Why is Garber using negotiations from 2004 to discuss contracts in 2017-2018? It is not usual for there to be no-bid contracts because of RoFN. Absolutely not. That whole interview was an embarassing CYA for Garber. He deflected the core issues entirely which was probably his point.
Because SUM's contract with U.S. Soccer ends in 2022. LOL, says who? His RoFN response makes sense if you think about it.
Um, what? This is just flat out incorrect. Garber helped to save MLS from the same fate of every league prior to it. Also, that rise in popularity of the sport, Garber had a lot to do with that. He was one of the people who came up with and helped found Soccer United Marketing. Like it or not, without SUM, Soccer wouldn't be as popular as it is today. The popularity of MLS had been slowly and steadily climbing from 2007 onward. It still has 1000's of miles to go still, but MLS is surely in a much stronger position today than it was in 2002. First, SUM hasn't even been around for two decades yet. What other companies have tried to enter "the space" and been denied access? The USSF signed a contract with SUM, and then chose to extend the contract prior to it expiring. That's much different than not allowing anyone to bid on it. Are you referring to the Ricardo Silva "proposal?" That all sounded great, except one very not so minor detail. The USSF couldn't entertain that proposal because they had a contract with another company. Legally the federation could not entertain that "offer." Further, ESPN, FOX, and the other media partners would sue the federation faster then the USWNT did if the federation actually entertained Silva's proposal. Just stop. Ratings aren't the be all and end all when it comes to sports media rights. For example The AAC's TV deal is worth $83M/yr. It's about inventory of games. There are far more MLS games available to be shown on TV than there are WNBA games. Also, it should be pointed out that there are about as many WNBA games shown on TV as there are USMNT and USWNT games combined each year. So is the USWNT and USMNT worth more than $25M a year? This is a valid question. The NBA has to play as many games as they can if and when the season resumes as they have commitments to their TV partners. That said, their TV deals are guaranteed. As a comparison, Australia's NRL is in a huge financial crisis due to the possible cancellation of games/their season. If they don't provide games, they don't get paid by the media companies. SUM still paid the USSF $30M in 2018 despite their loss of income due to the USMNT not qualifying for the World Cup. Would another media company do the same? None of us know that answer. Those types of things are often written into the contract. I've worked in contract management before, and there is almost always clauses written in contracts to protect not only the client but also the management company. The current climate is going to play a role in media deals going forward, particularly those that are being negotiated (i.e. ones that are expiring) if for nothing else due to the uncertainty of when games will resume. Let's think about this in terms of US Soccer. Olympic qualifying is now postponed. When will those games be played? They might be played during a time that Fox has prior commitments to other clients such as MLB, WWE, College Sports, NFL, etc. That's going to have an impact on advertising dollars, broadcast availability, etc. Nations League, Gold Cup, World Cup Qualifying, etc. are going to need to be rescheduled. Not to mention, there might not be time in the calendar now for friendlies. There might not be as much inventory of games in the next few years, which will impact the TV contract. The USWNT might not have as many opponents available for friendlies in the next 2 years. Most federations don't put anywhere near the amount of money into their women's teams as the US does. The Covid-19 Pandemic is going to negatively impact those federations now too, and they might not have the money available to send their women's teams to play the US. The same can be said for MLS. They likely won't be getting the TV windows they'd prefer if and when the current season resumes. They'll have a lot more competition from the NBA, MLB, etc. for the TV slots that they currently do have. Particularly in the Summer months where they traditionally have only had MLB to compete with for TV time. Going forward, the NBA's stated desire to shift their calendar is going to impact MLS' TV deal. It will also affect the US Soccer teams as well. The NBA gets a lot of money from China. I believe Basketball is the most popular sport in China currently, or at least has been. Nearly a third of the world lives in China. This is why FIFA turns a blind eye to China and the CSL. FIFA wants that money. I'm actually shocked that FIFA hasn't placed a World Cup in China yet. That would have been an easier and less controversial pill for FIFA to swallow than Qatar has been.
you mean the contract that was signed right before Gulati left office? Furthermore, I recall that the terms of the original agreement weren’t papered so it’s interesting that Garber was so definitive on a specific clause. BTW, an RoFN does not mean you get the contract indefinitely. I take it you don’t negotiate a lot of contract with these clauses and other similar ones in them.
