The MLS model has delivered sustained growth myth

As I've said several times writing posts for this blog, its main purposes are to educate and myth bust.

If you've ever had a discussion about how closed league single entity MLS business affects soccer as a whole in this nation, I'm sure you've seen a thought expressed similar to this tweet...

@THEChrisKessell We are significantly further along than we were 20 years ago and wouldn't be having this conversation without this system.

— WrongSideOfThePond (@wrongsideofpond) December 22, 2016

The common line of reasoning is that the Single Entity structure of MLS and the closed league structure of the US Pyramid has allowed the protection needed for the fledgling sport league to achieve the slow and steady growth it has had so far.

This is FALSE. By the words of FC Dallas President Dan Hunt, in 2001 the league died. It's single entity structure... closed league... USSF supported model... failed. 

The league was, in theory, dead. They gave up and were ready to close up shop. MLS had failed. The investors were out and there would no longer be a top flight professional soccer league in the United States.

For at least a few hours, MLS essentially ceased to exist.
"We were having a league call in November and the league folded," Hunt said. "It went out of business, they were preparing the documents and that was it."

 READ THE ENTIRE ARTICLE HERE

The creation of Soccer United Marketing (SUM) as the marketing arm of MLS in 2002 saved the business.

So really what allowed MLS the business to come back from the dead?

1. SUM deals with disgraced admitted criminal Chuck Blazer.
2, SUM brokered USSF National Team assisted media deals with obvious Conflict of Interest issues.
3. SUM selling Mexican National Team sponsorships and matches in the United States
4. SUM selling FC Barcelona to the US market

and much more from SUM.

It is plainly obvious that SUM is the driving force behind the current growth of MLS. Without it the closed system single entity model was a massive failure. 

What many don't know is that at any point in time USSF could decide to pull the NT assistance for the severely under-performing MLS media rights deals and decide to sell the NT media rights in house like every other sport governing body in the country does.

At any point in time USSF could stop allowing SUM to host Mexican NT games on US soil.

At any point in time USSF could stop sanctioning any SUM promoted friendlies.

Will it? Should it even do this? Those are very big questions. Any of these things could easily put a huge damper on MLS/SUM growth.

What USSF also could do...

1. Mandate an end to the current privately owned for profit league system.
2. Outlaw the "single entity" model MLS employs.

It would allow current MLS investors to continue to profit via ownership shares in a newly spun off (and highly profitable) SUM. They would also be acquiring independent ownership of their clubs that would be firmly stationed in Division 1 USSF controlled soccer.

A separate positive by-product of this split would be the relieving of quite a bit of the COI issues related to soccer governance in the US.

This would be a great first step toward more USSF control of how the US soccer pyramid is managed and a future Open Pyramid featuring #ProRelForUSA.
 

A simple question... Whats next?

 A week ago I was sent this very simple tweet...

@THEChrisKessell what's next?

— Derek (@Derek525) December 14, 2016

What do we do next? About a year and a half ago I wrote an article about the massive growth of the #ProRelForUSA reform movement. Today you can find dozens of people with the hashtag in their social media bios, Instagram accounts dedicated to the movement, Facebook groups, Supporter Group Coalitions, and anything else you can think of trying to move us forward as a soccer nation. This has all happened since I wrote that article...

Today I saw two very interesting pieces of Twitter analytics comparing #MLS vs #ProRelForUSA.

 

As we can see very easily the #ProRelForUSA conversation is reaching quite the audience. One that is not very far behind the #MLS conversation. Over 1.4m impressions and a reach over over 500k people.

Now lets amplify that ... 

That is the next step. Every time you see somebody speak up in support of an Open Pyramid, USSF reform, promotion and relegation, ending the Conflicts of Interest at USSF, single entity structure of MLS... anything tied to the #ProRelForUSA movement. 

1. Tell them thank you for speaking up.

2. Ask them to continue to speak up. 

3. Invite them to use the #ProRelForUSA hashtag

4. Point them in the direction of helpful articles, blogposts, and infographics to support their ideas.

5. Ask them to share them. 

This is how we continue to grow the discussion online is a civil manner and put pressure on USSF and the powers that be in American soccer to change. 

