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FOR WHAT THEY’RE WORTH: $157 MILLION PER MLS TEAM

The average worth of Major League Soccer clubs reached $157 million in 2014, up 52 percent from the previous year, according to a valuation by Forbes magazine.

Topping the list were the Seattle Sounders at $245 million, while the Colorado Rapids, worth $105 million, brought up the rear.  The biggest mover was DC United, whose value increased 97 percent, from $71 million in ’13 to $140 million last year.  Average team worth was $103 million in 2013, nearly triple what Forbes valued the teams five years earlier.

Eight of MLS’ then-18 clubs turned a profit in 2014, led by Seattle’s $10 million.  The biggest loser was the New York Red Bulls at $9 million.

2014 valuation of MLS clubs, plus revenue and operating income*:

1.  Seattle Sounders — $245 million, $50 million, $10 million.

2.  Los Angeles Galaxy — $240 million, $44 million, $4 million.

3.  Houston Dynamo — $200 million, $26 million, $5 million.

4.  Portland Timbers — $185 million, $35 million, $4 million.

5.  Toronto FC — $175 million, $32 million, -$7 million.

6.  Sporting Kansas City — $165 million, $29 million, $4 million.

7.  Chicago Fire — $160 million, $21 million, -$6 million.

8.  New England Revolution — $158 million, $25 million, $7 million.

9.  FC Dallas — $148 million, $25 million, -$3 million.

10.  San Jose Earthquakes — $146 million, $13 million, -$1 million.

11.  Philadelphia Union — $145 million, $25 million, $2 million.

12.  New York Red Bulls — $144 million, $22 million, -$9 million.

13.  D.C. United — $140 million, $21 million, -$1 million.

14.  Montreal Impact — $128 million, $22 million, -$3 million.

15.  Vancouver Whitecaps — $125 million, $21 million, -$6 million.

16.  Columbus Crew — $112 million, $18 million, -$4 million.

17.  Real Salt Lake — $108 million, $17 million, $1 million.

18.  Colorado Rapids — $105 million, $15 million, -$3 million.

*Operating income before interest, taxes, depreciation, amortization.

Forbes cited a number of reasons for the league’s surging team valuation, including:

o  Growing attendance, which through July averaged 21,000, as MLS continued to widen the gap with the NBA (17,800) and NHL (17,500) in that department.  That average projects to total attendance of 7.2 million in 2015, thanks in part to the addition of new teams in New York and Orlando.   The 2013 total was 6 million.

o  An influx of overseas talent that picked up in 2015 with the arrival of the likes of Kaka, Andrea Pirlo, Steven Gerrard, Frank Lampard, David Villa and Didier Drogba–a clear indication that owners are willing to spend to enhance the product on the field.

o  More soccer-specific stadiums throughout MLS.  The latest was San Jose’s Avaya Stadium, which opened in March, and DC United plans be in new digs by 2018.  Like United, the Earthquakes’ value has doubled since ’13.

o  The end of a TV deal with ESPN, NBC and Univision that paid MLS an average $30 million per year.  The new deal, in which Fox replaced NBC, pays $90 million a year.  Hardly NFL figures, or even NHL figures, and average viewship of 232,000 this year on Fox Sports 1 trails even the WNBA, but that represents a 65 percent improvement over NBCSN’s average audience of 141,000.  [September 19]

Comment I:  Total team worth of more than $2.8 billion for a league that as recently as 2002 nearly went under.  No wonder there were no signs of panic when MLS Commissioner Don Garber, during his “State of the League” address in December, revealed that the league was losing more than $100 million a year.

Comment II:  Being part of MLS is still far from being a license to print money, but no wonder the owners of LAFC, which won’t begin play until 2018, paid a league-record expansion fee of $110 million to try to succeed where it predecessor, the ill-fated Chivas USA, failed.  By comparison, the Miami Fusion, one of the league’s first two expansion teams, paid $20 million in 1997 to join MLS.

 

 

 

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MLS: DRAWN AND MORE THAN QUARTERED

This Saturday, Major League Soccer will kick off its 17th season, tying it with the old North American Soccer League (1968-84) as the country’s longest tenured national pro soccer league.  With the addition of its 19th club, the expansion Montreal Impact, the league will play 323 regular-season games, 17 more than in 2011.  The climactic MLS Cup is scheduled for Saturday, December 1, making this the league’s longest campaign in its history.  And for the first time, every match will be televised, thanks to ESPN, Univision, new partner NBC and various Canadian networks.  [March 7]

Comment:  Another set of milestones for a league that a dozen years ago was in danger of falling flat on its back, but for those who care about what goes on down on the field, perhaps we’ll see some improvement in the standings, where wins and losses are in danger of being surpassed by ties, draws and deadlocks.

Last season, with 18 MLS teams each playing 34 regular-season games for a total of 306, a whopping 106 of those matches ended in a tie.  That’s 34.6 percent, or more than a third.  The New York Red Bulls and Chicago Fire registered 16 draws apiece, breaking the record of 14 set the previous season by FC Dallas.  Toronto FC and the Philadelphia Union were next at 15, and another nine teams posted 10 draws or more.  In fact, 11 teams finished with more ties than victories, including all those who made up the bottom nine.

Is there a trend in place?  In 2010, in a 16-team MLS, only three clubs hit double digits in ties, and just one club, the New England Revolution (5-16-13), had more ties than wins.  Teams each played 30 games that year and they racked up 58 draws–24.1 percent of all results.

