still be profitable even if they do less well on the field. They can spend 25% of their revenue on wages and have $3 mil extra from luxury tax to break-even/profitable.

The defending MLS champs attendance decreased from last year and only average about 12,500 this year.

If TFC is not a big spender, many would still attend games because you can watch high quality live soccer. Even if your team only have $4 mil in wages, you can still be competitive with other $4 mil team and even $6 mil team. Only a few MLS clubs can have wages of $7-9 mil a year.

Dust2
06-05-2009, 06:57 PM
But there's no guarantee that increased "quality of footy" will mean increased revenue.

Look, this is America we're talking about. "Quality" rarely translates into sales - look at the movie business.

But the biggest problem with this kind of argument is that there's just too much competition for sports dollars in America. You're fighting over a hundred years of baseball tradition and the most successful sports league in the world in the NFL. If MLS takes it slow and can grow in every market in the US it can get that TV contract. If it goes too fast and has teams trying to outspend each other it'll go the way of NASL.


NASL would still be in business today if it follows my proposal:

1. each team can spend at most 30% of their total revenue
2. high revenue earners will pay luxury tax to low revenue earners (significant enough that low earning teams might break-even)

Even if you make $8 mil a year, you can still be profitable if your salary expense is only 30% (or $2.4 mil a year) because you will receive $3 mil in luxury tax and use the other 70% to pay for other expenses.

Speaking of TV contract, a few big clubs with talented players will do wonder when negotiating a contract. High profile matches = high tv rating = much better TV contract.

TFC FORZA RPB
06-05-2009, 07:40 PM
how about no cap at all, this brings me back to relegation.

If the team's cannot support themselves financially then they should fold or be relegated to USL 1, or 2, or 3, meanwhile, the teams with fans and $ can purchase whomever they chose, the salery cap, makes me sick of MLS, and the NHL. But that is probably 20 years away and even then profit sharing will still exist.

Do you think the government will bail out the Original 6?

:scarf::flare::drum:

Dust2
06-06-2009, 02:55 AM
how about no cap at all, this brings me back to relegation.

If the team's cannot support themselves financially then they should fold or be relegated to USL 1, or 2, or 3, meanwhile, the teams with fans and $ can purchase whomever they chose, the salery cap, makes me sick of MLS, and the NHL. But that is probably 20 years away and even then profit sharing will still exist.

Do you think the government will bail out the Original 6?

:scarf::flare::drum:


MLS will never get rid of its cost restraint. Ask the Bundesliga if it would take off the restriction where clubs can only spend at most 55% of its total revenue. Believe it or not, Bundesliga generated as much money as La Liga and more than Serie A in the past season even with only 18 teams according to Deloitte. Without this restriction, Bundesliga would do much better in the Champions League.

For MLS, capping wages of each club to a % of each club turnover is just as effective as having a salary cap of $2.3 mil.


The problem with the current MLS regulation is that the markets that have great growth potential that could push MLS forward like Urawa Reds in the J-league are held back. A few great teams with average attendance 30,000-40,000 will help define MLS and help push MLS into American sports consciousness. Into Major League Level. Into the Top 5 Major League. This would mean great matches for TV audience. Higher TV rating means better TV contract. What's a high profile match-up in MLS today? Which match-up that would get most existing soccer fans in the USA take notice? Can't think of any right? Me neither.

Imagine $50 mil revenue LA Galaxy taking on $50 mil Seattle Sounders in front of 50,000 screaming/chanting fans at Qwest. (or NY at Toronto, Toronto at Vancouver, LA, Seattle, NY etc...). It could happen within a few years if MLS do not held back teams with great growth potential. These match-ups would get the eyeball of many existing soccer fans in the USA.

Dust2
06-06-2009, 03:30 AM
In 2-3 years, MLS could have a salary structure like this:

top 4-6 MLS revenue teams: $7-10 mil a year in wages
the next 5-6 MLS revenue teams: $5-6 mil a year in wages
the bottom 5-6 MLS revenue teams: $3-4 mil a year in wages

A team with $3-4 mil a year in wages can easily make it to the playoff. Good manager or coach or good draft/youth development will make a $3-4 mil team a contender. Lastly, a team with $3-4 mil in wages would make it among the lowest revenue earners in MLS. Therefore, it would receive significant luxury tax/revenue sharing from MLS top teams. This give the team a very good chance at profitability especially since it only spend 25-30% of its total revenue on wages.

If MLS wants to improve its image/reputation/quality of play, allow its top teams the opportunity to built on its off the field success into on the field success. Top MLS clubs competitive with top Mexican Clubs would help improve MLS image/reputation/quality of play.

Take a look at TV rating for Mexican clubs in USA.

http://www.sportsbusinessjournal.com/article/62347


Mexican soccer consistently produces the highest-rated sports programming not only for Univision, Telemundo and their sister channels, but also for ESPN Deportes and Fox Sports en Español. Thirty-four of the 35 top-rated sporting events on Univision in the last year featured teams from the Mexican league, with audiences ranging from 750,000 to 3.3 million. The other was the Mexico-U.S. game that drew 5.9 million.

3.3 million people watched a high profile Mexico's FMF club games. (Chivas vs. Club America). The audience for MLS is there for at least 750,000 viewers. Just need the quality of play to improve to near FMF level.

troy1982
06-06-2009, 04:25 AM
The NFL is by far the most successful league in the World and MLS will continue to follow that model because of the stability it brings and because of the greater fan interest. In fact more and more leagues are going to single entity (see AFL).

Anyway MLS is already spending 25% of revenue on players salary.

Pookie
06-06-2009, 05:05 AM
They can get FOUR players who are as good as Angel and use the other $4 mil on the rest of the team. Would this team be good enough to be playoff contender? I would say yes. Would this team be good enough that some existing soccer fans in New York who ignored MLS before to check it out? I would say yes. All the team need is 15,000 of these fans out of a 2 million soccer fans living in New York to attend games to sell out the stadium.

Seattle increase its capacity to 32,500 and still sold out in a matter of days. In the first few hours of going on sale, Seattle sold over 60,000 tickets for Chelsea. If Seattle win more consistently because it uses 30% of its revenue (or $9 mil) on getting FIVE $1 mil a year players and the other $4 mil on the rest of the squad, I wouldn't be surprised if Seattle can sell out 40,000 seats. Vancouver have the potential to do the same.

Same with Toronto (with an expanded 35,000 grass BMO), DC United (with SSS) Galaxy.

Look, most of your analysis is based on the idea of increased revenue as a function of increased gate receipts. That's a pretty big gamble.

The reason that MLB and NFL salaries are high is a function of television rights. This league has been around since 1993 and has not secured any lucrative TV contracts.

MLS teams need a connection. You can throw $ at players but again, the players who are talented are going to want to play in the top leagues in their home countries.

The players you will get are going to be those that have either left for a boatload of cash or couldn't play in their home countries for some reason (ie. work ethic, injury problems, etc).

An example we all relate to is the scenario in which a Canadian hockey player chooses to play in the new Russian KHL. Why? Likely either for the cash or because they've run into some kind of off ice issue that prevents them from working here.

You can't change our situation over night. The solution is in developing home grown talent.

Dust2
06-06-2009, 06:33 AM
Look, most of your analysis is based on the idea of increased revenue as a function of increased gate receipts. That's a pretty big gamble.

The reason that MLB and NFL salaries are high is a function of television rights. This league has been around since 1993 and has not secured any lucrative TV contracts.

Right now, MLS is spending 25% of its total revenue on wages (give or take). See my 2007 wages/turnover calculation for detail.

As the revenue grow, this percentage can be increase because the fixed cost stay the same.

For example, NHL wages/revenue ratio was 53% (but this increased to 56% because of higher revenue). NFL wages/revenue ratio is 60%.

MLS will not take any further risk if it allows teams to spend up to 25% of its total revenue. Therefore, it is not depending on any huge TV contract. Also, MLS tv contract is worth around $16-20 mil a year with ESPN, FSC, Univision, HDNet and run until 2014.



MLS teams need a connection. You can throw $ at players but again, the players who are talented are going to want to play in the top leagues in their home countries.

The players you will get are going to be those that have either left for a boatload of cash or couldn't play in their home countries for some reason (ie. work ethic, injury problems, etc).

$1 mil a year would get you quality players. See the J-league. See the Mexican league. See the Russian Premier League. See the Portugese League. MLS would also be able to retain American talents like Donovan to stay. Players like Altidore, Adu, Dempsey, Edu, Bocanegra, Bradley etc...

See the J-league as an example. MLS could use these talented players.

Brazil

*2 - Ponte (Urawa/Brazil) - 1.63 million
*4 - Franca (Kashiwa/Brazil) - 1.09 million
*5 - Juninho (Kawasaki/Brazil) - 1 million
*5 - Edimilson (Urawa/Brazil) - 1 million
10 - Danilo (Kashima/Brazil) - 860K
10 - Alex (Urawa/Brazil) - 860K
10 - Lucas (G Osaka/Brazil) - 860K
10 - Bare (G Osaka/Brazil) - 860K* sold during season
10 - Roni (Yokohama FM/Brazil) - 860K
10 - Lopes (Yokohama FM/Brazil) - 860K* (Loan)
21 - Fernandinho (Shimizu/Brazil) - 760K
21 - Reinaldo (JEF United Chiba/Brazil) - 760K
27 - Marquinhos (Kashima/Brazil) - 710K
27 - Denis Marques (Omiya/Brazil) - 710K

Others

10 - F. Johnsen (Nagoya/Norway) - 860K
21 - Kim Nam-Il (Kobe/Korea) - 760K

Dust2
06-06-2009, 06:37 AM
The NFL is by far the most successful league in the World and MLS will continue to follow that model because of the stability it brings and because of the greater fan interest. In fact more and more leagues are going to single entity (see AFL).

Anyway MLS is already spending 25% of revenue on players salary.

NFL is the most popular sport league in the USA. Totally different from MLS which has to compete with NFL, NBA, NHL, MLB, NASCAR, college sports

IN ADDITION to

Mexico's FMF, EPL, La Liga, Serie A, Brazil, Argentina etc....

Yes, MLS is spending 25% of its revenue on player salary. Why not allow team to pay for player wages? And make it so that each team can not spend more than 25% of its total revenue.

The problem with the current MLS regulation is that the markets that have great growth potential that could push MLS forward like Urawa Reds in the J-league are held back. A few great teams with average attendance 30,000-40,000 will help define MLS and help push MLS into American sports consciousness. Into Major League Level. Into the Top 5 Major League.

All MLS has to do is two simple things:

1. Each MLS team can spend up to 25% of their total revenue on wages
2. High revenue teams will pay luxury tax (for example $2-3 mil a year) that will go toward small revenue teams.

Dust2
06-06-2009, 06:53 AM
Using TFC as an example:

With a $2.3 mil hard cap, is MLS holding back TFC growth potential?

If TFC is like 99% of all professional soccer clubs, it could spend as much money as it deem prudent. Because TFC is among the high revenue teams, it could in theory put together a better team than the average MLS club. With a consistent winning team (say top 4-7 each year), TFC could

-average 40,000 a game (assume MLSE expand the stadium with grass)
-generate $50 mil a year in revenue
-have a wages budget of $12.5 mil a year (25% of turnover regulation)
-have SIX $1 mil a year players (and use $6.5 mil a year on the rest of the squad)
-maybe win the trophy if the team is good enough

Take a look at Urawa who have $12.5 mil wages

URAWA Top 8 earners:

N. Takahara (Urawa/Japan) - 1.74 million
Tulio Tanaka (Urawa/Japan) - 1.20 million
Yuki Abe (Urawa/Japan) - 1 million
K. Suzuki (Urawa/Japan) - 780K
N. Yamada (Urawa/Japan) - 760K
Ponte (Urawa/Brazil) - 1.63 million
Edimilson (Urawa/Brazil) - 1 million
Alex (Urawa/Brazil) - 860K


-------------------------
I used TFC as an example for the above. You could say the grow potential for Seattle/Vancouver is about the same. Seattle sold out its 32,500 capacity for the rest of the year. Could it sold out 40,000 capacity if the team win on a consistent basis and its team have much better talents ($10 mil wages compare to $2.3 mil wages).

Vancouver sold out its 5000 deposits within 48 hours. Its owner is dedicated to the team.

The most growth potential belong to Galaxy (maybe Chivas too) and New York. They are in a market with at least 2 million existing soccer fans. How high can they grow?

Judging from the Cosmos, pretty high. However, MLS won't be NASL because it restrict wages to only 25% of its turnover. So LA/NY can only use 25% of its turnover on wages.

Small MLS teams benefit financially:

-high attendance when big clubs visit
-$2-3 mil a year in luxury tax.

http://www.bizofbaseball.com/index.php?option=com_content&view=article&id=3035:the-biz-of-baseball-organizational-report-the-new-york-yankees&catid=59:organizational-reports&Itemid=137


The Marlins who have a payroll hovering around $20 million made a profit of approximately $35 million, largely due to revenue sharing. On the other hand, “The Evil Empire” posted an operating loss of $47.3 million, largely due to their player payroll and $100 million paid out in revenue sharing.

$100 mil in revenue sharing (WOW). And the team still spend. Because the value of the club increase each year. It is over $1 billion now (it was around $10 mil maybe only 20 years ago).

Dust2
06-06-2009, 06:57 AM
I like your opinion on this:

Is MLS holding back (hindering) TFC/Seattle/Vancouver/NY/LA growth potential with its $2.3 mil hard cap (even playing field)?

If the answer is YES then the next question: Is the overall effect of this hinderance benefits MLS more than it hurts MLS? Or has it hurts MLS more than it benefit MLS?

Beach_Red
06-06-2009, 09:08 AM
I like your opinion on this:

Is MLS holding back (hindering) TFC/Seattle/Vancouver/NY/LA growth potential with its $2.3 mil hard cap (even playing field)?

