Greg Lalas mentioned in his most recent article that MLS has yet to turn a profit. I was wondering if anyone has read something about how much longer it will be before MLS is in the black.
I've read that L.A. did turn a profit in '03 and that Columbus has come close in previous years. I'm convinced that the teams playing in stadiums owned by their corporate parent (New England, K.C., Columbus, L.A.) come pretty darn close to breaking even, though the accounting doesn't necessarily credit that profit to the team itself (they may credit it to the stadium, by charging higher rent to the MLS tenant). I expect that once all teams are in similar situations the league will turn a profit overall. When will that be? Hopefully ten years from now. The league really seems to have been taking a more sensible business approach in the Garber years than it had under Logan. Between cutting the teams that were bleeding red ink, being more aggressive in pursuing stadium partnerships and marketing the league and the sport more business-like via SUM, I do give the league office some credit for paying better attention to the bottom line than in the early years. It might mean they're not bringing in a new big name European former-star every year, but I think the league is more stable as a result of it.
the general consensus is: no one has a clue... information (more importantly accurate information) is scarce. It also depends on how you look at it.. Most people (myself at least) care more about turning positive, rather than actually turning a profit.. In other words, is the league can stop LOSING $$$, and create a positve cash flow, gradually paying off debts, they SHOULD in theory eventually turn a profit down the road... To me this is more important than actually "being profitable." I think that investors are on the sidelines waiting for this proverbial "corner" to be turned, so much of the risk is diminished as an investment... In other words, the league will get more investments, once they can prove they are here to stay...
I didnt even want to get into that part of it..That is why I avoided it. This is why it gets so complicated. What exactly are we asking? the MLS as a whole making a profit, or specifc franchises? The equation gets complicate when you factor in AEG and Hunt, etc. Accounting tricks, etc clouds the mess even more...
MLS will turn a profit when the millions of soccer fans in this country actually respect the product on the field. When people stop looking at it as the "USA" trying to play soccer (no skill or passion) and see that we can actually play.
I don't think MLS is on the traditional profit-now business model. They're on the growth model. Not nearly as bad as the old dot-coms, because they have actually sold stuff. The idea is that the league must reinvest all revenue and then some (money from new I/Os) into the growth of the league. If profiting soon were the goal, there would be no talk of expansion or SSS. Both are very long-term investments. If the management woke up tomorrow and said, "we need profitability now!" They would spend all their time trying to sell season tickets, creating gimmicks, and selling sponsorships. Once they hit their target number of teams, I say about eight years after that is the first year in the black. Spending money on growing makes it really hard to profit. There will soon be teams that turn a profit, but not the newer ones.
I think the "turning the corner" point is somewhere between 25 and 30 years of existence. This covers two major spans. One, it outlasts its predecessor, the NASL. Two, it has been around for a generation of Americans.