Wednesday, October 11, 2017

An Open Letter to US Soccer fans

Wake up, America.


As ridiculous and tragicomic as our failure to qualify for the World Cup may be (getting knocked out by a nation no larger than the city of Dallas) there is a potential silver lining to this otherwise coal-black cloud: we have a once-in-a-lifetime chance to effect real, systemic change in American Soccer, the change we desperately need to spare our children and grandchildren from ever suffering this indignity again.


Much has been written already about needed change, from the modest and obvious (new coaches, new players) to the more strategic (new US Soccer leadership, a different developmental approach), but at the head of the stream of all these issues is the Mother of Them All, looming so large that many American sports fans can’t even see it: we’re the only major soccer nation on earth without promotion and relegation.

That’s nuts, you may say. What does a league system have to do with our current woes? Let me break it down for you:


  • Because we don’t have pro/rel (and instead have a closed, contrived oligopoly in MLS and USL), the game does not attract the sponsorship and TV rights to draw in more fans and, crucially, more TV dollars from the US and abroad.
  • Because we don’t have pro/rel, we don’t have the competitive pressures or the money necessary to attract the world’s best players. Without those players, we cannot hope to compete at the international level because American players aren’t playing alongside them and improving themselves. There simply is no substitute for the pressure of pushing to send your team up to the next level, or that of fighting to keep from going to the next league down.
  • Because we don’t have pro/rel (with its pressures or its money), lower division teams, deprived of the chance of league advancement, cannot afford to build out robust, competitive programs for youth and player development to develop local talent across our huge nation, so our oft-touted size is largely unleveraged. Leicester City, recent English Premier League Champions, is dwarfed by my own city of Chattanooga in size, yet without the opportunity to advance, teams in lower levels cannot attract the capital and the engagement to grow and expand. Academies attached to healthy second and third division teams (beyond the closed ranks of MLS’ handful of developmental programs in a few selected markets) would produce and identify thousands of talented American players.
  • And because the lack of pro/rel means we’re essentially out of sync with the rest of the world, the US remains a reputational backwater of international soccer, where the sport is permanently relegated to lower-class status, failing to attract our best player talent, our best management talent, and the full corporate support it deserves.


Why, then, you may ask, isn’t this obvious to everyone? Why haven’t I heard more about it? Why is there no outcry to change it? Frankly, because American Soccer has been controlled by an incestuous, second-rate plutocracy comprised of people whose interest in American soccer is primarily in enriching themselves, not in what’s best for the American game.


Unlike the rest of the world, the US has closed, for-profit leagues (MLS and USL), built primarily to benefit the league owners, not to produce great soccer talent (and for what it’s worth, these leagues are now officially a worldwide joke by virtue of this colossal failure). When this closed system was contrived, the excuse given was that it was necessary to build a “greenhouse” system to nurture a fledgling league. If this was ever really the case, that day has certainly long since passed. As the prominent soccer economist Stefan Szymanski reminds us, the economics of “real” soccer in the rest of the world are this: all but the slimmest profits get competed away in the pursuit of better players. In MLS’ closed, single-entity world, however, all players work for the league and are leased to the teams, with salary caps, so that the whole entity can (theoretically) be more profitable. The free market cannot function effectively in this system, and it will never be able to, as the world player market keeps chugging right along even as MLS persists in keeping its head buried in the sand. As for the second-division USL, it’s poorly-designed franchise saddles teams with crippling franchise fees, hampering growth and preventing them from paying more for the best players they could otherwise afford. American players are therefore not exposed to the world’s best, and we languish in mediocrity.


As for why it’s not more widely discussed, it’s a poorly-guarded secret that the Major League Soccer/Soccer United Marketing/US Soccer oligarchy (all three have common leadership and are functionally a cabal) have had a running PR war on media discussion of promotion and relegation in this country. As unbelievable as this may seen, it is absolutely true. Because they effectively control the vast majority of soccer broadcast rights in the US- and thus American soccer media- this is quite easy for them to do.  I have witnessed multiple examples of American soccer’s sports personalities threatened, demoted, and even fired for attempting to express their views on the subject. Their silence is purchased relatively cheaply by their attornies with Releases and Non-Disclosure Agreements (just like Donald Trump’s and Harvey Weinstein’s) so we very rarely hear pro/rel openly discussed- much less advocated- in the media.


