As I've already written a post concerning MLS today, I'm reluctant to struggle over another. However, based on some of my comments this morning and an ESPN Soccernet story from yesterday I just read, it seems like humiliated destiny.
MLS Commission Don Garber is going to give a speech at the upcoming "Leaders in Football" conference where he will discuss and recommend that European leagues adopt MLS style financial controls and policies in an attempt to curtail the excessive spending that characterized this past transfer season.
Garber's main recommendation will be a salary cap -- the current MLS salary cap is $2.3 million. However, the MLS has adopted the "designated player" (or David Beckham) clause where a team may choose a single player to pay without salary cap restrictions -- only $415,000 of that players salary counts against the cap.
UEFA will recommend a new policy that will require a club to break even in a fiscal year -- each team is only permitted to spend what they earned from "soccer-related income" (I'm not sure if this includes endorsement deals or not).
I agree with both recommendations, actually, but only in part. It's clear that eccentric spending is poor for the leagues; not only does it send a questionable proclivity to the fan community, but its impact on general league performance is considered negative.
These passages were worth quoting:
"I hope to present some of the experiences we have had in the MLS and in other leagues as perhaps, if not blueprint, a guide as European football starts looking at financial fair play," Garber said. . ."That is the key driver to the stability that exists in our major leagues -- and there is tremendous stability in American sport."
Since 1970: only 10 different teams have won the premier league title, only 9 different teams have won Serie A, only 8 different teams have won La Liga, 11 different teams have won Bundesliga, and 9 different teams have won Ligue 1.
Compared with, in the same period, 19 different MLB champions, 14 different NBA Champions, and 18 different NFL Champions.
I spoke with a fellow Zinedine Zidane fan earlier about this notion and, ultimately, we were both conflicted. Whereas sports fans enjoy the notion of a David and where I'm always partial to egalitarian policies in sports, do worldwide football fans want the end of a 4 (5 if included Manchester City) club dominance in the English Premier League, a 3 club dominance in Serie A, a 2 club (although I'm on the Sevilla bandwagon) dominance in La Liga, etc. . .
It seems bad for business that, before the season began, 15/20 clubs in the EPL were immediately dismissed. And now, with Liverpool's struggles, there's only 4 teams of significance.
However, you don't often hear much criticism of this select team dominance amongst football fans; it's often more regarded as a fact of history and tradition. Consider Manchester City's emergence as an EPL contender; the degree of criticism that team owner Mansour bin Zayed Al Nahyan and manager Mark Hughes have received is unparalleled. Although Manchester City engaged in similar transfer season fashion as Manchester United typically has, as Chelsea, Liverpool, Real Madrid, Barcelona, etc. have, they've been presented as a foe to the status quo, a challenger to the conservative white man culture that is English football.
"So while businessmen such as Stan Kroenke at Colorado and Philip Anschutz at the Galaxy could match the spending of Madrid and others, they are prevented from doing so."
"They don't use that capability as a means to win at all costs," Garber said. "That's just part of the DNA of American sport, revenue sharing, salary caps, the close relationships with our players through collective bargaining and union agreements."
Has Garber ever heard of Major League Baseball? While they have revenue sharing and salary cap fines, there are half a dozen teams whose annual expenses are immensely greater than their peers.
Is Garber aware that MLB has gone on strike over collective bargaining and union agreements?
Is Garber aware that the NBA did also?
Is Garber aware that it's going to happen in the NFL in near future?
Furthermore, the MLS business model isn't working. As I mentioned earlier today, Forbes studied the MLS teams and calculated revenue and net worth (via Forbes):
L.A. Galaxy -- Value $100 million; Operating Income $4 million
Toronto FC -- Value $44 million; Operating Income $2.1 million
Chicago Fire -- Value $41 million; Operating Income -$3.1 million
FC Dallas - Value $39 million; Operating Income $0.5 million
New York Red Bulls -- Value $36 million; Operating Income -$4.5 million
D.C. United -- Value $35 million, Operating Income -$3.0 million
Houston Dynamo -- Value $33 million; Operating Income -$1.8 million
Colorado Rapids -- Value $31 million; Operating Income -$2.2 million
Real Salt Lake -- Value $30 million, Operating Income -$2.1 million
New England Revolution -- Value $27 million, Operating Income -$1.5 million
Chivas USA - Value $24 million; Operating Income -$1.0 million
Columbus Crew -- Value $23 million; Operating Income -$4.5 million
Kansas City Wizards -- Value $22 million, Operating Income -$2.9 million
Compared with European Clubs:
*I took the top two teams (based on value) from each country via Forbes, but was unable to find any information concerning poorer forming clubs. Look for a future update, hopefully.
Manchester United -- Value $1.87 billion; Operating Income $160 million
Arsenal -- Value $1.2 billion; Operating Income $80 million
Real Madrid -- Value $1.353 billion; Operating Income $81 million
F.C. Barcelona -- Value $960 million; Operating Income $108 million
AC Milan -- Value $990 million; Operating Income $58 million
Juventus -- Value $600 million; Operating Income $46 million
Bayern Munich -- Value $1.11 billion; Operating Income $59 million
Schalke 04 -- Value $510 million; Operating Income $46 million
Olympique Lyonnais -- Value $423 million; Operating Income $94 million
Olympique Marseille -- Value $240 million; Operating Income $20 million
For context, here are the top American sports teams (by value) via Forbes:
New York Yankees -- Value $1.5 billion, Operating Income -$3.7 million
New York Mets -- Value $912 million; Operating Income $23.5 million
New York Knicks -- Value $613 million; Operating Income $29.6 million
Los Angeles Lakers -- Value $584 million; Operating Income $47.9 million
Dallas Cowboys -- Value $1.7 billion; Operating Income $9.2 million
Washington Redskins -- Value $1.6 billion; Operating Income $90.3 million
So. . .
The MLS business plan doesn't work; 10/13 MLS teams reported an Operating Income loss.
Photo(s): Don Garber, Manchester City, MLS, Dallas Cowboys
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