Major League Soccer Reclaiming Online Merchandise Sales From Franchises

[franchise646]

The reason they make money is because of the disproportionately large TV revenue pool. In the US, you have major TV networks across the country who are willing to pay huge sums to acquire the TV rights for their regions. That all tots up to a vast sum. In Europe, the TV networks extend across the country so you only get one or two TV networks which are willing to pay top dollar and then there's no other TV networks to sell to.

Incidentally, this is also why revenue sharing is not important in Europe - because whichever company wins the TV rights automatically gets it for the entire country, TV companies do not give a flying monkey whether half the teams are uncompetitive or not, because they have access to all the teams' games and therefore are in no danger of only showing uncompetitive teams, and the handful of successful teams have such huge amounts of fans that they can be as unfair in how little they show the minor teams as they want because they can be sure that they'll be satisfying the majority of their viewers by focusing on a half-dozen teams. That means that whether the league is a one-horse race or if all 20 teams might win, the league is going to get the same TV revenue regardless, so the league has nothing to lose.

Yeah in the US we have The Big Networks (ESPN the largest by the mile and then Fox Sports 1 and NBC sports Network) and you have the Regional Sports Networks (RSNs, with YES network being the largest in the country) all pay big money the teams and league and then the leagues spilt up the cash amongst them equity.

 

[FredMertz]

thats the way it SHOULD be

There would be no NFL without revenue sharing. It would have died out 60 years ago.

 

[CP_Scouse]

There would be no NFL without revenue sharing. It would have died out 60 years ago.

i understand that. but now, with the popularity of American football not only in the US, but also in Europe, they could deffinetely get rid of profit sharing.

have the teams make X amount
whatever the teams make, the league (NFL) gets a X amount.

lets say the tampa bay bucs make 4million in one month and they set up a contract with the league in which the leage ALWAYS gets 2million a month reguardless. now the bucs pay the league their 2 mil and they keep 2 mil. Kinda like paying rent

what about the teams who make alot of money one month, but not so much another?
this is where good budgeting comes in.

 

[franchise646]

There would be no NFL without revenue sharing. It would have died out 60 years ago.

There would be no any of the leagues without revenue sharing, Hell there would be no MLS and Soccer without single-entity. The thing is don't use it as cover for no free agency when there are other Single-Entity companies that have a free agency type system in place.

 

[FredMertz]

http://shop.nycfc.com/
http://www.mlsgear.com/shop-by-mls-team-new-york-city-fc.html

they dont even have the same products

I don't follow what you're saying.

i understand that. but now, with the popularity of American football not only in the US, but also in Europe, they could deffinetely get rid of profit sharing.

have the teams make X amount
whatever the teams make, the league (NFL) gets a X amount.

lets say the tampa bay bucs make 4million in one month and they set up a contract with the league in which the leage ALWAYS gets 2million a month reguardless. now the bucs pay the league their 2 mil and they keep 2 mil. Kinda like paying rent

what about the teams who make alot of money one month, but not so much another?
this is where good budgeting comes in.

I believe the competitive balance that comes with revenue sharing and a salary cap/floor goes a long way towards explaining why the NFL is the far and away the most popular and financially successful league in the world.

Sky paid $16mm per game in the much ballyhooed BPL deal that was just signed -- the NFL tv contracts are about $27mm per game.

This ain't socialism -- it's pure capitalism. The more balanced the league, the more revenue for EVERYONE.

 

[mgarbowski]

CP_Scouse - In the UK, when there are 4-6 Premier League games going on at once, are they all available somehow? And are lower league games ever broadcast?

 

[CP_Scouse]

CP_Scouse - In the UK, when there are 4-6 Premier League games going on at once, are they all available somehow? And are lower league games ever broadcast?

im not from the UK sooooooo

 

[mgarbowski]

im not from the UK sooooooo

D'oh. I knew that, even though sometimes your lingo seems foreign and the scouser thing threw me off at first.
But this was just a brain lock, and I meant to direct that question to Falastur : In the UK, when there are 4-6 Premier League games going on at once, are they all available somehow? And are lower league games ever broadcast?

 

[ferrarinycfc]

So this explains why mls gear.com hadn't really been updated in a long time.

If it's being done by fanatics.com then it should be pretty good.

