Big decisions loom for growing MLS

November 23, 2009

Major League Soccer shows plenty of signs of good health and progress but beneath the surface the North American league has some critical decisions to make over its future direction.

After a week of largely upbeat build-up and nationwide publicity for a sport that so often struggles to get space, the league’s title deciding game, MLS Cup, was played out in front of over 46,000 fans here in Seattle – the city that is staking a strong claim to be the de facto home of U.S soccer.

“It was a memorable night for soccer in the United States,” said league commissioner Don Garber.

Strolling through the squares of downtown Seattle, packed with fans bedecked in team colours and chatting to the soccer-savvy locals, it was hard not to imagine how the sports scene in the U.S could change if the Seattle experience truly was replicated across the country.

David Beckham and L.A Galaxy didn’t get their title, losing on penalties to Real Salt Lake, but they did both earn some respect.

Beckham has surely put to bed the argument that he is not fully committed to his MLS project by playing through the pain barrier of a badly bruised ankle for 120 minutes and since Bruce Arena took over as head coach, the Galaxy feel like a real team rather than the circus act they were in danger of becoming.

Salt Lake won the league in just their fifth season of existence – a real boost for the trio of new teams about to enter MLS, Philadelphia in 2010, Vancouver and Portland a year later and encouraging also for other teams in the league without a big name foreign player.

But for all the very real advances the 14 year-old league had made, MLS now finds itself at the crossroads with some very difficult strategic issues to deal with, including some tough talks with the players’ union over a collective bargaining agreement on wages and conditions.

MLS has prided itself on avoiding the boom and bust associated with the first attempt at a nationwide professional league – the NASL which ran from 1968 to 1984 before collapsing as one debt-ridden club after another folded.

The MLS executives have led a conservative expansion and investment strategy designed for steady and intelligent growth and in many areas that approach has been justified.

The league is a ‘single entity’ which means that there is a strong central control over spending and a collective responsibility for debt. The salary cap and the restrictive rules on recruitment and squad development act as a brake on what is so often the biggest cause of debt in professional soccer — wages.

Like all the pro sports leagues in the U.S, the desire for parity – keeping as many teams as possible competitive with each other – leads to rules and regulations that are surprising for a country known as the home of modern capitalism.

There has been some loosening of the reins – the Designated Player exception, also known as the ‘Beckham rule’, allows clubs to have a player on their squad who is outside the salary cap restrictions and is paid for directly by the team and not the league.

Some clubs in MLS, such as the Seattle Sounders and the L.A Galaxy, would like to see an expansion of that exception and greater freedom for clubs to buy intheir own players and offer lucrative deals while less wealthy franchises fear that would create a small elite.

At the weekend Galaxy owner Tim Leiweke suggested a rule change was on the horizon which would allow for three designated players and that he expected to see more big name players head to the league.

However, Garber was quick to put the dampers on such talk.

“It is clear that the LA Galaxy are a big proponent of the designated player rule but I can assure you that no decisions have been taken on the designated player rule,” he told reporters at halftime in Seattle.

“Frankly no discussions will be held at the board level on that rule or our salary budgets or anything related to what we spend on our players until after we get through our CBA negotiations,” he said.

BASIC MATTERS

It is a tricky issue for Garber to address. He wants to keep the big money backers of the Sounders and the Galaxy happy; he wants to see more Beckham style big-name players in the league but he doesn’t want to make the mistake of leaving weaker franchises to fade if they can’t keep up with the big-spenders.

But with the current agreement with the players running out on Jan. 31 and the union pushing for higher wages, it is more basic matters that Garber must attend to.

Some of the salaries being paid to experienced and talented players in MLS are astonishingly low compared to the money that players of similar ability earn in Europe or South America.

Stuart Holden, a 24-year-old U.S international and one of the top midfielders in MLS this season with Houston, earns a salary of under $35,000 from the league while Salt Lake’s top scorer Robbie Findley with 18 goals in 27 regular season games and the equaliser in Sunday’s final, this year earned just $72,000.