As the Deloitte study pointed out via the first released polling data on the subject, 88% of US soccer fans would like to see an Open Pyramid. We don't need to worry about convincing the 12% who oppose it to change their mind. THEY are the small super vocal minority of fans... we are the super majority. 

Now lets ALL speak up!

An Open Pyramid for US soccer is not about a competition format

The day you stop thinking of USSF as simply who puts together the US Men's and Women's National Teams and start to think of it as the regulatory agency tasked with one specific portion of the nations economy is the minute you see that #ProRelForUSA is about much more than a simple competition format.

Now that we are all thinking of  the USSF as a industry specific regulatory agency, we can see that the current USSF imposed regulatory environment has created glass ceilings that are restrictive concerning the growth potential for an entire group of entrepreneurs. On social media fans act like an Open Pyramid featuring #ProRelForUSA is just some gimmicky competition format... we know it is not... unfortunately much of our entrenched American soccer media has not done a good job making it clear that the closed system that we currently have is a barrier to growth for those outside of the privileged group of investors that are allowed entry in to the closed top tier.

It is as simple as that... no matter how much money, sweat, and ingenuity you invest in to growing your business, if you are not "in" with those in power then you can't fully expand as a business to the maximum the market will allow.

.@THEChrisKessell 3four3 would already have launched a 4th division club if glass ceilings weren't there.

— Gary Kleiban (@3four3) November 28, 2016

How many other investors are holding back investment because of this regulatory environment?

Now some big questions need asked...

Would this regulatory environment be allowed to exist in any other industry in the United States?

I think it is fair to say that it would not...

So why is this creating of artificial barriers to entry and glass ceilings on growth being allowed to exist in this industry by the regulatory agency (USSF)?

As myself and others have explored over the years there are severe conflict of interest issues at play concerning the USSF, MLS, and SUM.

We know MLS has for its entire existence created policy via USSF decisions that have hurt all clubs not a part of their singular business to ward off any potential competitors.


Knowing all of this, it is frustrating to see people actively root for the oppression of small business owners... people who dedicate their lives to their club... their fans... players... staff... the sport itself. To have them be rewarded daily with people, not just fans but many influential media members and sitting USSF board members, actively participating in their businesses nightmare of regulatory sabotage by the group that is tasked with growing the game at all levels even though a recent Deloitte study shows it would be best for the long term growth of the sport.

That's what you are doing when you support a closed system like we have now... you support the regulatory crisis that small business owners nationwide are trying to overcome. These people who have invested life savings in to their club... decades of their life... you are rooting for them to fail... it actually makes me sad to think of the toil that these 1000s of great people put in... and you choose to root for billionaires pocketbooks via a regulatory system 100% stacked in their favor.

Worries about USSF Conflict of Interest issues are not new.

Recently Stefen Szymanski and Roger Pielki Jr released a wonderful article about the Conflict Of Interest issues within USSF and the lack of external oversight on these potential conflicts.

READ IT HERE

While this current crop of COI issues concerning many of the non-profit USSF board members and their potentially self serving relationship with their for profit business ventures MLS and its Soccer United Marketing (SUM) marketing arm are alarming... concerns over Conflicts of Interest from USSF leadership are not new at all.

During the initial creation of MLS the Chicago Tribune reported that many inside and outside of USSF were concerned about the inherit COI issue between USSF President Alan Rothenberg and his self described substantial financial stake as an investor in MLS.

It is easy to understand why voices and eyebrows were raised over the process by which the U.S. Soccer Federation gave preliminary approval for one of the three plans it reviewed to start a top-flight pro league in the United States.

After all, the USSF's Board of Directors approved the plan submitted by its president, Los Angeles attorney Alan Rothenberg, likely to be an investor in the entity he calls Major League Professional Soccer, Inc.