If the answer is YES then the next question: Is the overall effect of this hinderance benefits MLS more than it hurts MLS? Or has it hurts MLS more than it benefit MLS?

You may be right about NY, LA and maybe even Seattle, but you should take TFC out of the equation (and probably Vancouver). MLSE would never have bought a soccer team in a league without a strict salary cap and there are no other owners in town willing to get into those kind of bidding wars for players. MLSE won't even sign one DP.

Look, Toronto could have an NFL team today if there was an owner willing to pony up the billion dollars. The same with LA - but there isn't.

Your plan might work - but it would be at most a six team, all-American league.

troy1982
06-06-2009, 11:01 AM
NFL is the most popular sport league in the USA. Totally different from MLS which has to compete with NFL, NBA, NHL, MLB, NASCAR, college sports

IN ADDITION to

Mexico's FMF, EPL, La Liga, Serie A, Brazil, Argentina etc....

Yes, MLS is spending 25% of its revenue on player salary. Why not allow team to pay for player wages? And make it so that each team can not spend more than 25% of its total revenue.

The problem with the current MLS regulation is that the markets that have great growth potential that could push MLS forward like Urawa Reds in the J-league are held back. A few great teams with average attendance 30,000-40,000 will help define MLS and help push MLS into American sports consciousness. Into Major League Level. Into the Top 5 Major League.

All MLS has to do is two simple things:

1. Each MLS team can spend up to 25% of their total revenue on wages
2. High revenue teams will pay luxury tax (for example $2-3 mil a year) that will go toward small revenue teams.

MLS was based on the NFL model because of it's success and rapid growth to being number 1 in the US from obscurity 40 years earlier.

Single entity is also attractive to investors and has lead to the recent expansion.In the last 5 years MLS has attracted about a dozen investors to new or existing teams without these investors the league would have collapse or remained with only 2 owners owning every team. In your model MLSE may not have ever considered getting in to MLS do to the risk.

Pookie
06-06-2009, 12:13 PM
Dust2,

MLS will not take any further risk if it allows teams to spend up to 25% of its total revenue.

I'm not sure how you can say that when only 3 MLS teams posted a profit in net operating income... that's with a salary cap at levels below what you are proposing.



Therefore, it is not depending on any huge TV contract. Also, MLS tv contract is worth around $16-20 mil a year with ESPN, FSC, Univision, HDNet and run until 2014.


That's awesome. There will be 19 teams by 2011 and they have revenue sharing. That $16-20M per year is just around $1M per team. That doesn't get you out of gate dependency status.



MLS would also be able to retain American talents like Donovan to stay. Players like Altidore, Adu, Dempsey, Edu, Bocanegra, Bradley etc...


Really? So the lure of playing profressional football (futbol) in the best leagues in the world does not appeal at all to an athlete? It's all about the money?

This is a big part of the equation. In all professional sports, athletes desire to go as far as they can and compete against the best.

It's why MLB players aren't content to play in Japan. It's why NBA players aren't weighing an offer from an NBA team vs an Euroleague club.

It's why Professional Golfers look to the PGA Tour vs the Australian Tour.

It's why Beckham wants to go back to Europe. You can throw money at them but you cannot erase the tradition and prestige that comes with playing in the best leagues in the world.




*2 - Ponte (Urawa/Brazil) - 1.63 million
*4 - Franca (Kashiwa/Brazil) - 1.09 million
*5 - Juninho (Kawasaki/Brazil) - 1 million
*5 - Edimilson (Urawa/Brazil) - 1 million
10 - Danilo (Kashima/Brazil) - 860K
10 - Alex (Urawa/Brazil) - 860K
10 - Lucas (G Osaka/Brazil) - 860K
10 - Bare (G Osaka/Brazil) - 860K* sold during season
10 - Roni (Yokohama FM/Brazil) - 860K
10 - Lopes (Yokohama FM/Brazil) - 860K* (Loan)
21 - Fernandinho (Shimizu/Brazil) - 760K
21 - Reinaldo (JEF United Chiba/Brazil) - 760K
27 - Marquinhos (Kashima/Brazil) - 710K
27 - Denis Marques (Omiya/Brazil) - 710K


Ok, those are players with their current salaries. What would it take to get them over here?

Further, by bringing them in are they going to sell more tickets?

I mean no disrespect to your opinion and appreciate the research you have done to back up your view. However, in essence, teams have the ability to spend 30% of their revenue on salaries if they want through the DP. They can go out and get whomever they want. Hell, they could bid on Kaka if they wanted.

Yet, only 6 of the 17 teams currently take advantage of it. (Seattle, LA, Chicago, Columbus, NY, DC)

Only 2 of those teams have decent attendance numbers, Seattle and LA (though LA is behind TFC in attendance).

Here's what the other 4 draw:

DC - 13,275
Columbus - 12,368
Chicago - 11,726
NY - 10,787

Maybe the fans just don't relate to a player like Angel or Emilio. Is bringing in another player like Edimilson, who is largely unknown to a North American audience, going to change this reality?

Dust2
06-06-2009, 01:26 PM
MLS was based on the NFL model because of it's success and rapid growth to being number 1 in the US from obscurity 40 years earlier.

Single entity is also attractive to investors and has lead to the recent expansion.In the last 5 years MLS has attracted about a dozen investors to new or existing teams without these investors the league would have collapse or remained with only 2 owners owning every team. In your model MLSE may not have ever considered getting in to MLS do to the risk.

NFL has no competition. Imagine if NFL has a region tournament like a Champions League and its teams were crap in it. Imagine if the NFL has to compete with 8-10 different leagues for attention and money.

How would it be a risk for MLSE if it generates $20 mil a year and only spend 25% of that per MLS regulation on salary.

Revenue: $20 mil
Salary expense: $5 mil
Other expense: X mil
Operating profit: $20 - 5 - X =

Dust2
06-06-2009, 01:39 PM
Dust2,


I'm not sure how you can say that when only 3 MLS teams posted a profit in net operating income... that's with a salary cap at levels below what you are proposing.

If MLS set the percentage at 25% for each team, it means that revenue for the top teams will increase at a much faster rate than they are now.

Since the rest is fixed expense, any increase in revenue is profit.


That's awesome. There will be 19 teams by 2011 and they have revenue sharing. That $16-20M per year is just around $1M per team. That doesn't get you out of gate dependency status.



Really? So the lure of playing profressional football (futbol) in the best leagues in the world does not appeal at all to an athlete? It's all about the money?

This is a big part of the equation. In all professional sports, athletes desire to go as far as they can and compete against the best.

It's why MLB players aren't content to play in Japan. It's why NBA players aren't weighing an offer from an NBA team vs an Euroleague club.

It's why Professional Golfers look to the PGA Tour vs the Australian Tour.

It's why Beckham wants to go back to Europe. You can throw money at them but you cannot erase the tradition and prestige that comes with playing in the best leagues in the world.I'm not talking about players like Kaka, Messi, CRonaldo or even mid-table EPL good. I'm talking about players who are Mexican clubs good or J-league good. MLS could use these players.

$1 mil a year in salary will get you decent (not world class) players.


Ok, those are players with their current salaries. What would it take to get them over here?

Further, by bringing them in are they going to sell more tickets? Transfer fee will cost MLS some money. Include transfer fee in the wages. Get players who are free agent too.

By themselves, they won't sell tickets. But if you have 4-5 Angel/Scheleto type of players on your team, hell yeah, you will sell tickets especially when your team win consistently.


I mean no disrespect to your opinion and appreciate the research you have done to back up your view. However, in essence, teams have the ability to spend 30% of their revenue on salaries if they want through the DP. They can go out and get whomever they want. Hell, they could bid on Kaka if they wanted.

Yet, only 6 of the 17 teams currently take advantage of it. (Seattle, LA, Chicago, Columbus, NY, DC)

Only 2 of those teams have decent attendance numbers, Seattle and LA (though LA is behind TFC in attendance).

Here's what the other 4 draw:

DC - 13,275
Columbus - 12,368
Chicago - 11,726
NY - 10,787

Maybe the fans just don't relate to a player like Angel or Emilio. Is bringing in another player like Edimilson, who is largely unknown to a North American audience, going to change this reality?A DP won't change attendance unless that player has a huge draw.

I am sure LA would have been much better served if they have SIX $1 mil player rather than one $6 mil DP.


-------------------
For those that think MLS should keep its current hard cap (level playing field). Think on this fact:

If MLS increases the salary cap by $500,000 a year (VERY optimistic), it will take MLS 10 years to get to $7.3 mil salary cap.

In 10 years time, $7.3 mil salary cap will not get MLS the players it require to improve its quality of play by a whole lot compare to today. $7.3 mil salary cap in 10 years time mean MLS will still be behind FMF by the same margin as it is today. FMF would probably has wages budget around $25-30 mil by then. Some FMF clubs already spend $15-20 years in wages TODAY.

So with a $7.3 mil salary cap in 2019....MLS will still be ignored by two third of existing soccer fans in the United States. Its reputation/image/quality of play will not improve by much compare to where it is today. Its TV deal will not go up by much because there is no really high match-up profile that most soccer fans living in USA/Canada would want to watch.

The Man Utd/Barcelona/Real of the world will have wages of around $350 mil in 10 years time instead of around $200 mil today.

Dust2
06-06-2009, 01:47 PM
Here's what the other 4 draw:

DC - 13,275
Columbus - 12,368
Chicago - 11,726
NY - 10,787

Maybe the fans just don't relate to a player like Angel or Emilio. Is bringing in another player like Edimilson, who is largely unknown to a North American audience, going to change this reality?And here's what Seattle draw: 30,000+ (32,500 capacity is already sold out)
And here's what Toronto will draw if it has a 30,000 seats stadium: 30,000

Vancouver will do similar number to Seattle

LA averaged 26,009 last year

The problem with the current MLS regulation is that the markets that have great growth potential that could push MLS forward like Urawa Reds in the J-league are held back. A few great teams with average attendance 30,000-40,000 will help define MLS and help push MLS into American sports consciousness. Into Major League Level. Into the Top 5 Major League.

LA/NY/TFC/Vancouver/Seattle could easily have a $7-9 mil wages and still be profitable.

Think of the talents $7-9 mil will get you compare to $2.3 mil.


The question is still this:

Is MLS holding back (hindering) TFC/Seattle/Vancouver/NY/LA growth potential with its $2.3 mil hard cap (even playing field)?

Is this hinderance helps or hurts MLS (overall)?

Pookie
06-06-2009, 02:25 PM
I'm not talking about players like Kaka, Messi, CRonaldo or even mid-table EPL good. I'm talking about players who are Mexican clubs good or J-league good. MLS could use these players.

$1 mil a year in salary will get you decent (not world class) players.

By themselves, they won't sell tickets. But if you have 4-5 Angel/Scheleto type of players on your team, hell yeah, you will sell tickets especially when your team win consistently.


.... like Columbus gets? Or the draws the DC and Chicago get, with their DP and the fact that they are 1 and 2 in the Conference?

If you had 4 quality DPs (or players earning DP type salaries) your quality of play should theoretically improve.

As you admit though, the MLS is never going to be on par with the top leagues in the world.

You can paint a Volkswagen but you can't sell it as an Audi.

What you need to do is accept that it is built differently and appeals to a certain market. Cater to that market.

The MLS could grow but it isn't going to grow based on improving on field performance. Averaged out, 16,310 fans in each MLS city don't need a better product, they are already at the games.

What they need is a different type of marketing. One that isn't based on selling "stars" but rather on selling the concept of community and team. Seattle, Toronto are all examples of how grass roots marketing works (and if you read the boards here, the dangers if the FO alienates that support). Philly seems to be doing that with the Sons of Ben supporters group. I have no idea what Vancouver is doing for its supporters but imagine if they open a Starbucks on-site then they'll be happy.

The Beckham seeking fans might come in the first year but once they realize you are selling them a Volkswagen, they are gone.

Opening up your wallet just gets you into a bidding war you can't win. It pins the league's growth on marketing stars that could jump to any other market in the world. It's a losing strategy

Dust2
06-06-2009, 06:28 PM
.... like Columbus gets? Or the draws the DC and Chicago get, with their DP and the fact that they are 1 and 2 in the Conference?

If you had 4 quality DPs (or players earning DP type salaries) your quality of play should theoretically improve.

As you admit though, the MLS is never going to be on par with the top leagues in the world.

It won't catch up to the top 5 of Europe but MLS can be near competitive with Mexico's FMF. Mexico imports talents from South America in addition to its domestic talents. It's like the J-league. They are successful with keeping their star players, developing domestic talents and getting 4 foreigners talents per team.



You can paint a Volkswagen but you can't sell it as an Audi.

What you need to do is accept that it is built differently and appeals to a certain market. Cater to that market.

The MLS could grow but it isn't going to grow based on improving on field performance. Averaged out, 16,310 fans in each MLS city don't need a better product, they are already at the games.Wrong. MLS will grow solely based on improving its field performance. Higher quality will retain fans and attract existing soccer fans. Higher field performance will raise MLS image/reputation because it will do better in CONCACAF Champions League.


What they need is a different type of marketing. One that isn't based on selling "stars" but rather on selling the concept of community and team. Seattle, Toronto are all examples of how grass roots marketing works (and if you read the boards here, the dangers if the FO alienates that support). Philly seems to be doing that with the Sons of Ben supporters group. I have no idea what Vancouver is doing for its supporters but imagine if they open a Starbucks on-site then they'll be happy.

The Beckham seeking fans might come in the first year but once they realize you are selling them a Volkswagen, they are gone. You can market grassroot all you want but if your team and league is mediorce, you won't grow as fast or worse stagnate. Great idea..opening a Starbucks will make Vancouver fans happy. How about letting Vancouver spend 25% of its total revenue on wages which could mean $7-9 mil a year, which could attract 3-4 $1 mil players and allow the chance to win a little more than average club on a consistent basis.

