Why the Power *may* leave Long Island. REVENUE: Ticket Sales: $1,000,000 (Assuming 10 games, 5,000 per game, $20 per head) Parking Revenue: $ 0 Merch/Concession Sales: $ 200,000 (Assuming $5 per person per game) Camps $ 360,000 (Assuming 4 weeks of camp x 300 kids x $300 per kid) ---------- Top Line $1,560,000 EXPENSES: League Escrow $ 780,000 (Assuming SEM 50% of top line, this pays for TV, Players, Marketing etc.) Stadium Rent $ 80,000 (Assuming $8,000 per game) Promotion/Marketing $ 50,000 (Assuming $5,000 per game) Staff Expense $ 500,000 (Taking GM, HC, AC, GC, Sales Staff, Press Staff etc. Figure is low as many of these probably have TW duties too, so the Power get charged a portion of the total) Insurance $ 120,000 (Assuming $12,000 per game) Security $ 60,000 (Assuming 20 guards at $300 per night times 10 games) Office Rent $ 25,000 (Assuming $5000pcm for 5 months) ---------- $1,615,000 These are in the same ball park, so due to many assumptions being made, there could be a profit or a loss, but the point is they are pretty close to break even. Or that is how it would appear. Remember, this is just looking at the balance sheet of the team. AOL/TW are also a part investor in the LEAGUE, which gives them the right to operate the team. So let's do a little more math: There are 8 teams in the league, with the I/O of each team owning a 1/8 stake in the league. They will collect 1/8 of the league profits, and will have to pay up for 1/8 of the league losses for each team they own. I guestimate that the buying-in fee would be $8million. SO the league starts with a pot of $64m. Add corporate sponsorship -- 5 charter sponsors, reportedly at $2m for 5 years, or $400k per year. 13 'other' Sponsors, unclear as to how much they are worth. Be generous, and say average $100k per annum each. Therefor for year 1, corporate sponsorship would be $3.3m Year 1: League has $67.3m in the bank. Reports say the league SPENT $50m in year 1. That leaves $17.3m. Assuming aggressive cost-cutting (moving offices etc. etc.) saves them 20% of their costs, which would be impressive, then year 2 would cost $40m. Add another $3.3 m for corporate sponsorship and what do you get? -$19.4m The eight I/Os have to pony up that amount between them. That works out at about $2.8million per team. They pay up. Each I/O is now down around $11m, for a league with zero cash and effectively no net assets. Then factor in the fact that TW is not doing to well financially. They got killed in the merger with AOL (topic for another day), and wouldn't mind writing off everything that they can get. Assuming the costs of year 3 of WUSA are equivalent to year 2, they would be down another $4.8 million next year. At those rates you could probably buy the team for a nominal fee (say $1m), because you would not be buying an asset, you would be buying a debt with a potential to turn into a profit. Now go back to the figures above. The Power are probably close to breaking even by any conservative measure (they could in fact be losing money h over f) Would *you* want to buy them for $1m, knowing that you'd have to pay about another $5m in league fees this year (as well as 50% of your top line), for a team that cannot turn a decent profit at its present location? However if you were confident that you could up their revenue by 20-30% through better attendance, being able to collect parking revenue and operating in a city with much lower costs (for example Portland), where the star of the team is from your city and a sure draw (i.e. Portland) and where you could probably negotiate a lowered SEM fee to help them save credibility (instead of folding the team), *then* it might be more tempting. That's why I think there is a risk of the Power leaving Long Island. I for one would be sad to see them go.