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Winners and Losers--May 17, 2013


By Rick Horrow and Karla Swatek

May 17, 2013

College Sports

Winner: Fast food chain Zaxby’s has signed sponsorship deals with 25 universities as it attempts to brand itself as “The Official Chicken of College Sports.” The schools partnering with Zaxby’s are concentrated in the Southeast, which is where most of the restaurant’s chains are located.

Loser: Major college athletic departments last year saw operational spending increase by more than $665 million, this despite revenue increasing just $385 million. Of the 228 public schools in Division I, only 23 were self-sustaining, and of those, only seven didn’t receive some sort of subsidy.

What it means: Zaxby’s sponsorships are aimed at challenging Chick-fil-A’s dominance in the college sports space, as Chick-fil-A sponsors a bowl game in Atlanta and advertises heavily on ESPN. It’ll be fun to see who asserts themselves as the actual “official” chicken of college sports.

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MLB

Winner: The National Baseball Hall of Fame has generated lots of digital traffic from its recent online release of scouting reports for thousands of current and former players, according to Eric Fisher of SportsBusiness Journal. The archives are part of a new exhibit called “Diamond Mines,” designed to look at how scouting reports are developed.

Loser: MLB is being criticized for banning pink bats without Louisville Slugger logos on Mother’s Day. Louisville Slugger’s parent company made a large donation to the Susan G. Komen for the Cure, the league’s charity partner, in exchange for pink bat exclusivity.

What it means: Among the players who couldn’t use a pink bat was Baltimore Orioles OF Nick Markakis, whose mother is a breast cancer survivor. With that said, it’s disappointing that a worthwhile cause like breast cancer awareness can be subject to sponsor exclusivity by MLB.

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NHL

Winner: Coors Light has agreed to title sponsor the NHL’s newly created Stadium Series, which will feature six games in outdoor football and baseball stadiums. While terms of the deal weren’t disclosed, Coors Lights already is the biggest sponsor in NHL history, having signed a seven-year, $375 million deal with the league in February 2011.

Loser: The family of late NHL player Derek Boogaard has filed a wrongful death lawsuit against the league. The suit claims the NHL is responsible for the physical trauma and brain damage Boogaard sustained over six seasons in the league. Boogaard committed suicide in May 2011 at the age of 28.

What it means: The Coors Light Stadium Series will generate a lot of money for the NHL, as each game is expected to produce $30 million in revenue. The only concern for the NHL is ensuring that the influx of outdoor games doesn’t diminish the novelty of the league’s signature event, the Winter Classic.

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MLS

Winner: MLS signed a six-year deal with Topps to make the company the “official trading card producer” of the league. Topps hopes to release its first MLS collection this July. In addition to the MLS, Topps also has deals with the NFL, MLB, and English Premier League, among other sports leagues.

Loser: Through the first two months of the regular season, MLS attendance is down 8% compared to last year. Four teams are seeing double-digit declines in year-over-year attendance, lead by Chivas USA, whose attendance at the Home Depot Center has fallen nearly 40%.

What it means: Topps said it was encouraged by MLS’s growth, which made the company that much more interested in the league’s trading card license. With a 20th team on the horizon, rumored to be paying a $100 million expansion fee, MLS might finally be poised to take the next major step soccer enthusiasts in the U.S. have been waiting for.

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NBA

Winner: The Seattle group bidding to buy and relocate the Sacramento Kings increased their offer by $75 million to $625 million, as well as included a $116 million relocation fee, the richest in league history. The increased bid came after the NBA’s relocation committee recommended keeping the Kings in Sacramento.

Loser: The first round of the NBA playoffs saw viewership decline 9% compared to the first round last season. The first round this year averaged 2.96 million viewers for 45 games, compared to 3.27 million viewers over 44 games last year.

What it means: With the backing of billionaire Microsoft CEO Steve Ballmer, the Seattle group has a bottomless supply of money. That said, every time the group throws more money into their offer, it makes the Kings bidding war look worse and worse for the NBA. At this point, the best option may be adding Seattle as an expansion franchise, something Commissioner David Stern appears adamantly opposed to.




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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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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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