As for marketing stars, I take 6 quality players ($1 mil a year in salary) over a star player (Beckham) any day for my team. In fact, this approach will benefit the team a lot more long-term than a well-known DP like Beckham.


Opening up your wallet just gets you into a bidding war you can't win. It pins the league's growth on marketing stars that could jump to any other market in the world. It's a losing strategyThere will be no opening of wallet and no bidding war with Europe tops club. Each team can only spend 25% of their total revenue on wages. The only bidding a few MLS teams might do is with the top J-league clubs and FMF for South American talents. (J-league only targe Brazillian).



Can Seattle average 40,000+ if it is stuck in mediocrity because MLS has a hard cap which level the playing field? Or is it more likely that Seattle attendance will drop after its first year? (capacity of 32,500 is sold out for the rest of the year...they could average 35,000+ right now if they open more seats).

I believe Seattle will average at least 40,000 if MLS allow Seattle to spend 25% of its total revenue (about $35 mil this year) on player wages. As a result, they will gain even more fans and grow even faster.

Would Seattle average 40,000+ each game help or hurt MLS overall?

K1nG
06-06-2009, 06:44 PM
Dust2,

I actually created a thread along the same lines as this a long time ago with the exeption that I was no where near as knowledgable as you are. You have rebuttles and facts to prove all of your points, where as those against this idea have none. This is essentially a disertation and I only wish the MLS takes gets their heads out of their asses and gives up on the whole fabricated parity bullshit that is going on today.

You are probably the smartest person I've ever read a post from.

Beach_Red
06-06-2009, 07:08 PM
You are probably the smartest person I've ever read a post from.

Everyone who sees the world the way I do and agrees with me is smart ;).

Someday soccer may be a big sport in North America. It's got a long, long way to go.

Pookie
06-06-2009, 07:43 PM
Dust2,

I'm beginning to think that you are going to keep throwing out numbers until you get a "fine, I give up... good idea."

I can't agree with your proposal as it simply doesn't work, IMO.

Going back to your original post that served as the basis of your theory, you provided some numbers... specifically:


$10 mil revenue club = at most $3.0 mil salary ($7 mil left over)
$15 mil revenue club = at most $4.5 mil salary ($10.5 mil left over)
$20 mil revenue club = at most $6 mil salary ($14 mil left over)
$25 mil revenue club = at most $7.5 mil salary ($17.5 mil left over)
$30 mil revenue club = at most $9 mil salary ($21 mil left over)

You then go on to hypothesize that:


3-5 MLS teams with wages of around $7-10 mil a year will help improve


You suggest this could take place in 2010.
That would mean that there would need to be 3-5 teams with revenues of $25-30M. Here's one big problem with your theory. There is only 1 team that has revenue of over $25-$30M....LA.

From Forbes (Revenue $ in Millions):

Chicago - 16
CHV - 10
CLB - 6
COL - 11
DAL 15
DC - 13
HOU - 10
KC - 5
LA - 36
NE - 10
NY - 10
RSL - 7
TOR - 17

You then go on to suggest that spending money on "quality players" will improve the quality of play...


It won't catch up to the top 5 of Europe but MLS can be near competitive with Mexico's FMF.

Yet, the Mexican League averges over $35M per team in revenue (2006, http://www.deloitte.com/dtt/press_release/0,1014,sid%253D2834%2526cid%253D120056,00.html ) Clearly, MLS teams do not even approach this average ($12M per the Forbes' numbers above).

Let's ignore the fact that your numbers don't support this position in 2010.

Let's examine your stance that improved on field product will lead to increased revenue. Don't you contradict your postion when you state:



You can market grassroot all you want but if your team and league is mediorce, you won't grow as fast or worse stagnate.


when you've already said that:


It won't catch up to the top 5 of Europe but MLS can be near competitive with Mexico's FMF.

In saying the above, you've apparently acknowledged that it won't be a top flight league.

Missing from your conclusion is some kind of historical proof that fans in North America would support a league (to the tune of national television contracts and crowds regularly in the 30,000 range) that is not considered amongst the best.

Of course, you sort of skipped that and highlight Seattle and hypothesize that they could draw over 40,000 and ask:


Would Seattle average 40,000+ each game help or hurt MLS overall?

Of course it would help. It helps the league because there is revenue sharing and it keeps the league afloat. The league is stronger as a whole as a result.

If you want to have a 4 team league, I think the interest would drop pretty quickly.

Dust2
06-07-2009, 12:12 AM
Dust2,

I'm beginning to think that you are going to keep throwing out numbers until you get a "fine, I give up... good idea."

I can't agree with your proposal as it simply doesn't work, IMO.

Going back to your original post that served as the basis of your theory, you provided some numbers... specifically:



You then go on to hypothesize that:



You suggest this could take place in 2010.
That would mean that there would need to be 3-5 teams with revenues of $25-30M. Here's one big problem with your theory. There is only 1 team that has revenue of over $25-$30M....LA.

From Forbes (Revenue $ in Millions):

Chicago - 16
CHV - 10
CLB - 6
COL - 11
DAL 15
DC - 13
HOU - 10
KC - 5
LA - 36
NE - 10
NY - 10
RSL - 7
TOR - 17

Seattle, LA Galaxy, TFC (in expanded stadium), NY will all gross $25-$35 million revenue come 2010. The Forbers number is for MLS 2007.


You then go on to suggest that spending money on "quality players" will improve the quality of play... Of course it would. A $7-9 mil wages team will have better talents than a $2.3 mil team.


Yet, the Mexican League averges over $35M per team in revenue (2006, http://www.deloitte.com/dtt/press_release/0,1014,sid%253D2834%2526cid%253D120056,00.html ) Clearly, MLS teams do not even approach this average ($12M per the Forbes' numbers above).

Let's ignore the fact that your numbers don't support this position in 2010. MLS has to start somewhere. Could a $7-9 mil wages team be competitive against the Mexican clubs? I would like to think so. Competitive doesn't mean MLS win more than FMF. Competitive means MLS can hold its own against FMF which is not clearly the case today. It shouldn't be a surprise that MLS can't since its $2.3 mil wages against $10-12 million wages. If you want MLS to stick with its hard cap of $2.3 mil and very low increase each year, how do you suppose MLS be competitive with FMF clubs in CCL? How do you suppose MLS image/reputation be when MLS teams do poorly each year in international tournaments? It will just reinforce existing soccer fans who ignore MLS that MLS is crap: "I would never watch MLS, they're crap, they are miles behind Mexican club football?"

Here's my numbers:

LA Galaxy from Forbes $36 mil revenue in 2007.
Seattle will gross around $30-35 mil this year.
NY will have a brand new 25,000 stadium in 2010 (how much revenue? it depends if the fans come out or not)
TFC in a 30,000 seats grass stadium? Revenue = ?
Vancouver in 2011? 25,000 average very possible

Keep in mind that if these teams are allowed to spend 25% of their total revenue, they will win more often and grow faster. As a result, their revenue can only increase.





Let's examine your stance that improved on field product will lead to increased revenue. Don't you contradict your postion when you state:



when you've already said that:



In saying the above, you've apparently acknowledged that it won't be a top flight league.Of course, it is not top flight. The only top flight leagues are the Top 3 (or 5) in Europe. The wages for the top teams in those leagues are at least $120 million. The J-league, FMF do pretty well for itself without being a top-flight league and attracting world-class players.


Missing from your conclusion is some kind of historical proof that fans in North America would support a league (to the tune of national television contracts and crowds regularly in the 30,000 range) that is not considered amongst the best. And what league would that be? The Canadian Football League?
CFL do have its supporters but there are many football fans in Canada who prefer the NFL to the CFL. By the way, the CFL has a salary cap of around $5 mil while the NFL has a salary cap of around $100 million. Also, the NFL only have a hard salary cap within the last 2 decades. The reason the NFL succeed is not because of its hard salary cap but because the sport is so damn popular.

You just give the link that say FMF generates on average $35 million a team. How do you expect MLS teams to compete with that with a $2.3 mil salary cap? Keep in mind that a large portion of existing soccer fans in the USA are Mexican-Americans.



Of course, you sort of skipped that and highlight Seattle and hypothesize that they could draw over 40,000 and ask:


Of course it would help. It helps the league because there is revenue sharing and it keeps the league afloat. The league is stronger as a whole as a result.Then why not let Seattle spend 25% of its total revenue? Surely, Seattle attendance will increase by 7000 if the team is consistently good and its rosters comprise of much better talents compare to today's roster.


If you want to have a 4 team league, I think the interest would drop pretty quickly.Tell that to 4-teams league in England, Spain, Germany, Italy, France, Portugal, Russia, Netherland, Japan etc.....

The interest would be greater for MLS if MLS have 3-5 teams that could spend $7-9 mil in wages among the existing soccer fan base. Keep in mind that other MLS teams could spend $4-6 mil in wages. It's not like $7-9 mil wages for 3-4 teams and $2.3 mil wages for the other 14 teams.

noochie
06-07-2009, 12:25 AM
This whole system effectively does nothing to grow the game in North America. If you were talking about a sport already well entrenched in American culture then sure. But for a sport struggling just to get on the map what does this buy?

Yohan
06-07-2009, 12:25 AM
exactly where are you pulling out this 35million bucks number from? are you clairvoyant or something?

Dust2
06-07-2009, 12:38 AM
Someday soccer may be a big sport in North America. It's got a long, long way to go.

The thing is that soccer is already a big sport in North America but MLS is not. FMF TV rating is higher than NHL TV rating in USA. UEFA Champions League Final on a Wednesday noon-ish kickoff generated over 2 million viewers. World Cup Final was watched by over 15 million viewers when combining ABC and Univision tv rating. This is even better than NBA final tv rating.

It can be argued that in certain cities, MLS is the '5th' Major Sport:

-Seattle (32,000 sold out)
-Toronto (20,000 sold out and 15,000 waiting list).
-Vancouver come 2011 (sold 5000 season ticket deposits within 48 hours)

It's not NFL, NBA, MLB, NHL big time sport but in these few cities but it has the potential to be big time. However, you cannot be a big time sport when you only spend $2.3 mil on wages.

Should MLS allow these teams to grow? Or should MLS hinder their grow by its obsession with a level playing field through its hard cap.

If MLS business model is like MLB (no salary cap but has luxury tax/revenue sharing), Seattle could spend $10-15 mil in wages no problem.

Dust2
06-07-2009, 12:43 AM
exactly where are you pulling out this 35million bucks number from? are you clairvoyant or something?

My best guess from the available information that I have. See the thread on BigSoccer where posters guess Seattle 2009 revenue.

30,000 paid tickets
Shirt sponsorship with XBox
Local TV deal with FSN and King/Kong TV
Local sponsorship
Club seats
50/50 share of revenue with Chelsea/Barcelona in their sold out games at Qwest
Merchandise (jerseys are selling very well)
Parking/concession

LA Galaxy generated $36 mil in 2007 according to Forbes and they averaged 24,252. Surely Seattle can do the same revenue when they average 30,000 a game and share 50% of revenue from 2 sold out 67,000 games with Chelsea/Barcelona.

Yohan
06-07-2009, 12:46 AM
My best guess from the available information that I have. See the thread on BigSoccer where posters guess Seattle 2009 revenue.

30,000 paid tickets
Shirt sponsorship with XBox
Local TV deal with FSN and King/Kong TV
Local sponsorship
Club seats
50/50 share of revenue with Chelsea/Barcelona in their sold out games at Qwest
Merchandise (jerseys are selling very well)
Parking/concession

LA Galaxy generated $36 mil in 2007 according to Forbes and they averaged 24,252. Surely Seattle can do the same revenue when they average 30,000 a game and share 50% of revenue from 2 sold out 67,000 games with Chelsea/Barcelona.
you're doing a lot of guesstimate based on a lot of sketchy data and sources (BigSoccer. Seriously?)

unless you have detailed access to accounting books of each clubs, what you're coming up with is just a pipe dream. sorry

edit: let me put it a better way. your theory would be more convincing if your facts and numbers were more solid and from more credible sources.

oh, and less guess work and more realism

Dust2
06-07-2009, 12:53 AM
you're doing a lot of guesstimate based on a lot of sketchy data and sources (BigSoccer. Seriously?)

unless you have detailed access to accounting books of each clubs, what you're coming up with is just a pipe dream. sorry

i never claimed my number for Seattle 2009 revenue is 100% accurate. Heck, even Seattle accountants won't know until its fiscal year is over.

$35 mil is my best guess basing on the information available to me. Whatever its revenue will be, you can't deny the fact that Seattle will make a whole lot of money this year and its owners will be very profitable.

p.s. Here's Portland projection for 2012 (with about 13k-14k paid tickets) from its MLS franchise bidding:

Portland 2012 Pro Forma

Turnover $18.9m
Gate and match-day $9.9m [$9.357m tickets (before split with MLS); $542,00

concessions]
TV and broadcasting [SUM Distribution] $1.6m
Commercial activities [Merchandise; Exhibitions] $1.8m
Sponsorship (including stadium naming rights) $4.6m
Other operating income $1.0m

Yohan
06-07-2009, 12:58 AM
i never claimed my number for Seattle 2009 revenue is 100% accurate. Heck, even Seattle accountants won't know until its fiscal year is over.

$35 mil is my best guess basing on the information available to me. Whatever its revenue will be, you can't deny the fact that Seattle will make a whole lot of money this year and its owners will be very profitable.
based upon what? do you know what the operating cost of sounders fc is? what their ad deals, tv deals, merchandising, etc are?

sure. anyone can claim that sounders will be profitable. but right now, your facts don't add up to much credibility

Dust2
06-07-2009, 12:58 AM
Let's hope that if MLS stick with its obsession of a level playing field and keep the hard cap, it would have the decency to increase the salary cap by $500,000 a year. Very optimistic I know. With $0.5 mil increase each year, in 10 years, MLS will have a $7.3 mil salary cap.