So why is MLS- whose billionaire owners are the real issue here- so afraid of pro/rel? As always, one simply needs to follow the money: because it would make doing business much more expensive for them. They’d have to compete on the open, world market for player talent, and their cost of capital would rise considerably as the possibility of being relegated down to a lower league would drive up the risk of lending money to them (because of the presumed lower sponsorship, TV, and ticket revenues there), and would lower the paper value of their teams, overnight. But what they’re missing is that the incredible double-edged drama of promotion and relegation- multiplied by the number of leagues in this country participating in such a system- would very likely dramatically increase the appeal of the sport and the engagement level of the fans, and the money in the new pro/rel system would likely soon dwarf that generated in the old, closed system. Would they still be able to get $250MM for the privilege of owning an MLS team, though? Nope, and too bad. American Soccer has suffered enough for their greed already.


Worst of all, the greed and stubbornness of the old guard owners in hanging onto their fake, closed system for fear of relegation has now collectively relegated all of us, as Americans, to the basement of world soccer for at least the next four years. If we can’t see that now, and don’t have the courage and fortitude to rise up and change it, then that’s where we belong to stay.

Wake up, America. It’s like being in The Matrix: once you see the truth, it isn’t complicated. Just walk out and demand the simple reality of promotion and relegation that the rest of the world already enjoys. If that happens, the US will soon be on a path back to becoming one of the World’s greatest soccer nations.  If it doesn’t, all this suffering will have been for nothing.

8 comments:

  1. The MLS clubs aren't really clubs. They're franchises. They're properties that belong in part to the MLS, and the owners have to pay the league a franchise fee in order to "own" the team. In the same way that you cannot buy a McDonald's franchise and turn it into a Wendy's, nor can you just decide to open a McDonald's restaurant without paying a franchise fee to McDonald's, you can't buy an MLS franchise and "relegate" it to a lower league, nor can you just buy any soccer club and decide to move it to the MLS. It's the same with all American sports. The Golden State Warriors are an NBA property, and the NBA has no interest in a system that would result in them or anyone else being relegated, nor do they have an interest in a team that's not a property of the NBA being promoted up to the NBA. Unless you can convince the MLS owners that this will meet their selfish interests, it is never going to happen on the scale that it needs to.

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    1. Well said. The franchise system is a very poor fit for global football. Traditional American sports don't need to concern themselves with the same level of world competition, either. And traditional American sports ownership is team-based, not place-based, so that owners can (and of course often do) move teams when they don't get the deals they want. That almost never happens in the rest of the world, either. If FIFA puts it foot down, those teams can devolve out of a single-entity system easily enough, and the power and control will return to where it belongs: the teams themselves.

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    2. You're just FLAT OUT wrong. The NBA is a closed league but it isn't single entity. There's profit sharing initiatives but that's not the same as being "Single" entity. There are no teams in MLS just MLS everything is shared where as in the NBA the lakers and KNicks are not beholden to the Pelicans. In fact there are measures in the NBA in which teams like the Knicks and Lakers can punish Pelicans for not bringing in revenue.

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  2. Tim it's Eli. I'll be honest Tim. I had no idea. You have definitely got me interested in doing some more research on this. It will, I'm sure, be a hard row to hoe to get the owners of MLS to buy into this concept since they for obvious reasons are interested more in their bottom line than in the value of America winning world soccer. Would someone with a large endowment just have to start another league themselves with this concept or are you thinking more American Olympic committee expanding and starting their own league somehow tied in with taxpayer money?

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  3. Nowhere in the world was promotion/relegation ever instituted to improve talent or to help clubs grow. That is a byproduct, and is not always guaranteed. There are several clubs and leagues out there in promotion/relegation systems that have not produced the benefits that this letter assumes. Promotion/relegation was implemented to reward clubs that BEFORE the institution of pro/rel had already invested and grown their clubs to compete with higher clubs. If we need pro/rel to make that happen, that means that our competitive landscape, and more importantly the popularity necessary to fuel it, is just not ready for pro/rel yet.

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  4. Right now we have MLS > NASL > USL > NISA > USLD3 as our professional "pyramid." You know how to tell if the US is ready for promotion & relegation? If we instituted promotion and relegation right now, would investors interested in a new club be perfectly OK with starting in USLD3 and waiting an absolute minimum of 4 years to get to MLS? And that's if they earn promotion without falling short. Could be 5-8 years. This sport is just not that popular here for an investor to be OK with that risk. We are not ready yet.

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  5. keep up the good work.

    Would like to see your thoughts regarding on-field innovations you think should be considered. I bring this up since, if we can ever move forward with pro/rel, USA could become the driving force in improving the game itself

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