 

[ferrarinycfc]

The service and selection will be much better this way. Each team is a small customer to a 3rd-party vendor, but the league as a whole is a big customer. As we are seeing with the jersey problems, current fulfillment is crap. Chances are they are using soccer.com/Worldsoccershop (the same company -- they also own bigsoccer.com) and, although I've had problems with those guys, I'm betting this will be a better solution for fans, less hassle for the teams, and more money for the league. Win, win, win.

Mlsgear.com is already run by sports endeavors which own soccer.com etc. considering how that site wasn't being updated I'm assuming it will be another group like fanatics.com

 

[Falastur]

I believe the competitive balance that comes with revenue sharing and a salary cap/floor goes a long way towards explaining why the NFL is the far and away the most popular and financially successful league in the world.

Think we'll have to agree to disagree over the NFL being the most popular league in the world. Does anyone actually watch it outside of the US? I know they don't watch it here.

Sky paid $16mm per game in the much ballyhooed BPL deal that was just signed -- the NFL tv contracts are about $27mm per game.

True. Those UK figures are pretty impressive, though, when you consider how much weaker our tv companies are compared to yours, and how they have to bid for national rights, not for just a selection of geographical areas. Also, they're about to sell the foreign broadcast rights now they've sold the domestic, and those usually raise an additional 50% of the domestic figure, making PL games worth a similar amount game-for-game.

This ain't socialism -- it's pure capitalism. The more balanced the league, the more revenue for EVERYONE.

Eh, the "capitalism" tag is really not relevant here considering that the definition of capitalism is just money-making which is not controlled by the government. Sorry to say it, though, but I have to agree with scouse. Anything which operates on a system of wealth redistribution and equality for all is quite clearly socialist.

D'oh. I knew that, even though sometimes your lingo seems foreign and the scouser thing threw me off at first.
But this was just a brain lock, and I meant to direct that question to Falastur : In the UK, when there are 4-6 Premier League games going on at once, are they all available somehow? And are lower league games ever broadcast?

Good question. There's actually a Premier League rule which says that no TV broadcaster (inside the UK - foreign ones are fine) is allowed to broadcast a Saturday 3pm kick-off match. This rule is there to encourage fans to attend the games rather than just staying at home or going to the pub, and it's a pretty important rule for the major fan organisations such as the Football Supporters Federation. The league also strictly restricts what slots games can be showed during and (there might have been exceptions) prevents more than one game from being shown at a time outside of the sat 3pm, so this means that de facto, half the games every week are not allowed to be shown on national TV.

One of our free-to-air TV stations actually tried to take the PL to court earlier this year claiming that that rule is restraint of trade and illegal - they wanted every game to be aired, and fans be damned. Thankfully the courts threw out their complaint, but the league still opened up a brand new Friday evening slot from when the new deal kicks in. Match-going fans are not happy.

You can bet that if every match were broadcast, TV rights would sell for a lot more. You'd probably get several more companies join the bidding, too.

There are some lower-league games broadcast, but only a handful a week, and the TV deal is worth peanuts. The BBC does a decent hour-long summary programme which highlights of every single game in the Championship and Leagues One and Two, though, but it gets broadcast after their PL highlights programme (Match of the Day) and runs past midnight.

 

[mgarbowski]

Falastur thanks for the reply. That sounds like NFL thinking as of 40+ years ago. TV broadcasts were heavily restricted to encourage attendance. When I was very young home games were never televised. When they opened that up they had strict rules about needing a sellout 72 hours in advance or it would not be on TV, which sometimes led to local businesses buying blocks of tickets mid-week to allow broadcasts. More recently they have opened up the rules even more as they realized they made a lot more money off of TV rights than tickets.
But now I think some owners wish they could reverse things somewhat. With home theaters, HD quality video etc, watching at home is more pleasant than attending and some clubs are having trouble filling seats. But it's hard to reverse the process without a fan revolt, and probably politician interference. At this point I don't think the US could accept the limited broadcast rules that the PL enforces. Also, I bet the clubs in the UK are even more jealous about guarding their attendance. There's always a chance (except for a small handful of clubs) that you'll be relegated and lose the TV exposure and money but some folks who are conditioned to buy tickets and attend in person might keep doing so.

 

[Tom in Fairfield CT]

The UK being smaller may play into it too. Your local club, is just that, local. Easy to attend games. In the US, the teams are hundreds of miles away from each other. So if you live in CT, in my example, popping off to the stadium every weekend is really not an option, whereas if the club was in the same town, you can encourage that more.