$7.3 mil salary cap in 2019. Cool. At least it is enough to be competitive against Costa Rica top team (Saprissa) in the Champions League in 2019.

Yohan
06-07-2009, 12:59 AM
p.s. Here's Portland projection for 2012 (with about 13k-14k paid tickets) from its MLS franchise bidding:

Portland 2012 Pro Forma

Turnover $18.9m
Gate and match-day $9.9m [$9.357m tickets (before split with MLS); $542,00

concessions]
TV and broadcasting [SUM Distribution] $1.6m
Commercial activities [Merchandise; Exhibitions] $1.8m
Sponsorship (including stadium naming rights) $4.6m
Other operating income $1.0m
yay budgets that are forecasted 3 years away.

let me know after 2012 when real numbers for portland comes up

Yohan
06-07-2009, 01:01 AM
Let's hope that if MLS stick with its obsession of a level playing field and keep the hard cap, it would have the decency to increase the salary cap by $500,000 a year. Very optimistic I know. With $0.5 mil increase each year, in 10 years, MLS will have a $7.3 mil salary cap.

$7.3 mil salary cap in 2019. Cool.
look. I want MLS to raise quality of its play as much as you do.

however, not at the risk of financial wellbeing of the entire league.

it's not about parity. it's about sustainable growth

Dust2
06-07-2009, 01:05 AM
look. I want MLS to raise quality of its play as much as you do.

however, not at the risk of financial wellbeing of the entire league.

it's not about parity. it's about sustainable growth

And I told you multiple times, it is no financial risk to have a salary cap based on a percentage of total revenue.

Right now, that number is 25%.

It would help MLS total revenue/profit if it lets its team spend at max 25% of their total revenue on wages.

Surely, a $20 mil revenue team can be profitable if it only have a $5 mil wages expense. $15 mil will be enough to pay for fixed expense like travel, insurance, staff etc...

And surely a $10 mil revenue team can also be profitable if it only have $2.5 mil in wages expense. It will have $7.5 mil left over. Not to mention the $2-3 mil luxury tax revenue it will get from MLS top revenue generators.

Why do you think MLS total revenue/profit will decrease if MLS follow this 25% and luxury tax suggestion?

The answer that fans of small revenue teams will lose interest will not work because many ticket buyers to those teams only care about a nice day out. If team X lose 1000 in attendance, team Seattle/Vancouver/TFC/NY/LA will more than make up for that with increase in attendance,

Dust2
06-07-2009, 01:09 AM
yay budgets that are forecasted 3 years away.

let me know after 2012 when real numbers for portland comes up

That will be the closest you will ever come to MLS real financial data. They keep that stuff top secret.

Portland has access to MLS books in order to make its projection whether a MLS franchise $35 mil is worth it. And they err in the conservative side by projecting paid attendance of around 13k-14k and their attendance will DECREASE after the first year.

Pookie
06-07-2009, 06:44 AM
Dust2,

I'm not going to go on and quote you as you seem to argue around in circles in favour of your system.

You want the MLS to compete dollar for dollar with leagues like the Mexican league. When shown that current revenues between leagues are not even close, your argument is that "it will be." Opinion is not fact. Revenues are not close. There is no TV deal on the horizon. The current one pays clubs just $1M per season.

You assume that this will improve the quality of play yet also acknowledge that the league won't be on par with top leagues. What's missing is proof that North Americans would accept a second rate league in the numbers that you project. There are no examples of it. The CFL has folded in cities like Ottawa numerous times. The Argos can't draw squat and Montreal had to move to a smaller venue. Out west it works, likely because Winnipeg and Saskatchewan have no other profressional sports.

Perhaps the most troubling aspect of your theory that hasn't been discussed is as follows.

For a league that depends extremely heavily on tickets, merchandise and concessions how do you increase revenue without raising ticket prices?

You seem to suggest expansion yet how many (newly built) stadiums have the capacity to expand?

Further, even if expansion were a possibility, you think that they would not need to increase prices to cover it?

Simple supply and demand will tell you that demand drops as prices increase particularly for a second rate product.

Dust2
06-09-2009, 01:25 AM
Why a level playing field/hard cap is a bad idea for MLS:




I sincerely believe that a hard cap/level playing field (like in the NFL) is only a good idea when your league is mature and has almost no competition in the same sport. The only competition in the sport of American football for the NFL is college football, which is really a feeder league to the NFL.

A level playing field in the English Premiership today would be a disaster for EPL's revenue. Just imagine the like of Man Utd, Chelsea, Liverpool, Arsenal having the same wages cap as the like of Fulham, Wigan, Stoke and Hull. Its popularity worldwide would plummet because EPL teams with a wage cap of $100 mil can't retain/sign star players. Its domestic and foreign TV deal would decrease significantly. Its attendance revenue, merchandise, sponsorship will all take a hit. Its top teams will do poorly in the Champions League.

The Premiership has competition in the sport of soccer from Serie A, La Liga and Bundesliga. MLS has competition from EPL, La Liga, Serie A, Bundesliga, Champions League FMF, Brazil, Argentina league, Copa Libertadores among the existing soccer fans living in the US and NFL, NBA, MLB, NHL, NASCAR among potential/future fans (who are not soccer fans yet).

An easy way for the Premiership to achieve profitability for all teams and still keep its popularity/star power is to cap its wages/turnover ratio to 55% (for example). Each team can only spend at most 55% of its turnover on wages.

However, an European Super League with Europe top teams could do a NFL hard cap/level playing field and it would be widely popular/successful because it would have almost no competition. Heck, its salary cap would probably be around $200 mil per team. Its revenue would be much greater than the NFL. The Premiership itself generated 1 billion pounds ($1.6 bil) a year in TV revenue. And an European Super League >>>>>> EPL.

Dust2
06-09-2009, 01:26 AM
This proposal has two fundamental objectives:

1. Clubs with great growth potential that could push MLS forward are allowed to grow. Level playing field for all teams from the hard salary cap is holding back these teams from achieving their natural growth. Success off-the-field cannot be built upon. By removing this obstacle, the like of LA, NY, SEA, TOR, Vancouver and to the lesser extent Philly, Chicago, DC United can achieve their growth potential. A sold-out New York Area, Home Depot Center and 35,000-40,000 average attendance in Vancouver and Seattle will help MLS a lot more than it hurt MLS.


2. Ensure profitability for all MLS clubs. Each club can only spend at most 25% of their total revenue. This is a salary cap imposed on club level, not league level, but it is still a salary cap. In addition, high revenue generators will pay luxury tax. Small revenue generators will receive luxury tax. National TV revenue (about $20 mil a year) and National Sponsorship revenue (??? a year) will be shared equally among all teams after the league take its share for operation.

p.s. MLS clubs also have the yearly profit distribution from SUM.

Dust2
06-09-2009, 01:41 AM
Dust2,

I'm not going to go on and quote you as you seem to argue around in circles in favour of your system.

You want the MLS to compete dollar for dollar with leagues like the Mexican league. When shown that current revenues between leagues are not even close, your argument is that "it will be." Opinion is not fact. Revenues are not close. There is no TV deal on the horizon. The current one pays clubs just $1M per season.

A $7-9 mil MLS teams will be more competitive against the FMF clubs in CCL than a $2.3 mil MLS teams. I never stated that MLS should compete dollar for dollar against the FMF. All I said is competitive in the Champions League. The revenue gap is still large but can be closed by a select MLS teams like Sea, LA, Tor, NY. LA Galaxy generated $36 mil in 2007 according to Forbes. They can compete and do all right. The beauty is that LA Galaxy has much more growth potential than any FMF clubs. It's an American city with 15 million people ($$$$$).


You assume that this will improve the quality of play yet also acknowledge that the league won't be on par with top leagues. What's missing is proof that North Americans would accept a second rate league in the numbers that you project.

North Americans do accept a second rate league.

Toronto: 20,000 sold out with 15,000 waiting list
Seattle: 32,000 sold out
Vancouver: likely do a Seattle

However, they will not accept mediocrity. Give them win and better players relative to other teams, they will stay. Back in 1996, LA averaged over 30,000 and NY averaged over 23,500. What if these two teams win consistently and have better players relative to other MLS teams?


There are no examples of it. The CFL has folded in cities like Ottawa numerous times. The Argos can't draw squat and Montreal had to move to a smaller venue. Out west it works, likely because Winnipeg and Saskatchewan have no other profressional sports.

Perhaps the most troubling aspect of your theory that hasn't been discussed is as follows.

For a league that depends extremely heavily on tickets, merchandise and concessions how do you increase revenue without raising ticket prices?

You seem to suggest expansion yet how many (newly built) stadiums have the capacity to expand?

Further, even if expansion were a possibility, you think that they would not need to increase prices to cover it?

Simple supply and demand will tell you that demand drops as prices increase particularly for a second rate product.

Expand new stadium will cost money but it will also make money. If it cost $20 mil to expand BMO Field to 30,000 and it will take in $30 mil (discount to present value) over its lifetime, it's a good deal.

MLS depends heavily on attendance and will continue to do so. However, I believe overall attendance/concession/merchandise will increase under this proposal, not decrease. A few teams attendance will drop but a few teams attendance will increase by a whole lot more.

Dust2
06-09-2009, 02:01 AM
However, I believe overall attendance/concession/merchandise will increase under this proposal, not decrease. A few teams attendance will drop but a few teams attendance will increase by a whole lot more.Here's my estimate of how this overall increase could take place. Assuming that teams like SEA, NY, LA, TOR, VAN could win a little more relative to MLS mid-level clubs. Also, fans interest would be higher with a $7-9 mil wages team than a $2.3 mil wages team. Four or five $1 mil/year type players will make a difference to these team quality of play. For example, a $7-9 mil team could have four $1 mi/yr type players like Angel, Scheletto, Dero, Donovan.

Seattle: increase by 10,000 to about 40,000
LA: increase by 8000 to 26,000 (1000 below capacity)
NY: increase by 13,000 to 24,000 (1000 below capacity)
TOR: depending on the capacity of new expanded grass stadium (which MLSE will more likely build if success on the field is more likely in this new model compare to the current model). increase by 10,000 when MLSE expand to 30,000.
Vancouver: sold out its 5000 deposits within 48 hours. Owners are learning from the Seattle experience and want to replicate it. Attendance of at least 25,000 is very likely. Compare this to an average of 16,000 in MLS.

From these teams:

SEA: + 10,000
LA: + 8,000
NY: + 13,000
TOR: +10,000
Van: + 9,000* (from league average)

Even if teams like SJ, KC, Colorado, Columbus, Dallas drop 3000 each in attendance, MLS overall attendance will increase. And guess what markets have the highest ticket prices/concession/merchandise? That's right......LA, TOR, NY, SEA. Keep in mind that many ticket buyers in SJ, KC, Colorado, Columbus, Dallas are soccer moms and casual fans who like a nice day out. They will come out even if their home teams are less than average. Don't forget the draw potential of teams like NY, LA coming to town.




DATES TOTAL AVERAGE DATES TOTAL AVERAGE
Chicago Fire 6 70,357 11,726 7 109,292 15,613
Chivas USA 8 122,494 15,312 5 70,190 14,038
Colorado Rapids 4 49,638 12,410 7 95,597 13,657
Columbus Crew 5 61,843 12,369 7 116,844 16,692
FC Dallas 6 52,808 8,801 6 90,474 15,079
D.C. United 7 100,122 14,303 6 80,680 13,447
Houston Dynamo 6 93,843 15,641 5 58,776 11,755
Kansas City Wizards 6 57,539 9,590 7 124,753 17,822
Los Angeles Galaxy 6 115,367 19,228 6 103,570 17,262
New England Revolution 5 57,557 11,511 6 83,055 13,843
New York Red Bulls 7 76,763 10,966 7 117,450 16,779
Real Salt Lake 6 92,691 15,449 6 85,764 14,294
San Jose Earthquakes 6 65,293 10,882 6 70,938 11,823
Seattle Sounders FC 6 176,806 29,468 6 84,301 14,050
Toronto FC 8 162,136 20,267 5 63,573 12,715
MLS Totals 92 1,355,257 14,731 92 1,355,257 14,731

Dallas decrease 3000 to 6000 average
SJ decrease 3000 to 8000 average
Columbus decrease 3000 to 9000 average
KC decrease 3000 to 7000 average
Colorado decrease 3000 to 9,500

It is very likely that they won't decrease this much. These teams can still be profitable because MLS revenue share SUM profits, national TV deal and national sponsorship. Also, these teams will get $2-3 mil a year in luxury tax revenue.

p.s. Pookie can you come up with your overall attendance best guess analysis?

Dust2
06-09-2009, 02:15 AM
Overall standings


--------------------------Club Pts GP
1 Chivas USA (W1) 27 13
2 Houston Dynamo (W2) 21 11
3 Chicago Fire (E1) 21 13
4 D.C. United (E2) 19 13
5 Seattle Sounders FC 17 12
6 Colorado Rapids 17 11
7 Toronto FC [note 1] 16 13
8 Columbus Crew 16 12
9 Kansas City Wizards 16 13
10 New England Revolution 16 11
11 Los Angeles Galaxy 15 12
12 Real Salt Lake 12 12
13 FC Dallas 10 12
14 New York Red Bulls 9 14
15 San Jose Earthquakes 9 12 −10Look similar to a league that have no salary cap doesn't it?

And MLS revenue/profit would be much better off if the top teams in the table are New York, Los Angeles Galaxy, Toronto FC and Seattle (soon Philly, Vancouver).

