Single Entity and its lifespan

Discussion in 'MLS: Commissioner - You be The Don' started by waltlantz, Aug 6, 2017.

  1. JasonMa

    JasonMa Member+

    Mar 20, 2000
    Arvada, CO
    Club:
    Colorado Rapids
    Nat'l Team:
    United States
    Free agency didn't exist in the NFL until the players sued for it, and again, the NFL isn't and has never been single entity.

    Clearly, because in 24 hours in this thread alone you've changed your complaint about single-entity twice, each time to an equally invalid argument.
     
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  2. JasonMa

    JasonMa Member+

    Mar 20, 2000
    Arvada, CO
    Club:
    Colorado Rapids
    Nat'l Team:
    United States
    MLS doesn't have this either (outside your little mind)
     
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  3. jaykoz3

    jaykoz3 Member+

    Dec 25, 2010
    Conshohocken, PA
    Club:
    Philadelphia Union
    Nat'l Team:
    United States
    So many assumptions............so few facts..........

    No, the individual clubs determine who they want to sign. Will the league step in if it feels a team is grossly overpaying for a player? Yes. That's not exactly a bad thing.
    No, this is by and large determined by the teams and the player's agent. The league only steps in when it feels a contract is overpaying for a player. This happened to TFC a few years ago when they tried to sign a Sweedish (?) defender to a DP deal.
    Again, the contracts are negotiated between the individual teams and the player and the player's agent. If a player feels that the contract offered is unacceptable, they can sign for a club in another league.
    The CBA that is negotiated between the players MLSPU and MLS is what determines this. Again, if a player feels that they have been mistreated the MLSPU will intervene. This happened when Pitor Nowak went nuts when he was the Union's Manager. The MLSPU got involved because Nowak wasn't treating players fairly.
    Nope again. Teams determine whether or not they sell a player. MLS only gets involved if they feel that the team is not getting fair market value on a transfer fee. This happened in the Matt Miazga transfer to Chelsea, and Tim Ream's Transfer to Bolton. The league stepped in and negotiated a higher fee, which benefited both the team and the league in the end. Also it's not a small percentage of the transfer fee either. The amount of the transfer fee a team retains is based on how long that player was with the team:
    1 Year = 1/3 of the fee
    2 Year = 1/2 of the fee
    3 Year+ = 3/4 of the fee

    Except that it is not.....
    Again, NOT due to single entity. In EVERY US Pro Sports League Free Agency was negotiated by the player's unions. Again, the MLSPU does not currently view Free Agency as a must have. To this point it hasn't been a deal breaker, and wasn't even a deal breaker in the last round of CBA negotiations. Free Agency will likely be granted in a more broad sense in the next CBA negotiations.

    Do yourself a favor, and get educated on these matters before making assumptions. We all know what happens when one assumes..............

    Guess what? MLS doesn't have pre-determined salary tiers either. Obviously you feel that DP contracts constitute a "tier." It's just a label for determining how much of a players salary counts against the salary budget. You are really striking out here.

    Oh, but do you know who does have Salary Tiers for players by position though? The NFL. Go look it up.
     
  4. adam tash

    adam tash Member+

    Jul 12, 2013
    Barcelona, Spain
    Nat'l Team:
    United States
    if willful misrepresentation was a skill you would be an expert.

    there are so many false and dishonest details about what you have written it is 100% CLEAR TO ME you are just arguing me to argue me and this has nothing to do with anything specific about the content of what i have said.
     
  5. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    United States
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    Free agency is part of the MLSPU discussions. It was introduced last year for players over 28.

    It was introduced in the EU in 1995 so we're not that far behind.
     
  6. Paul Berry

    Paul Berry Member+

    Notts County and NYCFC
    United States
    Apr 18, 2015
    Nr Kingston NY
    Nat'l Team:
    United States
    #31 Paul Berry, Jul 4, 2018
    Last edited: Jul 4, 2018
    Which parts are you objecting to?.

