Something tells me that if MLSE and other like-minded owners have anything to do about it, MLS communism will go the way of the dodo.
Something tells me that if MLSE and other like-minded owners have anything to do about it, MLS communism will go the way of the dodo.
Cost certainty is why MLSE and the other new owners invested in MLS. Single entity isn't going anywhere. Communism as you call it is the way forward for sports league around the world. All new league use salary caps and single entity and all the established leagues want to move toward that model.Originally Posted by Chevy
Last edited by troy1982; 09-21-2009 at 09:15 PM.
No way MLS lets the teams become free operators. Remember, Garber came out of the NFL league office.
Agreed. But there has to be some breaking point where the league says enough is enough.
What does MLSE or the other new owners have to complain about?
Right now they have nothing to complain about. My point is that feel-good feeling may disappear over time as the "rich" clubs continue to support the less fortunate ones.
I guess I'm just assuming (possibly wrongly) that greed will triumph over cooperation.
I see what you mean. But If total revenue continues to grow like in the NFL I can't see the owners complaining.
raising the salary cap raises the quality of the players, raising the level of play, and the public preception. This means there is a higher likely hood more people will want to watch it. This would help ticket prices.
The Price of the tickets isn't really an issue, nor do I think that ticket prices going up too much is too big an issue. even $35 keep seats are still nice and it will a few years to get to that point.
Now that I'm "trying" to stay moved to the area, I am hoping to make it out to at least 5 homes games next year. And I still have this pipe dream about actually seeing the San Jose game on the 10th.
A raised cap will improve the experience over all... and do something that people haven't really thought about.. better perception means better coaches are willing to come her, which also improves the product.
well $4 million still is a very low salary when you compare to other leagues around the world. Even small leagues often pay at least $4million worth of players. And if teams cant afford a $4 million salary they could just keep it at the current $2.5 million salary, no one says every team has to pay $4 million. I mean pretty much every other league around the world teams pay whatever they want, and those teams seem to survive, so why couldnt teams in North America survive? teams in USL survive. I think all teams could still be pretty competitive to if the salary was still just $4 mil., the gap of $4million to $2.5 million is quite small when compared to some other leagues.
Also are tickets are quite exspensive for the quality of soccer on the field and salary we pay players. You can go to countries like France and go to a game for like 20 euros and they are paying the players in multi millions of dollars, yet are cheapest tickets are like $20 but can go as high as like $120 and we pay salary $2.5 million? I dont even understand how that works, but to me it just seems like we should beable to buy alot more exspensive players for what we pay.
The "rich" clubs don't have a choice.
What's the point of keeping the money for yourself when all but three of the teams in the league go bankrupt and fold?
A cooperative league is better than no league at all.
btw... my earlier comment about "communism" was an attempt at humour.
I have no problem with the current financial setup in MLS.
What I would like to see though is teams having freedom with player movement and signings.
Teams should not have to stand in line and wait their turn to sign a player.
The league works fine.
Maybe they could adopt a 2way system of sorts. MLS pays $3 million and then teams are able to spend up to $1million if they wish. That way it doesn't penalize teams that actually bring in crowds, but keeps competition pretty level.
In any case, like I said before $4million is a decent jump. Not where it should be, but can't go overboard either.
With the possiblity of the cap going up to a possiblity of $4mil, will changes like the :
a) Roster sizes increase?
b) Return of the reserve league?
c) ........
Moderator
Good article. Very encouraging to say the least
A cap of 4 million sounds pretty reasonable. Personally, I was hoping for a ceiling of an even 5 million dollars, but at least we are getting somewhere. Good to hear the minimum salary increase as well.
I agree that it would be nice to hear something about the possibility of bringing back the reserve division, but I have my doubts its a pending issue for the league at the moment.
Did the USA , of all countries, just fix soccer? - C. Ronaldo, May 27th commenting on the FBI-led investigations into fraud and corruption throughout FIFA.
If TFC had $4 million to work with we would have the same budget as Debrecen from Hungary!
It's sad to think that a league in a market of 340 million people or so is not able to compete with another in one of just 10 million people. I keep telling myself that things will improve and to be patient, but it's difficult for me to see the love of football in our fair city, and the sold out stadium, and yet we're told to relax, sit down, and give the other cities a chance to grow a bit more - lest we get too strong for them to compete with us. It's frustrating to say the least. We're the only league in the WORLD where it's considered suicide to allow a couple of teams to grow beyond the others. But I guess we'll have to sit down, chop off a leg or two, so the likes of Dallas and Kansas will be able to keep up with us. Meanwhile we're not able to keep up with Puerto Rico. It's really very sickening.