No guarentee that these teams will be successful if they spend up to 25% of their total revenue on salary. A $4-6 mil team can definately finish higher than a $7-9 mil team. J-league proved that the second to last wages spender can be successful (currently in 3rd place). EPL proved that even the 5th highest spender (Newcastle) got relegated. In addition, MLS have the draft where worst teams are rewarded. MLS has the 8 teams playoff where anything can happen. I wouldn't be surprised if a $3-4 mil wages team make it to MLS Final like Tampa Bay did it in baseball.


Salary structure could be like this (25% and luxury tax)

top 4-6 MLS revenue teams: $7-9 mil a year in wages
the next 5-6 MLS revenue teams: $5-6 mil a year in wages
the bottom 5-6 MLS revenue teams: $3-4 mil a year in wages

This definately won't be the Scottish Premier League where Rangers/Celtics have wages of around $80 mil while the rest of the league has wages on average of $3-6 mil (about MLS level). It won't even be EPL level where Chelsea spent 180 million pounds on wages and the bottom teams only 30 million pounds. At such a low wages scale ($7-9 mil vs. $3-4 mil), it won't matter as much as 180 million pounds vs. 30 million pounds. A good player or two a $3-4 mil team can be really competitive.

Pookie
06-09-2009, 06:23 AM
I could come up with attendance numbers. But whether it comes from my ass or yours, they are completely guestimates.

What level would ticket prices need to be at in order to pay for stadium expansions and the increased spend on salaries?

The spend has to happen first in your theory. You don't get more people over night.

Ticket prices/concessions are the only things funding your increased spend. The money is not coming from TV contracts or some make believe advertising deal.

Fort York Redcoat
06-09-2009, 08:18 AM
I think parity encourages consistency in fan interest.

Why? because you're never out of it.
The reason teams lose fans often in North America is they have no chance at the championship year after year (see the Blue Jays over the past 10 years).

Parity may be frustrating at times, due to ties, but it means all teams' fans have hope.

Secondly, some teams in MLS have been highly successful, year after year, despite parity (see New England or DC United or Houston). These teams are consistently good.

Parity does not force teams to be good, then suck, then be good. It just means you cannot depend upon spending more than the means of your enemies to solve problems. Solving problems means finding people to manage the club who can succeed within the restrictions.

LS.

Sory I'm late to the parity party. BR knows this is one of my favourite topics and this episode has been one of the best, Dust2.

Parity breeds weaker support. It's easier to follow a team that is "in it" for most of the season and even easier to watch them "if they make the playoffs". I'm not saying we don't need this in MLS at this point I'm just voicing that the level of commitment will always be inferior to the world model. I agree with the fact that it's upon the team's organization to succeed more than just buying talent but I personally find it a hindrance to the passion of the game on the field. (well used eg. "this loss is great for tank nation!")


Yep. 30% is way too much. I'd love to see spending actually linked to revenue, but this isn't Europe. It'd never work in MLS.

Please leave the nevers out. It kills the discussion. What percentage would YOU set if you wanted to see a change?


Everyone who sees the world the way I do and agrees with me is smart ;).

Someday soccer may be a big sport in North America. It's got a long, long way to go.

C'mon. I've read the thread and agree or not Dust2 has put more work into that side than anyone I've seen. It may be a long road but someone has to keep talking about the first steps.


The lower revenue teams would fall off the face of the planet under this system.

The league would shrink and die.

I HATE having to agree on this, for now, but with growth of the league in number of teams we must put stability before rapid change.

Beach_Red
06-09-2009, 08:39 AM
Sory I'm late to the parity party. BR knows this is one of my favourite topics and this episode has been one of the best, Dust2.

Parity breeds weaker support. It's easier to follow a team that is "in it" for most of the season and even easier to watch them "if they make the playoffs". I'm not saying we don't need this in MLS at this point I'm just voicing that the level of commitment will always be inferior to the world model.

I don't think you can discount the "American model" so quickly. Especially given the huge changes that TV have brought to sports. NFL, MLB, NBA and college sports support may not be as "passionate" as the world model, but it works just fine. If MLS could get into that club, it would be a big deal.

I agree, we should leave the nevers out. The league is going to change, it's just a question of how much and how soon.

And yeah, I agree, Dust2 put a lot of good work into it. Didn't a I put s miley face on that ;)?

rocker
06-09-2009, 08:46 AM
It's easier to follow a team that is "in it" for most of the season and even easier to watch them "if they make the playoffs".

It's harder to support a team that never wins anything because the big 4 capture it all.

Now, if leagues were made of 4 teams, that'd be OK! ;)

flatpicker
06-09-2009, 08:51 AM
It's harder to support a team that never wins anything because the big 4 capture it all.

Now, if leagues were made of 4 teams, that'd be OK! ;)


and yet baseball still seems to be watched by quite a few people.

Fort York Redcoat
06-09-2009, 09:17 AM
I don't think you can discount the "American model" so quickly. Especially given the huge changes that TV have brought to sports. NFL, MLB, NBA and college sports support may not be as "passionate" as the world model, but it works just fine. If MLS could get into that club, it would be a big deal.



Agree the NA model must be used until MLS can say they rank 4 or 5 in the sports landscape but that's their ceiling. To try and topple an entreched sport using the same model would be extermely difficult. At the ceiling they must look to world competition to succeed on a world scale. Stability first, but it only takes one so far.


It's harder to support a team that never wins anything because the big 4 capture it all.

Now, if leagues were made of 4 teams, that'd be OK! ;)

My point exactly. More difficult to support reaps greater rewards in victory. It's a different mindset but not inferior.

Beach_Red
06-09-2009, 10:26 AM
and yet baseball still seems to be watched by quite a few people.


That's where the hundred years of tradition comes in. Remember, baseball isn't a sport, it's "America's Pastime." But even then, it's an issue baseball is addressing. Philly, Boston, the White Sox, teams that hadn't won in decades have managed World Series wins (and really, we should count "lesser" victories like pennants and division titles to make it morelike soccer where there seem to be lots of trophies to win).

But for sports and leagues that have to start up since TV became such a factor, it really is different.

Beach_Red
06-09-2009, 10:29 AM
Agree the NA model must be used until MLS can say they rank 4 or 5 in the sports landscape but that's their ceiling. To try and topple an entreched sport using the same model would be extermely difficult. At the ceiling they must look to world competition to succeed on a world scale. Stability first, but it only takes one so far.


Yes, this is exactly what gives soccer the edge over other sports.

MLS will be as successful as the USA national team is. If they ever actually make some noise in the World Cup then the MLS will increase exponentially.

But does anyone really want the US to be legitimate contenders?

trane
06-09-2009, 10:34 AM
For me it is not about winning it is about competing and about the game. My frustration with our team , as that to often we are simply not in it, because we can not play a decent game. Money is only a part of the problem in this. Look at a lower lever EPL side, Stoke City , Sunderland, sure they are not likely to win against LFC or Chelsea, but they are still capable in playing a good tought game and giving the big club a scare. Why? Becasue they are all able to play foundametlay sound football, and have the heart to compete. If you did that in the MLS, sure Columbus, may have a hard time winning the cup, but it should be able to compete in any one game. Then to time to time when it realy got it shit together it just may be able to beat some big clubs and make a run. For me that is preferable that mediocare play up and down the table.

Fort York Redcoat
06-09-2009, 10:50 AM
Yes, this is exactly what gives soccer the edge over other sports.

MLS will be as successful as the USA national team is. If they ever actually make some noise in the World Cup then the MLS will increase exponentially.

But does anyone really want the US to be legitimate contenders?

This presents an interesting dynamic. At this stage I'd agree that MLS is here to feed the US National team and said as much in their original mission statement but to digress a moment- How counterproductive to not spotlight international dates they're trying to feed with this league?

What's equally strange is that in the final stages of success MLS will ultimately grow bigger than the National team. It seems the natural progression to be:

Country>Club because Clubs are there for US team
Club>Country because one watches them more leading to stronger attachment.

Whereas in Canada

Club>Country until Canada builds on success. The league isn't designed for Canada so it will be interesting to see the great leaps our Country will have to take to stay competitive.

iansmcl
06-09-2009, 12:03 PM
I thought the US had been making noise in the World Cup the last few times... wasn't it an upset when they didn't get through the Group Stage last time around?

Fort York Redcoat
06-09-2009, 12:11 PM
I thought the US had been making noise in the World Cup the last few times... wasn't it an upset when they didn't get through the Group Stage last time around?

'94 they hosted it and introduced MLS. Pimped the sport out and the US team overachieved so last couple of World cups they felt they should've done better. Many feel they greatly underestimated countries looking at their size and economics vs their strengths in football.

They could get through the Group Stage if everything went their way but Quarterfinals? Not likely.

iansmcl
06-09-2009, 12:24 PM
Whoops... just did a quick Wiki-check and realised it's only been 2002 that they've really done all that well. Thought they did make it through to the Quarters that year, losing to Germany in a game that Kahn apparently kept them in.

Pookie
06-09-2009, 12:38 PM
Parity breeds weaker support. It's easier to follow a team that is "in it" for most of the season and even easier to watch them "if they make the playoffs". I'm not saying we don't need this in MLS at this point I'm just voicing that the level of commitment will always be inferior to the world model

Let's examine that a little because is it true? Does Parity breed weaker support and if so, is that a bad thing?

The NFL is the ultimate model in parity, a city like Green Bay can compete with Dallas in any given year (or Sunday). It is the highest grossing league in North America and arguably the most successfully run league in the world.

This is a good read, from the Economist http://www.economist.com/business/displaystory.cfm?story_id=6859210:

Two sets of incentives have been especially important (for the NFL): the teams' owners share roughly 70% of their revenues with each other; and they stick to a strict salary cap that limits the amount each team can spend on players' salaries.

It is little wonder, then, that Art Modell, the former owner of a franchise that moved from Cleveland to Baltimore, once referred to NFL team owners as “32 fat-cat Republicans who vote socialist” on football. But these two policies, taken together, have done wonders for profits, by giving all 32 owners a chance to field teams that are both financially viable and athletically competitive, even though some are in much richer local markets than others.

The contrast with English football's Premier League—the richest soccer league in the world—is striking. The lack of a salary cap and the fact there is little revenue sharing means that the league is dominated by the same teams, year after year, while the poorer and less successful teams lose support and flirt with bankruptcy.


But the NFL also stands out when compared with the other three big sports leagues in America. While they let teams in New York and other big cities capture giant local media markets, the NFL negotiates all of its television contracts as a single entity. Its latest contract, which will run until the end of 2011, will bring in $3.7 billion a year from several national networks, which Mr Tagliabue and the league have artfully pitted against one another.

By getting the co-operative bits right, the NFL as a whole benefits in two ways. First, its teams are far more evenly matched competitively than those in other leagues. Several teams rise and fall in the league tables from one year to the next, and every season provides many fresh examples of how any team can win on “any given Sunday”. That keeps supporters coming back, and ensures that the bulk of the games remain interesting, even in the final weeks of the season.

Second, the system lowers risk. “The NFL is a perfect portfolio,” says John Vrooman, a sports economist at Vanderbilt University, because one team's losing season and sagging revenues are offset by another team's banner year. The co-operative arrangements also make costs stable and predictable. Mr Vrooman reckons that even if another American sports league, or a big European football league, were to have similar cashflows to the NFL, the American league's teams would still be 50-60% more valuable because their business is so much less risky


...

There are a number of similarities between the NFL and MLS in terms of structure. Both employ revenue sharing and a reasonably strict cap. They also share the NFL's style in negotiating TV rights as a single entity. I'm not so sure that you would want to abandon a model that follows a very successful blueprint for one that has resulted in incredible amounts of debt.

Fort York Redcoat
06-09-2009, 01:55 PM
I see the strength in parity and stability being necessary for this fledgling league but after it hits its popularity ceiling (eg. NHL in the south) it will need to compete with the big 4 NA sports another way.

The rest of the world is what is in front of MLS and any other world football team whereas the safety of the NFL is where the latest owners come from to buy Premiership clubs. So yes, the NFL being the most successful league in the world is arguable since it should be the most desirable league to be in, the most watched league in the world. I don't believe it is.

^Interesting read and viewpoint.

Beach_Red
06-09-2009, 02:06 PM
^ you watch, though, when the European Superleague is formed it will be on the NFL model.

Fort York Redcoat
06-09-2009, 02:08 PM
^ you watch, though, when the European Superleague is formed it will be on the NFL model.

I'm crossing my fingers...;)

Dust2
06-09-2009, 06:23 PM
I could come up with attendance numbers. But whether it comes from my ass or yours, they are completely guestimates.



I never claim it wasn't a guestimate. However, I still want to see your guestimate.

Assuming that teams like SEA, NY, LA, TOR, VAN could win a little more relative to MLS mid-level clubs. Also, fans interest would be higher with a $7-9 mil wages team than a $2.3 mil wages team. Four or five $1 mil/year type players will make a difference to these team quality of play. For example, a $7-9 mil team could have four $1 mi/yr type players like Angel, Scheletto, Dero, Donovan.

SEA: + ?
LA: +
NY: +
TOR +
VAN +

And how much of a decrease for low revenue teams like Colorado, KC, SJ, Dallas, Columbus?

Dust2
06-09-2009, 06:37 PM
What level would ticket prices need to be at in order to pay for stadium expansions and the increased spend on salaries?

Only TOR need stadium expansion. I'm sure MLSE will charge higher ticket prices if the demand is there. Also, the revenue from the extra 10,000 seats over the span of the stadium life will help pay for the cost of this expansion.

10,000 seats x 18 games x $30 = $5.4 mil in revenue. Assuming concession and merchandise is 20% of ticket revenue, this extra 10,000 seats expansion would generate $6.5 mil a year. Over the lifetime of the stadium (assume 20 years), it would generate $130 mil (without discounting to present value).

