Catching Up

BSM is back up and running, following a week on the road and largely successful trip to the 2009 European Association of Sport Management (EASM) conference in Amsterdam. After five days in Holland, a number of interesting and thought-provoking (and hopefully research inspiring) presentations, a second look at Ajax FC of the season, and a chance to outline some new ambush marketing research we've completed this year with the Centre for the International Business of Sport, the blog returns with a few quick items of note to get the ball rolling...

First, in the days prior to the EASM conference, CIBS completed our most recent contribution to the EASM e-Newsletter, reporting on the highlights of the UK sporting world from the summer that was. The following three captions made the final product, in typical blog form:

As British sport enters the fall and the Premier League season kicks off into full swing, we leave behind a turbulent and controversial summer, which called into question the success and stability of football finances, and integrity and honour of English rugby, and the future transfer dealings throughout Europe regarding young players. Further questions surrounding the future of Formula One motor racing and the downfall of sports broadcaster Setanta made for an uncertain summer season, and an interesting one for the sport management world.

To begin, the rugby world was rocked by scandal over the summer, following the incident since labelled ‘Bloodgate’ emerged in late April. During a Heineken Cup match between London-based club Harlequins and Irish rivals Leinster, substitute Tom Williams feigned serious injury by using an exploding fake blood capsule, allowing a substituted player to return to the field. Fall-out from the event led to Williams and Harlequins manager both being suspended and fined, with the manager, Dean Richards, resigning his post in shame, as well as sweeping rule changes throughout European rugby regarding blood injuries. While the incident has succeeded in casting light over a dubious yet acknowledged and common practice, the English rugby world has been left reeling by Bloodgate, undermining the typically gentlemanly and honourable sport’s ethics and reputation.
Clubs introduce blood injury code


Elsewhere, English football endured a difficult summer in transfer dealings, losing a number of high-profile star players to other leagues, not least of which the £80 million transfer of Ronaldo to Real Madrid, and the £30 million agreement between Real and Liverpool over Xabi Alonso. Following years of staggering spending by English clubs, and dominance in Europe over the past 5 years, the economic downturn, uncertain revenues, and the growth of the Euro as compared to the Pound left Premier League clubs little choice but to reduce spending. Estimates of total transfer spending decreased approximately 10% on the 2008 summer window, with Manchester City accounting for nearly one quarter of league spending. Moreover, 2009 saw considerable spending between English clubs, rather than purchasing high-priced talent from outside the Premier League, making net spending in England a pale shadow of previous years.
Transfers down as austerity closes window


Finally, following the close of the summer’s transfer dealings, English football was shocked by the news of Chelsea Football Club’s ban from registering new players by FIFA until January 2011. The two window ban on transfer dealings for the club come after the London side allegedly incited young French player Gaël Kakuta to breach his contract with Lens in order to sign professionally with Chelsea. The controversy and ruling have thus far had serious ramifications through English football, as other big spending clubs have equally been called into question over the influx of young European, South American, and African players being brought to England on professional contracts. Reports have emerged suggesting that European regulations over the signing of players under the age of 18 may be required to govern such transfers, however the success and feasibility of such legislation has yet to be seriously studied.

Chelsea banned by Fifa from signing players till 2011 over Gaël Kakuta

Elsewhere in the news, one story in particular has jumped out over the past couple of weeks, and not only because it's Liverpool related...

As well as equaling (and perhaps eventually exceeding, based on performance bonuses) Manchester United's record shirt sponsorship deal by agreeing a minimum £20 million per year deal with British bank Standard Chartered, rumours and rumblings have emerged suggesting that Standard Chartered will begin to sell Liverpool shirts in their branches in Asia, encouraging a partnership between sponsor and property unlike any other I know. Liverpool's efforts to tackle the Asian market in a swift and meaningful way will be buoyed by the new deal, and word that the club's partnership with Carlsberg and Danish brewer's extended deal with the club for stadium pouring rights, will only serve to reinforce Liverpool's new commercial orientation while maintaining the history, tradition, and community-focus that have underlined the LFC brand over the years.