I’ve owned companies in the TV ad business and in fact TV ratings pretty much are the most important thing. Filling up TV inventory with low rated programs isn’t something channels are excited about as the ad revenues are unattractive for media companies. usmnt and USWNT games are far more popular than MLS and WNBA games on TV; it’s not particularly close. they are also marque name events that advertisers like to be associated with. Highly rated infrequent events are actually far more valuable than a broad swath of <300k viewer programming. Id guess that the standalone USNT rights would be worth a minimum of $50m/year and probably closer to $70m/year. I’d look at the WNBA as a very good comp for MLS - the word on the street in NY media circles was that the networks were told in no uncertain terms by the NBA to pay up for the WNBA if they ever wanted to compete for NBA rights in the future. what is the AAC? Never mind, I see it’s the conference with UCF, Cincinnati and UConn in it and there’s a clawback if any of these highly popular programs leave the AAC
Don't World Cup sponsors get RoFN? So how does that work exactly meaning who decides what those rights are worth? So MLS/ WC says this is how much we want and the company with RoFN takes it or leaves it with no negotiating?
I'd imagine it's for the major sponsors, like Coca Cola, Anheiser-Busch (SP?), etc. Say Pepsi wants to become a sponsor. Coca-Cola would have the right to negotiate first to renew before another company could negotiate for that sponsorship spot.
Based on what criteria? I'm genuinely curious. The NBA owns and operates the WNBA, so it's in their best interest to drive up the price for the WNBA. The real carrot is the rights to the NBA itself though. This will be interesting to watch seeing as UCONN is returning to the Big East for all sports except Football. It should also be noted that companies like IMG often bundle conference rights together when they negotiate media deals. SUM does the same currently for USNT and MLS games when negotiating. Personally I'd like to see them sold separately. The media partners themselves might prefer that the rights are bundled too. That was a sticking point for NBC during the last go round. They didn't want the rights split between companies. They wanted to be the exclusive broadcaster.
I feel like these discussions get too much in the weeds super fast. A CEO is about big picture stuff. For me, I think you just have to consider you have an organization like USSF that is having PR nightmares all over the place. Employees are disgruntled, the men's team in the toilet, you're needing to fill one of the most important roles in the organization; you need an inspiring chouice who brings something fresh to the table. But your CEO search ends up recycling another insider without experience at the level of job he is taking. No way that's going to be close to an inspiring choice. Hey, maybe it all works out and this guy turns good, but to pretend this isn't a disappointment for anyone who wants reform of USSF is absurd. Also, I hate there's no soccer to talk about. The adventures of high paid sporting executives is far less interesting or exciting regardless.
FFS, the sport of soccer wouldn't be as popular without SUM??? Did you mean MLS wouldn't be as popular?
SUM was founded in 2002. '00s '10s '20s Three decades it has been in existence and for the entire time the marketing rights for USSF have NEVER been competitively bid or even bid. They have been handed to SUM as a subsidy to keep MLS afloat. I don't really buy the mythology of its creation. I'm sure someone would have paid for the rights. Someone paid for the 1990, 1998, rights (and of course, 1994). Now, if you tell me that the offers were so low that the MLS guys saw an opportunity to purchase them at bargain basement price, then that makes a little more sense. But even then, those are FIFA rights. How did SUM come to get USSF rights with no written contract and nobody else being involved? No written contract. Why would Fox, ESPN, and other media sue if the USSF gave the rights to anyone else? Because they want them? So, there is a market out there and the rights are seen as valuable? But, they have just been given to SUM over three decades because? Who has been denied access? You said it yourself: Fox, ESPN, NBC, everyone. Nobody has had a chance to get those rights. Not having a chance to buy something is called denying them.
