could NASL buy an MLS expansion slot?

Discussion in 'MLS: Expansion' started by 4door, Dec 2, 2009.

  1. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States

    If a team is spending 1 year in the MLS, basically keeping the same roster, and therefore playing an NASL team in the MLS- chances are this team will finish way back, not close to the playoffs. maybe it's just me, but If I knew my team was only up for 1 year, had little or no chance of winning while up, and then would be back down the following year I would not get excited.
     
  2. klarthailerion

    Dec 10, 2009
    New Orleans
    Nat'l Team:
    United States
    Exactly. It's essentially free marketing and exposure for the MLS in those additional markets.

    Also, the MLS wouldn't have to worry as much about the long-term viability of each of the NASL team markets because if a team were to fold or move, it more directly affects the NASL to find a replacement market.

    The NASL benefits from the increased exposure of its markets to the broader national market provided by MLS. Higher visibility means greater sponsorship opportunities, increased chances for casual attendance and entertainment dollars, and an increased player pool for both leagues to draw from.
     
  3. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States

    1. I am guessing teams in NASL markets are going to be worried about what other NASL teams are doing. look at MLS standings from one year to the next - I don't think a fan in Rochester is going to worry about a game between SJ and Chicago just cause they could be playing one of them next year. A fan in rochester will be watching SJ/CHI cause they enjoy soccer.

    2. I have mentioned before, it carries many burdens that i think outweigh the benefits for the smaller markets

    3. You say it's no risk for the MLS- there is HUGE risk. based on things now, a team could be playing in a smallish stadium (smaler than SJ and KC), which hurts revenues. Also, merchandise sales, sponsorships etc would be better in a stable market vs a revolving one- it would build up more over time.

    If Miami plays in MLS one year - does the portion of their sales of merchandise etc go to MLS or NASL?

    It's way to complicated, an idea for failure, so I am not sure why people think it's viable.
     
  4. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States
    Another thing that hasn't been thought of.

    I think we all know that NASL does not plan on stopping at just 10 teams. All of these ideas are based on splitting not only the fee, but also the prophets from MLS 10 ways.

    For examples sake, lets say this actually does happen (which i doubt). And lets also say that between now and 2015 NASL expands to 16 teams. (I could care less what cities, so please don't turn this into an NASL expansion thread)

    What happens to those 6 cities? Does the fee they pay to join the league include the portion of the stake in MLS? if so, they get to play for this 20th spot, if not, why would they want to join the league?

    Also, if teams are dividing up revenues now by 16 instead of 10, that's a lot of lost revenue based on what they would have originally budgeted for. Since it's an annual revenue loss, I don't think they could make up enough in a 1 time expansion fee to off set this.

    Just another reason I think this is an idea set for failure.
     
  5. Lucho305

    Lucho305 Member

    Inter Miami CF, Junior de Barranquilla
    United States
    Jul 9, 2008
    Miami
    Club:
    Miami FC
    Nat'l Team:
    United States
    come on GUY, baseball? you comparing soccer to baseball? In soccer all around th world they go for their second division team because they have a chance to go up and play against the best teams.. Imagine a second division team beating Barcelona despite having a losing record in the time spent in the top division.

    The fans of the second div team will never forget beating Barca the year before even though they are back in second division, and would always have that experience forever pro-longing history and reinforcing teh fan base.

    This system you say is flawed will never have negative effect to it..

    Miami can be in the bigs one year and go down the next but i promise you the fan base will grow, because of the simple chance of us going back the following year..

    It would make the NASL teams scout for better players, and bring more fans to the stands and like i said before, it would bring history to the NASL teams, setting and important footprint in US soccer, maybe that is why other leagues in the world have that look, because their fans see that their teams have never gone down to second division meaning they have every right to stay in the top divsion, meaning that they are good. In the MLS

    the red bull were horrible, last place as was the galaxy the year before taht, how do you expect to grow fans like that if they are the worst one year after year, there is no credibility to it..
     
  6. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States


    Nope- I am mentioning how sports work in the US.

    WE DON'T live in the rest of the world, we live in the US.


    Does the NBA believe their should be pro/rel with minor league basketball? NOPE- and they could care less that in Euroleagues it happens.
     
  7. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States
    And yet the Galaxy made the MLS cup final this year after winning the Western Conference regular season.

    That's how they win fans- by winning. I'm not sure what your arguement is?
     
  8. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    I see that you think this is an awful idea. I am really sick of arguing with people on these threads, but I will discuss why I think you may be wrong.