Hopefully we'll have more to report on the new deal, and the impact the renewed relational approach Liverpool and Standard Chartered have adopted may have on future sponsorship deals, later in the week...

Drawing a Line Under an Embarrassing Summer

Prospect and mini camps are underway throughout the National Hockey League this week, with most main camps expected to open over the course of the next 7 to 10 days, announcing the long-return of hockey, and hopefully bringing to a close the embarrassing and belittling backroom politics and legal struggles that have marred the hockey world over the summer.

Yesterday's news of prospective Phoenix Coyotes bidder Ice Edge Holdings' removal of their anticipated bid means that, as things stand currently, when Judge Redfield T. Baum rules on the future of the organization later this week, the ownership of the franchise will either be transferred to the National Hockey League, allowing them to solicit and secure an owner of their choosing for the failing team, or to Canadian billionaire Jim Balsillie, making the possibility of a seventh Canadian franchise a step closer to reality.

Whatever the judge's ruling this week, the fate of the Coyotes is almost certainly still undecided. Appeals, prolonged legal battles, and the ultimate fate of the Phoenix franchise, be it finding a new owner willing to suffer the losses of an Arizona-based team, or the eventual relocation of the club to Hamilton and the potential conflicts with both the Toronto Maple Leafs and the Buffalo Sabres, will no doubt ensure that this story will continue long into the new season, with little hope of an amicable resolution with the best interests of the game in mind.

The best case scenario, at this stage, would be (in my opinion) an enforced compromise between the two parties, handed down by Baum and held up in appeals court. Award ownership of the club to Balsillie, on the condition that the franchise will stay in Phoenix while preparations are made to Copps Coliseum and the City of Hamilton, as well as any relocation fees, territory infringements on the Leafs and Sabres, and any unresolved personal issues between Balsillie and the league are dealt with. While in Phoenix, the league will split operational losses with Balsillie (as he has already suggested and agreed to, though the notion was quickly dismissed by the league).

Ultimately, after the summer that has been, and the constant back and forth between the league and Balsillie, neither party will escape as a white knight and saviour of the team. Balsillie has shown considerable disregard for the integrity of the league and the sophistication required to run a league by suggesting that he would move the team in mid-season, and has angered Bettman and the league by attempting to secure ownership through what they see as a back door. By contrast, the NHL have shown little respect or willingness to secure the best future for the club or the league throughout the process, treating the court proceedings and Balsillie's bid with disdain and irreverence. Rejecting Balsillie as an owner by vote demonstrated little more than how tightly-knit the Board of Governors is, and what old boys-club politics underline the business of hockey. Moreover, but setting a relocation fee for the franchise rumoured to be in excess of $100 million, the NHL has acknowledged that a Hamilton franchise would be worth more than one in Phoenix, and yet persist with a dream of conquering the Southern United States while dreaming of an ever-elusive national broadcasting rights deal with a major network.

Neither camp can claim a moral high-ground through the summer's events, and one can only hope that upon Baum's ruling, and the inevitable appeals that will follow, the best interests of the fans, the players, and league, and the owners will in some way be addressed. That said, I have my doubts, on all counts.

Elsewhere in league politics, the Players' Assoiation firing of Executive Director Paul Kelly may signal even greater uncertainty and strife in the future for the league, as the PA appear to aiming for a more hard-line, focuses stance going into negotiations for the next Collective Bargaining Agreement. While Kelly was widely regarded outside the union as having been doing a good job, he had seemingly fostered a working relationship with the league and formed a burgeoning partnership going forward. While details of his removal from duty have been hard to come by, there has been speculation that, as with Ted Saskin before him, Kelly had become too close to the league, leaving the players uneasy about any future negotiations. While Bob Goodenow was relieved of his duties for taking too hardline a stance in the last CBA talks, the union appears to be uneasy entering into too close a partnership with the league at this time, and are thought to be seeking an Executive Director prepared to guard the players' interests and rights above and beyond creating a partnership with the league.

