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Bust, Boom, and Hope: August 29, 2011

By Rick Horrow and Karla Swatek

August 29, 2011

“Bust”: Top Five Reasons the Armageddon is Near

1. NBA teams can expect to lose at least $1 billion in ticket revenue if a lockout claims the entire 2011-12 season.  Gate receipts generated $1.1 billion for the league last year, and that total is expected to grow as ticket prices increase.  In addition to the lost NBA revenue, arena operators also would have difficulty booking concerts last minute.

2. Unable to reach a revenue-sharing agreement with the IOC, the U.S. Olympic Committee has decided against bidding on the 2020 Summer Games.  The decision not to bid means the U.S. will go at least 20 years without hosting an Olympic Games.  Chicago, Dallas and New York were among the U.S. cities interested in hosting the Olympics.

3. The University of Maryland may have to cut some of its sports teams to address a $1.2 million budget deficit.  The school’s other option is to cut spending across all sports.  Maryland’s athletic department in recent years has been using money from a reserve fund to cover operating expenses, but that fund has since been depleted.

4. University of Connecticut AD Jeff Hathaway resigned amid concerns about his compliance with NCAA rules and several other allegations.  Expect compliance to be a much bigger issue at top-flight athletic programs in the wake of the University of Miami’s scandal.

5. The San Francisco 49ers and Oakland Raiders are ending their annual preseason rivalry after several violent altercations at last Saturday’s game at Candlestick Park.  In response to shootings and fan beatings, the 49ers have decided to ban post-kickoff tailgating, use post-game DUI checkpoints and increase police presence at the stadium.


“Boom”: Top Five Reasons that Prosperity is Right Around the Corner

1. Global delivery company DHL signed a four-year, $66 million sponsorship deal to put its logo on Manchester United’s training jersey.  The amount DHL is paying for the sponsorship is more than most English Premier League teams receive for their primary shirt sponsorship.

2. Boost Mobile and the WNBA reached a multiyear, multimillion-dollar marketing partnership that will see the wireless phone provider put its logo on 10 of 12 team jerseys.  The only two teams not participating in the deal already have a jersey sponsor.  The agreement is the WNBA’s first “marquee level” partnership.

3. College football advertisements have nearly sold out across all networks, according to Jon Lafayette of Broadcasting & Cable.  Nielsen data indicated that college football ad spending increased 6% to $508 million last year, and that total is expected to grow again in 2011.

4. Oklahoma State University will receive $11.1 million worth of shoes and apparel over the next six years after signing a new contract with Nike.  The Cowboys have had a product-supply deal with Nike since 2007.  The deal covers all OSU sports except wrestling and golf.

5. Lambeau Field is expected to undergo a $130 million renovation that will add 6,600 new seats by 2013.  Adding the seats should help the Packers chip away at their 81,000-fan season ticket waiting list.  The team will fund the project on its own, possibly through a stock sale.


“Hope”: Top Five Reasons That Creativity is the Key to Economic Survival

1. FedEx has put images of PGA Tour golfers on trucks in the four cities hosting FedEx Cup tournaments.  The FedEx Cup began last week in Edison, N.J., and will make stops in Boston, Chicago and Atlanta.  The golfers used to promote the playoffs are Phil Mickelson, Bubba Watson, Luke Donald and K.J. Choi.

2. Researchers at Ball State University found that of 360 high schools surveyed, 57% are pursuing corporate sponsors to fund athletics.  Of that total, 3.7% have offered logos on uniforms as a benefit to potential sponsors.  Program ads and stadium signage were the most common benefits reported.

3. The Idaho Potato Commission will spend nearly $2.5 million over six years to title sponsor the annual college bowl game in Boise.  The Commission becomes the bowl’s fifth naming rights partner in the last decade, joining uDrove, Roady’s Truck Stops, MPC Computers and

4. The Columbus Blue Jackets, MLS Columbus Crew and Triple-A baseball Columbus Clippers have partnered with the Greater Columbus Sports Commission to install an electronic billboard.  The billboard will promote all three teams through an advertising campaign called “Game On, Columbus!”

5. Washington Redskins LB Brian Orakpo signed an endorsement deal to appear in ads for Geico.  The deal is the first in which Geico has used a NFL player in a national advertising campaign.  Since Geico isn’t a NFL sponsor, Orakpo cannot appear in his jersey in commercials.

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Beyond the Scoreboard
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.
Beyond the Scoreboard eBook
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.

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