    1. from the NASL side we need to compare the path of going it alone as a 'minor league' organization or buying into a more stable profitable organization. From their perspective lets just look at those 2 routes. In my opinion due to the increase in interest (media/fan/sponsorship) we have seen in the markets that have made the jump from 2nd division to the first then NASL would certainly benefit from not only being apart of a stable organization but to have the possibility of a such bump every year. Even if the promotion doesn't happen it does give fans a incentive to come out and support that they would not have if indeed they were simply a minor league club. It gives media outlets an incentive to cover the team if they are on a brink of MLS opposed to winning a new 'minor league' soccer league. If lets say Rochester wins NASL or USL that would probably be a minor story in the local media, if they were promoted to MLS that would in fact be a much bigger story and thus allow them to attract more fans with new interest.

    A big question would be how much could this organization make instead of going it alone and not buying a MLS franchise spot. They would of course only be getting a 1/10th piece of the pie. But that piece of the pie has proven to be growing at a very rapid rate. Even as a minority owner of SUM it would still be a financially wise decision. But it would mean that NASL owners would need to rely on themselves to generate their own budgets because they couldn't survive off MLS alone. Of course they would need to do this if they didn't buy into MLS as well. But NASL could have additional revenue sources that could offset their lack of revenue from MLS. For instance naming rights to the league (Honda NASL) and NASL vintage merchandise. Now this will not completely even the playing field, there will certainly be smaller clubs as there are smaller clubs everywhere in the world, but what it will do is allow the investors with smaller capital to invest and test the market. If indeed interest begins to boom after a promotion the investor could look for new capital and investors to try to stay up or buy a permanent franchise spot.

    2. From the MLS perspective, if they indeed stop expansion at 20 and only sell one more slot they run the risk of alienating huge metropolitan areas of potential soccer fans. This is very different than alienating other american markets with fans of basketball/baseball/football. With soccer there are many international leagues for people to begin to follow and as the game grows in popularity and access to games increase via technology it is crucial for MLS to begin to reach people nationally. Don Garber has said that he thinks only 1 out of 3 soccer fans in the US actually supports MLS and that number in my opinion is much higher. The major question in a league spanning 2 countries and 350M people...is how do we get people to care? Going 1 expansion team every 2 years and waiting decades to get to key markets can be 'brand suicide' for MLS. Creating a second division with a promotion system could give fans a reason to care, and allows MLS not to change their structure or threaten the value of current franchise holders. In fact it helps them because if expansion slots were permanently ended and only NASL slots are sold, that means a new owners looking to buy into MLS would need to buy out a current franchise. This would mean that more offers of buy outs would be coming in for various franchise owners from new perspective owners. These bids would in fact raise the value of the league's franchises.

    Also from a technical perspective, if MLS is getting a piece of the pie from the gate it would be actually more profitable to have a 10 teams averaging 5-6k a game than one team getting 18-20k. Even if ticket prices are lower. From MLS perspective they can not only make more on game day but actually spread their brand more effectively by taking this approach.
     
  9. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States

    then

    1. Don't start threads that might have contarty opinions

    2. Don't post replies.


    But since you did, you must really not be that sick.

    Also- you have yet to answer what happens when the NASL goes beyond 10 teams.

    And for your attedence example. if these teams each get 10% of an MLS stake, then the contrary would be that MLS get 10% of their stake. So 5,000 tickets per game per team = 50,000 tickets. *10% = 5,000 tickets

    Nope, less benefit to have 10% of 50,000 vs 100% of 18,000


    But I will edit to add- in concept I agree that getting more people to care about soccer is a good thing. I just don't think that you you have proposed will happen, and I think your idea has many more long term flaws than you have thought of.
     
  10. Kingston

    Kingston Member+

    Oct 6, 2005
    Not only does it set up the idea for failure, it seems really cruel to the poor MLS prophets. I mean, all they're presumably doing is trying to spread the word about soccer and they get all chopped up.
     
  11. klarthailerion

    Dec 10, 2009
    New Orleans
    Nat'l Team:
    United States
    In regards to reaching more markets, would the average person rather cheer for a team that has a chance to be on national television or one that doesn't? When thinking about increasing the audience long term, any league can't just focus on hardcore fans. Greater market penetration = greater potential audience.

