Monday, May 25, 2020

Garber Memo about leaks... leaks

The Athletic has been reporting on a steady stream of COVID-19 MLS items in great detail over the last few weeks. From plans to play a tournament (and how) in Orlando to negotiations with the MLSPA - it's all there.

Well, as it turns out, MLS is not directly providing that information like they normally do to get attention. All this information has been leaking out to the press without the authorization of the league and Don Garber appears livid about it.

Last Friday Garber sent a memo (which itself leaked to The Athletic) out to the league that threatened termination and fines up to $1 million dollars for anyone leaking information. Later in the memo it states that Garber has hired an investigative firm to figure out who is leaking information.

Two of the writers at the Athletic have very close ties with MLS. One of them even worked and wrote for MLSSoccer.com. My hunch is that they don't have to go asking for this information, close friends that are likely irritated with plans in Orlando, as well as the proposed and current wages cuts, are passing it along.

MLS ON THE EDGE

Garber added that the leaks could “severely imperil the future of our League.” 

As soon as it became clear that this pandemic lockdown was going to last longer than a couple weeks, I came to the conclusion that MLS was likely going to be in some financial trouble. Gameday revenues are the lifeblood of the league as TV deals still have yet to be more than a small fraction of what others get.

Garber's fury at the leaks is a sign that MLS was likely working out something with ESPN and Disney independent of what the NBA is working on (they want the same thing in Orlando). Not so much a competition, but I think MLS was trying to have a more achievable plan than the NBA. Interestingly, the NBA released a very similar plan within a day of the MLS leak.

With large organizations, the top decisionmakers often don't get the details on their desk until it's polished. They are too busy or don't give two shits what underlings are working on. Now that all the information is out there, everyone at ESPN has a chance to evaluate it and give their two cents (ie. kill it) before it has been completely hashed out. This MLS idea in particular looks far from a finished product.

A basic way to imagine the impact is to think of it as a superhero movie that has a lot of leaks. Or the recent video game leak with the Last of Us 2. In my own career, I've had multiple projects torpedoed before all the kinks were worked out. This happens often with ideas that appear abstract to non-stakeholders.

Once it's out there, EVERYONE will poke holes it in and or steal it. Intellectual property should be guarded well.

It wasn't here with MLS, and they will be paying a huge price.

Thursday, May 21, 2020

MLS All-Star Keepsake

My wife brought a Pringles can home the other day that featured the MLS All-Star game that will not be this year (canceled due to pandemic). Pringles has been a fairly recent sponsor of MLS. I see them tagged in VAR Twitter posts.

The cancellation of the all-star game is significant for MLS as it serves as a type of US Soccer trade show where sponsors, media and league employees meet up.

Wednesday, May 20, 2020

MLS is canceling things

MLS announced Tuesday, May 19th, that the All-Star Game vs. a team of Liga MX All-Stars and the Campeones Cup and Leagues Cup competitions have been canceled for this year.

This decision comes after news started leaking out about LigaMX shutting their season down.

None of these events are more than a few years old, but MLS has been making quite a bit of money off staging games that bring in big Liga MX crowds (bigger than regular MLS games).

Don Garber has expressed interest in merging the two leagues amid Liga MX recently suspending their convoluted promotion and relegation system.

I expect the two leagues to attempt to merge ahead of the 2026 World Cup that takes place in the US, Mexico, and Canada.

ANY MLS RESTART UPDATES

Not since last week. There has been no news on either the 20% player pay cut nor the pie in the sky idea of playing a tournament in Orlando.

Sports have started to get going, however. The Bundesliga started back up last weekend. NASCAR held a race. I think there was a horse racing event. Also, there was a charity golf event that hosted many of the sports stars.

MLS, along with MLB, NBA, and the NHL are still in a holding pattern.