    - Teams sign who they want - check (but see below*)
    - Negotiation is handled between clubs, players and player agents - check!
    - How much to pay players on their books - check! Tyler Adam's guaranteed compensation went from $91k to $175k this season.
    - The CBA that is negotiated between the players MLSPU and MLS is what determines this. Again, if a player feels that they have been mistreated the MLSPU will intervene -check!
    - The amount of the transfer fee a team retains is based on how long that player was with the team (clubs now keep 100- check but note the clubs now retains 100% of the transfer fee for home grown players.
    - The NFL is not a single entity (or acts like a single-entity) - check!
    - In EVERY US Pro Sports League Free Agency was negotiated by the player's unions - check! Also, free agency exists for players over 28. It was introduced in the EU in 1995 after a court ruling, so we're not that far behind.
    - MLS doesn't have pre-determined salary tiers - check! You can sign a 15 year-old as a DP

    *One aspect I would like to see changed, and I think many MLS fans would agree, is discovery rights, especially for foreign players playing in foreign leagues and returning players.

    I'd also like Garber to go in the near future so we can further distinguish soccer from the NFL model.

    I think the current model will be changed significantly if certain expansion owners feel that several clubs are a drag on taking the league forward.
     
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  7. KCbus

    KCbus Moderator
    Staff Member

    United States
    Nov 26, 2000
    Reynoldsburg, OH
    Club:
    Columbus Crew
    Nat'l Team:
    United States
    Demonstrate what you are talking about.

    I'm seriously debating whether or not it's worth allowing you to post here anymore. You're an anti-MLS poster in MLS forums complaining, and you don't even seem to have a grasp on the facts you're posting anymore.
     
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  8. JasonMa

    JasonMa Member+

    Mar 20, 2000
    Arvada, CO
    Club:
    Colorado Rapids
    Nat'l Team:
    United States
    Its not. Considering you can go back to his first posts in this forum and find him spouting the same incorrect "facts".
     
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  9. mschofield

    mschofield Member+

    May 16, 2000
    Berlin
    Club:
    Union Berlin
    Nat'l Team:
    Germany
    I appreciate a con POV regarding MLS, but perhaps a more robust version? Debating the post-factual crowd is annoying. OTOH, it is a sizeable crowd these days.
     
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  10. El Naranja

    El Naranja Member+

    Sep 5, 2006
    Alief
    Club:
    Houston Dynamo
    Nat'l Team:
    United States
    I'm still waiting to see what the 'post factual' side said that was a lie. Everything they said is true.
     
  11. mschofield

    mschofield Member+

    May 16, 2000
    Berlin
    Club:
    Union Berlin
    Nat'l Team:
    Germany
    Berry and Jaykoz3 just gave a pretty detailed explanation of this.
     
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  12. triplet1

    triplet1 BigSoccer Supporter

    Jul 25, 2006
    #37 triplet1, Jul 5, 2018
    Last edited: Jul 5, 2018
    I think there may be an interesting discussion hiding in here, so while I don't want to speak for the OP, I'll take a crack at it.

    Let's all begin with a reminder of what the "single entity" is, and what it is not. The term is actually a legal defense from a case called Copperweld Corp. v. Independence Tube Corp. In Copperweld, the Supreme Court concluded that a company and its subsidiary could not, as a matter of law, "conspire" to violate the Antitrust laws because conspiracies require two actors and here these companies were a "single economic entity." In other words, in antitrust law, it takes two to tango before you have a Sherman Act violation.

    Former USSF President Alan Rothenberg had a lot of input into the early blueprint for MLS, and he is the one who really built the league around the premise of a "single entity". Rothenberg, a gifted lawyer, had lead an investment group that owned the Los Angles Aztecs of the old NASL. He was convinced foolish, lavish spending on players had doomed the NASL and he thought for a new US soccer league to have a chance, it could not repeat these mistakes.

    Rothenberg conceived of a simple, bold plan where the league itself would own and operate every team, with investors owning stock not in a franchise, but in the league itself. In this way, it wouldn't matter if a team in New York made money and a team in Chicago lost money -- the owners would divide the profits and share in the losses of every team equally. To make sure spending on players did not get out of hand, the league itself would hold all player contracts and negotiate all salaries -- a perfectly legal arrangement under the antitrust laws since the league was a "single entity."