    The same thing extends to NASL markets v MLS markets. The diehard fans are going to be mostly focused on their own team, and to a lesser extent their own league. Those aren't the people that need to be targeted to expand the league, it's the casual viewers and newer fans. If the leagues are even partially connected, the potential to draw in more casual viewers and incoming fans is greater because the markets of interest are greater. It's not just about existing fans, it's about potential fans. It's all about market penetration.

    As for the risks and benefits to the two leagues, I disagree with you here but I do acknowledge that it would be complicated. MLS gets the same amount of expansion fee money from a single entity group (NASL) or a single team, and likewise splits the same amount of shared revenues. In return, they get access to multiple new markets instead of a single market. Remember, NASL as an organization would be owning the 20th slot, so the league itself would be responsible for managing the revenue flow between the NASL teams and the MLS (in both directions). The league isn't even officially sanctioned yet, so trying to pin down concrete figures is so much dart-throwing at this point in time. Certainly, player contracts, salary cap and minimum salary, and revenue sharing issues would all need to be addressed. It comes down to numbers... if a realistic formula to make it work wouldn't be possible, the NASL wouldn't attempt it.

    To specifically address what would happen when the NASL went beyond 10 teams, though, the incoming teams would pay an entry fee to the NASL and would then be held to all of the revenue and cost sharing as any other team in the league. They could build the cost of the MLS slot into the entry fee, or figure out whatever method of splitting it up that would work for them. Again, if the numbers don't work, the NASL owners wouldn't go for it to begin with. It's all speculation at this point.
     
  12. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States

    MLS as the single entity owns 51% of the stake of every club, 49% is owned by some kind of private company. Private companies buy into the single entity and own an equal share. Single entity takes match day revenues of I believe 30% of the gate of each game. These numbers you are throwing out...like MLS taking 100% of gate revenue is inaccurate. What I am saying is that NASL form a corporation and buy a franchise like any other private company. They would operate the same, but field 10 clubs instead of 1. MLS would need to make special previsions to allow this to private company to operate additional clubs and make money outside of MLS to allow for these clubs to stay financially stable. The clubs would still be a part of the single entity because they are owned by the private company that bought the franchise. There are various approaches that would need to be negotiated to allow the system to work. For instance MLS could just agree to take 30% of the gate from the promoted team. This deal may be best for both sides because it would allow the NASL clubs a few years to grow before revenue is taken, but may not be the decided path.

    Another option could be to take an average from all teams. If MLS averages 16k a game they could know what their average cut is from the gate. They can then spread that cost over all 10 clubs. This will certainly be under 30% thus allowing NASL owners to keep more of the gate and hopefully stay more financially stable.

    We have to remember that MLS will view NASL as both a way to solve their issue with development issues, allowing their reserve and development contract players a place to play. It allows MLS to reach more markets and to appeal to certain soccer fans who enjoy the pro/rel system. As long as their franchise NASL can produce the same revenue of the average MLS team while spreading the brand and growing new markets then they will view it as a success. If NASL can make higher profits than by going it alone, appeal to a larger fan base, get more media coverage, and be apart of a more stable system they will view it as a success. Everyone in the system would understand that without additional investors to buy a full franchise the NASL clubs will never reach the value of MLS clubs, but the point isn't for that to happen. The goals are to spread the brand, develop more players, increase media interest in more cities, increase the interest of future investors, and to limit future MLS franchises thus driving up the value of current MLS franchises.
     
  13. crash2772

    crash2772 New Member

    Mar 18, 2001
    I agree with you that this idea where the NASL shares all the revenues equally, and therefore they try to compete with an MLS team with 1/10 the resources is probably a non-starter for MLS. MLS would never allow a team to join that dealt themselves a self inflicted penalty like this. Furthermore, I believe there are minimum salary expenditures written into MLS' CBA, so there is no way a team would get away with only spending $210,000 (an approximation of what 1/10 of the current salary cap could be).

    Granted my post was long, and therefore many didnt probably read it- but my concept avoid most of these problems. Essentially it only requires MLS to accept that a team would relocate and re-brand on an annual basis.
     
  14. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    we have a designated player rule allowing teams to operate above the 2.5M cap, the money beyond the cap is just paid by the independent owner and not by the single entity. My idea was that NASL would just pick up the cost beyond the divided MLS salary budget. The rules would need to be adjusted for them to sign multiple players not just 1 or 2 but the rule would really just need to be adjusted but we wouldn't need a total system change.

    There could be ways that NASL corp. could make money outside of MLS to allow for the individual clubs to sustain themselves.