Folktale: a tale or legend originating and traditional among a people or folk, especially one forming part of the oral tradition of the common people. You know why that is a folk tale? Because there is no written history of any of it. Can he show you the written contract with the RoFN? No, there was none. How did SUM get the rights to the USMNT and USWNT? It wasn't even a part of the tale Garber tells there. Those are rights sold by FIFA. How do the MLS owners go from forming a company and buying, with a written contract, FIFA rights to just being gifted USSF rights? What is the folk tale for that one? I've never seen it written about, discussed by Sunil or Garber, or asked by any media member. Here is another question: How come, when they finally wrote the "agreement" down, in 2017, because litigation forced them to, did the RoFN get dropped and MLS bundling get discontinued? All talk in MLS media is that MLS rights will be a standalone package to be bid on by anyone in 2022.
We’ve covered this ground before in the Cordero thread....take a look at post 55 (I couldn’t link it for some reason).
It seems like you love to just gloss over the numerous times Don Garber, U.S. Soccer and SUM have been openly conversational about their partnership and business procedures. Continue with your folklore this, and fake news that anyway. "Can he show you the written contract with the RoFN?" No, just as I'm not allowed to see your contract with your employer or any other NDAs. That isn't a folktale either, its been well documented and acknowledged by folks asking Garber. AFAIK, FIFA doesn't sell rights pertaining to one's men or women's national program. I don't have any justifiable answer on your second question, sorry. Ask that around, I'm sure they would answer that better than me.
Yes, SUM was founded in 2002. It's 2020, which would make SUM at most 19 years old....a decade is 10 years....Stop playing semantics. The broadcast rights for the USMNT and USWNT are NOT FIFA rights. Those rights are held by the Federation. FIFA sells the rights to the FIFA World Cups. https://www.ussoccer.com/media-services/faqs-world-cup-qualifying-tv-rights They've been denied access??? Doesn't ESPN, FOX and ABC broadcast USMNT, USWNT and MLS games currently? You do realize that SUM does more then just handle media and marketing for the USSF and MLS? They handle the media and marketing for Concacaf, Liga MX and FMF in the US as well. They also handled the Copa America Centenario as well. All of that helps increase the popularity of the sport in America. The money that SUM generates gets directly invested back into the game in the US. Without SUM, there is no MLS. There are no academies. Wirth out an FC Dallas Academy.....there might not be a Weston McKennie, a Paxton Pomykal, a Chris Richards, etc. That's just one academy. In the early 2000's our country did not care one iota about soccer. Unless you paid for a sports tier, you likely couldn't find live soccer on TV. Think about that. Hey, if USMNT fans want to put all of the USSF's failure at the feet of MLS and SUM, have at it. That's your opinion. I'm with all of you that the media rights should be unbundled. Perhaps Will Wilson will lead that effort.
It does reference a 2007 number, but that appears to be the latest figure that FIBA has on the subject (when they did some sort of interview process and extrapolated data from that sample). FIFA references ~265M people playing organized soccer, and FIBA (in 2007) references 450M playing any basketball. I couldn't begin to guess how many of those playing basketball played organized ball. The WNBA number might effectively be equal per game, but the number of games shown is much lower. Without treading back into the research I did this morning, I think it was around 40 WNBA games to 95 or so MLS games. If the WNBA contract is $25M/year, and the numbers per game were similar, then you'd think that the MLS contract would be about 2.5 times the WNBA contract. But I don't know how media people and advertisers value various demographics. I do know that MLS fans trend young, in the age groups that are most sought after by advertisers. So, fairly random completely uneducated guess, to answer your question, I'd think the MLS contract would be about $60M/yr. Given that the current deal is for $90M/yr and includes all MLS, USMNT and USWNT games, then that seems about right. So, if the contracts were split, the USSF would get $30M/yr. How much does USSF get annually currently? Ah, yes: "Currently SUM pays about $30 million a year to the USSF per the federation’s annual report." That seems to validate my completely uneducated guess, based entirely on the value of the WNBA contract.
