By Rick Horrow and Karla Swatek
July 2, 2012
“Bust”: Top Five Reasons the Armageddon is Near
1. The London Olympics will be the most over-budget Games since Atlanta in 1996. Hosting the Olympics is expected to cost the city more than twice the original $6.5 billion estimate. The high costs of security and low private investment have been attributed for the large funding gap.
2. Despite negotiating for months, the Washington Nationals and regional sports network MASN still aren’t close to reaching a new TV rights deal. The team, citing the San Diego Padres’ recent 20-year, $1.2 billion TV deal, is seeking $120 million a year, while MASN is offering $35 million annually.
3. Santa Clara County has decided to pull $30 million in tax funds earmarked for the San Francisco 49ers’ new stadium, saying it would rather spend the money on teachers instead. While the issue may go to court, the 49ers plan on eating the loss if necessary.
4. Effects of the NBA’s new collective bargaining agreement could end up hurting the small-market teams, according to Ken Berger of CBSSports.com. Because the league has a soft salary cap, large-market teams can still out spend small-market ones. The new luxury tax might be cost prohibitive for small-city teams.
5. IndyCar has abandoned its search to find a replacement for the inaugural China race that was unexpectedly cancelled by a new local government. IndyCar CEO Randy Bernard said he explored other cities, but he didn’t think the circuit could put on a quality race on such short notice.
“Boom”: Top Five Reasons that Prosperity is Right Around the Corner
1. The Houston Astros, in conjunction with the city of Houston, have developed a $40 million civic-focused sponsorship program that has the team’s biggest corporate partners spending money to revitalize the community. Of the money committed to the program, $18 million will go to building and repairing youth baseball fields.
2. The New Orleans Hornets signed a new long-term local TV rights deal with Fox Sports. Financial details were not disclosed, but the deal reportedly is for the low-to-mid eight figures annually. Fox Sports plans to launch FS New Orleans, a new regional sports net, in October.
3. Dale Earnhardt Jr.’s recent Sprint Cup win continues to be good for NASCAR business. Earnhardt merchandise sales on the NASCAR.com website spiked 500% from a year ago, while Michigan International Speedway, home of Earnhardt’s win, saw a 22% increase in ticket sales for its August race.
4. Pepsi is returning as title sponsor of the Super Bowl halftime show for the next four years in a deal valued at more than $7 million annually. Pepsi decided to reacquire the rights for the first time since 2007 because of its effort to link sports and music.
5. U.S. Olympic trials for some marquee sports are reporting record ticket sales. USA Gymnastics and USA Track & Field both reported selling more tickets than they did for the 2008 trials, while USA Swimming’s gross ticket sales exceeded $4.4 million.
“Hope”: Top Five Reasons That Creativity is the Key to Economic Survival
1. Yankee Stadium has become the first sports venue in the U.S. to be covered with a federal Safety Act designation and certification from the U.S. Department of Homeland Security, according to David Broughton of SportsBusiness Journal. The certification protects the team against liability in the event of a terrorist attack.
2. Now that they’ve settled a revenue sharing dispute with the IOC, the U.S. Olympic Committee is expected to create a board to study the feasibility of future Olympic bids. The next two Olympics the U.S. would be able to bid on are the 2022 Winter Games and the 2024 Summer Games.
3. NASCAR is teaming up with HP to open a new social media center at its office in Charlotte. The center will be staffed 18 hours per day and is responsible for monitoring and responding to digital, social, and traditional media. HP is developing the hardware/software system.
4. Rather than handing out thick playbooks, the Miami Dolphins are giving players iPads that can be easily updated as the playbook evolves. Any player found visiting an unauthorized website will be fined $10,000 by the team.
5. Hedge fund manager Chris Hansen bought two new properties in downtown Seattle as he continues to assemble land for a proposed $490 million basketball arena. Hansen is leading the charge to build an arena and bring the NBA back to Seattle.