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Bust, Boom, and Hope: July 1, 2011


By Rick Horrow and Karla Swatek

July 1, 2011

“Bust”: Top Five Reasons the Armageddon is Near

1. The Los Angeles Dodgers filed for Chapter 11 bankruptcy protection after MLB Commissioner Bud Selig rejected a proposed TV contract between the team and Fox. The team reportedly didn’t have enough cash to meet its end of June payroll obligations. Selig rejected the TV deal because it hurt the team in the long-term.

2. Chicago businessman Matthew Hulsizer has pulled his bid to buy the Phoenix Coyotes, putting the team back on the market. Hulsizer failed to reach a $200 million bond and arena management deal that would have helped fund his purchase. Two potential suitors remain for the Coyotes, which the NHL has owned since 2009.

3. The USOC has decided not to bid on the 2020 Olympics, nor will the USOC consider bidding on future Olympic Games until a revenue-sharing dispute with the IOC is resolved. The USOC currently gets 16% of sponsorship revenue and 12.75% of U.S. TV rights revenue from the IOC.  Chicago lost its bid to host the 2016 Games.

4. Crown Royal will end its sponsorships of NASCAR and Roush Fenway Racing’s No. 17 Sprint Cup Series car at the end of this season. Fellow liquor brands Jack Daniels and Jim Beam have also left the sport over the last couple of years.

5. Ticket sales for the 2011 FIFA Women’s World Cup are expected to fall far short of the 2007 tournament in China. Just 670,000 of the nearly 900,000 tickets have been sold, well off the 1.2 million seats sold in 2007. The tournament, which is taking place in Germany, runs through July 17.

 

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

1. General Electric has extended its IOC TOP sponsorship through 2020, and the length of the deal coincides with NBC’s new TV rights agreement. A TOP deal, which is the IOC’s highest sponsorship level, costs upwards of $100 million per four years. The IOC currently has 11 TOP partners for the 2012 London Olympics.

2. MetLife is in advance talks to buy the title naming rights to New Meadowlands Stadium, according to Terry Lefton of SportsBusiness Journal. The multiyear deal is valued at $17-18 million annually. MetLife already is paying $7 million a year as one of the stadium’s four cornerstone partners. If MetLife upgrades to a bigger deal, the stadium could resell its corner sponsorship.

3. The NFL is shopping an eight-game Thursday night package to TV networks, according to sources cited by SportsBusiness Journal. The package is valued at $700 million annually, and would provide the league with a new, lucrative revenue stream.

4. Sprint has put together a unique NASCAR promotion that could pay out $3 million. If the winning driver of the September 4 Sprint Cup race in Atlanta won one of the five previous races—Indianapolis, Pocono, Watkins Glen, Michigan, or Bristol—Sprint will give a $1 million prize to the driver, the charity of his choice, and one fan.

5. The University of Washington is seeking $50 million for the title naming rights to its under-renovation football stadium, set to be complete in 2013. The school would prefer to have an individual, family or foundation by the rights in perpetuity, but the school will turn to corporations for shorter-term deals if no buyer is found.

 

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

1. Tiger Woods has signed an endorsement deal with Japanese pain relief brand Vantelin Kowa. The deal is Woods’ first new sponsorship agreement since his much publicized sex scandal in late 2009. Woods plans to appear in Japanese commercials for the company next month.

2. Wasserman Media Group is considering various moneymaking opportunities for its basketball clients in the event of a prolonged lockout. One of the agencies ideas is a “China Basketball Tour” featuring 15-20 of its most prominent players. Among WMG’s clients are Derrick Rose, Pau Gasol, and Russell Westbrook.

3. A growing trend in the sports industry is team-branded restaurants at local airport terminals. The proliferation of team restaurants is the result of concessionaires looking to tie local brands to themed eating areas. Among the teams with airport restaurants are the Anaheim Ducks, Chicago Blackhawks, and Dallas Cowboys.

4. The NHL reportedly is considering a widespread realignment beginning with the 2012-13 season. A popular scenario is one 16-team conference with two eight-team divisions and one 14-team conference with two seven-team divisions. Realigning could create more geographically logical conference.

5. Sports conglomerate IMG is partnering with Brooks Brothers to sell a line of licensed college merchandise. The clothing line will include sweaters, dress and polo shirts and ties embroidered with logos from schools such as Harvard, Notre Dame and Ohio State.




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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.
£13.99
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.
£13.99

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