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Winners and Losers--May 31, 2013


By Rick Horrow and Karla Swatek

May 31, 2013

College Sports

Winner: The American Athletic Conference will distribute 60% of Big East exit fees, estimated to be about $110 million, to incumbent schools, with the remaining 40% going to newcomers. The conference’s incumbent schools are Cincinnati, UConn, and USF.

Loser: EA Sports used Tim Tebow’s name in several plays in “NCAA Football 10” while the quarterback was still enrolled in school, according to Patrick Vint of SB Nation. EA and the NCAA, which are being sued for illegally using player likenesses, previously claimed no actual names were used in the game.

What it means: The basis of EA Sports and the NCAA’s defense is that they don’t owe college athletes any money because only numbers were used to identify players. However, even without names, it’s clear players in the game were designed to mirror actual college athletes, and the discovery of Tebow’s name only strengthens that argument.

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NFL

Winner: The NFL and Microsoft unveiled a five-year, $400 million sponsorship deal that makes the computer software company the league’s official sideline technology sponsor. Per the deal, coaches will be allowed to use Surface tablets on the sideline for communications, play calling, and to view pictures. The two sides will also develop video games for Microsoft’s new Xbox One console.

Loser: The NFL Players Association is looking into CAA’s relationship with Roc Nation Sports, the agency founded by Jay-Z. At issue is whether Jay-Z is violating the union’s “runner rule,” which dictates that only certified agents can recruit players. Jay-Z is not eligible to become a NFL agent because he didn’t graduate from an accredited university.

What it means: The NFL’s deal with Microsoft has been called one of the “most extensive” in league history. According to SportsBusiness Journal, the deal uniquely blends on-field technology, media-related assets, player health and safety, and traditional branding. If the partnership is successful, it could represent a template for future sponsorship deals.

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NBA

Winner: LeBron James’ signature Nike shoe is the best selling of any NBA player by a 6-to-1 margin, according to data from SportsOneSource. Nike in 2012 generated $300 million in sales from James’ signature shoe, up 50% from sales in 2011. Kobe Bryant’s shoe was the next best seller at $50 million.

Loser: New York City’s Planning Commission denied Madison Square Garden’s request for an indefinite operating permit, paving the way for the arena’s possible relocation. The commission typically grants indefinite status, but only gave MSG a 15-year permit because it eventually wants to rebuild Penn Station.

What it means: It’s amazing how far LeBron James has come since alienating a majority of the country with his decision to leave the Cavaliers for the Miami Heat. In addition to having by far the best-selling shoe in the NBA, James is also the league’s most prominent product pitchman, bringing in $40 million annually from endorsements.

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MLB

Winner: MLB corporate sponsor Chevrolet has purchased the title naming rights to this year’s Home Run Derby. The league had been seeking a new sponsor since State Farm, which held the rights since 2007, decided against renewing. The rights are valued in the mid-seven figures.

Loser: The New York Yankees and New York Mets are seeing sizable decreases in TV ratings for their games. Yankees ratings are down 39% from the same point last season, while Mets ratings are off 22% from last year and are on pace for the lowest figure in broadcaster SNY’s eight-year history.

What it means: While Major League Baseball probably left some money on the table by getting Chevrolet on board just six weeks before the Derby, at least they were able to find a title sponsor for the event. League execs had targeted various insurance companies to replace State Farm, but had been unable to find a taker.

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Golf

Winner: PGA golfer and Oklahoma State alum Rickie Fowler pledged to match the first $100,000 donated to Oklahoma City tornado relief efforts by fans at last weekend’s PGA Tour Crowne Plaza Invitational. Fowler joins other Oklahoma athletes including Kevin Durant and Sam Bradford that have donated to victims.

Loser: Sergio Garcia was condemned by TaylorMade-Adidas, his biggest sponsor, for a racial comment he made about Tiger Woods. TaylorMade-Adidas says it will continue to review the matter, leaving open the possibility of terminating the contract that pays Garcia $5 million annually.

What it means: On the one hand, Garcia’s feud with Tiger Woods is drawing attention to how superior of a golfer Woods is. On the other hand, a feud involving two of the sport’s most recognizable players will help bring in more casual fans. Regardless, Garcia’s comment was out of line, and he should be thankful TaylorMade-Adidas hasn’t dropped him. Yet.




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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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