A deal needs to be struck with the union to avoid the acutely embarrassing and potentially damaging scenario of threats of a strike and also to lessen the danger of the country’s best talent voting with their feet.

Not only is MLS unable to attract quality foreign players into the league, salaries well below the international level mean that it cannot hang on to a lot of American talent.

Holden’s contract runs out in January and he could well move abroad and while players of his quality will always be tempted by an offer from England or Spain, what should be worrying Garber is the exodus of more modest talent to smaller leagues.

It doesn’t look good for MLS’s credibility as a major league – among U.S sports or on the international soccer stage — when young American players choose, as a number have, to move to the relatively anonymous and modestly paying Danish and Norwegian leagues in order to earn a better living.

And while Leiweke talks of new names coming into the league, the fact is that his team and the league can’t control the top names they do have.

Next year’s MLS season starts two months before the World Cup finals in South Africa – an event which is being well promoted on television and which is increasingly on the radar of mainstream sports fans in North America.

MLS’s two highest profile foreign players – Beckham and Mexico’s Cuauhtemoc Blanco – will likely be featuring in that tournament and offer the perfect way to lead interested fans from the World Cup to the domestic competition.

Yet at the start of the MLS season in March, those two players will be playing in different leagues, Beckham with AC Milan in Italy and Blanco back home in Mexico – thanks to deals designed to keep them in shape for South Africa.

Blanco may not return while Beckham is being loaned out — a bizarre situation that is simply unthinkable for any major league sport in the United States or any serious soccer championship elsewhere.

The one area where MLS’s caution has been less evident of late is in the matter of expanding its size. The league will go to 16 teams next year and 18 by 2011. In the subsequent seasons Garber would like to add Montreal and then a 20th team, possibly one owned by Beckham or a consortium he would front.

Here again there is something of a quandary – expansion risks spreading the talent too thinly across the league and creates a need for more imported players and therefore a demand for higher salaries to attract those foreigners.

But with interest in the game as a whole growing – with rising television audiences for the English and Spanish leagues and Champions League football – not embedding MLS into key soccer markets risks allowing a generation of fans to get their fix elsewhere – probably from foreign television.

MLS’s prudent, intelligent and relatively cautious approach has been largely justified by the steady progress the league has made and Garber is perfectly right to celebrate the achievements in bringing the sport to a new level in North America.

But there is, at the heart of all these issues, the conflict between the tried and tested methods of North American major leagues – salary caps, drafts, the desire to keep the gaps between the best and the worst to a minimum, and the fact that, unlike American football and baseball, MLS faces strong competition from overseas leagues and a global labour market for talent.

Soccer, globally, is a ruthlessly free-market business where the rich usually get what they want.

Ultimately, if MLS wants to step up to a higher level, if it wants to be truly major league in the U.S. and in the world soccer scene, there will be some strains on the almost socialistic structures it currently operates in.

PHOTO: Los Angeles Galaxy’s David Beckham watches the celebration after losing to Real Salt Lake in a penalty shootout during their MLS Cup 2009 championship soccer match in Seattle November 22, 2009. REUTERS/Robert Sorbo

15 comments

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Wow! I’m not used to well-written articles about soccer from such mainstream sources. Thanks!

[...] the original:  Reuters Soccer Blog » Blog Archive » Big decisions loom for … By admin | category: soccer | tags: 20th, become-its, brothers, record-as-coach, seattle, [...]

Something that MLS and writers seem to disregard.. Seattle has been a soccer town for many, many years. In 1976-78, the NASL sounders averaged over 23k fans.MLS needs to pay a little more attention to the history of their locations and maybe not buy into their own press releases quite so much.If they don’t, they are going to set themselves up for a big fall.