    As I said, it was a bold plan. Too bold, as it turned out. Investors were very skeptical of the arrangement and Lamar Hunt, who got many original owners to buy into the league, got a lot of pushback. As a compromise, when MLS kicked off the league owned all of the teams and held the contract for all of the players, but MLS entered into management contracts with individual owners to operate some specific teams. Hence the term "investor operator" was born; MLS owners invest in the league, and operate specific league owned teams.

    The league operated teams lost a lot of money. Frankly, all the teams lost a lot of money because the investor operators had very little financial upside if they operated their teams profitably -- almost all income and all losses were shared anyway. And, in effect, MLS failed at the end of 2001.

    The league restructured and made some important changes. All teams would be operated by investor-operators, not the league, and the I/Os were allowed to keep a lot more of the money their teams made, in exchange for taking more financial risk. MLS still owned the teams, but the investor operators took on more duties under their management agreement with the league which make them function much more like typical owners of a sports franchise.

    When the court of appeals in the Fraser case considered MLS' structure, it correctly noted (IMHO) that MLS is not and never was a pure single entity, but it wasn't a collection of franchises either. The court called the league a "hybrid", and I think that's the most helpful way to understand it. (The court of appeals noted in Fraser, "To sum up, the present case is not Copperweld but presents a more doubtful situation;  MLS and its operator/investors comprise a hybrid arrangement, somewhere between a single company (with or without wholly owned subsidiaries) and a cooperative arrangement between existing competitors.")

    To me, between the single entity Rothenberg envisioned and a league like the EPL is a spectrum, and, over the years, as MLS has shifted more and more financial risk and reward to the individual I/Os, it has moved further away from the "single entity" and more towards a "conventional league" on this spectrum. How far it has moved is in the eye of the beholder, but it is undeniable that the MLS of today looks much different than the MLS of the early days. In many respects, MLS is much like other major U.S. sports leagues now in terms of revenue sharing, a CBA and a draft. But one key element of MLS remains unique -- the league holds the player contracts and, with that, has eschewed more unfettered free agency. To be fair, MLS has moved on this some too, but compared to most professional leagues, for the most part MLS has kept the clamps in place on free agency.

    To me, that's the last piece of the original single entity concept that really has not changed: unrestricted free agency.

    Should it?

    That's debatable. Perhaps it is even a conversation worth having. But free agency isn't a result of the league's structure so much as the league's structure is a response to its desire to avoid unrestricted free agency. It could be changed.
     
  13. ceezmad

    ceezmad Member+

    Mar 4, 2010
    Chicago
    Club:
    Chicago Red Stars
    Nat'l Team:
    United States
    I do wonder how they fit the free agency of 28 and over players into the single entity of all contracts owned by the league.

    Aren't they really saying that 2 subsidiaries are now competing with each other over a company employee?
     
  14. triplet1

    triplet1 BigSoccer Supporter

    Jul 25, 2006
    Yes -- and technically that's accurate, but practically it's taking more and more gymnastics to describe this as a single entity. Of course, free agency isn't the only area where the league's structure increasingly seems quite different from the "single entity" it purports to be. After all, right now an operator is attempting to move a league owned team that he only has the right to operate to another city -- ponder that a minute and consider how far removed MLS is from the "pure" economic single entity Rothenberg envisioned.

    Rothenberg had a fair point, but in the last 20 years, modern salary caps have gotten much more sophisticated -- so much so I wonder if there isn't an easier way to achieve the salary discipline MLS needs. I am not sure why MLS can't get the protection it needs with something like an NBA salary cap which provides for a number of exceptions and allows for more competition, but ultimately I think the teams would have to hold the contracts, not the league. That's typically the sticking point.
     
