Wednesday, February 28, 2007

The NFL, the NBA – professional sports and the Big Easy Blues


Try as they may, professional sports just doesn’t get it right when it comes to the Big Easy. In a seemingly never-ending search for trying to do the right thing, the National Football League and the National Basketball Association seem determined to return the New Orleans Saints and New Orleans Hornets to New Orleans on a full time permanent basis. The Saints made it back to the Superdome in time for the 2006 season and the NBA remains determined to see the NBA Hornets return to New Orleans in time for the start of the 2007-08 NBA season. This despite overwhelming evidence New Orleans remains devastated from the terrible aftermath from Hurricane Katrina that nearly destroyed New Orleans 18 months ago.

Tuesday, New York Newsday’s Ken Berger reported that the NBA Players Association executive director Billy Hunter told Berger its not sure thing the 2008 NBA All-Star Weekend will be held in New Orleans where it is currently scheduled to take place. Hunter offered his assessment in part reacting to the lawless NBA All-Star weekend the NBA ‘experienced’ ten short days ago.

"I'm wondering, how will New Orleans accommodate all these people if they elect to come to New Orleans?" Hunter said. "They'll shut the city down.

"First of all, their police force is dissipated. They're probably dealing with half the force they had before. They don't have all the resources that we will need to properly police the city. They've got a serious crime problem as it is. And so what are they going to do?"

Hunter told Berger that he plans to meet with NBA commissioner David Stern in the “immediate” future and unless the NBAPA hears what Hunter wants to hear about the safety of NBA players in New Orleans, Hunter and the NBAPA want the event moved elsewhere and are prepared to take the NBA to court if need be.

"If the union is not convinced that the city can accommodate the All-Star Game," Hunter said, "it's an issue that will be subject to litigation between the union and the league."

The NBA released a statement Tuesday night trying to reassure everyone the 2008 NBA All-Star Weekend will be held in New Orleans.

"We're looking forward to New Orleans playing host to next year's All-Star events and are equally excited about the Hornets' return to the city next season," NBA commissioner David Stern said in the statement. "The reports we have received about other major events and conventions recently held in New Orleans have been very positive, and we fully expect All-Star 2008 to be a great success.

"While progress is still necessary in the continued rebuilding efforts, we hope the return of the Hornets and the coming All-Star game will be part of the rebirth and vibrancy of the New Orleans community."

That may have been the ‘message’ Stern wanted released Tuesday night, but ten short days ago, Stern offered a not to subtle hint about the Hornets long-term future. As part of his “State of the Sport” held as part of the NBA’s All-Star Weekend, David Stern sounded anything but convinced the NBA has a long-term future in New Orleans, but did suggest if Hunter calls Commissioner Stern about where the 2008 NBA All-Star Weekend will be held, Stern’s stands behind the Big Easy.

“We're looking forward to it. We've been checking on other conventions that have been housed there, hosted, and the reports have been very positive and upbeat. Our team will be playing there next season, but I don't want to be Pollyanna-ish. You read in the New York Times that people are -- yesterday's, I guess, front page of the Times -- not yesterday -- yes, I think it was yesterday, actually I've been here a long time. About people just tossing the towel in and leaving. And although sort of politics and government are not our beat, it sure would be nice to see a plan, almost unrelated to basketball, completely unrelated to basketball, to deal with the issues for the people of New Orleans that hasn't been dealt with.

“We want to be good citizens, but we'd like to see just something that takes care of the displaced people and a place that hasn't really made a lot of progress, because it really is not going to be that much fun to be there if progress hasn't been made, even though it won't affect our visitors. We think it's time to move past having this wonderful tourist ability, a great convention center, and a covered arena, and then you take your guests on tours of areas that have been devastated and where it seems like very, very little has been done. We don't understand it.

“But that doesn't stop us from being behind our Hornets, having worked with them to have a sponsorship lineup that is going to be better and larger than it was before they were displaced and working to have ticket sales that will be very robust. But that's going to be, to me, we'd love to be part of the rebirth and vibrancy of that community rather than something that is an exception to what's going on.” Stern said

When pressed about the long-term viability of the NBA in New Orleans Stern didn’t mince his words.

“Well, you know, what we said to the folks in New Orleans was we are concerned that we would like not to come back and not be successful. And that's why we're putting in enormous efforts into the return of the team, to using All-Stars, to combine and have sales with and tickets and corporate sponsorships, Crescent City Partners. I've been down there. I've met with potential investors. I've met with potential sponsors. I've met with season ticket holders, Suite holders, you name it.

“I think we can probably make it work and we're very optimistic about that. But it doesn't make me feel so good when I go down there and see the inaction for the people in New Orleans. But we're not going to be part of the problem; we're going to be part of the solution, if there's a will in Louisiana and New Orleans to solve the issues.”

Nonetheless the Hornets continue to move forward with their plans to return full-time to New Orleans at the start of the 2007-08 NBA season. The Hornets announced over the weekend they will launch their 2007-08 season ticket sales campaign on March 5. Hugh Weber, the Hornets' chief operations officer, told the New Orleans Times Picayune some of the teams’ prices will reflect the costs what tickets were in 2004-05 the last full season the Hornets played in New Orleans. Weber also suggested the Hornets sales staff will ask some of its longstanding and more influential season ticket and suite holders if they’ll get directly involved in the sales process.

“We will basically ask them to host an event. We'll go to their event. We ask them to invite their friends and family," Weber said. "From the Hornets, we would give them an insider to make it a benefit for them to show up."

“It's a chance for us to get in front of folks in the community who could be potential season-ticket buyers. We'll probably host some ourselves, and we'll go to their homes, country clubs or place of business. I would describe it as a town-house-type setting to put a personal face on our efforts.”

If Hunter follows through on his intent to move the 2008 NBA All-Star Weekend the result would seriously impact Weber’s sales efforts. A key component to the Hornets return to the Big Easy sales campaign will include guaranteeing anyone who purchases Hornets season tickets for the 2007-08 season tickets to at least one 2008 NBA All-Star Weekend event.

"We're trying to reintroduce ourselves," Weber said. "The first phase of these was doing a data dive on who these people were and what was important to them two years ago and what they've done in the last two years, like have they bought multiple six-game packages.

"We're reaching out instead of just sending a letter and invoice, which a lot teams do in their renewal campaigns.

Friday, the San Antonio Business Journal reported San Antonio still has a chance at landing the New Orleans Saints. San Antonio’s Alamodome was home to three Saints home games during the 2005 season when the Saints played their entire home schedule away from New Orleans directly as a result of the aftermath of Hurricane Katrina.

Former Vikings Owner Red McCombs, a San Antonio resident suggested time was of the essence if San Antonio wanted to make a move on the Saints and pointed out the obvious – there are many issues facing the Saints long-term future in New Orleans.

As was the case when David Stern delivered his “State of the Sport”, at Super Bowl XLI NFL commissioner Roger Goodell was asked how he viewed the Saints future in New Orleans.

“I think the whole New Orleans Saints and the Gulf Coast region has been a great story for the NFL this year, not just because of the Saints success on the field, but also because of what you're seeing the team has done for that community. It's obviously a community that was tragically impacted. It is still going through a recovery period.

“But we're very proud of the fact that Tom Benson brought his Saints back there very early last year, before we even knew we had a place to play. And the league, Tom Benson, and the rest of us participated in trying to get that stadium back and running, which was identified as one of their primary objectives in New Orleans by the governor.

“And we're proud of the fact that we got that facility open. It created new revenues for that community, it brought hope back to that community. The Saints brought hope back to their community, and people like Drew Brees and his wife, have done great work there. We're proud of what the Saints have done and our hats are off to Tom Benson and his group for doing it.”

The good news, the Saints’ current lease keeps them in New Orleans for at least the next three NFL seasons. However, the ‘fine print’ the language included in the Saints current agreement permits the Saints to walkway from their current lease agreement as long as they serve notice by March 31, 2007.

The bad news, Saints owner Tom Benson wants a new state-of-the-art stadium for the Saints. It costs more than $185 million to renovate the Superdome following Hurricane Katrina. Taxpayers contributed more than $165 million, with the NFL adding $20 million.

"Our people are in talks," Louisiana Gov. Kathleen Blanco told The New Orleans Times Picayune declining to elaborate. "I think we are going to get a consensus (for the Saints) to stay at least through 2010," the year the existing contract tying the Saints to the Superdome expires. That contract allows the Saints to opt out of the deal by March 31, but the team would have to repay about $70 million the state has provided for a practice facility and annual inducements to the team.

Blanco said she is optimistic the Saints will not cancel the contract next month.

"We are hoping that they don't," Blanco said. "I feel like discussions are leading them to staying until at least 2010."

Frank Vuono, a sports marketing consultant hired by the NFL, assisted the Saints in securing a naming rights partner for the state-owned Superdome discussed the Saints future in New Orleans with the USA Today prior to their return to the Superdome on September 25. He believes a deal could be worth $4 -$6 million a year to the state; most new stadium deals average 20 years. The Saints had aggressively tried to sell the Superdome’s naming rights before the facility hosted its last Super Bowl in 2002. The Superdome’s corporate naming rights have never been sold.

"There's no way the Saints can be long-term viable in New Orleans without more corporate sponsorship," says Vuono, who has worked on nine NFL naming rights deals in a USA Today report "We're getting good response from five, six corporate sponsors. But when they saw the record ticket sales, it took away the sense of urgency. There's still urgency."

"The Superdome naming rights would be the best move a national company could make," Vuono says. "The Saints' home opener is on a Monday night. All eyes will be on New Orleans and the grand reopening of the Superdome.

"The exposure that company will get will be damn near the equivalent of a Super Bowl. And companies pay $2 million for 30 seconds of advertising during the Super Bowl."

The problems the Saints had before Katrina have only been magnified. The Superdome has 137 luxury boxes; it has been years since the boxes have been sold out for more then the occasional game. The cities population before Katrina had fallen below 500,000. It’s a safe bet the population in New Orleans will never again approach 500,000. Thousands of businesses have left the Big Easy, and they’re never coming back.

On the positive side, the Saints still have a great lease. They pay the City of New Orleans $1 million a year in rent and retain every dollar of revenue the Superdome generates. And that $12.5 million taxpayer subsidy made to keep Benson happy in 2001 has increased to $18 million a year. And remember its nearly impossible for an NFL franchise to lose money given each NFL franchise receives $106 million a year in television revenues and the league shares 83 percent of all of their revenues.

''The Saints are everything to this community,'' Michael Siegel, a New Orleans developer told the New York Times last February, ''but Tom Benson is a businessman at heart and not a sports enthusiast.''