Wednesday, May 13, 2020

MLS proposes pay cut, reopening

After leaking out a near 50% pay cut a few weeks ago, MLS has submitted a proposal to the player's union to cut pay by 20%. According to ESPN, if the cuts happen on July 1, players would only lose 20% of half seasons pay. The assumption by ESPN is that players will keep 100% of their pay up to that point.

What this means is that players will lose only 20% of half their year's wages. For the league as a whole, that means somewhere around $30m off the top. For a player like Michael Bradley, who made $6.4 million last year, that would mean a $643k pay cut (20% of half a years pay).

I think it's a leap for ESPN (Jeff Carlisle and Noah Davis) to calculate 20% on a half year's pay. I think MLS would sell it as a 10% cut if that were the case so the medicine goes down easier with the MLSPA. My hunch is that this is a straight 20% cut in overall pay.

Regardless, MLS is trying to get the wheels turning on this to stop some of the bleeding.

RE-OPENING

MLS is still only inching back on restarting some sort of season. The last two days we have seen a few different proposals. The one that keeps popping up involves locking players and staff down in Orlando to play games for weeks.

Nothing about this idea passes the first couple of questions. The first being - cost. Most of MLS income comes from game day activities. MLS will go even deeper in the hole with no fans. The second hurdle it can't get over is locking players into a hotel for a long period of time away from families and friends. Never mind that these are 20-30 somethings and there's no way to lock them down.

Ultimately, these ideas are futile. We are still in the middle of this pandemic, not on the other side.

MAKING MATTERS WORSE!

Last thing here is something you've probably picked up on. MLS is negotiating a pay cut while proposing ideas to get back to playing. "Hey employees, I'm cutting your wages and then going to require you to go into a damn moon bubble for a couple months."

Where the heck is leadership in this? It makes no sense. Get ducks in a row about returning to play and then approach players on a pay cut.

I still contend that MLS should push the start of play to the Fall and flip the calendar. There is a great chance that the NFL will officially open the sports country. Let them do it, then start your season in September.

Friday, May 1, 2020

Voices to shut '20 MLS down?

Yesterday, Portland Timbers and Thorns' primary investor, operator, CEO, and member of various committees and boards across the US Soccer landscape said the following via Twitter:

March was bad. April was even harder.  
But I believe May will give us some positive momentum to start a path back. Advancements are close on treatments/therapeutics & data is suggesting Oregon can soon carefully start managing the lifting of local restrictions. 
Stay strong (emoji flexed arm). - Merritt Paulson 

It is mildly surprising is that only a handful of teams have started laying off staff but the "stay strong" sentiment at the end suggests that there may be some wavering hearts among MLS stakeholders.

With reports starting to emerge that suggest that more than 80% of MLS team's revenue comes from gameday activations/activity, it makes perfect sense for investors to look at shutting it down for the year.

The pressure is on, however. Youth development leagues closing for the year along with, now, bottom tier amateur / semi-pro teams in the 82 team USL2 calling it a year and colleges (which supply many of these leagues with players) mulling whether or not to even have in-person fall classes, the writing may be on the wall for the rest.

For loosely held together leagues like (NISA, USL1, NPSL, USASA) logistics of even fielding a roster might even be a bridge too far, let alone playing games.

WHERE IS MLS-COVID

Two weeks ago Don Garber said conversations with the MLS Players Association were just getting started in regards to player pay cuts - but since then it has been silent on the business front (well, until Paulson's tweet).

It's clear that Garber and MLS have decided, at least in the short term, that MLS would try generating forward-looking COVID related content instead of history/past pieces like best player by jersey number, MLS Classics, and endless clips of the old shootouts. It's always a good thing to look forward, but the slight change is a signal that MLS is trying to own the situation they are in instead of just endure it.

Paulson's comments, the silence from MLS and the MLSPA and the shift in content creation leads me to believe that the league is going to hold fast as long as they can in the belief that there will be a way to play games in front of fans.

I believe this puts the league on shaky ground. I don't think fans will be able to watch games this year. The fear of COVID returning in the Fall will be too great and there will be states that enter into another lockdown situation.

