by Rick Horrow and Karla Swatek
February 3, 2014
Bust, Boom, Hope: Soccer
Bust: Barclays is considering ending its EPL title sponsorship when the deal expires in 2016. The current three-year extension signed in July 2012 is worth $66.2M per season. The bank is in the process of reconsidering its sponsorship of high-profile events.
Boom: EPL club Manchester United within the next six months is likely to sign a record shirt deal after requesting bids from Adidas, Puma, and Warrior. ManU could receive in excess of $108 million per year, a deal nearly three-times more lucrative than the club’s current deal with Nike.
Hope: David Beckham spent time in Miami last week negotiating with the local government on potential sites for a MLS stadium. Beckham is allowed to buy a MLS expansion franchise at a discounted rate, and he’s favoring bringing a team to Miami. He hopes to have a stadium deal in place by summer.
What it means: Barclays has been an EPL sponsor since 2001. The concern amongst the bank’s execs is that the rising cost of sports rights will make a title sponsorship extension too expensive. It doesn’t help that the original deal was signed under different Barclays management.
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Bust, Boom, Hope: Hockey
Bust: NHL teams and their insurers paid $653 million in salary to injured players over the last three seasons, according to a study published in the medical journal Injury Prevention. The study found that concussions were the most costly injury, amounting to $43 million per year in wages paid to injured players.
Boom: The Ottawa Senators signed a 12-year deal with Bell Media for local radio and broadcast TV rights. The deal increases the Senators’ annual media rights from $7 million to an estimated $33 million per year. Bell and Sportsnet had been in a bidding war for the rights.
Hope: Reebok reportedly could be replaced on NHL jerseys by parent company Adidas as soon as next season. As part of the change, there could be an extension of the league and Adidas’ current contract, which expires in 2017. Reebok has several NHL endorsers including Penguins star Sidney Crosby.
What it means: It’s easy to forget that teams are on the hook for paying players who are out with injuries. The study found that 63% of the 1,300 NHL players who have played at least one game over the last few years has missed time due to injury. Ouch.
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Bust, Boom, Hope: Baseball
Bust: The $300 million Wrigley Field renovation is being held up by the threat of lawsuits from rooftop owners near the ballpark. Part of the Cubs’ renovation plan includes installing a new scoreboard, but the size and placement have yet to be determined.
Boom: Fox is taking an 80% stake in YES Network, increasing its ownership from the 49% it bought in 2012. While terms of the deal weren’t disclosed, Fox originally paid $584 million for the 49% stake. Fox is not expected to rebrand the channel as a FS affiliate.
Hope: MLB has approved a new protective hat for pitchers that will be tested during Spring Training. Players won’t be required to wear the new cap, which protects the skull from balls traveling up to 90 MPH. The protective hat is slightly thicker and heavier than the traditional baseball hat.
What it means: The new hats may take some getting used to, and plenty of pitchers might be late adopters, but kudos to MLB for taking a proactive approach regarding player safety. The hats also will be made available to the general public beginning in March.
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Bust, Boom, Hope: Football
Bust: Super Bowl XLVIII had far fewer volunteers than expected, forcing the NY/NJ Host Committee to bring in paid help. Super Bowl organizers originally expected more then 20,000 locals to volunteer, but the final number ended up being closer to 9,000.
Boom: Super Bowl XLVIII will generate an estimated $210 million in direct spending for the greater NYC area, according to analysis by Pricewaterhouse Coopers. The total marks a record for the Super Bowl, and is the first to crack the $200 million mark since Dallas-Ft. Worth in 2011.
Hope: The Detroit Lions are becoming the first NFL team to introduce variable ticket pricing. The team is dropping preseason ticket prices by 70%, and then dividing its regular season schedule into three pricing categories depending on the anticipated demand of the game.
What it means: The Super Bowl direct spending represents a 13.5% increase over last year’s game in New Orleans. The $210 million total includes lodging, transportation, food and beverage, entertainment, and other activities.
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Bust, Boom, Hope: Basketball
Bust: An NBA official said the league would stop using Adidas sleeved jerseys if players continue pushing back. Though players from multiple teams were consulted about the jerseys, when asked publicly, they’ve been overwhelmingly against wearing them.
Boom: The average NBA franchise is worth $634 million, a 25% increase over last year, according to an annual study conducted by Forbes. The Knicks, Lakers, and Bulls are all worth more than $1 billion, while the league’s 30 teams collectively are worth $19 billion.
Hope: As the Charlotte Bobcats prepare for a name change and rebranding, the team is posting record merchandise sales on Hornets gear. Bobcats execs have said that the three best sales days at the Time Warner Arena store have all occurred in the past five weeks.
What it means: The NBA’s continued growth over the years is a testament to David Stern, who retired as Commissioner this week after 30 years on the job. When Stern first took over the role in 1984, the league’s 23 teams were worth a combined $400 million. Today, the least valuable team is worth $405 million.
