In Year of Downs, Big Leagues Filled Stands, Pockets
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The last 12 months have been, for the most part, pretty good for the sports industry. Major League Baseball had a career year with record revenue and attendance, newly signed television deals, a new collective bargaining agreement between owners and players, approval for new and renovated stadium projects in New York, Minneapolis, and Kansas City, as well as the promise of a ballpark and related development in Fremont, Calif., for Oakland A’s owner Lewis Wolff. And MLB players seem mostly to be behaving — both on and off the field.
There are two potential problems facing MLB commissioner Bud Selig: the outcome of the ongoing BALCO–steroids grand jury proceedings in San Francisco, and Florida Marlins owner Jeffrey Loria’s efforts to get a new stadium built for his team. (The league may soon replace Loria and Marlins president David Samson in talks with Miami and Florida officials.) Yet Selig may have won big this past Election Day when Florida voters selected Charlie Crist to succeed Jeb Bush in the governor’s mansion in Tallahassee. In Crist, a former lawyer for Minor League Baseball, Selig and Loria may have found the stadium partner they have long been seeking. In his two terms, Governor Bush never supported any stadium-finance package for a new Marlins ballpark.
While things are looking up for Major League Baseball, both the commissioner of the National Football League, Roger Goodell, and the National Basketball Association boss, David Stern, face a multitude of problems — one of which keeps cropping up for both. Players are winding up in handcuffs, a far more significant issue than an on-court basketball scuffle.
Stern has tried to clean up the image of the NBA since a disastrous 2003 calendar year that saw a number of players, including Kobe Bryant, go through the judicial system, followed in 2004 by the brawl in Auburn Hills, Mich., between the Detroit Pistons and the Indiana Pacers.
At least Stern won’t have to cope with former Charlotte Bobcats forward Lonny Baxter, who was arrested on August 16 and sentenced to a two-month jail sentence for firing a gun near the White House. Baxter, a member of the 2005–06 Bobcats, left the NBA and signed a deal with a team in Italy.
But Stern still will have to deal with Indiana guard Stephen Jackson, whose trial date for allegedly firing gunshots during a fight outside an Indianapolis strip club is set for February 12, 2007. Jackson has pleaded not guilty to a felony charge of criminal recklessness and misdemeanor counts of battery and disorderly conduct arising from the October 6 incident.
Stern has employed various strategies in his effort to repair the NBA’s tarnished image. He imposed a dress code for NBA players, tightened up rules regarding on-court arguments between players and officials, and muzzled owners like the Dallas Mavericks’ Mark Cuban. He has also asked NBA players to leave their guns at home.
Stern is, of course, worried about the perception of his players in the eyes of the corporate world and whether that perception will affect sales of luxury suites and club seating at NBA arenas, along with lucrative marketing and advertising partnerships.
In the next few months, Stern will not only be looking to renegotiate his national cable-TV deals, but also to secure new government–franchise partnerships for funding for new arenas in Sacramento, Orlando, and Seattle. Stern doesn’t need the added difficulty of an image problem in cities such as Seattle and Sacramento, where local residents have been hostile to any sort of taxpayer-assisted arenas for “billionaire owners” and highly paid players.
Despite all of this, the NBA is still collecting big coinage from its global partnerships, as is the NFL.
Roger Goodell has not had an easy time of it. The owners and players have yet to sign the new collective bargaining agreement because NFL owners still cannot agree on a revenue-sharing plan. Senator Schumer, a democrat of New York, has joined the conversation by throwing the weight of his office behind Buffalo Bills owner Ralph Wilson in an effort to ensure the league’s 32 owners share revenue equitably — a move that will allow the Buffalo franchise (as well as other small markets such as Green Bay, Jacksonville, Nashville, and Kansas City) to compete on an even playing field with New York, Chicago, Dallas, Washington, Philadelphia, Boston (New England), Houston, and other major-market teams.
Goodell also has the former chair of the Senate Judiciary Committee, Senator Specter of Pennsylvania, on his back, following the drafting of various TV arrangements. Specter is threatening to introduce legislation to overturn the 1961 Sports Broadcasting Act. But both Schumer and Specter are internal matters for Goodell and his owners; Goodell also has to contend with the same perception problem plaguing Stern.
At least 35 NFL players have been arrested in 2006. The police blotter in cities like Cincinnati, Chicago, and San Diego has been filled with details about the various brushes with the law by members of the Bengals, the Bears’ Tank Johnson, and the Chargers’ Steve Foley, among others.
The number of arrests has drawn the attention of Goodell, his owners, and the executive director of the NFL Players Association, Gene Upshaw. But the league’s fans and clientele don’t appear to be too distracted by the misconduct if attendance, marketing partnerships, and TV dollars are any indication. The league is thriving in all three areas.
Voters in Kansas City said yes to renovations at Arrowhead Stadium; Minneapolis and Minnesota officials are moving ahead with a proposal to build a new facility for the Vikings; the NFL is actively exploring venues outside America that want to host a 2007 regular-season matchup, and the league is attempting to make inroads in China.
Similarly, while the San Diego incidents have made county politicians leery of investing public dollars in a new facility for Chargers owner Alex Spanos, neighboring communities in Chula Vista and National City are preparing stadium proposals for Spanos’s stadium pointman, Mark Fabiani, to consider.
If Spanos cannot find a suitable alternative in San Diego County—Las Vegas and San Antonio officials would gladly talk to Fabiani about relocating the franchise to those cities.
For all the knocks NHL commissioner Gary Bettman is taking this year regarding the league’s sagging viewership on the Versus network, the NHL seems to be in decent shape. Yes, attendance has dipped slightly in comparison to last season, and Bettman may have a relocation issue on his hands should Pittsburgh, Allegheny County, and Pennsylvania officials fail to build a new Pittsburgh Arena, but the NHL commissioner is among those (including his former NBA boss and mentor, Stern) who point out that you can no longer judge a sport by TV ratings alone. Bettman rightfully maintains you judge a sport by multimedia platforms, and the NHL is embracing that in deals with Google, YouTube, and Yahoo! The three companies are providing video packages of league content on their sites. The sports business is evolving into an era in which success will also be measured by exposure on the Internet, cellular phones, and iPods, and whether leagues manage to use those platforms to market their properties directly to consumers. The NHL will continue to plod along as critics, who are busy analyzing the TV numbers, write the league off as entertainment on the level of indoor football and lacrosse.
Speaking of indoor football, the much maligned sport will get a huge assist in 2007. Disney is becoming a partner of the Arena Football League by way of an equity investment, which means the AFL will become an ESPN staple and enjoy some exposure on ABC, as well as the various multimedia platforms ESPN uses to promote its programming.
Professional sports leagues are well oiled machines that work 365 days a year at selling their product. In 2007, there will be some issues — BALCO, the Marlins, Schumer and Specter, Stern’s and Bettman’s arena problems — facing the leagues. But the money keeps rolling in, and at the end of the day, that’s all that matters in the sports world.