i understand your logic on per game costs but that's not how TV deals work. For example, most MLS games are shown on two channels (English and Spanish), each of which gets ratings similar to the WNBA and sell ad inventory separately or via pricing that make it effectively so. By that logic, it's 190 games for MLS across the various channels (95 games each using two channels) so they should be making $120m per year by your math (2x your $60m). Maybe they really are subsidizing the USMNT. Let's look at it another way: MLS has shown time and again that it is a ruthless negotiator. I don't hold this against them as I'm a diehard global capitalist (although I believe you are decidedly not). They refused to pay globally standard S/TC fees when it wasn't in their interest and as soon as they started losing money by losing talent in the system, they switched. At the same time of the switch, MLS still refused to listen to FIFA's mandate wrt contract length for Academy players. The thought that this ruthless organization has a joint media contract that is anything but favorable to MLS is laughable - the second the economics are not in their favor, they'd sever the ties immediately. Quite frankly, in sports media buying circles here in NYC, word was that the money paid to the WNBA was effectively a (forced) ante so that ESPN could have a shot at getting NBA rights in the future. At this point, even the diehard MLS fans like @jaykoz3 realize its time to sever the marketing rights between MLS and the USSF - the stink of the conflict of interest is too great and it's time to let each organization sink or swim on its own merits. Hopefully, both numbers will be much bigger than $30 and $60 for the USSF and MLS, respectively.
Maybe a lot of these folks are younger and don't know or believe this. I used to have to go to Salvadoran restaurants in shady neighborhoods to watch US-ES road qualifiers. Every road game was a different adventure.
I agree that Don Garber and MLS are ruthless in their capitalistic exploits. Completely. I also agree that it's entirely likely that MLS has benefited from the bundling of tv rights, and that they'd leave if they thought they could do better some other way. Why would you ask for my opinion on how much the MLS contract should be if you know the answer? It's just a trolling bait-job. You ask for my opinion directly, I'll do my best to give a response. Don't turn it around on me--that's a dishonest way to have a discussion. Just so you and everyone else knows, I'll lay it out clearly in this post. I have never had an opinion on the bundling of rights, and even after reading the posts in this thread still don't have an opinion (though after a few hours of thought and reading I'd lean towards split 'em up). Don't put me into any category regarding this (as much as I know you want to).
lol. I don’t know the answer but I have an educated guess. I do think that your analysis is erroneous albeit logical. we are in agreement that MLS is ruthlessly capitalistic and wouldn’t push for a “no-bid” evergreen deal with the USSF (that was signed at the stroke of midnight before the incoming chairman of the board came in) unless it was favorable to them.
Well, I'm not sure the reason for this was lack of interest. The problem was CONCACAF controlled the away rights, and sold them to interests in Central America. It was not that many World Cups ago when I quietly celebrated Conor Casey's winning goal in Honduras, in a Honduran restaurant. Now you can argue, if there was more interest, US networks would have outbid the foreign ones, but I'm not sure that's the case.
Because that was where they made the most money back then. Selling rights to pay-per-view that took place in restaurants and bars of compatriots of the country the game was being played in. Back then no ESPN, Fox Sports World, ABC, NBC, CBS were interested in paying more than rinky dink pay per view.
You miss the point. There was literally no written contract between SUM and USSF between 2002 and 2017. Just Garber and Sunil having a verbal understanding. It isn't a privacy issue or corporate secrets issue. I've never seen anywhere, in any other industry, where millions of dollars worth of goods and payments were transferred without anything being in writing...legally.
When was the SUM contract actually papered? If it actually was right before 2017, the concept of a RoFN is questionable as that’s a legalistic term for contractual law. sound more like SUM was the only party that USSF considered in the past 10 years even though the sports media landscape changed dramatically since then.
Concacaf doesn't control the away team rights, the host nation of the qualifier does. Until recently, networks in the US did not want to pay the asking price to broadcast those games, and the host nations were making more money from the PPV companies.