Posted by Charles U. Farley | Report as abusive

It’s not additional DPs, and expansion is not going to dilute talent one bit. There is an entire world of players. What does need to happen is that the players should make enough that they could afford season tickets to their own game. DPs may help, but if you want quality, start making the minimum salary $50k and 100% medical with no co-pay for the players and their family.I’d much rather see that, and see American talent stay here and develop before catching a transatlantic, than to see additional star players that make more than the rest of the team combined.When you know that college gridiron players make more money hush hush than these pros, it makes you wonder…

Posted by Mat | Report as abusive

Fantastic article, really interesting analysis/explanation. I’ve been rooting for MLS to succeed since the very first year and attended more DC United Games than I can count. Watching Beckham and Donovan connect with Findley in the championship with the very talented Beckerman on the other side really gave me some hope for the future of US soccer.

Posted by Andrew | Report as abusive

Great article. I am a huge soccer fan who has been to many MLS games and also follows European leagues. I want to see MLS succeed, but I believe it is not realistic nor desirable to shoot for being a “truly major league.” The goal should not be equal status with the NFL or NBA, but rather NCAA men’s football/basketball: An understanding that the product on the field will be mediocre, but a passionate fan base nonetheless. It is no different in the majority of soccer leagues around the world.

Posted by Scott | Report as abusive

I like the idea of 3 designated players because I think the MLS could get a lot of attention if some world class players started signing with American/Canadian clubs.About expansion, the MLS should grow small and really look into markets and the ownership group behind it. I hope to see Montreal and Alberta join Toronto and Vancouver in Canada and I would like to see at least 2 southeast based teams (Florida and Atlanta). Other than that the MLS should stay small and not over expand.GO TORONTO FC

Posted by Joe Strummer | Report as abusive

Soccer, the King of sport as African call it, will finally get some visibility. Long way to go though. I grow up knowing only one game: soccer as protrayed in my book http://www.thehurdlesofdoctor.com

[...] Reuters Soccer Blog » Blog Archive » Big decisions loom for … [...]

Many thanks for your comments. Let me deal with a few of the issues you raise so far.1.Charles – yep, absolutely right about Seattle\’s tradition in NASL, A-League and USL. Shouldn\’t be forgotten, especially by people who mock the non-MLS structures that are all some fans have in their markets. Actually Bruce Arena pointed out that Seattle isn\’t some new phenom when he talked to reporters after last night\’s game. He has a lot of respect for what you are talking about.2. Mat. I agree with your main point but my argument was that expansion without increased spending will weaken the talent pool. MLS will lose the best American players to Europe and not be able to replace them with decent players from elsewhere. Obviously the very best Americans will always go to Europe as long as the best money is there – but I think it is disappointing that Norway and Denmark are more attractive to young players than their own league.3. Mat – the reason I highlighted Holden\’s salary was because it really surprised me when I saw it. And I know there are guys on even less than that. The rookie salaries are not far off Walmart levels. I am pretty sure the players union will be making their case strongly. Thanks for the info about health insurance etc. Something else for me to ask the players assocation about.3. Andrew. I think Beckerman is one of the best players in the league at the moment. It would be good to see him in the World Cup squad – he keeps things ticking in midfield and on Sunday showed a composure that was lacking in most other players.4.Scott – I think the NCAA comparison is a really good point and fans will understand when players go abroad. They do already really don\’t they? But I think long term, MLS has to decide whether it is part of the global soccer market or not. At the moment it has closed itself off somewhat. I think the standard has to rise somewhat – that can bring in the fans who currently stick to EPL and Champs League on tv.5. Joe – they have to be careful with the DP thing though and make sure they get the right guys. People often forget that the big problem with NASL wasn\’t so much the salaries on their own but the fact that they were basically ripped off by some low-performing over-aged and overpaid European players. As for Canada – MLS commish Garber wants Montreal – let\’s see how much Montreal wants MLS (on the terms being offered). I live in Miami so a team in the South East would be nice!