Gov. Banco made it clear the Times Picayune two weeks ago while she wants and believes the Saints should remain in New Orleans the state isn’t prepared to provide any additional funding for the organization.

Gov. Banco did suggest the state would consider additions near the Dome "would be the next level of comfort" for football fans. "I am open to that kind of discussion, but I don't know what kind of obligation they would be looking for from us," Blanco said.

Blanco would not say how much the state would be willing to commit.

"We are not going to enhance the money" in the existing 10-year, $186.5 million contract, which includes annual cash payments to the team and construction of a $6.7 million practice facility.

No one directly associated with the National Football League or the New Orleans Saints seems prepared to commit the Saints will be in New Orleans beyond the 2007 season. There remains a real possibility the Saints could move to a new home in time for the 2007 season, although logistically that may be next to impossible.

Every single indicator points to the Saints leaving New Orleans in the very near future, no later than the end of the 2010 season. It never made any sense for the NFL to return to New Orleans for one season only to be faced with the same challenges the franchise had to deal with before Katrina. The only difference – the terrible toll from Katrina, $20 million spent by the NFL and $165 million by Louisiana taxpayers to fix the Superdome.

Just how embarrassing is it going to be if when his March 31 deadline arrives in a months’ time, Tom Benson announces he’s moving the Saints? Try and imagine what could have been accomplished with the $185 million invested in one or two seasons of NFL football in New Orleans? The Saints returning to New Orleans for a few seasons should be considered offensive to anyone with a sense of decency. New Orleans is going to return to its former ‘glory’ as one of America’s great destination cities. That isn’t going to take place today, tomorrow or for many years to come, but it will take place. To pour hundreds of millions of dollars into sports facilities and into sports teams is a catastrophic decision of biblical proportion. Bring the 9th Ward back to life, fix the schools, take care of the people and then focus on sports teams.

For SportsBusinessNews.com this is Howard Bloom. Sources cited in this Insider Report: The New Orleans Times Picayune

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Tuesday, February 27, 2007

The NBA goes where no sports league has gone before – brokering their tickets


Monday the National Basketball Association went where no major professional sports league has gone before openly endorsing the burgeoning secondary ticket marketplace. The real question is, if it looks like a duck, sounds like a duck and walks like a duck is it a duck. Or in this case, if a ticket to a sports or an entertainment event is sold above the listed face value printed on the ticket is it a ‘scalped ticket’? If a ticket is sold as part of a package that includes transportation, accommodation or other goods and services a pretty strong argument can be made the reseller has put together a package for that event. But if anyone, business or individual, street corner hustler or multi-billion dollar Internet based business, offers only a ticket to an event above the listed face value than in fact that is the definition of what ticket scalping has always been about.

"Fan resale of tickets has become ubiquitous and the NBA shares our position that every fan expects and deserves to have the right and the ability to resell their ticket to the extent permitted by law," said Sean Moriarty, President and CEO of Ticketmaster. "We're pleased that the NBA has selected us to provide this league-authorized service. The NBA has tremendous brand recognition across the country as well as the world, and they recognize that fans identify the brand to their event ticketing experience. This League-wide agreement encourages greater protection, choice and flexibility for fans and makes it easier and more cost effective for the League and its teams to connect with those fans directly."

"Ticketmaster is providing NBA teams with the most innovative ticketing services and products for reaching our fans," said Adam Silver, NBA Deputy Commissioner. "Working with Ticketmaster has set the NBA on a course to achieve record numbers of season ticket and attendance for the fourth consecutive year."

"Phoenix Suns fans know to go to Ticketmaster as the one stop shop for tickets to attend Suns games," explained John Walker, Sr. VP - Business Development, Phoenix Suns and US Airways Center. "Whether fans are buying their tickets from us or from other fans through TicketExchange, at Ticketmaster they are assured a valid authentic ticket that they know will get them in to see the game. Our Box Office has also seen a significant reduction in reports of fraud. Suns fans have a team-authorized channel to buy and resell tickets through Ticketmaster and we're very pleased to see the service rolling out across the entire League."

Is it against the law to resell tickets above face value? According to a report in Monday’s USA Today: about 15 states have anti-scalping laws. Massachusetts, for example, bars the resale of tickets above face value. Ticketmaster CEO Sean Moriarty says his company's online platform's software won't process a transaction if it violates the law. Now, "People are going to buy more tickets and feel better about it," Moriarty told the USA Today. Legalities aside – is it moral and ethical for any sports league to directly associate itself with the practice of selling its tickets above face value?

In the United States, ticket resale on the premises of the event (including adjacent parking lots that are officially part of the facility) may be prohibited by law, although these laws vary from state to state and the majority of U.S. statehoods do not have laws in place to limit the value placed on the resale amount of event tickets or where and how these tickets should be sold. Ticket resellers may conduct business on nearby sidewalks, or advertise through newspaper ads or ticket brokers. Some U.S. states and venues encourage a designated area for resellers to stand in on or near the premises, while other states and venues prohibit ticket resale altogether. Resale laws, policies and practices are generally decided, practiced and governed at the local or even venue level in the U.S. and such laws and or interpretations are not currently generalized at a national level.

Another issue in the United States is that since ticketing laws vary state by state, many ticket resellers use a loophole and sell their tickets outside of the state of an event. Therefore, a ticket reseller who is reselling tickets to an event at New York's Madison Square Garden is not subject to New York State's markup laws as long as the sale takes place outside of New York. The majority of ticket brokers in the New York metropolitan area have their offices in bordering states New Jersey and Connecticut for this reason.

Online auction sites like eBay only enforce state ticketing laws if either the buyer and/or seller reside in the state where the event is taking place. Otherwise, there is no resell limit for tickets.

Scott O’Neil the NBA Senior Vice President, Team Marketing and Business Operations spoke with SportsBusinessNews Monday evening addressing a number of different issues relating to the NBA’s announcement Monday. O’Neil made it clear the NBA decision wouldn’t impact the existing relationships StubHub has with the Charlotte Bobcats, New Jersey Nets, the Portland Trailblazers and Washington Wizards. The four NBA franchises each have team partnerships with StubHub. StubHub is also an in-venue advertiser with the Dallas Mavericks but their relationship with StubHub (at least officially is limited to that of an advertiser).

O’Neil tiptoed around several of the questions SBN asked, including if this is an indication that the NBA has no issues with tickets being sold above face value (often referred to as 'ticket scalping). “The market exists and is growing at a rapid clip. Currently, there are millions of NBA tickets posted across the web in the secondary market,” O’Neil told SBN.

O’Neil didn’t answer the question relating to what the NBA defines as “ticket scalping” but did answer this question asked by SBN, concerning the message the NBA is sending out to basketball fans about tickets being sold above face value.

“Don't think it is a message other than we understand market forces (supply and demand). With an all-time record attendance set again this year (4th year in a row) and season tickets being sold and renewed at a record pace, we want to make sure that fans wanting to experience the greatest athletes in the world, playing the world's most exciting game have that opportunity...and we get to build a connection.” O’Neil the NBA’s Senior Vice President, Team Marketing and Business Operations told SBN Monday.

If Monday was a day of reckoning for the secondary ticket marketplace, how do secondary ticket operators feel about the next step in the evolution of the ticket reselling business?

“We wonder if it is in the best interest of NBA fans that a company which controls the primary ticket distribution is also now being promoted by the league as the secondary market solution as well? It’s positive in that it will further expose the secondary ticket market to fans for which we think StubHub has the best solution. We continue to see substantial year over year sales growth for team’s that already have TicketExchange as their official provider,” StubHub’s Sean Pate told SBN.

“We definitely view this latest move by Ticketmaster as a benefit to our business as well as to the industry in general. There remains a great need for consumer education as it relates to the secondary market for event tickets (TicketsNow has produced and released a PSA specific to this topic), but more and more sports fans, concert-attendees, and theater-goers are becoming aware of – and embracing – the secondary market for event tickets. The Ticketmaster announcement only helps to further legitimize our company and our industry,” Jennifer Swanson TicketsNow.com Director, Marketing and Communications said.

“It certainly was exciting news for the secondary industry. In answer to your questions… the announcement/relationship bodes well for our company as it brings more visibility and interest to the secondary market. It also reaffirms corporate America recognizes the potential for the secondary market and confirms the industry and online platform as a valid and viable arena to conduct business” Razorgator.com spokesperson Julie Reynolds told SBN.

One of the more interesting industry trends that exploded in 2006 and clearly will remain very much a part of the business of sports in 2007 (and well beyond) is the secondary ticket marketplace. Monday’s announcement by the NBA clearly reinforced that development.

In their never-ending search for new and innovative sources for potential revenue (the leaving no stone unturned economic philosophy) the completely unregulated ticketing ‘service’ professional and college sports teams believe is in the best interests of their supporters. If selling tickets above face value is in the best interests of sports fans then the business partnerships sports franchise have developed with StubHub, Razorgator, Ticketsnow.com and the other ‘companies’ that have emerged in the last few years are in the best interests of the consumer.

It is simply a matter of the law of supply and demand? On November 28, the New England Patriots filed a lawsuit in Suffolk Superior Court against StubHub and two Patriots season ticket holders for what the Patriots believe is the illegal resale of tickets to Patriots home games. According to a report in The Boston Globe, the Patriots are seeking an award of three times the revenue StubHub and the other defendants brought in through the online sales, plus an injunction against further resale of Patriots tickets on the StubHub website.

And here’s where the NFL is normally the master of their own domain when it comes to everything associated with the National Football League and better begin to understand the scope of the problem the league will be facing in the not too distant future.

The Patriots entertained the Chicago Bears Sunday afternoon November 26 at Gillette Stadium. The Bears are one of eight NFL franchises who have a partnership agreement with StubHub. The other seven teams: Atlanta Falcons, Cincinnati Bengals, Detroit Lions, Houston Texans, Indianapolis Colts, San Diego Chargers, and Washington Redskins. How in the minds of the New England Patriots can StubHub be considered ticket scalpers, but are partners with the franchise the Patriots played on that Sunday in Foxboro. One of the keys to any sponsorship is doing what you can to reasonably help your partners business grow. Would it not be incumbent for the Bears to have directed Bears fans who wanted to attend Sunday’s game in Foxboro to their partner StubHub if they were interested in tickets to the sold out game? However, what happens if football fans directed by the Chicago Bears inadvertently become tangled up in the Patriots/StubHub lawsuit – what message is being sent out?

The Washington Post reported that StubHub pays the Redskins $5 million annually for their sponsorship. StubHub retains all of the revenue from the resale of Redskins tickets. A $5 million sponsorship fee is very important to the Redskins, but given the Patriots lawsuit against StubHub is a real potential problem.