    1. League wide naming rights
    2. Multiple shirt sponsors
    3. loan agreement that all loaned players and reserve players be sent to NASL from MLS clubs not USL. This could allow each NASL team to have several players on their squad that is paid for by MLS clubs.
    4. instead of taking 30% of the gate like other MLS clubs, NASL clubs could operate at a lower percentage because all 10 teams will bring in a much higher total tickets sold than an average MLS club. This will allow individual clubs to keep more of their gate.
    5. Shared player sales with NASL clubs. If ACSTL develops the next Ibisevic and Europe comes calling with a 5M bid, ACSTL can kick some funds to other NASL clubs. NASL like any other smaller club will depend on player sales to be profitable, this is good for MLS because they can get a cut of sales and having 10 clubs focused on development would be good for the USMNT as well which indirectly helps MLS.
    6. Future NASL franchise sales. If NASL gets together and buys an MLS slot for 40M with each team kicking in 4M, and MLS agrees to stop expansion slots, then the only way to MLS would be through NASL. This can allow MLS/NASL to sell additional expansion slots in NASL. MLS has lived for years off expansion fees, and in the immediate future NASL could do the same selling 4M+ slots every year to new owners that can be spread through the NASL helping their finances.
    7. NASL sponsorships
    8. NASL media sales (FSC paying NASL in the future not the other way)
    9. Selling NASL vintage merchandise.



    Everyone who invested via NASL would understand that to become as profitable as a full franchise, then NASL is going to have to buy in and thus buy out a current club, but there are ways in which the clubs can stay financially secure enough to compete. We have seen both the Islanders and Impact make solid runs in CCL. This structure could be much more profitable than the USL structure, and those clubs were able to put together squads that are at least strong enough to compete. NASL clubs will be smaller but if done right they can be profitable on some level and be strong enough to maybe not win the league but maybe strong enough to compete. The big picture will be development of the game on a larger national scale not just having NASL teams be able to win the league.
     
  15. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States

    Okay so MLS gets 30% of gate. Lets call gate $16,000 @ $25 a ticket.

    16,000*25*.3 =$120,000

    $120,000 *15 (home games)= $1,800,00 Per team


    now from NASL they get their 30% of the gate, but they only own 1/10th of each team.


    so average of 6,000 fans, $20 ticket *.3 = $36,000 *.1 =$3,600


    Now they do get this times 10 teams - so it goes back to the $36,000.

    $36,000 *15 (home games) = $540,000 from NASL teams



    That's about 1/3rd the revenue- the math doesn't work, MLS has very little to gain.
     
  16. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    sorry I think your math might be a little off.

    Lets first start with MLS. They average over 16,000 per game as a whole but we all know that number includes ticket give aways but for this example lets jut go with 16k. MLS average ticket price is $22 and change, to make the math easier lets just say $22. If indeed the league went to 20 teams the league would play 38 games and 19 total home games.

    MLS average - $16,000
    MLS average tickets - $22
    MLS total home games - 19 (with 20 teams)
    6,688,000 total revenue per year
    MLS cut - $2,006,400

    if MLS sold the club to any franchise owner the hope would be that the franchise could produce at least this much in revenue for the league, others produce lower (Colorado, NY, Dallas, SJ, Kansas) others produce more (LA, Sounders, TFC) but overall this is what they are shooting for.

    If NASL corp. buys a franchise MLS would want a revenue stream of 2M per year from them to reach the average. This is how it can be done.

    NASL plays 32 games. 1 promoted team, and 9 teams in NASL plays each other team 4 times for a total of 32 games. They sell tickets for $12 each almost half the cost of MLS and on par with other minor league sports. For NASL to provide the 2M to their parent company they would need each NASL team to produce $200,000 of revenue for MLS.

    Total games - 32 (dual home and away series)
    Total home games - 16
    Average Ticket Price - $12
    Average attendance - 6,000
    Total Revenue - $1,152,000
    MLS cut needed - $200,640
    MLS cut equivalent - 17.4% of gate (far below gate cut of other franchises)





    From the MLS perspective, they can:
    1. sell a franchise slot to NASL corp. for the same price as any other buyer
    2. obtain a revenue stream on par with current franchise holders
    3. increase media exposure
    4. spread MLS brand to untapped regions of North America
    5. create additional revenue streams by selling future NASL franchises
     
  17. crash2772

    crash2772 New Member

    Mar 18, 2001
    I'm not trying to be difficult, just offer out another perspective... BTW- please do the same for my ideas also. Makes for a better debate from which better ideas will emerge. So by playing devils advocate:

    Why would MLS set an arbitrary standard of 2 million in revenue? There are MLS teams that deliver less $$ now, but EVERY recent expansion team over delivers that easily. As MLS grows, the expectations are growing.