Posted by Simon Evans | Report as abusive

A few observations/ponderingsWith increased expansion, there is more money and roster positions available for American players. Their are only so many roster spots available to internationals. That could keep more of those players in the US rather than leaving to Denmark or the Norwegian leagues. If each MLS team had cap space for 2 of those Americans/Canadians then expanding would simply allow for more of those players to stay in MLS.Regarding Holden, I believe he is being smart and has not renegotiated his contract because he knows that by waiting until his contract is up he can get the best deal possible. So while it is shocking to see him making so little, it is not like Houston and MLS haven’t tried to extend his contract and offer him more money.You will also have a player like Hurtado in Seattle demanding more money. But it shows that players can come to MLS and then use it as a spring board to make money in other leagues. Similar situation with Montero, but he is making decent money.MLS does have issues with some players making more money than they deserve as well and it is very difficult to renegotiate those salaries down. The stronger the Player’s Union gets the harder it will be to do that.

Posted by Andrew | Report as abusive

As someone who looks out for the MLS results on a regular basis but is not all that familiar with the MLS organisation as a whole, I found this a very interesting article. One question that springs to mind is, do the franchises have an academy/youth team structure in place to nurture and develop young talent? I assume the college situation isn’t as strong or as “funded” as gridiron, so there woudl need to be a source of replacement players if/when the more experienced guys inevitably move abroad on higher contracts.Also, maybe the “designated player” rule could be expanded to encourage US players to stay in the MLS – perhaps have 3 DP slots at each franchise, but one must be American?

Posted by Sean | Report as abusive

Good article about the success and challenges of Major League Soccer.Unlike most every good soccer league in the world, America’s top flight soccer league faces unique challenges of staying relevant domestically competing with more popular sporting fair like American football, baseball, basketball and college sports while at the same time competing internationally for good players with every above average soccer league around the globe.Most soccer (footballing nations) only have to compete with other soccer leagues, MLS is competing on two fronts.

Posted by Mike G. | Report as abusive

[...] Reuters Soccer Blog » Blog Archive » Big decisions loom for …21 hours ago by Simon Evans  Posted by Reuters Soccer Blog » Blog Archive » Big decisions loom for … OQ China. November 23rd, 2009. 8:33 pm GMT. Something that MLS and writers seem to disregard.. Seattle has been a soccer town for many, many years. … – [ ] [...]

your right in most other countries football (soccer) is the main sport, the fact that americans turn it into a massive sideshow is possibly a reason for its failings, takes away the beauty of the game.

Posted by j | Report as abusive

Simon,I wanted to say this is a brilliantly written article, that poses many intriguing questions for the league that I spend my life covering. I had the pleasure to meet you in Seattle as a member of the Media Corps and it is a pleasure to see all your hard work come to fruition. As a young aspiring soccer writer, your piece is inspirational and hopefully I can emulate it in my own work.-Adam Serrano

Ridiculous.Your silly references to “capitalism” and “socialism” are not just bad corollaries, they’re also absurd.You cannot claim to understand the structure of MLS and then start tossing around that kind of nonsense.MLS being a SINGLE ENTITY means just that: it;s all ONE CORPORATION.The team “owners” are actually league investors. They are not a league in any sense that you seem to want to portray it. You really need to grasp this.In fact, each “team owner” only “owns” 49% of the team he operates. The majority share of each team is owned by the league – ie. the corporation – itself.Essentially, MLS is the functional equivalent of a national chain of company owned muffler shops or hamburger joints.Profits flow to the corporation after local expenses. Salaries are paid from one account and all employees are contracted with the corporation, not the teams.This isn’t a cabal of some kind. To call it “socialism” simply demonstrates an ignorance of what socialism is.MLS L.L.C. is a COMPANY that hires EMPLOYEES to play soccer games and then sells tickets for those games. There’s nothing “socilaist” about it that’s not “socialist” about Red Lobster or Starbucks.You need to grasp that before you write utter rubbish about it all.

Posted by Fred | Report as abusive

it sure sounds like socialism to me. Soccer in Europe is a free market game where those without money and a powerful fan base, are left behind. The worst team in MLS will be back next year and the year after that no matter how pathetic they are. That is the premise of socialism Fred; that the strong and the weak have access to the same resources and compensation is based on the amount of labour expended. MLS is a socialist league if it’s anything like you described.

Posted by JFox | Report as abusive