Its funny when you ask anyone directly connected to the secondary ticket marketplace if they believe Monday’s announcement is a trend (leagues signing deals with secondary ticket brokers) to watch for, their first response is to try and put you in your place.

“Let’s be clear on differential between traditional ticket “brokers” and the marketplace that StubHub operates. The former takes inventory strictly to resell where StubHub’s model is to manage transactions in the provided marketplace and guarantee those purchase against delivery or fraud issues.

“Because the NBA chose Ticketmaster for this marketing deal does not preclude teams who desire a better fan offering and a more endearing brand name to choose to work with StubHub. Teams will continue to sign with StubHub for Official Ticket Marketplace relationships for these reasons as well as the issue of not wanting one vendor to retain both platforms. Whether or not other leagues sign endorsement deals for the secondary market will not impact StubHub’s business, as their fans have clearly made their choice. The fact that StubHub’s system is set up so that users get paid out in cash once their tickets are sold will remain a key differentiator from TM’s, where the seller only gets credit towards next year season’s tickets.” StubHub spokesperson Sean Pate said to SBN Monday evening.

Monday brought an announcement of a different sort from Razorgator.com. The NCAA and RazorGator Experiences announced RazorGator had been selected by the National Collegiate Athletic Association's (NCAA®) as their Official Hotel and Hospitality Package Provider for the NCAA Men's Final Four.

"Basketball fans will now have an exciting opportunity to travel in style to the Men's Final Four games with special access to Hard-To-Get (SM) tickets and world-class hospitality experiences," said RazorGator Experiences President, David Lord. "March Madness will become a completely different experience for fans now that Official NCAA Men's Final Four packages will be available on the web. Traveling to The Big Dance(R) will be easy, fun and even more exciting."

"The NCAA's decision to select RazorGator Experiences as our Official Hotel and Hospitality Provider is based on our commitment to giving our fans the very best," said Gregory Shaheen, senior vice president of Basketball & Business Strategies, NCAA. "Now Men's Final Four fans have an easy, satisfaction guaranteed way to make top notch travel plans with a company that has a successful track record in the sports industry and is authorized by the NCAA."

There is a night and day difference between the reselling of tickets above face value and the packaging of tickets, accommodations and other components associated with a particular event.

Would the National Football League ever seriously consider a league wide sponsorship with a secondary ticket operator? Never, it wouldn’t make sense to potentially taint the NFL’s brand with the perception of being directly linked to anyone selling NFL tickets for more than face value. The NFL offers packages to events like the Super Bowl, but it’s a complete weekend package that includes everything anyone attending a Super Bowl would want to experience,

Ironically if anyone were to wager on which sports league would take that leap and officially license the reselling of their tickets above face value, most might have guessed the National Hockey League may have gone in that direction. However, it’s the NBA, a business managed by sports leading commissioner David Stern who made what is at best a questionable decision Monday. For a business so focused on delivering a unified message on everything, the NBA is setting itself up for embarrassment when it comes to the optics of their decision to enter into a relationship with the secondary ticket marketplace.

And yes, if a ticket is sold above face value, no matter how you paint that picture you are in fact scalping tickets. It may be perfectly legal in 35 states, it may be legal in the not too distant future in all 50 states, but there are nothing more than subtle differences that separates “Johnny” in the parking lot across from the arena, and “Billy” selling tickets on the Internet. Making it official – one more example of how sports have evolved into a half trillion dollar industry.

For SportsBusinessNews.com this is Howard Bloom

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Monday, February 26, 2007

Pacman Jones, the sorry state of entitlement among NFL players


When are the Tennessee Titans going to say enough is enough? When are the Tennessee Titans going to send a message to Adam "Pacman" Bernard Jones, your behavior off the football field represents a clear and present danger to the future of our football team and to our organization? A simple definition of “deviant behavior” describes exactly what Pacman off field antics are all about – a person would be considered to be acting deviant in society if they are violating what the significant social norm in that particular culture is.

After his junior year at West Virginia, he opted to forego his senior year and declare for the NFL Draft. He was the first defensive player drafted, taken 6th overall by the Tennessee Titans. He then held out in a contract dispute, missing most of training camp.

During his rookie season he had a total of 44 tackles, 10 pass deflections, but no interceptions. He totaled 1,399 return yards and 1 TD.

At the end of his sophomore season in the NFL, Jones totals 62 tackles, 1 forced fumble, 12 deflected passes, 4 interceptions, 130 return yards, 1 interception touchdown, 440 punt return yards and 3 punt return touchdowns. His 12.9 yards per punt return average led the NFL, edging out Chicago's Devin Hester by .1 of a yard. His 26.1 yards per kick return average ranked him 7th in the league. Pacman also caught two passes on offense for 31 yards and rushed twice for 8 yards. His best performance came against the Jacksonville Jaguars in Week 15; Jones had an 83-yard interception returned for a score, a 70-yard kick return, and broke up a touchdown pass to Matt Jones to save the game.

Even with constant off the field incidents, he has emerged as one of the NFL's elite playmakers. He is an explosive kick returner, as well as good cover corner. He, in certain packages, also plays offense.

His success on the field is a striking contrast to what has gone on off the football field, the latest incident taking place last weekend at the NBA All-Star Weekend in Las Vegas. The Tennessean offered this timeline of Jones’ incredible series of run-ins with the legal system:

Strip club incident

Where: Atlanta

When: April 2005

What: Jones' name appeared on the police incident report after a fight broke out in a strip club. The female involved said she had no plans to pursue the case and it was dismissed.

Comments: "Other than being visible at the place, that is the extent of the story," said Michael Huyghue, Jones' agent. "Unfortunately you can never just be in places where anything can happen, and that is a lesson you learn, even if you are completely not involved."

Titans reaction: Team officials said they believed Jones did nothing wrong.

Hotel incident

Where: Nashville

When: June 2005

What: Security officials at Regal Maxwell House Hotel had trouble getting two of Jones' friends to clear their room after checkout time. Police arrived, smelled marijuana and found some on a tabletop. Jones was in the room, but one of his friends took full responsibility for the evidence.

Titans reaction: No comment

Nightclub arrest

Where: Nashville

When: July 2005

What: Jones was arrested on two counts of misdemeanor assault and a felony count of vandalism after a fight at a Nashville nightclub. Charges were dismissed less than a year later.

Titans reaction: "Unfortunately we realize that some young players go through a maturing process to become professionals that includes decision-making, choosing friends, appropriate behavior, etc.," the team said in a statement. "Jones has not finished that maturing process, despite team and league efforts."

Vehicle confiscation

Where: Nashville

When: April 2006

What: Metro Police said a vehicle registered to Jones was involved in a drug trafficking ring. "Pac Man" was embroidered on the leather seats of a 2004 Cadillac XLR which was confiscated from a friend of Jones. Jones later bought the car back at an auction.

Comments: "Clearly there is some connection between Mr. Jones and one of the arrested individuals," Davidson County District Attorney Torry Johnson said. "But I want to emphasize he has not been charged."

Titans reaction: No comment

Shots fired

Where: Nashville

When: April 2006

What: Jones was at the scene where gunshots were fired following an altercation at a Nashville gas station at 1:50 a.m. Police questioned Jones but labeled him only as a witness. The incident occurred just three days after the vehicle confiscation.

Comments: "My name has been falsely dragged into these matters that are completely unrelated to me," Jones said.

Titans reaction: Coach Jeff Fisher met with Jones the next day, but declined to comment.

Nightclub arrest

Where: Murfreesboro

When: August 2006

What: Jones was arrested and charged with public drunkenness and disorderly conduct, both misdemeanors, for an incident at Sweetwater Saloon. With six months of good behavior the charges will be dropped, a judge ruled last month.

Comments: "An innocent bystander," Jones said.

Titans reaction: No comment

Spitting incident

Where: Nashville

When: October 2006

What: Jones was issued a citation for misdemeanor assault after being accused of spitting in the face of a Tennessee State student following a verbal exchange at a downtown nightclub. The charge was dismissed in general sessions court earlier this month.

Comments: "If I'm going to go out, I'm going to have to be at a little private spot,'' Jones said. "Maybe I'll chill out at a jazz bar or something with some older folks."

Titans reaction: No comment

Triple shooting

Where: Las Vegas

When: Monday morning

What: Jones has been questioned by Las Vegas police after he was at the scene of a triple shooting. According to Jones' attorney, the cornerback is not a suspect in the case.

Comments: "(Pacman Jones) told me, 'Man, I am not a suspect and didn't have anything to do with this,' " attorney Worrick Robinson said.

Titans reaction: No comment

The Titians have made it clear, Jones days are numbered with the Titans, at least that’s what they’re offering publicly. Mike Reinfeldt, the team's new general manager, was asked at the NFL Combine in Indianapolis about Jones' status after reports of the cornerback's involvement in the mayhem. He replied: "I would assume there is that potential."

In the last decade few NFL teams have taken a tough line relating to the off-field actions of players, with one notable exception – Christian Peter and the New England Patriots.

Don Yaeger, in his book 'Pros and Cons: The Criminals Who Play in the NFL,' published in 1998 claimed that 21% of the players in the National Football League have been charged with one or more serious crimes. Peter became the ‘poster-boy’ for Yaeger’s insightful book.

New England Patriots owner Robert Kraft took a stand against employing players with criminal records. In the fifth round of the 1996 NFL draft, the Patriots picked Nebraska defensive lineman Christian Peter, who had been arrested eight times (and convicted four times) during college for a variety of offenses, including the assault of a former Miss Nebraska and the rape of another woman. When Peter's past came to light (it was Kraft’s wife who alerted her husband), Kraft cut the player before he was even offered a contract. "We concluded this behavior is incompatible with our organization's standards of acceptable conduct" said Kraft. While he received numerous letters of support from high school and college coaches, he was not praised by the NFL. Peter’s had a seven-year NFL career.

If Robert Kraft’s stand against Peter meant nothing after Peter ‘enjoyed’ the benefits (financial and personal) of being an NFL players, is there any explanation for why NFL owners allow players whose off-field behavior is out of the boundaries of the law? SportsBusinessNews.com spoke with John F. Murray, Ph.D., Licensed Clinical and Sport
Performance Psychologist in Palm Beach, Florida.