Given the league's position in Phoenix, and the projected losses the league would be faced with should they gain ownership, and their objection to moving the franchise to a much more profitable, beneficial market such as Hamilton, one can hardly blame the players for being cautious in their dealings with the NHL. Given that player salaries are now tightly linked to hockey-related revenues, a fact which is unlikely to change in the next CBA, and the negative impact Phoenix has as compared to a Hamilton-based club, the PA's stance appears economically sound, if not the best publis relations. More news should be expected within the coming days and weeks regarding what happened between Kelly and union, but who the PA find to replace him should give a strong indication of any upcoming labour disputes, and the union's stance in builing a partnership with the league hierarchy.

Ultimately, while the return of hockey and the opening of training camps does little to address the legal concerns of the league, the ownership battle surrounding the Phoenix Coyotes, the on-going transfer saga between the NHL and the KHL, or the future direction of the NHLPA, it's it nevertheless a relief for all in involved that at last there's some hope of hockey's domestic issues finally taking a step back, and allow the athletes and games a chance to resume spotlight duty. That said, it would seem unlikely that we've heard the last of the NHL's troubles of this off-season...

Examining Athlete Brands... Part 3: Franchising Brand Beckham??

Reports out of New York this weekend indicated that David Beckham's long-term plans may involve ownership, with Montréal touted as a possible target for the England star and his investors.

According to a story in the New York Times on Monday, Beckham is believed to be considering, and perhaps in the early stages, of forming a partnership with the Saputo family in Montréal, owners of USL Division One team the Montréal Impact, and long rumoured to be interested in acquiring a Major League Soccer franchise. Reports previously had linked the Saputo family with former Montréal Canadiens owner (currently in the process of selling the club to the Molson family) and current Liverpool FC co-owner, George Gillett, whose interest in soccer following the purchase of Liverpool led many to believe a Montréal-based MLS side would be next.

However, Beckham's interest in forming a partnership with Saputo in the football hotbed that is Montréal merits following. As the Times note, included in Beckham's MLS contract, signed in 2007, is the option to become a MLS franchise owner in the future. Beckham's involvement in the sport beyond his playing career has long been a matter of debate, though his series of football academies have proven massively successful in promoting youth soccer and building Beckham's image in the United States.

Major League Soccer have already intimated future plans to expand the league, including hopes of capitalizing on Montréal's interest and the infrastructure already in place, with 2012 rumoured to be a likely target for further expansion in Canada. Beckham's ties to Los Angeles, however, including the formation and success of his football academy there and his links with current MLS owners and investors AEG, may ultimately impact Beckham's eventual retirement plans beyond any early links with the Saputos and the City of Montréal. It remains to be seen how serious Beckham is about becoming a future franchise owner, and what opportunities may present themselves when England's most capped outfield player finally announces his retirement from the game.

Quick Hits to Start September...

Just a couple of quick stories worth following from the world of sports that have emerged the last few days...

First, the National Hockey League Players' Association announced this week that Executive Director Paul Kelly has been let go. While details have been slow to emerge from the PA, a number of Kelly supporters, including former NHLers Pat Flatley and Glenn Healy, have resigned as a result of Kelly's firing. Allegations and rumours in the last couple of days have indicated that Kelly's firing may have been a result of the former PA boss reading the minutes of a confidential NHLPA summer meeting, causing distrust amongst the union and uncomfortable reminders of Kelly's predecessor, Ted Saskin. Expect more of the story to emerge as the news, and the reasons behind Kelly's release, spread through the full membership.

