Europe is DOOOOOMED... in soccer that is

[the_tyrant]

MLS's Goal is to become a world leading soccer (ok, fine, association football) league with 24 - 30 teams by 2020. I think their goal of becoming a top league is slightly unrealistic in their timeframe, but give them 15-20 years, I can see them become as good as, if not better than the major European leagues, top 3 in the world..

http://www.mlssoccer.com/bestof/2013...o-2-story-year

http://www.mlssoccer.com/sideline/ne..._campaign=Paid




You see, my assessment is based on 3 major things:

1. The collapse of the La Liga, Serie A, and Ligue 1
It is no secret that European soccer leagues are spending way, way beyond their means. Many clubs spend over 100% of their revenue on payroll (business 101 should tell you that it is a bad idea).

The French, Italian, and Spanish leagues are overall in the worst financial shape. I can imagine many of them slowly collapsing. After all, many top European are losing money at the pace of 2 billion per year.

http://www.nytimes.com/2012/01/26/sp...n-in-2010.html

Fully 75% of the richest and best clubs lose money; outlays on transfer fees and salaries among Europe’s top 10 teams were twice those of the next 10. And so it goes all the way down.

Read more: Europe’s Soccer Clubs: The Continent’s Other Looming Debt Crisis | TIME.com http://world.time.com/2012/01/30/eur...#ixzz2pM6fglQV

Southern European clubs are facing the biggest challenge. With Spain being closest to collapse.

Gay, who has produced several studies on Spanish clubs' sorry finances, estimates their debt at 6 billion euros ($7.4 billion).

The 20 teams in La Liga, the elite first division that includes powerhouses Barcelona and Real Madrid, owe more than half that amount. Gay believes at least 10 teams are at risk of going under. Several are already under bankruptcy protection.

The government says teams in the top two divisions owed 752 million euros ($921 million) in unpaid taxes alone last spring, on top of around 600 million euros ($735 million) in missed contributions to the social security system.

http://www.globalpost.com/dispatch/n...occer-football


The amount of debt the big European clubs carry would mean that collapse is inevitable. After all, some day they can't afford this anymore.

The 10 most indebted clubs in European soccer collectively owe $5.74 billion between them.


The 20 English Premier League clubs have a combined debt that has spiraled to $4.45 billion. Fourteen of them lost money in 2008-09, the most recent season for which numbers are available. The financial picture is even uglier in La Liga, in which last year's 20 teams tallied $4.65 billion in debt. Just three of those Iberian bastions of soccer achieved an operating profit: Barcelona, Real Madrid and little Numancia, which was relegated as a reward for its fiscal prudence.


Among 36 teams in the two professional Dutch divisions, only four are deemed financially sound by the Dutch soccer association. Twelve of them, including fabled Feyenoord, are having their troubled finances supervised by the league. As for the other 20 clubs, the league classifies as "worrisome" their state of financial affairs.

http://espn.go.com/sports/soccer/new...-eating-itself



Their financial problems would mean that the top players are looking elsewhere for work. And where better to go than to North America?


2. The hostile work environment in Italy and certain other European leagues

However, even with a mass financial collapse of the top European leagues, compared to the current salary capped MLS, they can still afford to outbid MLS teams for top players. However, that advantage is quickly shrinking.

However, smart managing can help shrink the gap considerably. Now if we look at Billy Beane's management of the Oakland A's as a good example, a good road to success is to exploit market inefficiencies, and find undervalued players.

I would struggle to see how there can be an undervalued young player in Europe. Everybody loves soccer over there, and there are so many tiers of professional, semi-professional, and amateur soccer, it is inconcieveable that there is currently an "undervalued" potential superstar that hasn't been discovered yet.

In North America, there is another issue. Multi-sport athletes would probably not go into soccer. The biggest money sport is obviously baseball. Of the largest 10 sports contracts in history, the only non-baseball player is Floyd Mayweather, a boxer. The highest paid soccer player in history? Lionel Messi, whose contract is smaller than Prince Fielder. MLS players get paid peanuts, making it hard for them to attract young athletes to focus on soccer.

However, there is a massive, undervalued group of players out there. I'm thinking Africa. Its no secret that there is a huge, huge number of athletic youth in the continent who just lacks a chance. That's why all the big sports leagues are scouting the continent, and in some cases like the MLB, establishing training camps.

Many european leagues are at an inherit disadvantage when it comes to obtaining african players.

This season, matches across Europe have been punctuated by repeated racist outbursts, which have led to calls for world governing body FIFA and European counterpart UEFA to show greater leadership and impose harsher sanctions.

http://edition.cnn.com/2013/02/21/sp...lan/index.html

As we can see, there are large numbers of racist fans in leagues like the Serie A. You can say that there are large numbers of racist elements in North America, but sports isn't one of them. Of the top 10 biggest sports contracts in the world (of which all of them are held by americans), only 3 of them are held by caucasians (although A-rod counts for 2 of the top 10).

Fans in North America love athletes who perform well, regardless of race. And this give the MLS a huge advantage when signing players are african descent.

The MLS is going to relax their homegrown player limits soon. After all, the league is expanding at such a breakneck pace, it is unrealistic to demand homegrown players, it would just water down the level of play and strain the amount of talent. They can easily focus on the African players who are undervalued and might be reluctant to go play in Europe.

3. Financially, the MLS will become a powerhouse

Financially, the MLS is doing well, and can only improve. attendance wise, the MLS broke 6 million in 2012 (with 19 teams) averaging over 18000. This means average attendance has exceeded the Skybet Championship, Primera Division Argentina and the Bundesliga 2.

With improving stadium conditions, and increasing level of play, and assuming that attendance is increasing at its current pace, MLS teams can hope to exceed the Serie A and Ligue 1 soon.

And that's just attendance. If the situation with other North American leagues is an indication, TV money is going to surge into the league soon. The NHL just signed a record TV deal with Rogers, 5.2 billion for 12 years.

that's just national TV money, local TV money is arguably an even bigger source of income. The LA dodgers just recently signed a local TV deal worth 6 -7 billion over 25 years.

Truth is, the value of sports entertainment is only going to increase for the TV industry. As you can't torrent live sports, or wait for it to show up on netflix, or tivo it and skip ads. And North America is the prime TV market.


http://www.wolframalpha.com/input/?i...ation+of+spain


The population of the US and Canada is 7.53 times the population of Spain. Sure, Spanish people love soccer a lot more. But even assuming every Spanish person loves soccer, and only 20% of North Americans love soccer, there is still potential for larger TV viewership, and hence larger TV revenue.

And of course, the MLS has a salary cap based on revenue. This means that unlike many other leagues, the teams are not overspending and do not have to devote a huge amount of their revenue to debt service.

With an increase of revenue, MLS's salary cap will quickly shoot up into a competitive rage with the big European leagues (of course, assuming their payroll decreases and they can't afford their overspending anymore)




The numbers don't lie, I first laughed at the MLS for setting their goal of becoming one of the top leagues in the world. Now, I can say that they have potential, enough potential to become one of the top 3 leagues soon.