“I think all owners would like to have a totally clean image and completely law abiding players. It only helps their franchise in their own community, helps the image of the NFL which they have an obvious stake in and ultimately helps their team perform better with fewer distractions. The problem is that there is also a great temptation to take a player who might not have the halo over his head if he can bring immediate improvement to the team, and there is competition for these on-field talents. Another problem I believe is that owners could invest more wisely in player evaluations. I have seen some of the evaluations conducted in the NFL, and while they are thorough in many areas, one area that appears to be still lacking is the solid evaluation of mental skills and psychological factors, and this is an area that presents a huge upside in talent evaluation in the future. There are so few legitimate sport psychologists, but they need to be more involved in assessment,” Murray told SBN.

The question that begs to asked, do owners care more about winning than they do the off-field actions of their players? Does it only matter what happens on the field?

“It is hard to make that kind of blanket statement, as owners are all so very different. I'm sure some care more than others. But I think it is also fair to say that in any business winning is the goal and owners are not running day care centers, they are trying to win, so this is where the "fine line" or "grey area" becomes a factor. I like to think that improved off-field behavior can lead to winning too. You can and need to train your players to be smart and aggressive warriors on the field who know how to tone it down off the field, or the whole system breaks down? “Murray said to SBN.

Friday, NFL Players Association Executive Director Gene Upshaw announced after a meeting Thursday, the NFLPA’s 12-player Conduct Advisory Committee unanimously agreed it is time for the NFL to institute sanctions against players who not only break the law but according to various media reports run afoul of the law (Pacman Jones falls into that category).

According to a report in the USA Today: among the members of the panel who recommended that more stringent punishment for conduct violations be strongly considered by the union: 15-year veteran defensive back Vincent, Colts Pro Bowl center Jeff Saturday, Panthers Pro Bowl receiver Steve Smith, Cowboys Pro Bowl tight end Jason Witten, Falcons Pro Bowl corner DeAngelo Hall, Bengals receiver T.J. Houshmandzadeh, Seahawks safety Ken Hamlin, Broncos cornerback Dominique Foxworth, Saints tight end Ernie Conwell, Dolphins Defense lineman Kevin Carter and Titans running back LenDale White .

"The common denominator was these guys really care," Upshaw said before addressing a meeting of player agents early Friday. "They care about the game.

"They care about the 10% that we're all painting with the same brush. That 90% are doing the right thing and 10% are not.

"Guys are moving in the direction that we need to have penalties similar to the drug (substance abuse policy) penalties. At some point, you're out. You can't just continue to keep violating policies. You can't be in the wrong place, three or four times.

"One time. Two times maybe. But three or four times in the wrong place at the wrong time, they didn't like that."

Pittsburgh Steelers owner Dan Rooney, Denver Broncos owner Pat Bowlen, and NFL commissioner Roger Goodell were interested observers at the Thursday’s meeting. Goodell who had a great deal to say about the deviant behavior of NFL players during his recent “State of the Sport” during the lead-up to Super Bowl XLI hinted after Thursday’s meeting he’s interested in holding both the players and the owners accountable for the off-field actions of NFL players.

At Super Bowl Goodell was asked if there is anything that the league can do to curtail the off-field incidents that have plagued it this year, especially some teams? And I wonder if the league at any point will hold individual clubs accountable for the misbehavior of some of their players?

“Well, we have to do something about it. I think it's an incredibly important issue. One incident is too many, in my book. I think we need to reevaluate all of our programs. We have a tremendous number of programs that I think have been quite successful to help our players. But I think we've got to do more. We are going to start that process, one, by evaluating our policies; but two, Gene and I are going to put together a group of players we're going to meet with in the next several weeks to give us their perspective on what's really happening and what are the issues, so we can try to learn something first.

“But I think our focus has to be on reevaluating our policies, make sure we educate our players to what's out there. We continually tell our players and our coaches that we are raised to a higher standard in the NFL and we have to exceed that standard. I firmly believe that and I think Gene does, also.

“We have to make sure our players are more accountable, but I think also our clubs have to be more accountable and we will be reevaluating our position to see if there are ways we should make our clubs more accountable in the offseason” Goodell said.

Accountably aside – what about the image of the NFL and the terrible toll being done to the decades the NFL has spent crafting that image. AT the end of the day, the damage should be of greatest concern to Goodell and company.

“I see it differently. I don't see it in droves. I think there are very few. But a few is too many in my book. I think when you have the outstanding athletes that we have, and we have two of them here today, that won the Walter Payton Award, Drew Brees and LT (LaDainian Tomlinson). These are two of the finest people I know. Not just football players, but outstanding people.

“We're proud of our players. We recognize that at times some of our players don't do what we would hope they do. When that happens we will be very aggressive in dealing with that and we have stepped up our discipline this year, and I intend to continue to do that.”

Unfortunately in an era of instant media visa-vie the Internet, far too much attention is spent on the behavior of Pacman Jones, Tank Johnson are far too many NFL’ers than do the good deeds of men like Drew Brees and LaDainian Tomlinson. Is the media at fault for focusing so much coverage on the off-field behavior of NFL players?

“I don't think the media makes enough of the problems. In a normal job you get fired for severe and embarrassing problems. It should not be any different here. Players need to know the standards long in advance and adhere to them or risk losing what they have worked for all their lives. This helps them too. Too little discipline is rarely the answer,” John F. Murray, Ph.D., Licensed Clinical and Sport Performance Psychologist in Palm Beach, Florida offered SBN.

And what message is the NFL sending out about its players. “A terrible message indeed. The NFL is one of the most successful businesses in history. It would be wise to invest seriously in cleaning up its image, taking care of the players and reducing tragedy,” Murray offered.

The NFL is business that generates more than $6 billion annually, $3.75 billion yearly in television revenues alone. “The NFL is very powerful and I think they will be around for a long time. It is a wonderful sport. But to allow the behavioral problems to escalate will eventually come back to haunt them. Rather than let the problems bring them down, I think they are in a great position to take action to not only help the players and the image, but in doing so to help society clean up its act too. What we are seeing in sport is often just a microcosm of our culture and society.” Murray said to SBN.

For Sports Business News this is Howard Bloom. Sources cited in this Insider Report: The Tennessean

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Friday, February 23, 2007

MLB going deep with their Extra Innings DirecTV Deal


Major League Baseball is expected to announce as early as today, no later than early next week a seven-year $700 million agreement with DirecTV, giving DirecTV the rights for MLB’s “Extra Innings” package, the package that offers baseball fans the right to watch out of market regular season baseball games. There are some suggestions that the package may be exclusive and others that report the first three years of the package give DirecTV the exclusive rights for three years, with the final four years starting with the 2010 season being open to other satellite and cable television providers.

The New York Times reported in Friday’s edition when the Extra Innings agreement is announced it will in fact offer DirecTV a seven-year exclusive agreement. However according to Richard Sandomir the possibility exists DirecTV will agree to let the exclusivity lapse after the 2009 season. If that takes place Sandomir reported DirecTV’s $100 million annual payment to MLB would be reduced.

With the imminent announcement the Extra Innings package that had been available to more than 75 million potential homes will now be accessible only to estimated 15 million homes that currently have DirecTV satellite systems.

Major League Baseball’s decision has upset baseball fans everywhere. What began in Internet chatrooms filled with baseball fans with too much time on their hands early in the New Year when reports first surfaced in Multichannel News relating to MLB’s imminent move to DirecTV, blossomed two weeks ago when Senator John Kerry, Democrat of Massachusetts (and the Democrat Party’s 2004 Presidential candidate) spoke with The New York Times.

''Here's what bothers me,'' Kerry told The New York Times on February 9. ''You get M.L.B. and DirecTV marshaling their forces to go out and make money while cutting out fans. In my judgment, more fans watching games strengthens baseball.''

He added, ''There's a whole movement toward fans being screwed by consolidation which raises prices and reduces options.''

And if that doesn’t have Bud Selig and company shaking in their boots, Kerry is ready to bring the full weight of his ‘considerable’ political clout to the debate.

''The F.C.C. doesn't have the right to say, 'You can't do this,' but they have levers that affect this business,'' said Kerry, who sits on the Senate Commerce Committee, which oversees communications.

Late Thursday night The Hollywood Reporter reported that FCC chairman Kevin Martin sent Sen. Kerry a letter concerning Kerry’s concerns about DirecTV MLB Extra Innings agreement.

"Once we have this information, we will report to you on the deal's implications for consumers and any recommended changes to the law to ameliorate any harm to consumers," Martin wrote.
Kerry told The Hollywood Reporter he is pleased that the commission is looking into the proposed agreement.

"It's good to know that (Martin) also has concerns about a deal that has the potential to deny choice to so many consumers -- all apparently in the interest of a short-term profit for Major League Baseball," Kerry said. "I look forward to hearing a full response from the league and from DirecTV, and I remain open to working with them and other colleagues on any and all plans that furthers options for consumers and makes it easier for all of us to enjoy our national pastime."

DirecTV’s rationale was easy to understand. MLB’s Extra Innings package would become the perfect compliment to DirecTV NFL Sunday Ticket package of NFL games. MLB’s interest wasn’t necessarily the $700 million, but the commitment DirecTV is prepared to make in agreeing to carry MLB’s plans to launch their own cable channel. MLB is expected to join the NFL Network and NBA TV in time for the start of the 2010 season. The NHL Network is currently only available in Canada.

In January, Multichannel News reported that: video-on-demand supplier In Demand was in talks to renew cable’s deal to distribute the “MLB Extra Innings” package, even as the league is discussing an exclusive distribution arrangement with DirecTV Inc., similar to the direct-broadcast satellite service’s deal with the National Football League for its “NFL Sunday Ticket.”

Cable operators had been offering the $170 MLB Extra Innings package — which offers as many as 900 games a year — since 2001. Initially, DBS leader DirecTV held the exclusive rights to that content. All one needs to consider is the following: MLB had an exclusive agreement to air the DirecTV Extra Innings package and then for five years shared that package with DirecTV and cable operators. It’s easy to appreciate why MLB’s decision to move back to an exclusive DirecTV package. Baseball fans don’t want to be treated like football fans, being forced to purchase a DirecTV system if they still want to enjoy Extra Innings. In Demand reportedly had offered $70 million a year to retain Extra Innings.

What is really interesting, when you take the time to crunch the numbers, MLB fans clearly are making other choices when it comes to viewing out of market games and those options to not include the Extra Innings package.

Kagan Associates estimates that Extra Innings generated 280,000 subscribers across both cable and satellite services in 2005. That pales by comparison to the 600,000 subscribers netted by the National Basketball Association’s “NBA League Pass” package and the nearly 2 million scored by Sunday Ticket during the same time period, according to Kagan.

