Why wouldn't Saputo like MLS single-entity?

[pc4th]

I have been hearing a lot on why Saputo doesn't like MLS single-entity. Base on the following, I can't think why he wouldn't like the single-entity model. You get to keep 70% of your ticket revenue, concession, parking, local sponsorships, local TV and radio revenue. MLS get to keep and share 30% of ticket revenue and national sponsorship but pay for the player salary. This is in many way similar to the hard-cap of the NFL. (and you know small-market in the NFL loves its hard-cap model).

The KC feasibility study includes some very interesting info on MLS' financial structure, pre- and post-contraction


Pre-Contraction Post-Contraction
Revenues Investor/Operator MLS Investor/Operator MLS

Gate Receipts 50% 50% 70% 30%
Concessions 100% 0% 100% 0%
Parking 100% 0% 100% 0%
Local Sponsorships (1) (1) 100% 0%
National Sponsorships 0% 100% 0% 100%
Other Stadium Revenue 100% 0% 100% 0%
National Media 0% 100% 0% 100%
Local TV & Radio 100% 0% 100% 0%


Expenses

Player Salaries 0% 100% 0% 100%
Front Office Expenses 100% 0% 100% 0%
Team Travel 0% 100% 100% 0%
Broadcast Expenses 0% 100% 100% 0%
Rent 50% 50% 100% 0%
Game Day Expenses 50% 50% 100% 0%


(1) The first $1.5 million was retained by the team and the remaining
revenue was shared with the league



http://www.kansascity.com/multimedia/kansascity/archive/sports/KC_Soccer_Final_Report.pdf

[Blizzard]

I have been hearing a lot on why Saputo doesn't like MLS single-entity. Base on the following, I can't think why he wouldn't like the single-entity model. You get to keep 70% of your ticket revenue, concession, parking, local sponsorships, local TV and radio revenue. MLS get to keep and share 30% of ticket revenue and national sponsorship but pay for the player salary. This is in many way similar to the hard-cap of the NFL. (and you know small-market in the NFL loves its hard-cap model).

Very interesting. Could it be as simple as control?

[piltdownman]

Very interesting. Why do teams have to pay 100% of the Broadcast Expenses while the League gets 100% of the national Media income? Finally I understand why MLS games have such low production quality.

[piltdownman]

Oh and for why the Big Cheese doesn't like the MLS: As I have read teams can't sell players and keep the money, when a player is sold to a european club the MLS gets the money. Saputo has a history of selling his players to Northern European leagues and the MLS would be the end of that.

Also both the Whitecaps and Impact say that the USL is better for development becuase it helps players at all levels not just profesionally.

[toronto_sports_1 redded]

I have been hearing a lot on why Saputo doesn't like MLS single-entity. Base on the following, I can't think why he wouldn't like the single-entity model. You get to keep 70% of your ticket revenue, concession, parking, local sponsorships, local TV and radio revenue. MLS get to keep and share 30% of ticket revenue and national sponsorship but pay for the player salary. This is in many way similar to the hard-cap of the NFL. (and you know small-market in the NFL loves its hard-cap model).

Saputo in the end doesn't like that fact that Toronto has beaten them and
Voncouver the the MLS and that is the bottom line. If Montreal had received a
team first you wouldn't see them complaining.

[BringBackTheBlizzard]

Saputo's opposition goes right back to the start of MLS when he turned down the offer of charter membership because he correctly felt that the business model would result in huge financial losses due to the use of oversized NFL and college football stadia in major American media markets. Whether he is still so rigidly opposed now with the move to soccer specific stadia and a business model that is much closer to break even remains to be seen if/when Stade Saputo has been built.

[leafs]

Single entity means losing bigdollars. Thats what SAputo does not like. He does not want to spend his money to prop up MLS. Its simple.

[pc4th]

Single entity means losing bigdollars. Thats what SAputo does not like. He does not want to spend his money to prop up MLS. Its simple.

I agree with you that single entity means losing bigdollars. But it is also true that without single entity, MLS would lose 'even' more dollars, big or small. That is why MLS founders wanted the single entity model in the first place.

[Daniel from Montréal]

I agree with you that single entity means losing bigdollars. But it is also true that without single entity, MLS would lose 'even' more dollars, big or small. That is why MLS founders wanted the single entity model in the first place.

Of course, Saputo need'nt care about that. The Impact is making a profit, why would he want to lose money now?

Essentially, the $10m expansion fee is 5 years of USL operating budget and is flamed away, not invested. Also, Saputo needs/wants full control, which he doesn't get with MLS.

[DoyleG]

Of course, Saputo need'nt care about that. The Impact is making a profit, why would he want to lose money now?

Essentially, the $10m expansion fee is 5 years of USL operating budget and is flamed away, not invested. Also, Saputo needs/wants full control, which he doesn't get with MLS.


That doesn't count at least $8 Million/year to run the team.

[BringBackTheBlizzard]

Sometimes Doyle you need to decide exactly what your take home message is going to be. On one thread you are painting a picture of MLS as a league that can't possibly hope to compete with small town Norwegian clubs for players. On this thread you are painting a picture of MLS as a league with an astronomical budget.