  15. mschofield

    mschofield Member+

    May 16, 2000
    Berlin
    Club:
    Union Berlin
    Nat'l Team:
    Germany
    But this does happen, a lot, in the world outside of footie, doesn't it? Two divisions of the same company both wanting the same employee.
    As Triplet notes, these days it really is single entity light. The clubs do compete quite intensely, and despite the setup there are strong differences in the approaches to everything from spending to marketing to playing. It's not dissimilar from say, Pepsi, where Mountain Dew, Aquafina and Tropicana do their own thing and fight for market share of those who drink with Pepsi, Pepsi light and Max, etc. There are certainly common goals (grow the audience for soccer), and there are similarities in the end product, but at least publically each has it's own approach and they don't really rely on the overarching MLS brand as much as their individual brands (SKC, TFC, RSL etc).
    I don't get upset about the free agency rules because MLS isn't even close to a monopoly, and lots of single clubs over here can more than match MLS league-wide spending. I've always advocated a slow and steady approach to growing MLS, just because I think that is the best way to ensure survival.
    But right now, while they could open free agency a bit more, and could dump the discovery lists, I do think they've made a lot of progress that benefits players.
     
  16. GrimmFreak

    GrimmFreak New Member

    Chelsea
    United States
    Jul 2, 2018
    It is my feeling that MLS will eventually reach critical mass where there are too many cities for the number of teams (32 is the total team target) I feel that when this is reached a small (at first) second division should be created by a combination of relegation (4 teams) and second league expansion (6 teams) where 2 teams per year are moved from the USL to the MLS second division until the second division reaches 10 teams.

    Once this is reached you could begin to expand both leagues by 1-2 teams per year (perhaps add teams to the second division while promoting 1 or 2 more teams to the first than are relegated to the second until the first division gets back to the desired total of teams) when a total of 32 First Division and 14 second divisions teams exist then slow things up. In this way, MLS could ensure that the teams entering are viable for MLS first division while bringing in a pro/rel system.

    An additional effect of such an action is that the expansion boon would be extended through lower expansion fees from second division's expansion teams. Additionally it might be good to start this a number of years after the final MLS expansion to 32 teams so that recent expansion teams can have time to become fully competitive.

    Thoughts?
     
  17. newtex

    newtex Member+

    May 25, 2005
    Houston
    Club:
    Houston Dynamo
    I'm breaking my personal rule to never respond to a post that ends with "Thoughts?".

    Why should MLS do this? If they do get to 32 and then stop expanding? Remember that the owners of those 32 teams own the league. They each paid what are incorrectly called "expansion fees" but are really the purchase price for a percentage ownership stake in the entire enterprise.

    As soon as those first 4 teams are relegated down to the new 2nd division they instantly become worth less. Why exactly should those Investor/Operators take that revenue/team value cut? They bought into a league as a member of the top division in U.S. soccer. What are they getting in exchange for giving up that value?
     
  18. GrimmFreak

    GrimmFreak New Member

    Chelsea
    United States
    Jul 2, 2018
    lol, I'll make sure to refrain from doing so again

    Good points, I'm not sure this would be feasible but perhaps there could be some sort of revenue sharing between leagues/teams. I'm not talking anything overly extreme but perhaps enough to mitigate losses a bit. Again, I'm not sure this is even possible but i just thought I'd throw the concept out there and see what happens.

    I do think pro/rel is generally good for sports because of the comfort zone I see certain teams who seem to become complacent just staying where they are as long as they can turn a profit. For me, the added incentive of pro/rel is positive. Looking at the team from my home town (san jose earthquake), they have not been mentioned in a long time in connection to any talent upgrades AFAIK. It is teams like this that make me think the idea has merit. However, the US economic landscape is obviously different than a lot of countries where pro/rel systems thrive and I have been wrong before and I'm sure I'm still wrong about many things. Hence posting my ideas here.
     
  19. JasonMa

    JasonMa Member+

    Mar 20, 2000
    Arvada, CO
    Club:
    Colorado Rapids
    Nat'l Team:
    United States
  20. triplet1

    triplet1 BigSoccer Supporter

    Jul 25, 2006
    Again, there might be an interesting discussion here, but it typically gets swamped by issues Beau Dure outlines in his article.