Further, the package is dwarfed by the 1.3 million subscribers that baseball generated in 2005 for its $79.95 MLB.TV subscription broadband service (the price for the 2005 season), according to New York Magazine. The package includes live games, as well as extensive highlights and classic contests. Sports-programming consultant Lee Berke told Multichannel News the emergence of the broadband package could allow MLB to take DirecTV’s exclusive package without alienating cable subscribers.

“[MLB.TV] has become so widely distributed in its own right that it’s become a balancing act — the leagues are looking at various platform and the dollars they get, and trying to figure out whether exclusivity or multiple distributors makes sense,” he said in the Multichannel News report. “My guess is that if DirecTV comes up with enough money, then baseball may say, 'We’re doing so well with MLB.TV maybe it’s worth it to explore being exclusive with DirecTV.’ ”

Clearly the message MLB fans are sending to the marketplace, ‘our buying habits more and more are tied directly to MLB’s live video streaming of games at MLB.com. MLB.TV is fast becoming an economic engine for MLB. Head to MLB.com;’s home page and conveniently located in the upper left hand corner of the home page is a countdown clock to opening of spring training. Click on countdown clock you’re directed to MLB.com’s spring training page. Head to that page and you can’t help but notice the banner ad dominating the right hand side of the page promoting the MLB.TV and voila you’re now where you want to be if you’re ready to see 150 spring training games. If you’re a baseball fan and you can’t make it to Florida or Arizona for the Grapefruit and Cactus League, MLB.TV has you covered.

That hasn’t stopped baseball fans from venting their rage on the Internet and to any sports media pundits willing to give them the time of day.

Dan Asnis, a Mets fan from South Brunswick, N.J., who started an online petition to keep Extra Innings on cable spoke with the New York Times

''I felt frustrated that this was happening, and that fans like me had no say in it,'' he said in a telephone interview. When asked if he’d head to the Internet for the options offered at MLB.TV Asnis said he wasn’t interested.

How angry are baseball fans? Several media reports hint disgruntled fans are getting ready to file a class action suit against Major League Baseball. And indeed if baseball fans file a lawsuit they won’t be the first to challenge the sports lords justifying their right to offer an exclusive agreement to a cable or satellite provider for season long, multi-game packages.

“I will be more the effected by this monopoly type move. I live right next to Wrigley Field and will not be able to watch baseball. This move is literally insane and does nothing but make fans want to move away from the sport” read one of the latest of 4,065 (as of 10:17 PM EST Thursday night) responses on a petition opposing the deal, at www.petitiononline.com/MLBCABLE/petition.html.

According to a New York Times report: in 1997, a group of DirecTV subscribers filed a class-action suit against the N.F.L. in Federal District Court in Philadelphia saying that the Sunday Ticket package violated antitrust laws partly because it was sold exclusively. The plaintiffs settled for an undisclosed sum before a definitive judgment. But the United States Court of Appeals for the Third Circuit upheld the lower court's ruling that the 1961 law applied to broadcast deals, not those made with a satellite service.

Are baseball fans being slow to adapt to the choices MLB would certainly site if a lawsuit was filed, and the proof lies in the numbers, more baseball fans are choosing to buy the season long multi games packages being offered at MLB.TV than those purchasing the Extra Innings package.

''Baseball might say there is a process under way that is merging Internet streaming with TV, and anyone who wants the package can go to mlb.com,'' said Andrew Zimbalist, an economics professor at Smith College.

Its interesting most of the anger seems to be coming from Red Sox Nation. While most believe the Evil Empire (New York Yankees) are baseball’s most popular team, Red Sox Nation has been very vocal in the Extra Innings debate (and no its not because Red Sox fans haven’t figured out how to operate a computer or have yet to realize what the Internet is).

"Ever since the package was available to my cable company [Time Warner], I bought it and I love it," said John Tierney a Red Sox fan from Syracuse in a Boston Globe report. "My wife and I center our lives around it in the summer. Football was always on DirecTV, but that's just once a week. Baseball was on cable, and now they're taking it away. Then they tell me I can watch it on the computer; well, that's no good, I sit in front of a computer enough all day.

"This is heartbreaking, really."

"I am opposed to anything that deprives people of reasonable choices," Sen. Kerry wrote to The Boston Globe. "In this day and age, consumers should have more choices -- not fewer. A Red Sox fan ought to be able to watch their team without having to switch to DirecTV."

Kerry, continued, "In the case of my hometown team, Red Sox Nation stretches all across our country from coast to coast. I am concerned that this deal … will separate fans from their favorite teams."

The FCC has allowed NFL Sunday Ticket to be offered exclusively on DirecTV since 1994. However, News Corp. has filed a request for permission from the FCC to transfer its controlling 38.5% stake in DirecTV to Liberty Media Corp in a swap of assets, and any complaints about baseball's Extra Innings deal could come up in that review.

Michael Abramowicz, 34, of Arlington, Va., is a law professor at George Washington University offered this analysis on his blog ten days ago: "My reaction to this has been genuine sadness," he wrote. "Watching baseball games is my No. 1 hobby, and my house can't get DirecTV because of nearby trees. It did occur to me that if I chopped down my neighbors' trees, I would probably do a year in jail, which would leave me six years to enjoy the games."

The bottom line and this deal is all about just that the bottom line:

Baseball fans have a choice. More than 1.3 million fans headed to MLB.TV when the last statistical data was available for the 2005 season as opposed to the 280,000 who decided on the Extra Innings package.

What exactly is DirecTV thinking if the numbers skew so strongly towards fans choosing the MLB.TV option?

A MLB cable channel is long overdue. The suggestion MLB will launch the channel in time for the 2010 season suggests MLB is taking all the time they need to get it right.

If the period of DirecTV exclusivity is only for three years as some media reports suggest baseball fans need to be patient and think about the MLB.TV option as a short-term solution.

One continuing complaint fans have had about the MLB.TV option is the poor streaming at times. Historically people who have purchased the service have at times had serious trouble accessing games. There’s an easy solution to that problem, purchase the monthly option and if you’re not happy cancel the service.

MLB.com is the Mercedes-Benz of sport league websites. Managed by Bob Bowman, MLB.com began in 2000 when each MLB team agreed to invest $1 million each in creating a presence on the Internet. 2007 will be the sixth consecutive season MLB has offered live video streaming of their games at MLB.com, a program that began with the 2002 season. Arguably, MLB.com’s biggest success to date was the streaming of the 2006 NCAA men’s basketball tournament last March.

At least for Major League Baseball, MLB.com has evolved from an interesting concept, to a loss leader, to a profitable venture. A March Wall Street Journal report on the dollars and cents of the MLB.com said about 15% of the site's total revenue of $195 million last year came from managing Web sites and other partnerships like the one with CBS. An additional $68 million came from subscriptions to watch live video content on MLB.com, including the 2,400 baseball games it streamed in the 2005 season. The rest of its revenue comes from ticket sales and advertising. How good has MLB interactive become at what they do, good enough that they’ve been able to market their services to other sports leagues, properties and events.

Under the leadership of Bob Bowman, MLB’s interactive division has already signed up 25 clients, including CBS, Major League Soccer and the World Championship Sports Network. Entertainers Jimmy Buffett and LL Cool J, too, have hired MLB.com to promote albums and concerts by streaming video of interviews and live performances.

Baseball is as American as the free market system and the free enterprise system by all appearances will offer baseball fans two choices when it comes to buying the out-of-market baseball package, DirecTV or MLB.TV for 2007. Baseball fans may not like the choices they’re being offered but at least they’re being offered the right to make that choice.

For Sports Business News this is Howard Bloom. Sources cited and used in this Insider Report: The New York Times, Mutlichannel News, Boston Globe and Los Angeles Times

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Thursday, February 22, 2007

Welcome Back Barry – We’re Glad you’re here for a while


Regular readers of this blog Report know there are two certainties in reading the Insider Report – Gary Bettman is Howard Bloom’s least favorite “leader” in sports and SBN is one of the few outlets that support Barry Bonds on a regular basis. Tuesday Barry Bonds reported to the San Francisco Giants training camp for what is surely to the most talked about baseball season for one baseball player. Barry Bonds the symbol for Major League Baseball’s steroid era, regardless of having never tested positive for the use of performance-enhancing drugs is poised to establish the career home run mark.

Bonds reported to the Giants Scottsdale, Arizona spring training facility greeted by more than 50 media members.

"I'm ready," Bonds proclaimed to MLB.com’s Barry M. Bloom, tossing his hands up in the air as a media throng and a small gathering of fans looked on.

"Now I need only 21 [to pass Aaron]," said Bonds, who goes into the season with 734 homers -- Aaron finished with 755. "That one counts."

If nothing else Barry hasn’t lost his sense of humor. The Giants signed Barry Zito to a $126 million free agent contract during the off season. After Bonds hit a home run off another Giants pitcher (Matt Cain) Bonds and Zito retreated to the Giants clubhouse emerging moments later with both men wearing T-shirts that read on the back: "DON'T ASK ME...ASK BARRY!" An arrow below pointed at Bonds on the right side and Zito on the left.

"I'm sure I'm going to break the record this year," Bonds, who needs 22 homers to surpass Hank Aaron's mark of 755 told the media in January during a golfing vacation in the Dominican Republic. "But right now I'm just thinking about golf."

The latest storm involving Bonds surrounds news that Bonds tested positive for amphetamines in 2006. As amazing as it seems, of the 3,000 players (major and minor leaguers) tested last year, only Bonds tested positive. That is statistical impossibility. That Barry Bonds was the only player ‘sources’ revealed had tested positive for the use of amphetamines is statistical certainty and one that reeks of the personal and professional vendetta people within baseball and the media have for Barry Bonds.

That the media have long had serious issues with Barry Bonds isn’t a surprise. Early in January after Kevin V. Ryan, the federal prosecutor (the lawyer responsible for the BALCO case) announced he was leaving his current post, much of the media attention focused on not where the BALCO case was heading but where next for the Bonds BALCO case, a subtle but important distinction.

"I don't know what the future holds for me," Ryan told USA TODAY, "but when I leave, this (investigation) won't just fall off the map. The infrastructure is in place. We have good prosecutors on it. A good review process. Good institutional knowledge. So when I move on, there are those that can carry forward with it without a problem.

"I think we have had a tremendous impact in this case, and I understand there still needs to be open dialogue and debate about it. For those reasons, I'm still interested. If the opportunity presents itself in the future that I can still be involved in it, I'll avail myself to it."

Ryan’s investigation into Bonds was in the news six months ago. Ryan originally had until July 31 to hand down an indictment relating to Federal charges against Bonds in either the BALCO case of alleged charges of tax evasion and perjury. Bonds lawyer Laura Enos told The Associated Press in July, "We are very prepared," Enos said. "We have excellent tax records and we are very comfortable that he has not shortchanged the government at all."