Sunday, April 26, 2020

1st hint of open facilities

A handful of states not hit hard by COVID-19 are starting to make plans to loosen recommended restrictions on the stay at home orders and certain non-essential business closures.

There are a few states that are itching to open up earlier than recommended guidelines by a few days but a rundown of what each state is doing shows that most (outside of the Northeast, Northwest, and California) are going to start slowing opening this week (Monday, April 27).

With that news, the NBA is the first league to start opening facilities in areas where the state is lifting restrictive orders. The NBA is being very careful to word things right in order to not draw the ire of politicians. Opening facilities does not mean that there will be practices, just that players can come to work out, yet will still observe social distancing.



Major League Soccer has not floated any ideas about reopening facilities, but it is safe to say that with the NBA doing it - they will follow.

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Here's a quick rundown of MLS teams that might be able to use team facilities in the next week or so (state by state summaries pulled from New York Magazine):

Atlanta United
Governor Brian Kemp has made the nation’s biggest push to reopen in the country. Starting Friday, April 24, barbershops, gyms, salons, and massage therapists can reopen. On Monday, April 27, restaurants and movie theaters can follow. Despite the loosened restrictions, not all business owners will be reopening.

Colorado Rapids
With its stay-at-home order set to expire Sunday, Colorado moves to a new phase called “safer at home” on Monday, with some businesses allowed to reopen for curbside service. Then on Friday, May 1, personal-service and retail businesses can reopen with strict social-distancing measures in place. Bars and restaurants will remain closed to in-person dining at least until mid-May.

Minnesota United FC
Starting Monday, April 27, some nonessential businesses will begin to reopen in Minnesota. An executive order from Governor Tim Walz applies to “workers in non-customer facing industrial and office-based businesses who cannot work from home,” he said. Walz estimated that this would put 80,000 to 100,000 people back to work.

Nashville SC
Restaurants in Tennessee will be allowed to reopen on April 27, and retail stores on April 29, provided they operate at 50 percent capacity. The loosened restrictions from Governor Bill Lee will apply only in Tennessee counties without their own public-health departments, meaning large cities including Nashville, Memphis, and Knoxville will be allowed to set their own timeline.

FC Dallas / Houston Dynamo
Friday, April 24, will be the first day Texas businesses can offer “retail-to-go” services. This will allow nonessential retail businesses to make sales online or over the phone and deliver products curbside. Governor Greg Abbott has said he will make announcements about additional openings on Monday, April 27.

Columbus Crew / FC Cincy
When the state’s stay-at-home order expires on April 30, Governor Mike DeWine has pledged to begin “a phased-in reopening of the state economy.”

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There are likely going to be some issues around competitive advantage coming along with this. I'm sure that team personnel has already been in and out of offices throughout the lockdown and that means that players have been in as well.

Competitive advantages aren't always in regards to practice and working out. It is also resolving contract issues, bring players back into town to be ready to go. Player evaluations. Etc, etc.

I have a feeling that most will open facilities back up for employees and players within two weeks of this first group but getting the wheels turning for a few of these teams will give them a little edge over the coastal areas that are likely weeks and weeks off letting things open.

Friday, April 24, 2020

Columbus Crew lays off staff

Posting this via bizjournals.com Columbus, Ohio portal.
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With MLS season postponed, Columbus Crew lays off staff, cuts pay

By Hayleigh Colombo – Staff reporter, Columbus Business First

Apr 24, 2020, 5:04pm EDT Updated Apr 24, 2020, 6:32pm EDT

Dozens of Columbus Crew SC staffers will receive temporary pay cuts starting next month because of financial hardships caused by the suspension of the Major League Soccer season.

The Crew has also laid off 11 sales staff members, or 12% of its full-time workforce of 90 people, according to a source with knowledge of the team, and has also instituted a hiring freeze. Seven of the 11 people laid off were temporary workers.