Also a 30,000 seats stadium instead of a 20,000 seats stadium will have positive on the team in other areas like sponsorship revenue, brand value, game atmosphere, shirt sponsorship, stadium sponsorship. Are you telling me MLSE can't afford to expand the stadium and at the same time use 25% of its total revenue on wages? I actually they will be more profitable because of the stadium expansion. The cost of the expansion will be depreciated over a period of many years. It's not a lump sum cost on the balance sheet.

Vancouver and Seattle don't need expansion because their stadium capacity is 55,000 and 67,000 respectively. LA can't expand beyond 27,000 because of its agreement/lease deal with the Carson government. However, it could sell 3000 extra because of the grass/lawn at one end line. As for the Red Bull, they would glad to pay for expansion of Red Bull Arena because it mean that they consistently sold out 25,000 seats stadium and have a long waiting list. Red Bull don't care if it operate on a loss to expand stadium because their main target is advertisement for their brand. However, if the Red Bull expand 10,000 seats, they can get this money back easily from the revenue generated by these 10,000 seats. Also average attendance of 35,000 instead of 25,000 will mean sponsorship, merchandise, concession revenue will increase.


The spend has to happen first in your theory. You don't get more people over night.You're right. You don't. But I'm sure each MLS team is smart enough to come up with revenue projection for the year and use that. Even now, each MLS team has a revenue and expense projection for the year. Every business do it. Or they could use the revenue for the past year as a model.

You are right about the fact that people won't show up over night but as the season progress, the attendance might increase if 1) the team win consistently 2) the $7-9 mil team has a few $1 mi/type player worth watching


Ticket prices/concessions are the only things funding your increased spend. The money is not coming from TV contracts or some make believe advertising deal.

Right now MLS use around 25% of its total revenue on wages (see my calculation for 2007 wages/revenue ratio of 24.95%). If MLS continue to use this same percentage, there is NO INCREASE in money spent. So please stop saying that there will be increase in money spend when this is no true. In fact, there might be a decrease in money spent because this proposal call for up to 25% which mean a club could use 20% of its total revenue if it want to.

And I believe ticket/concession/sponsorship revenue will increase overall for MLS. As I have stated, a big TV contract for MLS is not coming any time soon. However, a MLS with a few marque teams that average 30,000+ will have a better TV contract than the current mediorcrity MLS that has no high profile matches.

Dust2
06-09-2009, 06:55 PM
There are a number of similarities between the NFL and MLS in terms of structure. Both employ revenue sharing and a reasonably strict cap. They also share the NFL's style in negotiating TV rights as a single entity. I'm not so sure that you would want to abandon a model that follows a very successful blueprint for one that has resulted in incredible amounts of debt.

For the last time, if MLS follow this proposal, it is not getting rid of salary cap. It just switch the cap from a macro (league) level to a micro (club) level.

This would be no where like the EPL.

If the EPL stipulate that each club could only spend 50% of its total revenue on wages and top earners pay luxury tax, then yes MLS will be like the EPL. For now with its low revenue, MLS can only afford to use at max 25% of each club revenue on wages. Overtime, this number will increase if revenue increase.

Dust2
06-09-2009, 07:00 PM
^ you watch, though, when the European Superleague is formed it will be on the NFL model.

I would assume so too. As I stated, the European Superleague will have almost no competition. It will still be the top dog.

If the EPL follow NFL model today, it would be a disaster. Yes each team will be profitable with a hard cap but overall revenue for the league would tank big time. No stars = no success in Champions League, lower attendance, ticket prices, sponsorship, and most importantly TV revenue. Fans abroad will migrate to La Liga or Serie A.

If the EPL follow the proposal of this thread, it will still be almost as popular and all of its teams will be profitable because there is "cost certainty."

Club Debt (£ms) Turnover (£ms) Wages (£ms) Wages/turnover

Arsenal 416 223 101.3 45%
Aston Villa 73 75.6 50.4 66.6%
Blackburn Rovers 17 56.4 39.7 70%
Bolton Wanderers 52 59.1 39 67%
Chelsea 701 213.6 149 68%
Everton 39 76 44.5 59%
Fulham 197 53.7 39.3 73%
Hull City (2007 figures) 1 9 6.9 77%
Liverpool 280 (est) 159 80 (est) 50%
Manchester City 147 82.3 54.2 66%
Manchester United 699 256.2 121.1 47%
Middlesbrough 93 48 34.8 73%
Newcastle United 106.2 100.8 74.6 74%
Portsmouth 57.7 70.6 54.7 78%
Stoke City 2.3 11.2 11.9 106%
Sunderland 69.2 63.6 37.1 58%
Tottenham Hotspur 65 114.8 52.9 46%
West Bromwich Albion 8.9 27.2 21.8 80%
West Ham United 36 57 44.2 76%
Wigan Athletic 66.4 43 38.4 89%

TOP PREMIER LEAGUE WAGE BILLS 2007/08
# Chelsea - £172.1m (£132.9m)
# Manchester Utd - £121.1m (£92.3m)
# Arsenal - £101.3m (£89.7m)
# Liverpool - £90.4m (£77.6m)
# Newcastle Utd - £74.6m (£56.7m) (2006/07 wages in brackets) Source: Deloitte

Pookie
06-09-2009, 07:20 PM
For the last time, if MLS follow this proposal, it is not getting rid of salary cap. It just switch the cap from a macro (league) level to a micro (club) level.


However you spin it, it is still creating a system whereby teams with higher revenue generating capabilities can outspend teams that are not in the same financial picture.

Interestingly, you note TFC as one of the higher revenue generating clubs that would benefit under this system. What happens if the dollar falls to .65 cents? All salaries are in US$. What of Vancouver (or Montreal or Ottawa) down the road?

The NFL model is envied for a reason, it works. It has a hard cap. It is equal for all teams. Revenue is shared. There is competition amongst all teams. There is a TV deal that is negotiated league wide. The strength of the league and cost certainty ensure stability.

I've not seen a reason why this blueprint should be ignored. Just my opinion of course, you are entitled to yours. I like the way the MLS is currently structured and think they are well positioned for the future. I have no expectations of EPL grandeur. I accept it for what it is.

Super
06-09-2009, 08:30 PM
Rich clubs in this league is still able to use its financial advantage by signing a DP player. Unfortunately our club is run by a clown who doesn't believe in this advantage. So we might as well be a poor club like Kansas - our money gives us no advantage.

flatpicker
06-09-2009, 09:06 PM
Parity does have it's pros... even though I think a few 'slightly' stronger teams can be good for a league.

If they were to adjust the DP rule so that none of the salary counts against the cap, then that could be a good solution.

Or maybe have 2 DP slots per team... one that has a limit on salary, and the other that has none.

That way wealthier teams could gain a slight advantage (but not an excessive advantage)
It would also mean a few more high calibre players in MLS to increase viewers and excitement.

Dust2
06-09-2009, 10:14 PM
Rich clubs in this league is still able to use its financial advantage by signing a DP player. Unfortunately our club is run by a clown who doesn't believe in this advantage. So we might as well be a poor club like Kansas - our money gives us no advantage.

Having a DP is not that much of an advantage. It still count $415,000 toward your salary cap. Ask LA.

Six $6 mil a year type players would benefit LA much more than a $6 mil DP player.


If they were to adjust the DP rule so that none of the salary counts against the cap, then that could be a good solution.

Or maybe have 2 DP slots per team... one that has a limit on salary, and the other that has none. I agree. MLS would be better off with this. And MLS fans who use BigSoccer think so too

http://www.bigsoccer.com/forum/showthread.php?t=1014206
What do you think MLS should do regarding the Designated Player? (2010 and beyond)


Have the 1 DP slot ($415,000 count against salary cap) 6 2.86%
Have the 1 DP slot (DP exempt from salary cap) 23 10.95%
Increase the DP to 2 per team (both count toward the salary cap) 7 3.33%
Increase the DP to 2 per team ($415,000 count against salary cap, 1 exempt) 34 16.19%
Increase the DP to 2 per team (both exempt from salary cap) 124 59.05%
Get rid of DP (like it was in 2006 with no DP) 16 7.62%

Out of 210 votes, 59% of those voted for increase the DP to 2 per team and both exempt from the salary cap. However, having 2 exempt DP per team would be financial risky compare to this proposal where each team can spend at most 25% of its total revenue and luxury tax revenue for small revenue clubs. Let's the club decide if having a $6 mil DP is more beneficial than having SIX $1 mil/yr type players.

p.s. Pookie, I am still waiting for your guesstimate on attendance if MLS follow this proposal. You stated that you believe MLS overall attendance will decrease. Now back it up.

Assuming that teams like SEA, NY, LA, TOR, VAN could win a little more relative to MLS mid-level clubs. Also, fans interest would be higher with a $7-9 mil wages team than a $2.3 mil wages team. Four or five $1 mil/year type players will make a difference to these team quality of play. For example, a $7-9 mil team could have four $1 mi/yr type players like Angel, Scheletto, Dero, Donovan.

SEA: + ?
LA: +
NY: +
TOR +
VAN +

And how much of a decrease for low revenue teams like Colorado, KC, SJ, Dallas, Columbus?

mclaren
06-09-2009, 10:22 PM
For me it is not about winning it is about competing and about the game. My frustration with our team , as that to often we are simply not in it, because we can not play a decent game. Money is only a part of the problem in this. Look at a lower lever EPL side, Stoke City , Sunderland, sure they are not likely to win against LFC or Chelsea, but they are still capable in playing a good tought game and giving the big club a scare. Why? Becasue they are all able to play foundametlay sound football, and have the heart to compete. If you did that in the MLS, sure Columbus, may have a hard time winning the cup, but it should be able to compete in any one game. Then to time to time when it realy got it shit together it just may be able to beat some big clubs and make a run. For me that is preferable that mediocare play up and down the table.

Watch it! According to Sky Sports, Roberto Mancini said, "I am very flattered to have received an offer from Sunderland.

"It would be an honour to manage such a prestigious club in the Premier League." Listen to Roberto ;)

mclaren
06-09-2009, 10:24 PM
For me it is not about winning it is about competing and about the game. My frustration with our team , as that to often we are simply not in it, because we can not play a decent game. Money is only a part of the problem in this. Look at a lower lever EPL side, Stoke City , Sunderland, sure they are not likely to win against LFC or Chelsea, but they are still capable in playing a good tought game and giving the big club a scare. Why? Becasue they are all able to play foundametlay sound football, and have the heart to compete. If you did that in the MLS, sure Columbus, may have a hard time winning the cup, but it should be able to compete in any one game. Then to time to time when it realy got it shit together it just may be able to beat some big clubs and make a run. For me that is preferable that mediocare play up and down the table.

Agree with you there (apart from the Sunderland part). This parity malarky is just boring - no excitement. You don't even get games where you have a minnow up against a big gun - you don't even get that narrative. Instead, it's average team A vs average team B. Some might love that, but I prefer the European model. Call me old-fashioned.

Beach_Red
06-09-2009, 10:54 PM
Agree with you there (apart from the Sunderland part). This parity malarky is just boring - no excitement. You don't even get games where you have a minnow up against a big gun - you don't even get that narrative. Instead, it's average team A vs average team B. Some might love that, but I prefer the European model. Call me old-fashioned.

You're old fashioned ;).

I'm curious, though, was the gap between the big teams and the rest of the teams in European leagues always so wide? Was a team like Man U ever serisouly worried about being relegated (never mind about not finishing in the top four)? I never followed european soccer, so I really don't know, but it seems that maybe things were different in a pre-TV revenue era. The Champions league seems almost a parity league.

rocker
06-09-2009, 10:58 PM
The Champions league seems almost a parity league.

I've always thought of Champions League in Europe as a way of counteracting the forces that create "big fours". Because most of those teams are the high spending teams in their leagues. So it's sorta like an unforced parity.


Agree with you there (apart from the Sunderland part). This parity malarky is just boring - no excitement. You don't even get games where you have a minnow up against a big gun - you don't even get that narrative. Instead, it's average team A vs average team B. Some might love that, but I prefer the European model. Call me old-fashioned.

boring? you honestly find MLS boring? I would say ties can be "disappointing" but I don't find it boring. It's like when soccer haters say the 1-1 game is the worst thing in the world. no it's not, cuz there's so much more to the game than just goals.

I've watched some kick ass matches this year in MLS. On any given day, you can be beat, and that's exciting.. the tension never ceases. Yes in the other leagues, sometimes a big guy can be beaten, but most of the time, it doesn't happen.. the narrative doesn't matter when Man U beats you handily 4-0.

Also, if your team was playing like Chivas you'd probably find things a bit more exciting than if your team is a mid-table side like TFC.

The fact is, the salary cap imposes fiscal parity on teams. But as we've seen with Chivas, it doesn't mean teams cannot do well, or that teams cannot suck shit. It just means the reasons they do well or suck shit have nothing to do with a fiscal unfairness. To me MLS is almost as close as you can get to perfect competition. Forget the money advantage -- this league forces teams to coach well, scout well, train well.... do things smart rather than solving problems by throwing cash at them.

Dust2
06-10-2009, 04:28 AM
NFL is probably the most balanced league (beside MLS) in term of having a level playing field for all teams because of its salary cap. However, it is no where near MLS in term of a level playing field for all teams.