And when Barry arrived at the Giants training camp the essence of what he said to the media according to MLB.com ‘bring it on’.

"It doesn't bother me at all. It's you guys [the media] talking."

When told that it was the government, not the media, investigating him, Bonds added:

"That's all right. Let them investigate. Let 'em. They've been doing it this long."

The media self proclaimed guardians of the diamond continue their relentless pursuit not for “truth, justice and their version of what the American way is” but “what do we have to do put get Barry behind bars – preferably sooner rather than later.

The New York Times went back to the history books and spoke with Jerry Johnson, who as the United States attorney in Pittsburgh prosecuted the baseball cocaine cases in 1985 for his opinion of whether or not the media’s dream of “Fantasy Jail time” for Barry is about to happen.

“That kind of thing happens in U. S. attorneys’ offices,” he said in a telephone interview earlier this week. Then he explained the philosophy of the man in charge: “My name is on the door, and I will make the final decision. Whether it’s declining or going forward on a case, if the U. S. attorney isn’t making the final decision, that person wouldn’t be doing his job. It’s the U. S. attorney’s decision, no one else’s.”

Johnson added, “Oftentimes, it takes as much or more courage to decline a case as it does to bring an indictment.”

The United States attorney’s office in San Francisco doesn’t have a great deal to say while they continue to spend taxpayer dollars in their pursuit of Barry Bonds. What is being reported, there is division in the office (and no it’s not those who are Giants fans and those who don’t like the Giants) as to how they should proceed.
Matthew Parrella, assistant United States attorney did offer this to The New York Times: “Without addressing the issue of whether there’s a case or a grand jury investigation, typically the new U. S. attorney is the person who ultimately makes decisions on cases.”

If the United States attorney’s office in San Francisco is waiting for Bonds former personal trainer Greg Anderson to break his silence on Barry Bonds they don’t seem to understand the bond between Bonds and Anderson. Anderson spent 57 days in jail on a civil-contempt charge last year and has been in prison for three months, since last Nov. 20, on another contempt charge. This sentence could run for another year, until the term of the current grand jury expires.

“Any reasonable, rational person at this point would realize that Greg Anderson isn’t going to talk,” Mark Geragos Anderson’s lawyer told the New York Times last week. “Keeping him in there is punitive. They should take a page from the administration letting Ryan go. They should let Greg go.”

While far too many baseball beat writers seem consumed by Barry Bonds, one debate that is sure to pick up steam as Bonds nears his record setting 756 home run will Major League Baseball commissioner Bud Selig be in attendance when Bonds passes Hank Aaron.

"My expectation would be that (Selig) would not be there when the record is broken," former MLB commissioner Fay Vincent said in a USA Today report. "I think he'll send a message: 'We acknowledge it, but we won't acknowledge it the same way we would have if Bonds had not been (allegedly) cheating.' I think he has got it just right."

For Vincent the key to everything appears to be Senator George Mitchell’s committee that is investigating the use of performance-enhancing drugs in baseball. As has been well documented the Mitchell committee has been a failure. Try as he may, Mitchell has no real power in his pursuit of the truth. His goals and objectives may be right but with he’s been dealt a losing hand before the game even game

Vincent said Mitchell's report is critical for several reasons: "He has to tell us what did baseball know? What were the federal authorities telling baseball, if anything? What did the security people know?"

Baseball knew something as far back as 1991. "Look, when I was in baseball there were rumors that (Jose) Canseco was taking steroids," Vincent said. "Baseball knew — at least I did. I put out a decree banning steroids. But we really didn't know what we were talking about. I don't think we understood. We didn't realize it was going to be as big a problem for baseball as it was."

For his part Bud Selig hasn’t had a great deal to say about the subject, but earlier this month, when Selig was a keynote speaker at Ripon College in Wisconsin. The topic: "Ethics in Sports." He spoke of the game's "integrity," about baseball's "enormous social responsibilities," as an American institution.

"I always say to people that if anybody goes to a game and there's scintilla of doubt, then we have no sport — it's done," Selig told his listeners.

Baseball historians are quick to point out then commissioner Bowie Kuhn wasn’t in attendance when Hank Aaron hit number 715. If anyone believes one mistake justifies a second error in judgment then they aren’t only students of history, they’re simply people who have never learnt from their mistakes.

Speaking at Fox Sports Net's annual baseball luncheon (San Francisco) offered this relating to his interest in witnessing history when Barry Bonds makes it according to The San Francisco Chronicle.

"That's a matter that I'll determine at some point in the future," said Selig, implying no set plans have been made for such an occasion.

"Hank Aaron and I have been friends for 50 years. But when you're the commissioner, you don't think about that. I've said before and I'll say it again, if and when Barry Bonds breaks that record, it'll be handled the same way that every other record broken in baseball was handled."

At one point, Selig told the assembled group his greatest fear is for the public to have a "scintilla of doubt in their mind that the outcome may be affected by people doing some things they're not supposed to do. Well, I can assure you, that isn't going to happen in baseball."

In a classic case of hear no evil, see no evil – Selig either believes baseball never had a steroid era or baseball fans have forgotten about the sports tainted past.

"I understand that theory, but I don't have to believe that," Selig said. "The fact of the matter is, you could go back 80 years. I wish you would spend the time I did studying each decade and understanding there were a lot of other external circumstances that really could have affected (an outcome). I have to tell you very candidly, I can't separate the last 15, 20 years from anything else."

Bud may actually have raised a legitimate issue. Babe Ruth may be the most popular player in the history of baseball and his career home run mark of 714 stood the test of time before Hank Aaron hit number 715 early in the 1974 season. Babe Ruth, didn’t he play in an era when the color of your skin determined whether or not you could play Major League Baseball. Ruth may have hit more than 700 home runs but his record is at best tainted. Hank Aaron, hard to make a case that Aaron didn’t earn his stripes on a baseball diamond but for what its worth the baseball played today is much more specialized than the baseball Hank Aaron played. Relief pitchers weren’t a big part of the game during the years Aaron hit most of his home runs.

So much of the media’s dislike for of Barry Bonds seems focused on Barry’s well documented misdeeds with the media and his teammates. Is Barry Bonds a good person – who cares? There have been athletes with terrible personalities who have excelled on the playing field. What should matter is what an athlete does on the playing field not away from the field.

When will people start to give Barry Bonds the respect he’s earned and when will they stop crucifying him? If Barry Bonds used performance-enhancing drugs he did so in an era when the sport didn’t ban those substances and didn’t test for the use of banned drugs.

Was Barry Bonds the only major leaguer who may have used performance-enhancing drugs? The baseball media should stop fooling themselves and accept baseball was in the same place most sports where a few years ago, looking for solutions to the use of performance-enhancing drugs. Once and for all let’s stop wasting time, taxpayer dollars in what seems like a media driven vendetta against Barry Bonds. There are far greater and more important causes we can ‘rally the flag around’. Baseball had a steroid era, we’ll never know how many players used performance-enhancing drugs or how it affected their game. Its time for the baseball media to grow up.

And here’s a final thought if Bonds historic home run number 756 lands in the hands of a baseball fan who is disgusted by Bonds accomplishment then let that fan take that baseball and throw it on the field. However you count on anyone lucky enough to catch that baseball they’ll auction it for millions and millions of dollars. The media; ESPN, Fox, Major League Baseball and anyone else who intends to cover the event if they really and honestly do not believe Barry Bonds is a legitimate home run hitter, then treat Barry Bonds as the person you believe he is. At the very least in rarely speaking to the media and in not suing everyone Barry Bonds is being honest in making it clear how he feels about what is taking place. He really and truly could care less what anyone thinks of him.

For Sports Business News this is Howard Bloom. Sources cited and used in this Insider Report: The San Francisco Chronicle and The New York Times

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Wednesday, February 21, 2007

Sports programming and Satellite Radio – now it’s going to get “Sirius”



The announcement Monday that Sirius Satellite Radio and XM Satellite Radio intend to merge their two services didn’t come as a surprise to those who have followed the evolution of satellite radio. The two companies faced their inevitable destiny, a merger of their assets in hopes of dramatically cutting back on their losses. And those losses, according to The Wall Street Journal have been staggering.

In 2005, the companies had combined losses of $1.5 billion, after losing a combined $1.4 billion the year before. Their 2006 results haven't been released, but Goldman Sachs analyst Mark Wienkes estimates that Sirius lost $1.1 billion on revenue of $628.8 million last year, while XM lost $658.2 million on revenue of $914 million.

Central to both satellite radio providers – their insatiable appetite in buying sports programming – paying rights fees to acquire the right to broadcast sports events

"What's a lot of money? To me, the NFL is exorbitantly expensive on all media," April Horace, a Denver-based emerging technologies analyst for Janco Partners Inc. told The Seattle Post Intelligencer. "But people in America seem to have an insatiable drive; they don't seem to get sick of sports, and they seem to continuously be willing to pay for sports."

A cornerstone of Sirius’ business strategy has been to pursue exclusive sports content. Currently, Sirius has exclusive satellite radio broadcasting rights to all NFL, CFL and NBA games. Sirius also announced in December 2005 a multi-year deal with the NBA, which makes the satellite radio company the broadcaster of more live NBA games than any other radio outlet. Sirius airs Full Court Press, weekdays from 12 pm - 3 pm ET; FCP is the only all-NBA show on Sirius. The agreement also creates a 24-hour NBA Radio Channel, located on channel 127. NHL games will be shared with XM for the 2005–2006 season, after which XM will have exclusive broadcast rights. Starting in 2007, Sirius will have full NASCAR coverage, including, among other programs, a two hour weekly show hosted by NASCAR driver Tony Stewart.

Sirius also has rights to a number of major college sports teams, including teams in the Big East, Big Ten and the Southeastern Conference as well as schools like Notre Dame. Beginning in 2005 Sirius also has exclusive radio rights to cover the NCAA Men's Division I Basketball Tournament. In August 2004, Sirius launched NFL Radio, a 24-hour radio stream dedicated exclusively to covering the NFL. Sirius has also been aggressive in creating its own in-house produced studio sports radio content.

Sirius also broadcasts select English Premier League matches, in addition to airing World Soccer Daily, a Monday-Friday two hour talk show dedicated to soccer, and has inked an exclusive deal with two-time defending EPL champion Chelsea. Continuing their major expansion of soccer coverage, Sirius announced a deal to add UEFA Champions League soccer to their lineup on September 27, 2006.