    Furthermore, why would an NASL team buy in for $4 million for their share of an expansion slot, then make annual payments of 200K just to maintain that relationship. All with the hope that someday their team will get a 1 year chance in the big show. On average that's a 6 million dollar buy in for 1 season in MLS (4 Million initial buy in, 1/10 chance so 2 million more).

    If we go back to your argument about the DP slots being used to augment the salary cap for NASL teams, the only way that works in your plan is if MLS allows NASL to have more DP slots than the other MLS teams. Therefore, the fairness/equality factor is out the window.

    Overall, it seems that with the plan you suggest MLS really needs to accept some responsibility for a Division 2. From there a controlled promotion/relegation would be run. MLS would then have an active interest in the performance of the NASL league, its teams, and would certainly exert its influence over the running of the league. Based on what I know of MLS, I think its highly unlikely that they would have any interest in doing something like that. MLS is interested in growing MLS- in expansion markets it wants a strong MLS market, strong financials, and strong fan support-- and based on history no significant changes to what they've been doing (successfully) lately. Why change the system so drastically if it works so well at the moment. Philly, Vancouver, and Portland look ready to replicate Seattle/Toronto success, why risk accepting something lesser?

    Essentially, with all the required changes to MLS rules and systems, and the added responsibility of managing NASL finances as well- MLS ends up with a new franchise that might end up as successful financially as an average MLS team. Certainly on the field, they are allowing a cellar dweller on a nearly annual basis. Lastly, they'd be dealing with a new ownership group every year. From my perspective these factors add up to a no go for MLS.
     
  18. crash2772

    crash2772 New Member

    Mar 18, 2001
    Throughout this thread posters have addressed the benefits to having 1 NASL market enter MLS for a season (or two depending on the ideas), then that team is relegated and NASL promotes a different market.

    I think all the ideas for this (including mine) probably ask too much of MLS. These ideas all ask for many changes to the current MLS structure. I feel that MLS would be hesitant to change their policies about ownership and expansion because the current system has a proven track record. The financial controls in MLS have enabled it to grow slowly and steadily. Each new market MLS enters has been successful, because of the standards MLS now sets when accepting these applications.

    So I offer this question to everyone who wants to participate in this thread- How could MLS work a promotion/relegation with NASL teams in a way that necessitates the least change to MLS' current structure, and also has the right incentive (financial, fan support, etc) to allow the various NASL markets into MLS?

    If there is a solution to this question, then the answer to the original thread question "could NASL buy an MLS expansion slot" could be yes.
     
  19. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    the first question was 'why would NASL buy a franchise spot for 4M and keep paying into MLS for the rights to get a 1/10 chance of going to MLS'.

    The answer to that question is Soccer United Marketing. This is the entity that holds all the media/sponsorship contracts for all of MLS. Owners may break even on the team, but ownership of SUM gives them not only nice checks but checks that keep increasing in value. If you buy your franchise slot of 4M and get 1/10th the pie over time your SUM could keep growing if the sport keeps growing. This could allow for a much more sound business structure than going it alone. Not to mention all the additional fan/sponsorship/media incentives when you become attached to MLS.

    I suggested MLS ask for equal revenue from NASL as the average franchise holder for 2 reasons. #1 it is not guaranteed that #20 slot would produce more than the average even if sold to an independent investor in Atlanta, Miami, NYC, or anywhere else. It is foolish to think that markets will only go up, there is a good chance that #20 wouldn't produce like TFC-Seattle, so it would be beneficial to at least get the average revenue. Also MLS will see value in spreading the brand to 10 markets not just one, so allowing them to be fair and let these small clubs grow is important to the business of MLS. Their hope is that they can get TFC or Seattle success guaranteed not just a roll of the dice. If ST Louis wins NASL and starts to get 20k a game and huge media interest locally, someone will see the value in that and simply invest in AC STL. They can then go to another MLS club, lets say Chivas and say...we will give you $50M if you take our slot in NASL and let us buy your full franchise. At that moment the going rate of franchises will be at least 50M since that is what it took to buy a team out. This increases the value of every team up to a minimum of 50M. Think of it like a stock price. MLS would see the value of the bigger picture...branding, player development, allowing successful clubs to replace les successful clubs and increase the franchise values for everyone.