What is also frustrating for me is that my home club of Aalborg, Denmark, routinely gets about 8k in attendance, and at much cheaper rates than TFC, and yet their team salary is probably well beyond 5 million bucks. WTF is going on here?
But yes, I'll try to be patient. Trying so fucking hard! At least, though, I'm very encouraged by the news of a lift to the cap. Problem for me is that no lift will seem enough. Wonder how long I'll be able to accept the Mickey Mouse ears on the league logo. End the cap, join the world community of football, and let's play some fucking real football that's not dominated by league regulations and franchise protectionism!
hmmm... Yankees. Nah, that would be Seattle or LA. Each has a much larger stadium to draw from and doesn't have to pay out salaries in Canadian dollars.
We'd be more like Kansas City. Middle of the pack.
^that's middle of the country. KC is lower than that...
Despite what some would say I think it the height of cynicism to think almost doubling the cap isn't good for the league when we need more talent to raise the image of the league.
Last edited by Fort York Redcoat; 09-22-2009 at 07:51 AM.
FORMER FULL TIME KOOL-AID DRINKER
of course doubling the cap is good for the league. hey, I wish the cap was 100 million for every team!
but it's about the economics of the move.
Nobody here (including me) has definitive numbers on revenue. If the revenue is gonna be rolling in, raise the cap immediately to a level that does not bankrupt the league.
I assume with Seattle/TFC bringing in shitloads of revenue, things are getting easier on the bottom line. Philly looks like a good bet to contribute solid revenue. I would think Portland and Vancouver will too. That should allow the belts to be loosened financially.
MLS used to make cash calls from its owners. That meant they couldn't pay the bills based on revenues, so they would ask the rich dudes in the league to toss some of their own money into the pot. That's pretty scary. So Garber, whose been around longer than us, has that memory in his mind.
Hopefully once they get costs settled with the players union (they are negotiating the next CBA now), they'll have a good sense of player costs for the next 6 years. Then they can come up with a SUSTAINABLE spending regime. One that doesn't involve cash calls from the owners, but which maxes out spending based on revenues they take from the teams. Push it right to the limit. If that's 4 mil per team, so be it. If it's 6 million, even better.
Garber has commented on needing to increase quality, so he's aware of that. He sees this problem of people loving Euro soccer but not thinking MLS is good enough. He knows the quality should go up and that spending more on players is the way to go. But he has to be responsible to the bottom line.
I want the same thing you do. I also believe that throwing money at the issue is an extremely risky proposition.
I find it frustrating that some in the raise the cap movement don't seem to see a correlation with rising ticket prices. This league is heavily... heavily gate receipt dependent. There is no major TV deal. There is no major advertising deal. Merchandise sales are a very small percentage of the overall take.
The only way to offset spending and ensure that investors are receiving return on their investment is to raise ticket prices.
If prices rise too quickly... ie. before this supposed talent improves the image of the league... fans will turn away. Regardless of the product on the field, if fans turn away, that will be the image of the MLS and it will be hard to get them back. The truth in business is that the hardest customer to win over is the one you've lost.
It's funny. If Sanyo came out and said, great news everyone, our cost of labour has just doubled. With that we'll be able to get better technicians to build your TVs and therefore will have a higher quality than ever before. But we'll have to charge you more for it.
Of course, the giants, Sony and Samsung are going to continue along with their market share and offer a higher quality product regardless of this development.
What do you think would happen to Sanyo? Would they survive long enough to realize the benefit of this move?
I'm all for development but I think it will come in the form of taking money from the top end of the salary scale and reinvesting it in raising the league minimum. For that, I could envision players committing to a set number of years to the MLS... similar to the way that they do to the Armed Forces. ie. Attakora gets more than $34k per year but is with MLS for a minimum of 4-5 years before he can entertain a transfer.
That way, talented youth will be with us longer and may establish themselves as "stars." They may be established in the community at that point and may not opt to immediately go to Europe.
Last edited by Pookie; 09-22-2009 at 10:28 AM.
Your mad, Pook. Keep it about money and not time or we'll lose twice as many kids to the rest of the world who don't want to wait to be noticed. I don't think this raise in talent, in cost will be as dramatic as you profess.
But we do want the same things from the league in better talent.
I just want to avoid what's happening in the NHL with 12yr contracts.
Last edited by Fort York Redcoat; 09-22-2009 at 11:25 AM.
FORMER FULL TIME KOOL-AID DRINKER
How dramatic it is depends on who you target.Your mad, Pook
To use my Sanyo/Sony analogy... if Sanyo decides to go after the world's best engineers at the height of their careers, it will cost them significantly.
