The Business of Sports

While NFL Fiddles, College Football and Soccer Get Hot


For 132 days now, the National Football League and its players association have held sports fans in a state of suspended animation as to whether a pro football season will actually kick off this fall. This week the suspense has only gotten worse, as each side is reportedly only "hours away" from ratifying a new collective bargaining agreement and making a joint announcement to the people of Earth—and their imaginary fantasy league kingdoms—that life on Sunday as we know it shall continue.

Fellas: Call us when you’ve signed the reams of paperwork. We have much to ponder in the meantime, including the long-term impact of the U.S. national team’s Women’s World Cup run on soccer in America and the upcoming college football season, as conferences around the U.S. hold their kickoff events for media and gridiron-hungry fans.

College Football Media Daze

The granddaddy of all college football conference schmoozefests, otherwise known as SEC Media Days, kicked off on Wednesday in Hoover, Ala. The three-day event, signaling the unofficial start of the Football Bowl Subdivision’s season, features boldface-name football coaches, top players from each team, and somewhere between 900 and 1,000 members of the media. Besides rating the teams’ on-field talent, schedules, and BCS bowl potential, the conference is discussing a proposal by SEC Commissioner Mike Slive: a new minimum requirement of a 2.5 GPA for high school graduates to be eligible to compete in the SEC, as opposed to the 2.0 GPA that represents the conference’s current minimum standard.

The new kid on the FBS block, the newly-christened Pac-12, will try to one-up the SEC by holding its July 26 football media day at the Fox studio lot in LA’s Century City. The expanded conference will welcome new members Colorado and Utah, talk up revenues from its first-ever conference championship game, and no doubt have a few Fox movie and television personalities around to help wow the media as well.

Elsewhere, Big 12 representatives, in addition to telling reporters why the conference now has only 10 teams but hasn’t bothered to change its name, will focus much of its conversations on new school-specific TV networks at the universities of Texas and Oklahoma.

ESPN, which will run Texas’s Longhorn Network, is laser-focused on distribution, reportedly seeking a monthly sub fee of 40¢ for expanded basic carriage from cable carriers in Texas and adjoining states. (In comparison, the Big Ten Network charges between 70¢ and 75¢ in states within the conference’s footprint.) Oklahoma has yet to announce a media company partnership, but its athletic director, Joe Castiglione, insists the school is "trying to position ourselves to be more available on all the emerging platforms the way the digital revolution is taking place" than is its Red River rival to the south.

BOLSTERED BY SUBSIDIES

Overall, USA Today reported last month that more than $470 million in "new money poured into major-college athletics programs last year, boosting spending on sports even as many of the parent universities struggled with budget reductions during tough economic times." While much of the new revenue came from a lesser form of the multimedia rights deals trumpeted by Texas and Oklahoma, as well as higher ticket receipts and donations, schools across the board continued "increasing their subsidies from student fees and institutional funds." Altogether in 2010, about $2 billion in subsidies "went to athletics at the 218 public schools that have been in the NCAA’s Division I over the past five years." Partially thanks to such subsidies, the athletics departments of 22 Division I schools were self-sufficient—meaning they had more revenue than expenses—as compared with 14 schools in 2009.

The newfound profits will also likely exacerbate two burning college football questions, posed at this week’s conference media days and beyond:

First, as college football programs turn into billion-dollar businesses and incidents of NCAA violations centered on illegal athlete compensation proliferate, will college sports’ governing body and its member institutions find a legitimate way to pay the athletes who keep fans coming back?

Second, will the new NFL CBA on the doorstep, supposedly including significantly reduced monies paid to rookies selected at the top of the NFL Draft, entice more pro-caliber football players to stay in school?

Futbol Fever: Blame It on the Girls of Summer

Yes, the U.S. squad lost. But by all accounts, the amazing trajectory of the national team throughout the just-completed FIFA Women’s World Cup is energizing American soccer at all levels of the game.

For starters, ESPN, widely praised for its strong production, even-handed coverage, and the excellent play-by-play of Ian Darke, earned an 8.6 overnight for Japan’s victory over the U.S. in the Women’s World Cup Final on Sunday, marking the network’s best overnight ever for any World Cup game, women’s or men’s. Further, Japan-U.S. set a new world record on Twitter, with a peak volume of 7,196 tweets per second at the end of the match. "Thousands of fans tweeted support" for the U.S. team, including President Obama, according to NBC’s Nightly News.

And as brethren validation, added Dan Courtemanche, MLS executive vice-president for communications, via Twitter on Monday, "Great to see all of the WWC coverage. Media outlets will hopefully remember most of these WWC stars play in WPS & will increase coverage."

The short-term impact of the team’s run, clearly, has been a benefit for the Women’s Professional Soccer league. According to WPS Chief Executive Anne-Marie Eileraas, ticket sales have increased, traffic to the league’s website has quadrupled, and interest in establishing expansion WPS franchises rose as the World Cup progressed. "This time around, we’re here to keep the momentum going through WPS," Eileraas told USA Today. "There’s no quick fix for a professional sports league. Our league is something that we develop by bringing people to stadiums, and when they come, they want to come back."

SELLOUT CROWDS

In the wake of the World Cup players’ return to the U.S., a sellout crowd on Wednesday in Rochester, N.Y., neared 15,000 fans for the WPS magicJack FC-Western New York Flash match featuring magicJack forward and New York area native Abby Wombach, U.S. goalie Hope Solo, and other stars Megan Rapinoe and Christine Rampone. In contrast, the first matchup between the Flash and magicJack on May 22 of this year drew 8,076 fans, according to franchise records. A magicJack spokesperson added that the team "had been receiving an unprecedented level of calls for tickets, and that 250 group tickets had been sold less than 24 hours after the World Cup final ended."

Additionally, WPS Atlanta Beat Owner T. Fitz Johnson indicated that the team "sold 1,200 tickets" to its July 23 game against magicJack in the two days after the U.S.-Brazil quarterfinal. "It’s been a tough haul to keep the league going and keep us all engaged," Johnson said. "While we’re all cautiously optimistic to keep this going, [the World Cup] is the shot in the arm that we needed. No way could we afford to buy that kind of advertising. It couldn’t have come at a better time, and with the Olympics staring at us next year, we just need to build a bridge from this year to the Olympics next year."

The Women’s World Cup athletes stand to benefit as well. Even though they arguably left millions of dollars on the sponsorship table with a loss instead of a win, players such as up-and-coming forward Alex Morgan, Wambach, and Solo will now see their endorsement earnings potential increase considerably.

Men’s soccer is on a roll as well. MLS clubs are averaging 17,526 fans per game so far this season, up 6.3 percent from the same period last year, according to league records. The Seattle Sounders continue to lead all teams by a wide margin, with an average of 37,189 fans per game. Sporting KC is benefiting from a move to its new Livestrong Sporting Park, with attendance up 81 percent to date. FC Dallas, New York’s Red Bulls, and the San Jose Earthquakes also are seeing double-digit percentage increases up to this point in the MLS season.

Rick_horrow
Rick Horrow is a leading expert in the business of sports. As chief executive officer of Horrow Sports Ventures, he has been the architect of 103 deals worth more than $13 billion in sports and urban infrastructure projects. He is also the sports business analyst for CNN, Fox Sports, and the Fox Business Channel. Karla Swatek is vice-president of Horrow Sports Ventures and co-author of Beyond the Box Score: An Insider's Guide to the $750 Billion Business of Sports (2010). Horrow is also the host of Sportfolio, a new program on Bloomberg TV that airs Wednesday nights at 9 pm ET.

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