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Bust, Boom, and Hope: October 3, 2011


By Rick Horrow and Karla Swatek

October 3, 2011

“Bust”: Top Five Reasons the Armageddon is Near

1. A cancelled NBA season could cost TV networks more than $1 billion in advertising revenue.  In particular, regional sports networks could be hit hardest by a lost NBA season because unlike national networks, they don’t have enough quality backup programming to fill the time.

2. MLB Commissioner Bud Selig has threatened to banish the Los Angeles Dodgers from the league if Frank McCourt doesn’t sell the team.  Though Selig would never follow through with such a threat, he has also indicated that the league will reject any TV rights deal that allows McCourt to keep the team.

3. The NHL has lent the Dallas Stars more than $50 million over the last three years to help keep the franchise operating.  The Stars owe creditors more than $200 million, and while the team is on the market, the estimated sale price wouldn’t cover all of its debts.

4. For the second consecutive year, the PGA Tour’s FedEx Cup winner didn’t even know he was in contention for the $10 million grand prize.  Bill Haas said he was unaware of what was on the line as he played in the Tour Championship playoff.  If players don’t understand the FedEx Cup, than neither do fans.

5. Texas A&M is joining the SEC without conditions, but the school will still have to pay a large exit fee to the Big 12.  Per their current contract with the Big 12, Texas A&M’s penalty could be as high as $28 million.  However, other schools that recently left the conference were able to negotiate a smaller fee.

 

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

1. The ACC is likely to reopen its 12-year, $1.86 billion deal TV rights deal with ESPN after adding Pittsburgh and Syracuse to the conference.  Increasing TV revenue was the primary driving force behind the ACC’s expansion, and a new deal could be worth $20-30 million more annually.

2. FC Barcelona’s General Assembly ratified the club’s five-year, $225 million jersey sponsorship deal with the Qatar Foundation.  Despite the magnitude of the deal, some Barcelona assembly members were upset the club was selling jersey advertising for the first time in its 112-year history.

3. A $345 million plan to renovate Nassau Coliseum and turn the surrounding land into a sports and entertainment complex has been proposed by a Long Island citizen’s task force.  The project would also include a minor league stadium, a parking garage, a new indoor ice rink and several retail stores.

4. The Texas Rangers this season set a franchise record for total home attendance at Rangers Ballpark in Arlington.  The Rangers drew just under 2.95 million fans this season, and have seen home attendance grow by 1 million fans over the last three years.

5. AEG has confirmed interest in working with the Sacramento Kings to build a new sports and entertainment complex.  Partnering with AEG could provide Sacramento and the Kings with enough upfront cash to begin arena construction.  AEG reached a similar deal in 2007 to build the Sprint Center in Kansas City.

 

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

1. MLB could add a second wild card team in each league as soon as next season.  The two wild card teams in each league would then hold a one-game playoff to determine who advances.  TV networks prefer this option to a three-game series because of the added drama.

2. The New Jersey Nets formally announced that they’re changing their name to the Brooklyn Nets beginning next season.  To celebrate the move to Brooklyn, the team is leveraging its relationship with minority owner Jay-Z.  The rapper is appearing in a new season ticket marketing campaign, is helping design the team’s new uniforms, and is scheduled to perform the opening concert at Barclays Center.

3. The company that owns MLS club Sporting Kansas City has created a new technology and entertainment consulting business, according to Fred Dreier of SportsBusiness Journal.  Because Sporting KC has such a technologically advanced stadium, the new business will take what’s learned there and consult other sports teams on how to use wireless technology.

4. Hoping to grow their fan base, the Carolina Hurricanes played their first exhibition game at Time Warner Cable Arena in Charlotte.  More than 10,000 fans attended the team’s 4-0 win against the Winnipeg Jets.  Charlotte is located about three hours from the team’s Raleigh home.

5. SEC commissioner Mike Slive indicated that the BCS could change its rule that prevents more than two teams per conference from playing in a BCS game.  BCS games payout $22 million to automatic qualifying conferences, plus an additional $6 million for at-large teams.




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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.
$19.95
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.
$19.95

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