XM’s service includes: 73 different music channels, 39 news, sports, talk and entertainment channels, 21 regional traffic and weather channels and 23 play-by-play sports channels.

While many believe Howard Stern’s move to Sirius was a key to what took place Monday (Stern was lured from terrestrial radio to Sirius for $500 million), sports rights fees have played an even bigger financial role.

On December 16, 2003 Sirius Satellite Radio signed a $220 million deal with the National Football League to broadcast professional football games beginning in 2004. Over the course of the seven-year deal, the NFL will receive $188 million in cash and $32 million in Sirius stock, with the ability to earn warrants to buy an additional 50 million shares.

Sirius secured national broadcast rights to all regular season NFL games, as well as select preseason and playoff contests. It also became the official satellite radio provider of the NFL.

"I would call this a transformative event," said Sirius CEO Joseph Clayton. "There's no question we're the leader in sports compared to terrestrial radio or our (satellite) competitor."

The deal was not exclusive, but contained a provision that would make it "very expensive" for Sirius competitor XM Satellite Radio to gain the same kind of rights to NFL games. As part of the agreement, Sirius created an additional sports channel, "The NFL Radio Network," an around-the-clock stream of NFL games, features and analysis. (Call it the NFL Network on radio).

The next salvo was fired by XM on October 20, 2004. XM announced an 11-year, $650 million deal with Major League Baseball to broadcast games live nationwide and become the Official Satellite Radio provider of Major League Baseball.

The agreement granted XM the rights to use the MLB silhouetted batter logo and the collective marks of all major league clubs. As part of the deal, XM created a 24/7 MLB channel called "Home Plate". The deal started with the 2005 season and runs through the 2012, with a 3-year option that MLB can pick up.

"This is the crown jewel -- the deal that we've been waiting for," declared Hugh Panero, XM's president and CEO, announcing the $650 million agreement with MLB to broadcast every game that began with the 2005 season.

Counters Sirius: "There is no more exciting sporting event in college sports than NCAA March Madness, and this deal will allow college hoops fans everywhere to follow their team, from the opening tip to the Final Four," said Scott Greenstein, president of entertainment and sports, announcing the multiyear deal to carry live play-by-play broadcasts of every NCAA Tournament game.

"Baseball is a radio game, because it's during that great time of year when everybody is out and about, traveling on vacation, they're on the highways, or maybe they are on the East Coast in drive-time traffic, so there is always a captive audience,” Seattle Mariners broadcaster Dave Niehaus said in a Seattle Post Intelligencer report in 2005 "We come into your house every day, nearly 200 times a year counting the games we do in spring training."

Two years ago (February 2005) Sirius pirated NASCAR from XM by offering $107 million over five years for the auto-racing broadcasting rights beginning in 2007. That agreement began Sunday with Sirius broadcast of the Daytona 500.

On September 13, 2005 XM announced a 10-year $100 million deal to carry National Hockey League broadcasts beginning with the 2005-06 season, initially sharing the coverage with SIRIUS but gaining satellite-radio exclusivity from 2007 (September) onward.

When Sirius announced their earth shattering five-year $500 million agreement with Howard Stern in October 2004 (Stern actually made his Sirius debut in January 2006) Sirius officials made it clear the demographic of Stern’s audience and sports fans was exactly what they where looking for.

"The demographic of the sports fan matches up really well with the demographic of our customer base right now," said Ron Rodrigues, Sirius media relations spokesman. "They tend to be men in their 20s through 40s who have average or slightly above-average income and education levels."

"You tend to go where the audience is, and you serve it, so sports came definitely as a priority for us," Rodrigues told The Seattle Times.

Both XM and Sirius offer ESPN Radio and Fox Sports Radio.

XM also offers Home Ice (hockey centric service broadcasting from Toronto), MLB Home Plate (a baseball channel that accompanies XM’s cornerstone MLB agreement), the PGA Tour Network (PGA related programming), XM Sports Nation which features everyone from Cal Ripken, Troy Aikman, Duke Head Basketball Coach Mike Krzyzewski, Dale Earnhardt, Jr. and NASCAR’s Jimmie Johnson. XM also hosts XM Deportivo a Spanish driven sports channel.

Sirius offers channels that accompany their National Football League, National Basketball Association and NASCAR programming. Sirius also offers something called Sports Action which is similar in nature to XM’s Sports Nation. Among the shows and hosts on Sirius’ Jerry "The Shark" Tarkanian, programming linked to the popular high school sports site rivals.com, NHL Live and The Mike & Murray Show.

Ironically not listed on Sirius primary content page is Hardcore Sports. Launched on January 15, 2007 and based in Toronto, the engine behind Hardcore Sports is a show called “Sports Rage” hosted by Gabriel Morency. While Morency remains a largely unknown talent, Morency is to sports radio what Howard Stern is to talk radio. Whatever they’re paying Morency isn’t enough, but at the end of the day Gabriel Morency is what will bring people to satellite radio. (Disclaimer – Howard Bloom appears as a regular guest on Sports Rage, but is not paid to be a guest on the show).

Many media business watchers believe Howard Stern’s $500 million deal (which has now ballooned by an additional $325 million in performance bonuses) was the biggest single mistake in the history of the media. Nothing could be further from the truth. Howard Stern maybe the only personality who is capable of generating enough interest to convince people to purchase the right to listen to him. Howard Stern is one of a kind programming. Others have tried but Howard Stern can’t be duplicated.

Its great to offer an NFL, MLB, NBA, NASCAR and NHL channels, but if you turn on your car radio, access ESPN, FSR or Sporting News Radio on your computer you’ll be able to listen to all the NFL, MLB, NBA, NASCAR and NHL talk you’ll ever care to listen to and it won’t cost you a dime. It remains to be seen when XM and Sirius merge in the coming months if they’ll keep the league centric channels as part of their programming. The costs associated with talk radio programming are much higher than most can imagine. It’s likely those buying satellite radio can tune into ESPN and Fox Sports Radio (both offered by XM and Sirius) and get their fill of NFL, MLB, NBA, NASCAR and NHL content, but if satellite radio is ever going to work it will only work with unique programming that can’t be heard anywhere else.

The key to long-term subscriber growth is with unique programming you can’t hear anywhere else. One of the key’s to long-term financial growth for the merged XM and Sirius will be initially to cut costs, get rid of programming that people can listen to on terrestrial radio. Howard Stern and Gabriel Morency they can only be heard and will only work through satellite radio. Their long-term futures have to be good; the same can’t be said for the costly and redundant NFL, MLB, NBA, NASCAR and NHL channels currently be offered by XM and Sirius.

For Sports Business News this is Howard Bloom. Sources cited and used in this Insider Report: The Seattle Post Intelligencer

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Tuesday, February 20, 2007

How they’re playing the arena game in Seattle with the Sonics


In the last five years, maybe even the last decade the stadium/arena game has changed ‘somewhat’. If a professional sports franchise wanted to build a new arena or stadium before the turn of the century professional sports teams held cities and taxpayers hostage demanding taxpayers build sports facilities or they would move their team to a city that would meet their needs. Walter O’Malley used that logic to move the Dodgers from Brooklyn to Los Angeles, the infamous Midnight Mayflower move of the Colts from Baltimore to Cleveland, and Art Modell ripping the heart of Cleveland when he moved the original Browns to Baltimore.

Between 1958 and 1997 (the year the Dodgers and Giants left New York for California) 35 sports franchises (Major League Baseball, National Football League, National Basketball Association and National Hockey League) moved at least once. In the last ten years three teams have moved. Sports have grown into a half trillion dollar industry but by all appearances teams are not moving much if at all anymore. And the reason -- the rules of how the stadium/arena game is played have dramatically changed. That’s not to suggest owners aren’t trying to keep the rules in their favor, just that taxpayers have had enough.

During David Stern’s “State of the NBA” Saturday night in Las Vegas Stern dealt with two of the NBA’s ‘pressing’ arena issues with the Seattle Sonics and the Sacramento Kings.

KeyArena at Seattle Center is on the grounds of Seattle Center (the site of 1962's Century 21 Exposition, a World's Fair). The arena's primary tenants are the Seattle Sonics of the National Basketball Association. It hosted the 1974 NBA All-Star Game.

Opened in 1962 as the Seattle Center Coliseum, the rebuild began on June 16, 1994 before the building reopened on October 26, 1995. The court which was originally at street level is now 35 feet below to allow more seating. After the rebuild, the Coliseum was renamed KeyArena, as Key Bank purchased the naming rights.

The rebuild cost the city of Seattle $74.5 million, and the Sonics approximately $21 million. KeyArena is the first publicly financed arena fully supported by earned income from the building. Its seating capacity for basketball games is 17,072.

In late 2004 proposals for expanding KeyArena to nearly twice its current size to accommodate new restaurants, shops, and a practice court (the cost is to be approximately $220 million) were debated. Because of a lack of interest by the city of Seattle in following through on the project the new owners of the Sonics and Storm made the decision to look outside the city limits for sitting a replacement arena. Currently, the future viability of the arena after the Sonics lease expires in 2010 is under debate.

Following disagreements between the Basketball Club of Seattle (a group fronted by Seattle billionaire and Starbucks founder Howard Schultz) and the city of Seattle concerning the need to renovate the KeyArena, the Sonics and Seattle Storm were sold to an Oklahoma City group led by Clay Bennett on July 18, 2006 for US$350 million. The sale was approved by the NBA owners on October 24 of that year. The new ownership has said that upholding the Sonics' lease with KeyArena through 2009–10 is "a priority" and that "with the right dynamics on the court, the right business model and a financially committed ownership group that recognizes and respect Seattle, we can succeed here for decades to come." However, there is speculation that their intention is to move the team to Oklahoma City once the Hornets return to New Orleans, Louisiana.

Fans of the teams formed Save Our Sonics and Storm to show support and urge the regions leaders and the NBA to keep the teams in Seattle. But on November 7, 2006 Seattle voters approved Initiative 91 to make a profit on-par with a 30-year treasury bond on any public investment on city owned facilities. While the Initiative would have no impact on the proposed arena, which will be owned and funded by the county and state, it is now unlikely that the team will stay inside the city limits. As of February 13th, 2007, the new ownership has stated it plans to build a new $530 million dollar arena in Renton, Washington. The fact that the new owners did not fight I-91 confirms that the new owners have no desire to remain in Key Arena after the lease expires in 2010. The initiative was approved with 74.08% of the vote.