To a disdainful general American public, soccer and ties are almost synonymous.  But compare MLS with the Italy, the land where, as popular perception would have it, the scoreless tie was invented, and games are so tight, oftentimes so negative, that the players walk onto the field hoping for that one, blissful penalty-kick call.  Yet in 2010-2011, Serie A’s 20 clubs, each playing 38 matches, had 97 ties in 380 games–25.5 percent, just more than a quarter of all results.  Half of the teams tied at least 10 games, led by Fiorentina, with 16.

“We’re not going to eliminate ties from Major League Soccer, but we have way too many ties and way too many zero-zero ties,” MLS Commissioner Don Garber told the Newark Star-Ledger in July, as the draws were piling up at an alarming rate.  “What could we do as a league to make it more valuable for a club to play to win every game as opposed to playing for just a point?  We’re looking at what those initiatives could be.  And that is a league initiative.”

[For the record, Commissioner, of those 106 ties last year, 27 were scoreless.]

What’s troubling here is that not only has MLS not taken concrete steps to reverse the trend (meaningful player bonuses for victories, perhaps?), it has offered little in the way of explanation beyond praising its parity and competitiveness.

MLS is catching up with the rest of the world when it comes to intimate stadiums and boisterous followings, thus creating in many cities the home-field advantage factor that was so missing in the league’s first decade.  As a result, however, is MLS also becoming yet another league in which teams are more than happy to escape most road games with a single point?  If that’s the case, it’s all the more reason for the league to take the necessary steps to foster a climate in which those large, loud and loyal followers go home happy on a more regular basis.



THE BIG QUESTION AS MLS BEGINS ITS 16TH SEASON: WHO WILL FINISH 11TH?

Major League Soccer will kick off its 16th season–one shy of the old North American Soccer League’s 17–tonight with two new clubs, the scheduled mid-season opening of yet another soccer-specific stadium, and the introduction of an expanded playoff format.

The addition of the Portland Timbers and Vancouver Whitecaps lifts league membership to a robust 18 clubs and creates a three-way rivalry in the Pacific Northwest among those two newcomers and the third-year Seattle Sounders.  A 19th team, what had been the second-division Montreal Impact, will join MLS next season, and a 20th–possibly a reincarnation of the New York Cosmos–will follow in 2013. 

In early summer, Sporting Kansas City (nee Wiz, Wizards) will leave its cozy but highly inadequate minor league baseball stadium for a sparkling new facility, and in the fall the biggest post-season field in league history will battle to lift the MLS Cup.  The first-, second- and third-place finishers from the Western and Eastern conferences qualify, along with the next four teams with the highest point totals, regardless of conference.  Those four wild card teams will be paired and play off for the right to join the top six in the quarterfinals.  [March 15]

Comment:  The 800-pound gorilla that has been seated on the floor at MLS headquarters, just to the right of the receptionist’s desk, since 1996 just gained another 200 pounds.

The expansion of playoff teams from eight to 10 allows MLS to claim that it continues to follow in the proud tradition of the NBA and NHL, where post-season berths are handed out like penny candy and fewer than half the teams go home early–or make that, on time.  However, it only compounds the challenge for a league that desperately wants to make more of its regular-season matches relevant, meaningful … exciting even. 

As always, MLS clubs will slog through what has grown to a regular-season campaign of some 250 games, and most–most–of them will then go into a bizarre sprint in which, too often, the very best team is knocked out before it can prove its mettle in the title game.   Nothing is really proven, except who performed best under knockout circumstances.  The team with the best regular-season record has nothing to show for its efforts but something called the “Supporters Shield” and a hearty handshake from Commissioner Don Garber.

Soccer traditionalists in this country have long pushed MLS to adopt the traditional European model in which 18 or 20 clubs fight it out over a 34- or 38-game, home-and-home schedule to determine who’s No. 1.  The bottom two or three are relegated to the division below to be replaced by that division’s top finishers.  Simple.  There’s pressure at the top to win and at the bottom there’s the pressure not to slip quietly under the waves.   And MLS’s response has been simple as well:  “We’re a single-entity enterprise; it’s an exclusive club not open to newcomers from below.”  And with the splintering and near-demise of the USL’s top division last year, that’s more true than ever.

But what’s to say that MLS can’t become its own first and second division?  Once it reaches a bloated, unwieldy 20 clubs,  it’s high time for the league to split into a 12-team top tier and eight-team second tier.    Promotion/relegation would involve the bottom/top three teams in the two divisions, and the best of the best would scramble for first place and berths in the CONCACAF Champions League.  If there absolutely must be a climactic match at the end of all this, have MLS “host” the Lamar Hunt/U.S. National Open Cup final; what with soccer’s lower regions in disarray for the foreseeable future, chances are very small that we’ll see the Atlanta Silverbacks or Carolina Railhawks or Puerto Rico Islanders crash that party.  It will be what we normally see, year after year, in the English F.A. Cup final:  two Premier League clubs in a death grip at Wembley.

Of course, this sort of arrangement is highly un-American, but MLS fans have proven time and again that they can handle anything un-American the league throws their way:  a game clock that counts up, not down; matches that end in ties; two-legged playoff series.  And as for the concern over what would happen if a club finished last in a proposed  MLS2 for three or four seasons, playing in front of 2,000 fans, the league’s devotion to that magic word “parity” makes that highly improbable.