Tuesday, April 03, 2007

MLS Hits Puberty

"This is Fuzzy Bunny. About a year ago, he noticed his voice was changing. He had terrible acne, and had fur where there was no fur before. He also noticed Fluffy Bunny..."

A great moment from the Simpsons. I wouldn't just bring it up for no reason, though. You see, Fuzzy Bunny represents MLS. So who's Fluffy? Why, none other than David Beckham, of course. Yes, after twelve years of survival and slow growth, MLS is changing. It seems that Beckham's signing will be considered the moment when MLS is ready to take the next step and begin the steady march to becoming a true major league.

Oh sure, there's definitely a long way to go. But for the very first time, it looks like MLS will make a profit (or come closer than ever before) in 2007. There's the new tv deals with ESPN2, HDnet, and Univision, which will bring in $15 million plus per year. In addition, you have the Adidas deal, worth another $10 million per (although not necessarily all in cash). There's also the shirt sponsorships, already worth around $5 million for just LA and RSL for just this season. Plus, let's not forget the biggest thing of all, the stadiums. With the new ones for Colorado and Toronto, over half the league will now play in an SSS.

It's very hard to find accurate MLS financial information, but the league definitely lost $34,424,199 exactly in 1999. That's probably the worst season (or close to it). So when you take $15 million for tv deals, plus the amazing new season ticket sales in Toronto and "Beckham bumps" elsewhere, it seemingly gets you pretty close. I always thought that getting New York a stadium would be the thing that gets us over the edge profit-wise, and that may still be true ($14 million lost, are they crazy?). But with those new revenue streams it's not hard to see how a profit could be made in 2007.

In a way, it's been meant to work out this way. As I've said before, there's very little reason to spend money to attract fans when you play in an NFL stadium. You don't control the revenue streams, so it actually works out better to not advertise and not work to get them to the stadium. Hence the Rapids in 2006. So only when every team has it's own stadium or is close to getting there is it worth the effort. Only when you're making money is it possible to sign better players and spend more on advertising, therefore getting more fans and media coverage which leads to better ratings, and so on.

I've been thinking about this since my "crystal baller" Bigsoccer post on October 20, 2004. Turns out that Beckham is the guy who is not only attracting attention and sparking sales, but also going to kickstart the league's march to major league status a bit earlier than planned. To better take advantage of his arrival, teams are spending more on advertising, ESPN2 is doing a big ad campaign, and several other good players are arriving. Once you've started doing that, you can't go back to the old ways, right? People would be disappointed, and progress would be lost. You can't go back to being a child after you hit puberty. You have to become an adult. Beckham = Fluffy Bunny, indeed.

Climbing the Ladder post schedule

Wednesday: Eastern conference preview
Thursday: Western Conference preview
Friday: MLS 2007 survey results

Comments on "MLS Hits Puberty"


Anonymous Anonymous said ... (8:55 AM, April 03, 2007) : 



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