Also of note this week, world football governing body FIFA have imposed a two-window transfer ban on Chelsea FC for inciting breach of contract in signing a French teenager a couple of years ago. While the club has indicated they will appeal, the ruling and the entire situation will hopefully cast a bit more light on the at-times shady transfer dealings in football involving teenagers. It would be naïve to think that Chelsea are the only club guilty of encouraging a young player to break contract and sign for them. Looking out for younger players, and regulating moves involving teenagers in the professional ranks, is something that has to be looked at more deeply by football's governing bodies.

And lastly, Aprils' Bloodgate has rocked the rugby world this summer, with sanctions and suspensions coming down on Harlequins, Tom Williams, the offending player, and 'Quins director of rugby Dean Richards. New regulations to prevent a repeat of the incident, and a new mandate to protect against cheating in the sport have emerged, signaling a renewed interest amongst the sport's stakeholders to clean up the game and restore some integrity to what the gentleman's game.

Expect more reports on all three stories in the coming days and weeks, but equally take heart in the rather aggressive way in which the NHLPA, FIFA, and the ERC (rugby's European governing body) have reacted to the corruption and cheating that have marred sport of late. While there are still plenty of issues in sport to tackle, this is a step in the right direction...

The End of an Era?

September is here, and the transfer window across European football has closed until January, without much fanfare or event. In truth, deadline day become something of a non-event in most circles, with big money having changed hands early in the summer, and clubs looking mainly to fine tune their sides on the final day, rather than overhaul them.

However, the disappointment amongst many football fans eager for a major move raises an important question: have we seen the end of major transfer deadline days and trade deadlines in professional sport, or are we merely seeing the temporary effects of the worldwide economic crisis on sport?

The biggest deadlines on the world sport calendar in terms of player movement, historically, have been the football transfer window closing date(s), the National Hockey League trade deadline, and the Major League Baseball non-waiver trade deadline. Unfortunately, 2009 has seen each of these major dates come and go without much incidence, despite massive media coverage, countless hours of devoted television time, and fan and expert analysis to rival American politics.

In the case of the NHL, this year's comparatively slow deadline can likely be attributed to the salary cap, and teams edging ever closer to the upper-limit of spending. Whereas in previous years, teams with championship aspirations would load-up on talent and take on additional expiring salaries in hopes of winning the Stanley Cup, under the new economic regime, such acquisitions are no longer possible, making trades more difficult to execute. It will be interesting to see if, following next year's Winter Olympics and the attention surrounding hockey in Canada this season, the major Canadian sports networks (TSN, Sportsnet, The Score and RDS) devote the same time to the trade deadline as this past year, and run the risk of another 8 hour broadcast with little news to report.

Perhaps more disconcerting than the NHL's slowing in-season player movement, has been the diminished transactions and spending in non-salary cap restricted leagues such as Major League Baseball, or the English Premier League. Although an important date in the baseball year, and traditionally a day of many rumours and considerable movement, the MLB deadline is perhaps less alarming than the NHL or the European football deadline days. Given that baseball has struggled for years with competitive balance, and that a small number of clubs are able to spend exponentially more than lower level clubs on player salaries, the lack of major player movement is less worrying. That baseball allows moves following the deadline, with transactions based on waivers, and that a number of deals have since been completed in this way, can perhaps appease any worries fans may have.

However, football's slow transfer deadline, and indeed the overall financial figures surrounding transfers in British football this summer, paint a cautious if not unsettling picture of football's standing in the current economic climate.

Without going into great specifics, and not wanting to press the panic button too early and abandon hope of a quick recovery for professional sport, these two articles from the Telegraph and the Financial Times maps out the Premier League's limited spending power, and generally cautious approach to transfers this summer, much better than any analysis I could provide here.

Have we seen the end of big spending in sports, massive transfer deadline days, and unrelenting player movement? Or will Premier League clubs redeem themselves and save Sky Sports News the embarrassment of another uneventful, uninteresting news day in January by once again spending beyond their means, acquiring exciting international talent, and loading up the Premier League for a final 5 month push before next summer's World Cup? Only time will tell...