The team is owned by billionaires Jimmy and Dee Haslam, who also own the Cleveland Browns, as well as local orthopedic surgeon and longtime team physician Pete Edwards and his family. The Crew does not release its revenue, but Forbes estimates it to be about $18 million annually.

“The Covid-19 pandemic has dramatically impacted all of our lives, including every business and sporting organization across the country," Crew General Manager Tim Bezbatchenko said in a statement. "In light of this environment, it has become evident that matches played in front of fans are unlikely in the immediate future based on local and national health restrictions. This has forced us to make some extremely difficult decisions that we do not take lightly and are not reflective of the quality of the affected individuals or the magnitude of their contributions."

The pay cut applies to less than half of the Crew's employees. More than half of the employees will not be subject to pay cuts because their earnings are not high enough, according to the source. The salary reductions will be between 10% to 20% of a staff member's salary, with higher-paid staffers taking bigger cuts.

The Crew's decision does not affect players, who are unionized. However, the MLS Players' Association is currently in negotiations with the MLS over a "drastic" pandemic-related salary cut, ESPN reported last week.

The Crew is not alone in its cost-cutting moves, which are occurring shortly after MLS' announcement that play will not resume until June 8 at the earliest. MLS team Real Salt Lake announced job and salary cuts earlier this month. And D.C. United has furloughed some of its workers.

The Crew's salary reduction will be reevaluated in the fall, with the reductions likely reversed if the Crew is able to start playing again with audiences, the source said.

The reduction of 11 sales staffers comes as a result of the Crew's decision to create efficiencies between its Crew sales staff and the staff at Legends, a New York-based planning, sales and hospitality agency. The Crew and Legends inked a deal in 2019 for Legends to handle commercial sales rights for the team's planned Arena District stadium.

That sales staff reduction had been a previously planned decision, but the move has been "accelerated" as a result of the challenging environment, Bezbatchenko said in the statement.

Crew staff members learned about the cost-saving moves Friday.

"Throughout this period, our staff has continued to be tremendous in managing adversity caused by this virus, and we appreciate their resilience," Bezbatchenko said in the statement. "During this challenging time, our thoughts continue to go out to all those affected by the Covid-19 pandemic in our community and across the world.”

NFL Draft Record TV #'s (Ohio is a football state)

Moments like this current pandemic reshape our sports world. Both World Wars and baseball. The rise of urban culture in the 70's and 80's and the NBA. The 94 MLB strike that propelled the NFL to the top. And now? The COVID-19 pandemic leaves us with...

the NFL at the top, still.

Last night's start of the 2020 NFL Draft was the most viewed in league history at somewhere close to 16 million. That's like a World Series AND NBA Final's game wrapped up in one.

It's tough to say where we will be next month, let alone late summer when the NFL gets going. But one thing is for certain - the NFL will be king.

Also. Ohio loves the GRIDIRON



Combine this with the huge numbers for the Michael Jordan documentary and it's easy to see that there is a good deal of demand for sports in this strange time. I see the industry folks getting pretty excited but important to remember - there are a lot more people just sitting around at home right now.

Wednesday, April 22, 2020

USSF DA Dead (Crew)

Last week (aka a lifetime ago) US Soccer announced the abrupt shutdown of the decade-old "Development Academy (DA)" for youth players. This event is worth mentioning because the Columbus Crew Academy was officially a DA program for U14 to 19-year-olds.

Shortly after the public announcement by US Soccer, Don Garber and MLS issued a statement that said they would pick up the slack in MLS areas. So, the Crew will likely just transition over to whatever MLS calls the new academy.

Open questions are things like - What becomes of academies not near MLS cities and Will MLS even have the money to run these types of things in a post-pandemic world - are still open because nobody seems to care enough to ask them or think them through.

On a personal knowledge note, I've never been close enough to the Crew Academy to really speak in-depth on it. I DO KNOW, however, that it is an insular group filled with relatives, coaches kids, former player's brothers, and assorted players that were selected from expensive pay-to-play programs.

Take from that what you will.