MLS bullish about global growth despite still lagging well behind North America’s biggest leagues
LA Galaxy celebrate after a goal by Zlatan Ibrahimovic against LAFC during their Major League Soccer game at the StarHub Center in Los Angeles, California, on March 31, 2018. (MARK RALSTON / AFP)
As Major League Soccer launched a milestone 25th season over the weekend, the mood was not one of reflection and cautious optimism but bold, even outrageous, predictions of a future empire.
Not content to eventually become one of the most successful leagues in North America, MLS has set its sights on supplanting England’s Premier League and Spain’s La Liga as the world’s top soccer product by the time it celebrates its 50th anniversary.
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Clearly we are expecting that our media contracts will increase. It is a very unique time in the landscape of media
Don Garber, Commissioner, MLS
A splashy 25th season kickoff event on Wednesday at a posh Manhattan hotel overlooking Central Park was not meant as a celebration of the past but of the riches that lay ahead, so there was no need to dwell on a troubling bottom line which is written in red ink.
While all indicators are trending upwards, MLS remains a largely unprofitable venture.
Only a handful of the 24 teams made money last year and even commissioner Don Garber concedes the league will remain a money pit until a new media rights deal is negotiated sometime before the current one expires at the end of 2022.
“I don’t think any owner wants to run a business that is not making money,” Garber told Reuters. “Clearly we are expecting that our media contracts will increase. It is a very unique time in the landscape of media.
“We are entirely upsidedown compared to all the other leagues. Media as it relates to our revenues is frankly the smallest piece of the puzzle and I believe going forward that will change.”
After 25 years, an impressive list of deep pocketed investors, including NFL owners the New England Patriots’ Robert Kraft (New England Revolution) and the Atlanta Falcons’ Arthur Blank (Atlanta FC), are still betting on what MLS might one day become.
The league will add another six teams by 2022 and roll out seven new stadiums custom built for soccer, with owners throwing even more money into academies and infrastructure.
Certainly no one present at the New York kickoff could claim MLS lacks ambition.
In this June 27, 2019 photo, England's football legend David Beckham gestures ahead of the France 2019 Women's World Cup quarter-final football match between Norway and England, at the Oceane stadium in Le Havre, north western France. (LOIC VENANCE / AFP)
David Beckham and Jorge Mas, coowners of MLS’ newest addition, Inter Miami, expect their club to one day be a global brand in the world’s best league.
“I think the MLS will be one of the top sports leagues in the United States.I think it will be on par with the best leagues in the world, the Premier League, Serie A, La Liga,” said Mas.
“As the economics of the league improve and we can compete with those leagues for the best players in the world, I think 25 years from now you will see the MLS as potentially the best league in the world.”
Los Angeles FC managing owner Larry Berg had the same message.
“I think we definitely have the demographics in our favor and I think we will pass baseball and hockey to become the number three sport in the US behind football and basketball,” said Berg.
“Whether we can be a top three league will really at the end of the day come down to money and whether we will be able to compete for players.”
Media rights will be the fuel that drives MLS ambition.
MLS counts itself among North America’s major sports leagues alongside the NFL, NBA, MLB and NHL.
However, when it comes to media rights, MLS is still playing in the minor league coming to the end of an eight year, US$720 million deal with FOX, ESPN and Univision. In comparison, the NHL in 2013 inked a 12year, US$4 billion deal for Canadian media rights alone.
The NBA in 2014 announced a nine year, US$24 billion rights deal with ESPN and Turner Sports, while, according to CNBC.com, the NFL pulls in about US$7.5 billion annually for its media rights, including US$2 billion for Monday Night Football games.
Garber will be seeking something that will put MLS in the same league when negotiations begin.
MLS will find itself in a very competitive marketplace with the NHL negotiating a new US broadcast deal in 2021 and NFL rights coming up for auction in 2022.
Garber, however, believes the MLS can offer something the other leagues cannot: access to the 1834 demographic coveted by advertisers.
A 2017 Gallup poll cited in MLS promotional material found that its popularity with the 1834 age group was up 11 percent, while the NFL, NBA and MLB were all down.
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“I do believe,in the new world, media companies are going to need Major League Soccer as sport content more in the future than they have in the past,” said Garber.
“Secondly, we have an audience that delivers something that most other properties don’t. It’s very young, very diverse, therefore our media partners will need us more tomorrow more than they have in the past."