Its top payroll pays 1.822 more than its lowest payroll. 2008 Numbers:

http://content.usatoday.com/sports/f...s.aspx?team=23 (http://content.usatoday.com/sports/football/nfl/salaries/teamresults.aspx?team=23)
http://www.altiusdirectory.com/Sports/nfl-salaries.php

NFL Teams Total Payroll
NFL Oakland Raiders Teams $ 152,389,371
NFL Dallas Cowboys Teams $ 146,401,600
NFL Minnesota Vikings Teams $ 133,354,045
NFL Cleveland Browns Teams $ 131,916,300
NFL New Orleans Saints Teams $ 131,531,820
NFL Pittsburgh Steelers Teams $ 128,815,061
NFL Tennessee Titans Teams $ 126,017,443
NFL Arizona Cardinals Teams $ 122,110,110
NFL Jacksonville Jaguars Teams $ 122,109,207
NFL Chicago Bears Teams $ 120,065,819
NFL San Francisco 49ers Teams $ 118,766,239
NFL New York Jets Teams $ 116,910,097
NFL St. Louis Rams Teams $ 116,677,660
NFL New York Giants Teams $ 115,816,180
NFL Miami Dolphins Teams $ 114,649,660
NFL Buffalo Bills Teams $ 113,364,927
NFL Carolina Panthers Teams $ 112,114,711
NFL Washington Redskins Teams $ 111,963,684
NFL San Diego Chargers Teams $ 111,813,340
NFL Cincinnati Bengals Teams $ 109,727,880
NFL Philadelphia Eagles Teams $ 109,557,398
NFL Houston Texans Teams $ 108,445,418
NFL Tampa Bay Buccaneers Teams $ 104,329,311
NFL Seattle Seahawks Teams $ 102,985,710
NFL Atlanta Falcons Teams $ 96,391,525
NFL Detroit Lions Teams $ 95,827,117
NFL Denver Broncos Teams $ 95,599,778
NFL Green Bay Packers Teams $ 94,018,300
NFL Indianapolis Colts Teams $ 93,373,915
NFL New England Patriots Teams $ 92,734,120
NFL Baltimore Ravens Teams $ 90,713,965
NFL Kansas City Chiefs Teams $ 83,623,776

Major League Soccer: each team can't spend more than $2.3 mil a year beside a DP will cost a team $415,000 in salary cap. Therefore, a top revenue earners like LA, Sea, Tor can only spend as much in salary as a small revenue earners like Columbus, SJ, KC (beside the DP).

Does MLS's obsession with a level playing field hurt MLS more than it help MLS?

Pookie
06-10-2009, 06:40 AM
p.s. Pookie, I am still waiting for your guesstimate on attendance if MLS follow this proposal. You stated that you believe MLS overall attendance will decrease. Now back it up.


Guestimate #1

No change at all to attendance if you draw 2-4 South American unknown players to the mix for a $1M salary.

Eg. Blanco at $2.7M is the biggest star in the league. He plays for a Chicago side that is 1st in the Conference. Chicago draws 11,726 per game and that's down 28% from previous year

Eg. Columbus has Schelotto, they draw 12,368 and are defending MLS Cup champs and sit 3rd in the Conference. They are flat (-0.12%) over last year


I will acknowledge that there is a star factor as evidenced by the "Beckham Bump." Beckham also cost $6.5M and I think we'd all agree is not part of your proposal.

Attracting relative unknown players that North American fans do not associate with has no draw at the gate or on TV.

Further, it could be argued that the decent play of clubs relative to the competition (ie. Chicago and Columbus) also has no measurable draw at the gate or on TV.

Guestimate #2

The rise in ticket prices necessary to pay for the increased expenditure would result in an overall decline in attendance.

The premise is simple. As shown in #1 above, there is no correlation between "unknown" talent and increased interest in the league. There is no correlation or at least weak correlation between performance on the field (relative to the competition) and attendance.

So now it comes down to price.

For proof, I'd suggest that you read these boards to see what fans think about paying extra for the Real Madrid game. While there are some additional circumstances there, a simple review of economics will tell you that demand decreases as prices increase.

Still not buying your theory. Hard Cap, Revenue Sharing, Affordability and "single entity" thinking will benefit this league more than following a flawed system.

Fort York Redcoat
06-10-2009, 07:16 AM
What happens if the dollar falls to .65 cents? All salaries are in US$. What of Vancouver (or Montreal or Ottawa) down the road?

The NFL model is envied for a reason, it works.

I've not seen a reason why this blueprint should be ignored. Just my opinion of course, you are entitled to yours. I like the way the MLS is currently structured and think they are well positioned for the future. I have no expectations of EPL grandeur. I accept it for what it is.

If the dollar falls then what should happen is we find out what hard times are. That's what support is supposed to be.

The NFL model is envied in NA sports by the $$$ it makes. It's not like supporters across the world are praying for parity.

I've said the blueprint isn't and shouldn't be ignored but as your highlighted bit indicates, average fans in NA look no further than NA and to me that's a shame because we have the $$$ resources and potential in numbers to be a world leader in world football as well.

Fort York Redcoat
06-10-2009, 07:26 AM
You're old fashioned ;).

I'm curious, though, was the gap between the big teams and the rest of the teams in European leagues always so wide? Was a team like Man U ever serisouly worried about being relegated (never mind about not finishing in the top four)? I never followed european soccer, so I really don't know, but it seems that maybe things were different in a pre-TV revenue era. The Champions league seems almost a parity league.

Since no one else is answering BR, Division 1 of the English League has been a tight race for most of its history. You're correct it wasn't until the on set of tv money that some rose above.

As an aside I love correcting NA fans that yearn to compare Man United to the Yankees. The Yankees were always the Yankees in the biggest city in the country. Man United at one point needed saving from Man City to not go under and relatively recently enjoyed extreme success.

OneLoveOneEric
06-10-2009, 07:38 AM
NFL is probably the most balanced league (beside MLS) in term of having a level playing field for all teams because of its salary cap. However, it is no where near MLS in term of a level playing field for all teams.

Its top payroll pays 1.822 more than its lowest payroll. 2008 Numbers:

http://content.usatoday.com/sports/f...s.aspx?team=23 (http://content.usatoday.com/sports/football/nfl/salaries/teamresults.aspx?team=23)
http://www.altiusdirectory.com/Sports/nfl-salaries.php

NFL Teams Total Payroll
NFL Oakland Raiders Teams $ 152,389,371
NFL Dallas Cowboys Teams $ 146,401,600
NFL Minnesota Vikings Teams $ 133,354,045
NFL Cleveland Browns Teams $ 131,916,300
NFL New Orleans Saints Teams $ 131,531,820
NFL Pittsburgh Steelers Teams $ 128,815,061
NFL Tennessee Titans Teams $ 126,017,443
NFL Arizona Cardinals Teams $ 122,110,110
NFL Jacksonville Jaguars Teams $ 122,109,207
NFL Chicago Bears Teams $ 120,065,819
NFL San Francisco 49ers Teams $ 118,766,239
NFL New York Jets Teams $ 116,910,097
NFL St. Louis Rams Teams $ 116,677,660
NFL New York Giants Teams $ 115,816,180
NFL Miami Dolphins Teams $ 114,649,660
NFL Buffalo Bills Teams $ 113,364,927
NFL Carolina Panthers Teams $ 112,114,711
NFL Washington Redskins Teams $ 111,963,684
NFL San Diego Chargers Teams $ 111,813,340
NFL Cincinnati Bengals Teams $ 109,727,880
NFL Philadelphia Eagles Teams $ 109,557,398
NFL Houston Texans Teams $ 108,445,418
NFL Tampa Bay Buccaneers Teams $ 104,329,311
NFL Seattle Seahawks Teams $ 102,985,710
NFL Atlanta Falcons Teams $ 96,391,525
NFL Detroit Lions Teams $ 95,827,117
NFL Denver Broncos Teams $ 95,599,778
NFL Green Bay Packers Teams $ 94,018,300
NFL Indianapolis Colts Teams $ 93,373,915
NFL New England Patriots Teams $ 92,734,120
NFL Baltimore Ravens Teams $ 90,713,965
NFL Kansas City Chiefs Teams $ 83,623,776

Major League Soccer: each team can't spend more than $2.3 mil a year beside a DP will cost a team $415,000 in salary cap. Therefore, a top revenue earners like LA, Sea, Tor can only spend as much in salary as a small revenue earners like Columbus, SJ, KC (beside the DP).

Does MLS's obsession with a level playing field hurt MLS more than it help MLS?

Yes it does. It's hurt every league that's obsessed with parity, except for the NFL which is a unique case.
Gary Bettman's worst move of many bad moves was putting the word "parity" on the lips of every sports fan in the continent. Why is a narrow gap from top to bottom so attractive? Parity necessarily comes at the cost of the top end. To prop up the worst teams, the best teams suffer, and the overall level of play drops. And what for? So people can watch an artificially compressed playoff race, where 6 teams that stand no chance of winning anything compete for the last playoff spot on their way to getting killed in the first round. It's just a way of making story lines and press interest where none exist. Look at the lengths they've gone to to induce "parity" -- they even award points for every permutation of game result so that no team is allowed to fall off the map. Then they make it so no team can hold on to their best players (except for one or two), so free agency rules the day, and a well-built, well-strategized team gets one kick at the can and then has to rebuild.
The artificiality of it is absurd.
That's why I love football. It's so not contrived. There are basically three rules -- don't handle the ball, don't make contact with another player, and don't go offside. None of this bullshit aimed at adding scoring, or decreasing scoring -- the goalie can't leave his dodecahedron, or you can't have a foot in the coloured part of the court for more than 2.8 seconds....... the list goes on.
Let people play the game, and let the winners win.
This meddling mindset is what fucked up the economy too :)

Fort York Redcoat
06-10-2009, 07:38 AM
boring? you honestly find MLS boring? I would say ties can be "disappointing" but I don't find it boring.

I've watched some kick ass matches this year in MLS. On any given day, you can be beat, and that's exciting.. the tension never ceases. Yes in the other leagues, sometimes a big guy can be beaten, but most of the time, it doesn't happen.. the narrative doesn't matter when Man U beats you handily 4-0.

Also, if your team was playing like Chivas you'd probably find things a bit more exciting than if your team is a mid-table side like TFC.

The fact is, the salary cap imposes fiscal parity on teams. But as we've seen with Chivas, it doesn't mean teams cannot do well, or that teams cannot suck shit. It just means the reasons they do well or suck shit have nothing to do with a fiscal unfairness. To me MLS is almost as close as you can get to perfect competition. Forget the money advantage -- this league forces teams to coach well, scout well, train well.... do things smart rather than solving problems by throwing cash at them.

What parity does to a league is dulls it by adding extraneous minutae that NA fans seem to lap up for a reason beyond me. I've grown up here and still suppress my yawn every time salary caps or draft position is mentioned.

I realize the world model doesn't appeal to NA fans or owners in leagues (or even most on this very forum) but the giant-killing hope supercedes any Garcia-for-a-third-rounder-next-year any game day of the year IMHO.

I do not believe our model for this league can change yet. I hope one day we can aspire to it to challenge outside our region.

Fort York Redcoat
06-10-2009, 07:44 AM
^^Fing post of the day OLOE (I know it's early but I don't care)

BTW what kind of marketing genius comes up with the term "Trapazoidal Area"?

OneLoveOneEric
06-10-2009, 07:44 AM
What parity does to a league is dulls it by adding extraneous minutae that NA fans seem to lap up for a reason beyond me. I've grown up here and still suppress my yawn every time salary caps or draft position is mentioned.

I realize the world model doesn't appeal to NA fans or owners in leagues (or even most on this very forum) but the giant-killing hope supercedes any Garcia-for-a-third-rounder-next-year any game day of the year IMHO.

I do not believe our model for this league can change yet. I hope one day we can aspire to it to challenge outside our region.

Thank you!!! It upsets me to no end, and I've posted this before, when I see a kid talking like an amateur accountant about sports. Why on Earth did we let it become like this?
I bet kids go out in the driveway and pretend to be agents and labour lawyers nowadays, instead of their favourite player.

Fort York Redcoat
06-10-2009, 07:54 AM
BTW Dusty I haven't voted on your poll because I believe it could help not hurt the league but it's the timing I can't agree with. The league still adding to itself with troubled teams already in it and a :sleep: CBA to negotiate I think they should wait to put your plan in effect until that's over.

OLOE-:lol:

OneLoveOneEric
06-10-2009, 08:14 AM
This type of shit is why our sports movies are now Jerry Maguire, instead of Field of Dreams or Bull Durham. If WP Kinsella was writing now, his hero would probably plough under his corn field to go do an MBA instead of to build a ball park.

Beach_Red
06-10-2009, 08:22 AM
This type of shit is why our sports movies are now Jerry Maguire, instead of Field of Dreams or Bull Durham. If WP Kinsella was writing now, his hero would probably plough under his corn field to go do an MBA instead of to build a ball park.

I'll give you Bull Durham, but if you think WP Kinsella had anything to do with that sentimental crap in Field of Dreams, you've never read any of his books and certainly not Shoeless Joe ;).

Okay, you can see a little WP in there, I admit it, and it was a lot better than Bruce McDonalds' Dance Me Outside.

And you are right about people talking like amateur accountants about sports and it's a shame. Of course, it's a shame when people talk about a movie's opening weekend box office receipts.

I also haven't voted in the poll, but I'm for anything that will make MLS better and more popular without killing it the way every other soccer league in America (and many, many start-up football, basketball and hockey leagues) went down.

Dust2
06-10-2009, 08:36 AM
Guestimate #1

No change at all to attendance if you draw 2-4 South American unknown players to the mix for a $1M salary.

Eg. Blanco at $2.7M is the biggest star in the league. He plays for a Chicago side that is 1st in the Conference. Chicago draws 11,726 per game and that's down 28% from previous year

Eg. Columbus has Schelotto, they draw 12,368 and are defending MLS Cup champs and sit 3rd in the Conference. They are flat (-0.12%) over last year

You use Chicago and Columbus as example but ignore others. This two teams do not have great growth potential relative to the like of Sea, Tor, NY, LA and Vancouver.

In fact, you actually made my point. Columbus as league champions do not benefit MLS as much if a team like NY, LA, Sea, Tor, Van was to become league champions. If Seattle/NY/LA is league champions, their attendance would definately increase, not decrease.

So care to guess the effect on attendance for Sea, NY, LA, Tor and Van assuming that teams like SEA, NY, LA, TOR, VAN could win a little more relative to MLS mid-level clubs. Also, fans interest would be higher with a $7-9 mil wages team than a $2.3 mil wages team. Four or five $1 mil/year type players will make a difference to these team quality of play. For example, a $7-9 mil team could have four $1 mi/yr type players like Angel, Scheletto, Dero, Donovan.