    The franchise of NASL would need specific adaptions of the rules to allow them to field 10 clubs. Basically allowing them to make more money via NASL (media contracts, sponsors, vintage merch, new franchise sales) to keep them viable. But having markets grow and attract new investors would be a good thing for everyone involved.
     
  20. SignGuyDino

    SignGuyDino New Member

    Aug 6, 2003
    Fletcher, NC
    You are incorrectly presuming the venues in NASL will be MLS quality. MLS will take a credibility hit playing in minor league venues after all the work they have invested trying to get SSS for all their teams. Now of all a sudden they have to focus on 10 new teams needing a better venue for a CHANCE of playing in MLS for ONE year?

    Now, Pro/rel of any sort SHOULD have been done from the start, I would have suggested a hard line of 2 conferences with 2 going up and down in each conference a year, but it's long past a dead idea. It's not happening in any way.
     
  21. Kingston

    Kingston Member+

    Oct 6, 2005
    Unfortunately, there isn't a realistic solution to this question so the answer is "it can't".

    Existing MLS teams won't go pro/rel for all the long-discussed reasons.

    The discussions on this thread have shown the essential impossibility of NASL teams jumping back and forth into the NASL MLS spot.

    The intangible benefits are not good enough for either NASL or MLS to invest the effort.

    In short, it is an interesting idea but not a workable one.
     
  22. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    nasl teams will play in small stadiums. MLS teams are playing in small stadiums now. MLS teams have played in small stadiums in the past. It is a part of business growth. MLS would see the value of increasing media exposure in multiple markets and brand awareness via a national footprint via NASL even if SSS were a few years down the road. Rochester/STL/Miami could all be playing in acceptable stadiums. Even Carolina could be expanded to a nice 10k SSS. Every league in the world has smaller clubs. What MLS would get is value beyond the size of the stadium. As interest grew stadium options would become open. Even if it were in a american football stadiums temporarily or in the Sounders and Revs case permanently.
     
  23. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    the answer is that NASL buys a franchise and operates as a franchise holder. They are in turn allowed to operate a second business operation that includes another soccer league. It would need rule changes but certainly workable.

    What has shown that this is impossible? From a business stand point there is much to be gained from both perspectives.

    I agree it won't happen, but impossible it certainly is not. Traditional pro/rel where franchises owners agree to a risk system is impossible. We know MLS is selling franchises, we know NASL combined owners could buy a franchise. There are rules as far as salary structures for instance that would need to be worked out, but if MLS can brand itself in untapped markets and NASL can attach itself to a sound business structure it is a good idea for everyone. Not likely yes, but certainly not impossible.
     
  24. CleveGuyOH

    CleveGuyOH New Member

    Aug 11, 2009
    Club:
    Columbus Crew
    Nat'l Team:
    United States
    The Real reason it will never work

    Okay- so the 10 NASL teams each have to pay $4 Million, plus $200,000 a year for their right to be a 1/10th owner of MLS.

    I am not sure what you get in terms of money from MLS from SUM, and TV contracts etc, but lets say the annual intake that is divided amongst teams is $80 Million.

    $80 Million/20 teams = $4 Million a share

    The 10 NASL teams split 1 share - so $4 Mill / 10 teams = $400,000.

    So the teams get $400,000 in revenue BACK from MLS. But that's only a net of $200,000 a year.

    In order to break even on their investment it would take 20 years.

    Assume they get some extra revenue from being in the MLS 1-2 times (some will more, others less), and it's probably still 15 years till break even.

    not a sound investment for NASL teams.
     
  25. 4door

    4door Member+

    Mar 7, 2006
    Chicago
    Club:
    Chicago Fire
    Nat'l Team:
    United States
    Re: The Real reason it will never work

    1. SUM would certainly go up. It is sponsorship money, sponsors pay 'per eyeball' on their ad. Increase markets to 19 and 10 smaller markets getting anywhere from 5k-12k that is a heck of a lot more valuable for sponsors than just 15 teams getting 16k. Also by 2012 we should have more SSS, more attendance, and overall more revenue in MLS. Those numbers will be larger than it is today and will keep going up. SUM on any level (1 franchise or 1/10th a franchise) will be a good investment.

    2. You forget about other streams of income dependent on each club, for instance player sales.

    3. You are figuring only averages not bumps in attendance as teams go to MLS. Some teams in NASL would do better than others just like in every league.
     

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