If they opt to go after the unproven, fresh out of University with loads of potential, the cost is not as dramatic. Further, you get them on the upside of their careers. What they lack in experience, they make up for in their hunger to prove themselves. They are hungry and full of ideas.
I favour the second route. Give talented players (not saying elite young players, simply talented players) a way to earn a professional living with a guaranteed source of income for a set period of time and I think you'll have quite a few takers.
What is the biggest risk for a player/student coming out of the NCAA? Income and security. Offer them a starting salary in the $70k range and many would prefer that to entry level jobs in the real world that are going to net them $30k. Offer them a 4-5 year contract so that they have security in their decision. How many walk away from the game knowing that the risk and ability to earn an income as a professional player are too high?
It's a slower process. But it's one that doesn't come with a huge impetus to raise ticket prices and subsequently risk losing your fan base.
Think about what TFC did. They nearly doubled their payroll on one player. Visit the 2010 Season Ticket thread to see what folks think about a 17% increase.
But what if they gave raises to the young players like Attakora, Gomez, Sanyang, White in exchange for guaranteed years of service? The net effect might have been a $120k increase in the payroll (30x4) but the long term benefit may have been greater.
As it stands now, I'd be amazed if Nana is on this roster 2 years from now.
Likewise, those are just plain silly.I just want to avoid what's happening in the NHL with 12yr contracts.
How does this work? Rich clubs supporting poor clubs? I mean how does MLS come up to Joey Sapputo et all, and say. "OK give us 40 mill, we'll control your salaries, and you give us money to support Columbus, NY, KC, NE"
That would the best salesman in the history of franchise salesmen!
Seriously how much money are we giving the league annually? Gate receipts go to MLSE? T.V. rights go to MLS? Shirt sales go to MLSE? Concessions go to the city? Where does the money go?
^ I imagine there must be a percentage taken from any profitable team which then goes into a pot and divided between the "poor" clubs?
The teams that earn more are still going to take in more money than those that are hurting.
You just don't get to keep it all.
yes this is what i was getting at in my message. There is many teams in europe where it cost about the same or even cheaper to go to a game then it does a TFC game and those teams get less then 20k a game and yet they still succeed and manage to pay players salary 5 times as high as what MLS teams pay.
i just dont get it, seems like we should be making alot of money and beable to raise team salary without even raise price of tickets.
^^ every heard of TV and Sponsor revenue?
It works like this:
The league has it's own revenue streams such as 1/3 of all ticket sales, league wide sponsors, National TV contract, 1/3 of transfer fees and the all important SUM, these revenue are what pays for the players, administrators and officials salaries.
The rest of the revenue such as 2/3 of ticket sales, shirt sponsers, stadium naming rights, concession, 2/3 of transfer fees, local TV go to the team owners.
The owners have administrative, taxes, rent and other cost which on average amounts to about 10 million (which does not include the players salary which the league pays for). So 10 million a year is what an owner has to spend to run an MLS team.
Last edited by troy1982; 09-22-2009 at 03:40 PM.
yes obvious, but id be interrested to see what those smaller Euro Clubs get paid in sponsors and revenue. I mean TFC is on Sportnet and TSN and also Goal TV the TFC own and they do have lots of spnsors.
Joey gets to do what he want in USL and so do the othter owners in that league, but all the owners seem to want out as soon as possible. MLS has a lot going for it that is attractive to investors.
These include, a stable league, salary caps, single entity, and increasing total revenue. When you buy into MLS you aren't really buying a team, you are buying a percent of the company of MLS and SUM
^ all the hardwork get done by the league
why wouldn't you buy a franchise
its like owning a McDonalds
There seems to be alot of confusing about the structure of MLS. the best way to understand it is this. MLS isn't a collection of 15 owners/teams. it is 1 company that runs 15 fanchises. MLSE for example invested in MLS not TFC. TFC is the part of the company that MLSE gets to run. All the employees are paid by MLS not TFC or MLSE.
So the "richer" teams aren't supporting the "poorer" teams as they are all one and the same, there is only 1 team which is MLS as a whole.
Another way to imagine it is with expansion:
the expansion fee is currently $35 million, when you pay it you are buying a piece of SUM/MLS not really a team. But MLS does allow you the right to run a piece of the company aswell, it would be like buying a piece of mcdonald and getting to run a part of the corporation aswell but the corporation is the one who actually owns the piece and pays the employees while you get to manage that piece. This is what single entity means.
Last edited by troy1982; 09-22-2009 at 04:07 PM.
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