    I agree with you, I think if the test is selling about 20,000 tickets a game, there may be 32, 40 or even 50 cities in the United States and Canada that could support an MLS team. MLS can still grow substantially -- if it wants to.

    In the United States and England, which both embraced professionalism early on, as leagues added teams they split into divisions. In the U.S., the divisions were organized horizontally (typically based on geography), while in England the divisions were stacked vertically. And these vertical divisions were soon linked by automatic promotion and relegation.

    But the key is that these divisions in English football were always part of a single league. The Football League had two divisions, the Southern League had two divisions, the Isthmian League had two divisions, etc. It took nearly 100 years for the Football League to allow automatic promotion from another league, or to automatically relegate its members out of the league. (Typically they had to stand for re-election). It didn't happen in England until 1986.

    Yet that's where the most vocal advocates of pro/rel demand the United States should start -- they want to force MLS to automatically promote teams from other leagues and relegate its own teams out of the league. It's nonsense, it's reckless and, usually, IMO it's often motivated by those who want to see "their team" admitted to MLS on the cheap (or from a small town that would not otherwise qualify).

    So let's be clear: MLS will never, ever agree to promotion and relegation of non-MLS owned clubs. (Well, okay, if we can match England maybe it could happen in 2094, but none of us will be here to see it.)

    Now, could MLS grow bigger and boost attendance and TV ratings if it adopted a vertical structure and split into MLS 1 and 2 (and even 3)? To me, that's a conversation that may be worth having. But if anything, the single entity structure makes that easier, not harder, because there are tools to deal with the risk this structure would pose.
     
  21. GrimmFreak

    GrimmFreak New Member

    Chelsea
    United States
    Jul 2, 2018
    I agree 100%. Any second (or third) division would have to be MLS run, it's a no brainier. MLS has to have control to ensure that the teams admitted to the lower divisions would be worthy of even having the chance to be in the first division. If you leave it to the USL then they could (and maybe even should but that's another discussion) put teams in more remote areas that would never be able to fill a 20,000 stadium.
     
  22. mschofield

    mschofield Member+

    May 16, 2000
    Berlin
    Club:
    Union Berlin
    Nat'l Team:
    Germany
    I think we also have to note that replicating the system in England in a place with the size and population of the US does not mean coming up with whatever it is, 98? clubs. Going by population, the two have a similar club per population density when the US gets to 650 or so fully professional clubs. Going by a clubs per square mile it's more like a jillion. It's difficult to build a US model using countries that do not share US challenges.
    At this point, the league is growing and improving, fairly rapidly IMO, under a single entity structure.
    MLS will change when the pressure builds to the point that they need to change to survive and grow. That change will be forced by business forces, and forces from business (egos) and nothing else.
     
  23. EvanJ

    EvanJ Member+

    Manchester United
    United States
    Mar 30, 2004
    Club:
    Manchester United FC
    Nat'l Team:
    United States
    If 98 was a guess at how many professional clubs there are in England, the amount is 20 + 24 + 24 + 24 = 92. I think the fifth level is pro or semi-pro, but it is not part of the Football League.
     
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  24. thekorean

    thekorean Member

    Jan 10, 2017
    Club:
    New York City FC
    Only thing that really bothers me about single entity is if teams coming in from USL or NASL. They are technically a new team and all their past achievements and records in NASL and USL gets thrown out.

    I mean granted most likely it won't be much. ANd I probably shouldn't be too bothered by it, but never the less.
     
  25. mschofield

    mschofield Member+

    May 16, 2000
    Berlin
    Club:
    Union Berlin
    Nat'l Team:
    Germany
    I'm not sure I agree. The Timbers note their history goes back to the original NASL. Seattle and Minnesota do as well. San Jose is a different club, but tips it's hat to the earlier version that failed. I'm sure the official Cinci history will note the last couple years in USL. Where else would an MLS side note previous accomplishments? And these clubs almost certainly have records of previous player accomplishments. I would agree that USL accomplishments are diminished by moving into MLS, but that is the case for every lower league side moving into a higher league (we don't call them different leagues, we call them lower leagues).
    Maybe I'm just not getting your point.
     

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