Throughout the past few months, the Sonics future has begun to take shape as the ICON Venture Group was selected to manage the arena development, HOK Sport as architects to design the new facility; the city of Renton is now the proposed location for the new arena, and former Sonics player, and coach, Lenny Wilkens being named as Vice Chairman. On February 13, 2007 Clay Bennett announced that the site for the new $500 million "King County Multipurpose Arena" would be a 21 acre site to be purchased from the Boeing Company located in Renton, Washington.

Towards the end of Saturday’s media Q&A a Seattle reporter attending David Stern’s presser suggested the arena challenges the Sonics are facing parallels what is happening with the Sacramento Kings and their hopes to find the needed funding for a new arena for the Kings.

“No, I think that two different things. First of all, in California it's really hard to get anything passed, because the citizens have spoken.

“I think that Seattle is a much more mature situation. The new ownership has done so much, beyond what we could have hoped. They were very poorly treated at first. Everyone thought they were simply going to go in and wanted to move the team to Oklahoma City again. And they were disbelieved when they said they would like to keep it there.

“They've spent enormous sums of money and time and the like to come up with a plan, a funding plan. They've laid it out. They've got a site selected, et cetera. And it will either happen or it won't. We've been around this track a long time and I hope it happens because Seattle has been a very good city for the NBA and the Clay Bennett Group, I think, would be great, great, and will continue to be great owners for the Sonics. I don't see a role for me at this point.” Stern said Saturday.

Thursday, Stern echoed similar comments to The Seattle Times relating to how the NBA feels about the Sonics insistence a new arena (largely publicly funded) be built in the immediate future. Its clear, David Stern has all but washed his hands of any future involvement in the Seattle arena debate.

"I'm not intimately involved" with the latest news in Seattle, Stern said. "Our office is keeping on top of it. I've been extensively involved with the All-Star [preparations]. I haven't had a chance to review it, except on a top-line basis.

"But, obviously, the ownership group is working very hard to get something done and spending an enormous amount of time, effort and money on putting together the best possible proposal and building."

Clay Bennett wants a new $500 million home for the Sonics, in tax money, and the Sonics hope for additional financial help from Renton, Washington (where he wants the arena built). By comparison Los Angeles’ Staples Center built in 1999 for $375 million was largely privately funded by the Anschutz Entertainment Group (AEG).

Last Tuesday, Bennett visited the Washington (State) House, asking for $300 million in state funding, and $100 million from the City of Renton. Bennett is ready to kick-in $100 million. However, Bennett intends to retain all of the funding the arena will generate. Given the Sonics can expect between $150 million and $200 million in naming rights for the proposed arena, not only will Bennett not pay a dime if his wish is granted, but he’ll actually make a profit.

According to The Seattle Times, here is the proposal Bennett made to Washington’s (State) politicians last Tuesday: Sonics funding plan

Senate Bill 5986 would extend several taxes paying off existing sports stadiums to fund a new arena, arts groups and stadium maintenance.

Sales taxes: A 0.017 percent sales tax for Safeco Field debt would be extended by 17 years, to 2029, and a separate 0.016 percent sales tax for Qwest Field debt would be extended by eight years, to 2029. $227 million

Restaurant tax: A 0.5 percent tax on restaurant meals and drinks to pay off Safeco Field debt would remain until 2015, three years longer than previously projected. $75 million

Car rental taxes: A 2 percent car-rental tax for Safeco Field debt would be extended until 2015. Another 0.75 percent car-rental tax for Kingdome debt also would continue. $40 million

Hotel/motel tax: After the Qwest Field debt is paid off in 2021, a 2 percent tax on hotel- and motel-room rentals would be split between the new arena and arts groups. $81 million

Total financed: $423 million

And how was Qwest Field (the Seahawks home) built. According to The Seattle Times Gregory Roberts a classic example of how the stadium game was played (before the turn of the century).

Paul Allen negotiated to buy the team (at the time the third richest man in the world), contingent on a stadium solution: renovation of the Kingdome, construction of a new stadium or use of an upgraded Husky Stadium at the University of Washington.

Allen ultimately decided on a new, 72,000-seat stadium, to cost $425 million. He spent $1.7 million lobbying the Legislature for his public-private financing plan. The package included $100 million from Allen. The $300 million initial public share, which could reach twice that with interest charges, would be financed by an eight-year extension (to 2020) of the 2 percent tax on hotel rooms in King County and by 10 percent taxes on stadium admissions and parking.

The deal also included $25 million in a county sales tax credit for Allen and a state sales tax deferral. And part of the hotel room-tax money would pay off the $127 million debt on the Kingdome, which would be torn down to make way for the new stadium.

Allen would pay $850,000 a year to lease the stadium. He would keep all the money from renting it to other users and 80 percent of the revenues from an exhibition center to be built along with it.

The Legislature agreed, sending the proposal to a statewide referendum that Allen would pay $3.4 million to underwrite. If the plan failed, Allen said, he wouldn't buy the Seahawks. He spent $5.4 million urging voters to approve the proposal, and they did, 51 to 49 percent, on June 17, 1997. The County Council signed off on the financing a week later. The stadium, now called Qwest Field, opened in 2002. (Key year was 1997).

When Safeco Field was built in 1999, bonds worth $325 million were earmarked for the project — paid with a combination of taxes to be collected through 2016. The money to pay off the bonds comes from three sources: a half a percent tax on food and beverage sales, a 2 percent car-rental tax, and a 0.017 percent sales tax.

The largest, by far, is from the restaurant tax. In 1999, it generated $13.5 million; last year it brought in $17.7 million. The sales tax brings in about $7.5 million and the car-rental tax about $5 million a year. (Again the key the funding was put in place before 1997).

Friday, a Seattle based polling group (managed by independent pollster Stuart Elway) sent a message to the Sonics and the NBA – an overwhelming majority of state taxpayers have no interest in supporting any measure that would offer financial support for sports franchises. Given Seattle’s two other ‘big league’ sports teams – Major League Baseball Seattle Mariners and the National Football League’s Seattle Seahawks are playing in stadiums that are less than 10-years old, the results of The Elway Poll as relating to sports facilities being built is clearly directed at the Sonics.

Lawmakers are considering plans for partial public financing for sports venues for NASCAR, the Seattle Sonics, minor league baseball teams and a rodeo and equestrian center. Asked a general question about whether pro sports owners should pay for their own facilities without taxpayer subsidies, 71 percent agreed, while 23 percent called subsidies a good investment.

About 77 percent opposed use of public dollars for major sports facilities such as the Sonics' Renton proposal. Public financing for a NASCAR racetrack was opposed by 79 percent.

Days before the results of the poll where released Bennett met with The Seattle Post-Intelligencer’s editorial board and suggested economics will force the Sonics to move in the not too distant future. Bennett told the paper the Sonics would lose somewhere “north of $20 million” this year. Through 27 home dates the Sonics are averaging 15,878 fans per game, or playing to 93.4 percent of the KeyArena’s 17,072-seat capacity the smallest in the NBA.

So what exactly is Bennett’s end game? The Sonics play in a facility so terrible it forced Seattle native and Starbucks founder Howard Schultz to sell the franchise to Oklahoma City interests. Just before the start of the NBA regular season in early November the NBA Board of Governors approved the transfer of the teams’ ownership to Bennett. Bennett keeps on saying all the right things about the team staying in Seattle, but let’s make it clear – Bennett is from Oklahoma City, and if Bennett and the NBA can’t convince Washington taxpayers to support the building of a new arena for the Sonics, Bennett will move his team to the city he lives in.

“Well, actually I have sort of a sense of optimism because although Clay and his ownership group are based in Oklahoma City, almost from the first day that Clay started looking at Seattle as an investment and then as a purchase, he stressed to me the vibrancy of the Seattle market, the revenue streams that could be available there, and its jumping off status to Asia and its business relationships to Asia, which is a subject on which the Board spent some time today, not in terms of Seattle, but in terms of the NBA’s opportunities. So, I went from kind of skeptical in a way, to kind of getting on line with “Ok, I get what you see here.” But, of course, the large investment that they’re making and that they’re continuing and willing to stand behind is dependent upon a new building. And, they actually have committed to resources for experts and consultants and the like, to follow a critical path that seems designed to exhaust every opportunity, including the political route, the governmental route that is necessary to have a new building. I’m delighted to see the effort so focused, and hopefully their intentions here will be reciprocated by the decision makers who have the opportunity to impact it in a positive way, “ Stern offered after the BOG’s approved Bennett’s ownership of the franchise.

“David has said it very well. We, first and foremost in our evaluation, made a decision to invest in the NBA and to be a shareholder in what we view as a very important and growing, global business. We also view the Seattle marketplace as a remarkable opportunity – very dynamic, expanding economy, beautiful place to be. The connection to the Pacific Rim, the existing trade that is there, the future trade that will happen, and the league’s potential internationally and really a lot of work that is already being done in that pursuit. So, our interest is in that marketplace and in that economic model. I am encouraged by what has happened so far in terms of the development of a building. I think we’re being well received, and I think we’re making constructive progress toward that end. So, we’ve been working -- although we didn’t receive board (NBA Board of Governors) approval until today – we’ve been working, really since the day we announced (the purchase), on this project. So, we’re excited to really hit the ground and begin some serious work,” Bennett saying what any new owner would say on the eve of his first year as owner of an NBA franchise based in Seattle.

Bennett has made it clear he’ll give it this year (the Hornets “plan” on moving back to New Orleans in one year) and then he’ll look at his options – moving the Sonics from Seattle to Oklahoma City, in time for the 2007-08 season. Whatever Bennett and Stern suggest, Bennett bought an NBA franchise to ensure the city he does business in and lives in (Oklahoma City) has an NBA team. Once Bennett moves the Sonics to Oklahoma City the NBA may expand to Seattle (the Charlotte Bobcats) or move a team to Seattle (the New Orleans Hornets) but take it to the bank Bennett -- will move the Sonics to Oklahoma City, when George Shinn moves the Hornets back to New Orleans.

The end game, Stern has tossed in the towel on Seattle he has no interest in personally or professionally getting involved as he is in Sacramento. With more than 70 percent of respondents in a poll released Friday saying in no uncertain terms they have no interest in helping to fund an arena unless Washington (State) politicians are ready to commit political suicide (unlikely) Bennett might be saying all the right things, but he’ll have little if any real political support. The NBA has been a resounding success in Oklahoma City as a stopgap plan to help the New Orleans Hornets for the last two years, but if anyone honestly believes the NBA is going to leave Oklahoma City to the NHL or another sports league than they clearly never understood how Clay Bennett and David Stern are playing the arena game – to win, with the Sonics moving to Oklahoma City.

For Sports Business News this is Howard Bloom. Sources citied and used in this Insider Report: The Seattle Times and The Seattle Post Intelligencer

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