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Winners and Losers--September 6, 2013

By Rick Horrow and Karla Swatek

September 6, 2013

College Sports

Winner: The NCAA generated $841 million in revenue for its 2011-12 fiscal year, distributing a record $522 million to its member schools. At nearly $700 million, the NCAA’s TV rights deal for the men’s college basketball tournament accounted for 84% of its total revenue.

Loser: University administrators are worried about decreasing college football attendance, according to Jeffrey Martin of USA Today. Though attendance fell just 2% last season, the trend is particularly worrisome as the cost to attend games rises and the home viewing experience improves.

What it means: Declining attendance has been problematic across all sports. What make it even more troublesome for college athletics is there aren’t “team owners” to cover operating losses. When an athletic department loses money because of issues like poor attendance, the shortfall is covered by taxpayers or students.



Winner: The London Olympics were the most lucrative in the IOC’s history, according to Tripp Mickle of SportsBusiness Journal. Boosted by a record $2.6 billion in TV right fees, the 2012 London Games generated a total of $3.4 billion, a 44% increase over the Beijing Olympics in 2008.

Loser: Three years ahead of the 2016 Summer Olympics, the only drug-testing laboratory in Rio de Janeiro has had its accreditation revoked by the World Anti-Doping Agency. The move comes after the lab was suspended this month for repeated failures to comply with necessary standards. Olympics organizers had planned to use the lab for its drug testing.

What it means: It’s unclear what the IOC’s move in Brazil will be. Fortunately, they have an extra couple years to figure out their drug testing plans. By comparison, the FIFA World Cup begins in less than 12 months, and Brazil doesn’t have any WADA-accredited drug-testing labs.



Winner: ESPN has reached a deal to extend its Little League World Series TV rights through 2022. The extension is worth $60 million over eight years, and nearly doubles the previous contract ESPN signed in 2007. ESPN/ABC’s relationship with the LLWS dates back 50 years to 1963.

Loser: MLB owners reportedly are losing patience with the lack of progress in Tampa Bay Rays stadium negotiations. The team wants to build a new ballpark, but is tied to its Tropicana Field lease through the 2027 season. MLB’s revenue-sharing plan has helped sustain the team because of its poor attendance.

What it means: MLB owners can be as frustrated as they want with the Rays stadium situation. The reality is that the team has a long-term lease and a St. Petersburg mayor who’s unwilling to negotiate an out. Don’t expect any real progress in stadium talks in the foreseeable future.



Winner: The NFL has reached a settlement in the class-action concussion lawsuit brought by 4,500 retired players. Rather than be subject to a lengthy and costly trial, the league agreed to a $765 million deal that will compensate victims, pay for medical exams, and fund brain trauma research.

Loser: Denver Broncos fans are unhappy that the NFL has put up large banners of Baltimore Ravens star Joe Flacco on the side of Sports Authority Field in advance of the season-opening game. Typically, the Super Bowl champions begin the next NFL season at home, but the Ravens will open in Denver because of a scheduling conflict with the Orioles.

What it means: With the $765 million being dispersed over 20 years, the total settlement may seem small given the NFL’s long-term TV contracts. However, a win for the players in court was far from guaranteed. With this legal hurdle out of the way, the NFL can redirect its attention on the most important issue: continuing to make the game safer.



Winner: The Indianapolis Capital Improvement Board is giving the Pacers an additional $11 million to help cover the team’s operating losses at Bankers Life Fieldhouse. The Pacers next year will receive a total of $21 million from the CIB, including money to repair the arena.

Loser: NBA Commissioner David Stern brokered a meeting between the rival owners of the New York Knicks and Brooklyn Nets in order to ease tensions. Knicks owner James Dolan has been furious with Nets owner Mikhail Prokhorov since the Nets erected a large billboard next to Madison Square Garden back in 2010.

What it means: Whatever the reason behind the Knicks-Nets peace meeting, the feud between the two teams has done a lot to reinvigorate New York City basketball. However, with the teams likely to split 2015 NBA All-Star festivities, the time is right for the Knicks and Nets to have a better working relationship.

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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.
Beyond the Scoreboard: Chapter 1. The Mega-Master Super Series XLXL eBook chapter

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