 

[franchise646]

The UK being smaller may play into it too. Your local club, is just that, local. Easy to attend games. In the US, the teams are hundreds of miles away from each other. So if you live in CT, in my example, popping off to the stadium every weekend is really not an option, whereas if the club was in the same town, you can encourage that more.

Which why TV rights in the US are such a huge deal, why MLS need to keep stadium at max 30K seats and improve on-field play. Also Falastur is right about two things 1) NFL is the most PROFITABLE league in the world not the most popular 2) yes it is a socialistic way to make money BUT because it, they (and the other North American sports leagues) are making more money than every other league and team in the world by a lot.

 

[MikeDatTiger]

That same DCU report has updated to say that the website running the MLS online store will be fanatics. I've had a good experience with them, although I only remember buying from them once. They've done stores for Seattle and Orlando, which you can look at here and look to be decent.

http://proshop.soundersfc.com/Seattle_Sounders_FC_T-Shirts
http://www.fanatics.com/Soccer_Orlando_City_SC_T-Shirts

 

[Goodfella]

That same DCU report has updated to say that the website running the MLS online store will be fanatics. I've had a good experience with them, although I only remember buying from them once. They've done stores for Seattle and Orlando, which you can look at here and look to be decent.

http://proshop.soundersfc.com/Seattle_Sounders_FC_T-Shirts
http://www.fanatics.com/Soccer_Orlando_City_SC_T-Shirts

I've had great experiences with Fanatics, they ship the same day the order is received

 

[Paul]

I've ordered from Fanatics many times (including some NYCFC gear) and they are a first class company. They ship quickly and handle returns/exchanges professionally. On the other hand, I've had numerous problems with the NYCFC online shop (which is run by the Dallas Cowboys merchandise company). So, I think this could be a very positive step.

 

[NYCFCFan10]

LOL

Its smart business.

They still keep track of what is sold for which club but think of it like this: If you have 20 clubs contracted to 20 different sellers then you are paying for 20 different administrations for selling everyone's stuff. If all 20 are contracted to 1 seller as 1 supplier, you are only paying for 1 administration.

Which do you think is more financially sound?

 

[NYCFCFan10]

The reason they make money is because of the disproportionately large TV revenue pool. In the US, you have major TV networks across the country who are willing to pay huge sums to acquire the TV rights for their regions. That all tots up to a vast sum. In Europe, the TV networks extend across the country so you only get one or two TV networks which are willing to pay top dollar and then there's no other TV networks to sell to.

Incidentally, this is also why revenue sharing is not important in Europe - because whichever company wins the TV rights automatically gets it for the entire country, TV companies do not give a flying monkey whether half the teams are uncompetitive or not, because they have access to all the teams' games and therefore are in no danger of only showing uncompetitive teams, and the handful of successful teams have such huge amounts of fans that they can be as unfair in how little they show the minor teams as they want because they can be sure that they'll be satisfying the majority of their viewers by focusing on a half-dozen teams. That means that whether the league is a one-horse race or if all 20 teams might win, the league is going to get the same TV revenue regardless, so the league has nothing to lose.

Ah but I somewhat disagree.

The EPL has been wise to try and add some parity through what, I believe, is the fairest distribution of TV funds of the major European leagues. However, there's only 5 or 6 teams that, essentially, anyone (outside of their base cities) wants to see play. ManU, ManC, Chelsea, Arsenal, and Liverpool. You could make arguments for a couple more like Tottenham, Everton, Newcastle, ect. but the Power 5 are where the bulk of the eyeballs are going. The TV networks take this into account when they pay out. They know the bottom 10 to 15 teams aren't worth much at all when they're not playing the power 5. No one is really watching Burnley vs. Hull City in September or March. They might check one of their last 2 or 3 games but that's it.

So the fact that the same clubs win endlessly and are always in the spotlight limits the value of the league as a whole because there's a lack of quality and interest in the bottom 50-75% of the league.

 

[Falastur]

If that's the case, though, then why do they broadcast six games every match week when there are only five "broadcast-worthy" teams to show? And why have Sky Sports chosen to show West Ham v Crystal Palace this weekend on their main channel in the 12:45pm Saturday kick-off slot, leaving such games as Manchester United v Sunderland unbroadcasted? And also, why are ITV trying to take the Premier League to court to force them to allow every single match to be broadcasted if they don't think there's any value in the remainder of the games?