Fact is that if the Impact want to retain the services of players like Patrice Bernier in future rather than losing them to small clubs in the Norwegian second tier like Moss FK they will have to pay them more to make it attractive to stay in Canada. That means having a significantly higher operating budget. To make that doable you need access to the revenue streams from a soccer specific stadium such as the new Stade Saputo which is planned for 2007 and a superior on-field entertainment product that people will actually consistently pay the full ticket price to watch (without various discounted ticket deals and freebies) in much the same way they will pay to watch the Alouettes in the CFL. That IMO means playing the Chicago Fire, San Jose Earthquakes and LA Galaxy rather than the Virginia Beach Mariners, Charleston Battery and Puerto Rico Islanders and to be able to do that you have to pay an expansion fee.

The Saputos have the wealth to be able to do it if they so desire. Montreal has the latent support for the sport to make it work. I hope the Impact go for it once Stade Saputo is up and running and the SSSs being built elsewhere have brought MLS close to point that single entity will start to distribute profits rather than losses.

[Daniel from Montréal]

Selected teams...

I'd rather watch Rochester and Vancouver and Seattle than Columbus, Kansas City or Real Salt Lake. It's all about how you put it.

By 2007, the Impact can probably get more people to pay full price and get higher ad contracts. The fans don't really care about the league anyways, rather about the immediate game. Most of the time they don't even know the opponents, much less the players.

[BringBackTheBlizzard]

......The fans don't really care about the league anyways, rather about the immediate game. Most of the time they don't even know the opponents, much less the players.......

If/when the fans are paying the full ticket price they will have much more of an idea about what's going on with the league and who the opponents are. From what I can see the Saputos are slowly putting the pieces in place for a much bigger operation in financial terms. They could have avoided the $7.5 million outlay for Stade Saputo and remained at Claude Robilliard if they were happy with just drifting along making money as things are now. By 2010 some of the most attractive USL-D1 markets will probably be in MLS and at the very least others will be seriously contemplating it. If Rochester manage to get their phase two stadium funding from New York state in the next few months they are going to be difficult for MLS to ignore.

[Canadian_Supporter]

If/when they are paying the full ticket price they will have much more of an idea about what's going on with the league and who the opponents are.

Perhaps, but I wouldn't be surprised to see a decent amount of people who still didn't know what was going on at the game.

I saw it enough at the PDL level (granted it is the PDL), but people were paying for the tickets and they still didn't have a clue.

[DoyleG]

Sometimes Doyle you need to decide exactly what your take home message is going to be. On one thread you are painting a picture of MLS as a league that can't possibly hope to compete with small town Norwegian clubs for players. On this thread you are painting a picture of MLS as a league with an astronomical budget.

The only thing that's wrong here is that you can't seem to stop talking out of your arse. It's quite clear you can't seem to grasp simple principles.

Fact is that if the Impact want to retain the services of players like Patrice Bernier in future rather than losing them to small clubs in the Norwegian second tier like Moss FK they will have to pay them more to make it attractive to stay in Canada. That means having a significantly higher operating budget. To make that doable you need access to the revenue streams from a soccer specific stadium such as the new Stade Saputo which is planned for 2007 and a superior on-field entertainment product that people will actually consistently pay the full ticket price to watch (without various discounted ticket deals and freebies) in much the same way they will pay to watch the Alouettes in the CFL. That IMO means playing the Chicago Fire, San Jose Earthquakes and LA Galaxy rather than the Virginia Beach Mariners, Charleston Battery and Puerto Rico Islanders and to be able to do that you have to pay an expansion fee.

Montreal has learned that losing players is a fact of life. You need to get back to reality and accept that a single MLS culb isn't going to keep players in Canada or bring them back.

So why should the rest of Canada pay the price because Toronto needs to have a case of self-gratification.

The Saputos have the wealth to be able to do it if they so desire. Montreal has the latent support for the sport to make it work. I hope the Impact go for it once Stade Saputo is up and running and the SSSs being built elsewhere have brought MLS close to point that single entity will start to distribute profits rather than losses.

Why should they waste money on MLS? They are obviously quite happy where there are. The Saputos aren't going to waste money on a league that doesn't give him the power to build the team he wants.

Don't like what you hear? Then don't post at all.

[RichardFH]

Oh and for why the Big Cheese doesn't like the MLS: As I have read teams can't sell players and keep the money, when a player is sold to a european club the MLS gets the money. Saputo has a history of selling his players to Northern European leagues and the MLS would be the end of that.

Also both the Whitecaps and Impact say that the USL is better for development becuase it helps players at all levels not just profesionally.Have to wonder why people think that MLS and USL entries must be mutually exclusive for owners. No reason why the Whitecaps for example could not operate their existing club with teams entered at various levels of the USL system, with an MLS team at the top of the pyramid. Unless there is some kind of restrictive wording in the franchise agreements but I really doubt that.

[DoyleG]

Have to wonder why people think that MLS and USL entries must be mutually exclusive for owners. No reason why the Whitecaps for example could not operate their existing club with teams entered at various levels of the USL system, with an MLS team at the top of the pyramid. Unless there is some kind of restrictive wording in the franchise agreements but I really doubt that.

Or that either leagues want major distractions.

[RichardFH]

"Or that either leagues want major distractions."

Not sure I understand what you're trying to say?

[DoyleG]

"Or that either leagues want major distractions."

Not sure I understand what you're trying to say?

One Team - One League

[toronto_sports_1 redded]

Single entity means losing bigdollars. Thats what SAputo does not like. He does not want to spend his money to prop up MLS. Its simple.

Look at all the money the make me laughs(maple leafs) spend signing old
worn out players just trying to compete in the NHL , it hasn't worked and won't this season once the injuries and tired legs take hold. If Saputo
doesn't want MLS then who needs them the loss of the Impact would mean nothing, just like the loss of the expos,Express,Concordes etc.