Dust2
06-10-2009, 08:44 AM
BTW Dusty I haven't voted on your poll because I believe it could help not hurt the league but it's the timing I can't agree with. The league still adding to itself with troubled teams already in it and a :sleep: CBA to negotiate I think they should wait to put your plan in effect until that's over.

OLOE-:lol:

Actually, the timing is just right. This could be part of CBA negotiation. This could be the model for the next CBA.

I am sure the player union would want this instead of the current hard cap model with a DP.

Dust2
06-10-2009, 08:52 AM
Attracting relative unknown players that North American fans do not associate with has no draw at the gate or on TV.

Are you saying if Seattle add four-five $1 mil/year players to its roster it will have no effect on attendance or TV rating?


Further, it could be argued that the decent play of clubs relative to the competition (ie. Chicago and Columbus) also has no measurable draw at the gate or on TV.

The current Chicago and Columbus are not a draw.

But a LA/NY/Sea/Tor team that have four-five $1 mil/year players would be. For example, a team that has Donovan, Cooper, Altidore, Dempsey would be a pretty attractive draw.


Guestimate #2

The rise in ticket prices necessary to pay for the increased expenditure would result in an overall decline in attendance.

The premise is simple. As shown in #1 above, there is no correlation between "unknown" talent and increased interest in the league. There is no correlation or at least weak correlation between performance on the field (relative to the competition) and attendance.

So now it comes down to price.

There is a different between 1 unknown talent and four-five $1 mil/year talents. As for ticket price, it doesn't have to increase. MLS use 25% of its total revenue on wages today. Under this model, MLS would still use 25% of its total revenue on wages.



For proof, I'd suggest that you read these boards to see what fans think about paying extra for the Real Madrid game. While there are some additional circumstances there, a simple review of economics will tell you that demand decreases as prices increase.



And a simple economic lesson for you. Greater demand means higher price. Real Madrid proves this. I bet you the game will sold-out.

Fort York Redcoat
06-10-2009, 09:06 AM
Actually, the timing is just right. This could be part of CBA negotiation. This could be the model for the next CBA.

I am sure the player union would want this instead of the current hard cap model with a DP.

I hope you're right Dusty but one concern of mine would be how drastic a change the league could make CBA-wise if there are still expansion teams on their way thinking the league is run a different way.

How far could you see this going Dusty?

-Your salary structure
-Extra roster slots
-Extra DP slot

All I believe are important to the growth of this league and this point in time could be intrumental but how much stress can we put on these owners?

Pookie
06-10-2009, 12:04 PM
You use Chicago and Columbus as example but ignore others. This two teams do not have great growth potential relative to the like of Sea, Tor, NY, LA and Vancouver.

In fact, you actually made my point. Columbus as league champions do not benefit MLS as much if a team like NY, LA, Sea, Tor, Van was to become league champions. If Seattle/NY/LA is league champions, their attendance would definately increase, not decrease.

So care to guess the effect on attendance for Sea, NY, LA, Tor and Van assuming that teams like SEA, NY, LA, TOR, VAN could win a little more relative to MLS mid-level clubs. Also, fans interest would be higher with a $7-9 mil wages team than a $2.3 mil wages team. Four or five $1 mil/year type players will make a difference to these team quality of play. For example, a $7-9 mil team could have four $1 mi/yr type players like Angel, Scheletto, Dero, Donovan.

I've already guessed. Those players you mention are not game changers. Beckham was. Attendance did not vary with their participation nor would a whole team of Angel's and Dero's because the NA fan does not relate to them.

As a collective, you could raise the "competitive level" of the league but in comparison to what? You've already acknowledged that it isn't going to be a top flight league. NA fans don't flock to watch the Columbian league on GOLTV.

Further, for Toronto to qualify for this level of spending they have to generate what, $30M in your example?

Let's work through that. They currently generate $17M. So, they need to raise revenues by $13M.

Can we agree that there is no magic TV contract on the horizon? The bulk of that will need to be raised through ticket price increases.

Over 20 home dates, the average ticket price needs to rise by just over $30/ticket/game to reach this revenue level.

So, you are asking the average fan to spend $1,200 more per year (based on two tickets) for the priviledge of seeing 3-4 guys they've probably never heard of. Guys who might collectively raise the level of the game (amongst the teams that have them) to something which is a little better than we have now but still "minor league" in perception.

Never addressed is what happens to the quality of play amongst teams that have no shot at winning under this scenario. Do they become the Edmonton Oilers pre-salary cap when players were developed to move on for bigger salaries (Doug Weight, Curtis Joseph, etc)?

You may counter that a bigger stadium could spread out the ticket cost. Terrific, is the stadium expansion free? Financing for this is going to come from ticket holders (price increase, personal seat licenses, etc).

In the end, it's an increased cost to the consumer. Price goes up, demand goes down.

... unless you bring in a Beckham

----

Also missing from this discussion is what is the effect on teams/owners that have bought into expansion based on the value of a modified NFL model of cost certainty and revenue sharing?

Fort York Redcoat
06-10-2009, 12:24 PM
^I would imagine the owners would have to deal with it the same way they'll have to deal witht the changes to the CBA next year. A state they didn't agree to with expansion.

Pook you keep on talking drastically about the change in performance needed to grow this league but I must disagree that Angels and Blancos change the level of play incrementally and grab the attention of those already watching the game hoping for growth. To add 1 Beckham or Figo or Del Piero is the band aid. The MLS needs to be the top competitor of the region. Half of American futbol fans know what the level of MLS is as they compete with our regions giant Mexico. It's a place where the world game is appreciated.

I don't feel we need any more gimmicks in this league. With the number of teams we can work on quality.

I'm curious why a precap Oilers team example is so unappealing but you yourself say the league should dispel delusions of grandeur as if they have no growth potential? Your saying that you don't mind if we all are mediocre?

Pookie
06-10-2009, 12:55 PM
^I would imagine the owners would have to deal with it the same way they'll have to deal witht the changes to the CBA next year. A state they didn't agree to with expansion.

Pook you keep on talking drastically about the change in performance needed to grow this league but I must disagree that Angels and Blancos change the level of play incrementally and grab the attention of those already watching the game hoping for growth. To add 1 Beckham or Figo or Del Piero is the band aid. The MLS needs to be the top competitor of the region. Half of American futbol fans know what the level of MLS is as they compete with our regions giant Mexico. It's a place where the world game is appreciated.

I don't feel we need any more gimmicks in this league. With the number of teams we can work on quality.

I'm curious why a precap Oilers team example is so unappealing but you yourself say the league should dispel delusions of grandeur as if they have no growth potential? Your saying that you don't mind if we all are mediocre?

I think you have to ask yourself what the end goal is.

It's clear that players and owners can make a comfortable living with the league as it is structured now. They can grow with it but will they ever rival the NFL in terms of North American popularity? Hope so but don't think it will be in the next decade.

I coach. I'm all for the development of the game. I'm frustrated right now because I have a gifted player whose parents can't stop fighting long enough to drive the kid to practice. But I digress, I see improvement in the MLS quality of play as a stable, long term project. It will involve more opportunities for local talents (North American) and will be a function of what we do with the kids now. There are no overnight solutions.

As of right now, local players that are gifted (Edgar for example) are going to try to compete in the best leagues possible. That's what an athlete does. They aspire to the best.

A $5-9M cheque spread out amongst 4-5 players doesn't change that.

Opting for a short term fix by throwing money at players offers no collective benefit in my opinion. The players you get do not have MLS Cup Dreams. They are either trying to reclaim careers or ride one out.

Fans don't relate to them. Amado Guevara, in some people's eyes, is one of our more talented players. He's certainly not being showcased in any promotional events, etc. A team of 10 Guevara's might win a few games (or all go down with shin "injuries" at the same time) but would you pay $1,200 more per season to see them play?

Because that's the reality as to what it would cost to put this idea into motion.

As a fan, are you comfortable with the idea that you'd pay NHL ticket prices? How about $65 for Supporters sections?

Would you like a $10,000 Personal Seat License added to your renewal next year? It's a business and a business pays out less than it takes in. They need to take in over $13M more (or increase revenues by 176%) just to make this feasible.

I think you'll lose fans and you'll lose them quickly.

I think we are both concerned with raising the quality of play but to me, that's accomplished more through the CSA (or OSA) and some of these Academy programs that are taking hold.

There is certainly hope. More kids play soccer than hockey. The multicultural nature of our country means that we could incorporate many styles.

That's where the energy should be.

Beach_Red
06-10-2009, 01:07 PM
I think you have to ask yourself what the end goal is.

It's clear that players and owners can make a comfortable living with the league as it is structured now. They can grow with it but will they ever rival the NFL in terms of North American popularity? Hope so but don't think it will be in the next decade.

There is certainly hope. More kids play soccer than hockey. The multicultural nature of our country means that we could incorporate many styles.

That's where the energy should be.

And more kids play soccer in the US, too, than most other sports. Even in places that aren't very "multicultural." So, the potential is there.

Soccer could someday be a top sport in the US, it could rival the NFL, but it can only get that way with American players. That's not good or bad, it's just a fact of American life.

So, MLS will have to grow at the same pace as the American talent pool.

Fort York Redcoat
06-10-2009, 01:29 PM
These kids have to see a future in it and I disagree with you there Pook. The min for a player is not enough to call a career yet. Most of the domestic kids will be in that range. I agree it might seem like overpaying for product that you weren't that impressed with to begin with but how else can you get those parents to get the kids to games ($$$ + hope). Thanks for coaching BTW. Nice to see passion for the game being proven.

One other thing touched on is that talent leaves for bigger leagues. I assume we agree it's a necessity to increase the skill level of our nation? There are other leagues far more successful and storied than ours that enjoy watching the kids play for as long as they can before they are scooped up but know that they'll be back to say goodbye. I see nothing wrong with that until we're the world power in the sport.

Beach_Red
06-10-2009, 01:34 PM
Talent leaving for other leagues should be addressed soon. Maybe MLS needs to have a special DP category for US players to try and keep the best ones in the league?

Fort York Redcoat
06-10-2009, 01:36 PM
Talent leaving for other leagues should be addressed soon. Maybe MLS needs to have a special DP category for US players to try and keep the best ones in the league?

"Addidas the Next Generation"

Or yes. Pay them more.

flatpicker
06-10-2009, 01:40 PM
hmmm... not a bad idea actually...

2 DP's per team... one doesn't count against the cap... the other uses perhaps $250,000 of cap space.

One can be used on any nationality... while one must be used on a domestic player.

that could make things far more interesting.

Fort York Redcoat
06-10-2009, 01:47 PM
hmmm... not a bad idea actually...

2 DP's per team... one doesn't count against the cap... the other uses perhaps $250,000 of cap space.

One can be used on any nationality... while one must be used on a domestic player.

that could make things far more interesting.

Potentially dangerous overvaluing domestic talent. On this board there are those that would talk DP about many Canadian Nationals that may be less of a contribution to the team than their price tag.They would have to proceed with caution.

Beach_Red
06-10-2009, 01:52 PM
Some players would certainly get overvalued. Anytime resctrictions are put on the supply it affects the demand.

The question is, is it worth overpaying some Americans to get them to play in the US and potentially grow the sport? (that may be the first time I've ever used grow as a verb and I feel a little dirty, like someone in the marketing department).

This may not be as big a factor in Canada as we are more used to foreigners on our sports teams than Americans (baseball, NBA, CFL, and well, even NHL these days, I guess).

Pookie
06-10-2009, 02:07 PM
These kids have to see a future in it and I disagree with you there Pook. The min for a player is not enough to call a career yet. Most of the domestic kids will be in that range. I agree it might seem like overpaying for product that you weren't that impressed with to begin with but how else can you get those parents to get the kids to games ($$$ + hope). Thanks for coaching BTW. Nice to see passion for the game being proven.


I agree though I think the process "to see a future in it" has a few components.

1. Kids need a hero. I had one of my U8's come up to me last night during our warm up and ask if I'd heard that Sutton was cut from the team. That was pretty cool. My son is a big fan of Brennan as he's met him and seen him play for both TFC and the Canadian National Team.

2. Kids and Parents need to understand their options as their child ages. Be it NCAA, Academy programs, various Professional Leagues, we don't do a terrific job of promoting the options available as a country. Heck, even between clubs the differences between programs can be extreme.

Conversely, ask a hockey parent about the differences between AE and AAA and they'll tell you in a second. Ask them about how to maintain NCAA eligibility as their kid contemplates a move to the CHL. Ask them about what they could make in European leagues if the NHL doesn't pan out. Hockey parents are much better informed and Hockey Canada does a terrific job of education on that front.

3. Related to that, the MLS does indeed need to improve its minimum salary. I won't single out specific TFC players but some are making $34k per year.

With this point I do agree with you and Dust2.

I don't think though that this increase in minimum salary comes on the back of raising the cap to be able to spend on a couple of players. How do you guarantee that the money doesn't just go to one player? In TFC's example, how does Vitti make $300k when another starter makes just $34k? And that's with a cap.

Raising the cap sounds great but remember to make the idea float, TFC need to increase revenues by 176%.

That just doesn't happen overnight unless you want to start charging fans through the nose.

Remember this is a revenue shared league. As other teams grow, so too does the league wide revenue. How do you grow revenue league wide? You make sure that fans in every city feel as though they have a chance to win.

You build on the sense of community as they've done in Toronto and Seattle and appear to be doing in Portland, Philadelphia and Vancouver.

You keep costs low to attract more teams or ownership groups in more viable cities that could take some of your less profitable markets through relocation.

Spending money you don't have on players that won't relate to the NA fan really doesn't accomplish what we both want, IMO.