The USSF also advanced Rothenberg a six-figure sum from the 1994 World Cup's expected surplus to help him develop the plan. Rothenberg is chairman, president and chief executive officer of the World Cup organizing committee.

And several of the directors who voted 18-5 to approve Rothenberg's plan are employed either by the USSF or World Cup '94.

The apparent and potential conflicts of interest in that situation dismayed members of the two competing groups, both of whom figured the deal was done long before the board voted last Sunday in Chicago.

"We were shocked and disappointed by the decision," said Bill De La Pena, president of the American Professional Soccer League, which wanted to move up from its minor-league status.

"People beholden to Alan were central to the decision," said Chicago businessman Jim Paglia, who wants to establish his League 1 America as part of a real estate development plan.

Another item that can easily be seen as a blatant lack of good governance caused by a COI is the fact that the USSF approved spending a very large chunk of money to support MLS's creation and did not receive an ownership stake in the league.

To that end, the USSF has pledged 30 percent of a World Cup surplus projected at $20-to-$25 million to start the league in 1995.

 But the man who helped push through MLS and his investment in the league as President of USSF did... 

READ FULL CHICAGO TRIBUNE ARTICLE FROM 1993 HERE


Looking back at these issues with the clarity that the lens of these current COI issues gives us we can see that these types of issue have been long standing and quite worrisome to many.

Another item that time has made apparent is that USSF leadership has not always picked wisely when it comes to allies. Sunil Gulati and USSF's relationship with Chuck Blazer has been documented quite well and with his fall from grace that relationship has come under some scrutiny.

Pairing Alan Rothenberg and his obvious USSF/MLS COI issues with what we now know about disgraced former FIFA President Joao Havelange and their relationship along the power play FIFA made to keep Rothenberg in power...we now have two USSF Presidents who have made very poor choices in who to align with.

Despite the success of the World Cup, which he helped organize, Rothenberg has been a controversial figure within the USSF during his four-year team. His current difficulty centers on Rothenberg's twin positions as president of the USSF and head of the proposed new professional league, Major League Soccer. Many within the USSF, particularly from the pro division, see this as a conflict of interest.

The pro vote, which delivered the election to Rothenberg in 1990, nearly cost him the presidency this time. The three voting blocks--professional, amateur and youth--split among the candidates. Only one of the four pro leagues voted for Rothenberg. His strength came from the amateur division and Groff took most of the pro vote and some of the youth.

Havelange's unprecedented attendance here has angered some delegates who resent FIFA's interference in the election. Most voters remember FIFA's support for Rothenberg's election in 1990. FIFA's role then consisted merely of a phone call to one presidential candidate, asking him to withdraw from the race.

FIFA's role in this election has been far more open. At a banquet Friday night, Havelange spoke for several minutes and lavished praise on Rothenberg, mentioning him by name some 16 times. On an evening that was meant to celebrate the sport of soccer in the United States, Havelange's nomination speech seemed out of place.

and

Earlier in the day, Havelange had summoned candidate Des Bordes to his hotel room. Speculation was that FIFA would request that Des Bordes, who had little chance to win, withdraw. Des Bordes would not reveal what was said but reiterated late Friday night that he was still in the race.

However, Des Bordes dropped out after the first ballot. Further fueling the FIFA-deal theory, apparently all of Des Bordes' delegates went over to Rothenberg on the second ballot.

Groff, for all of his conciliatory talk after the vote, was clearly angry with the FIFA influence on the outcome.

"FIFA is very insensitive to the operation of individuals with their constituents in the United States Soccer Federation," Groff said. "They didn't need to push so hard. FIFA is so scared to death that if Alan is not in front of MLS, it won't succeed.

"They took that one step further--if Alan is not president of the U.S. Soccer Federation, MLS won't succeed. It was all totally inappropriate."

READ THE FULL LA TIMES 1994 ARTICLE HERE


The calls for transparency and reform within USSF are becoming more frequent and louder.

If you agree that something needs to be done... check out this website

USSF REFORM

If you agree with any of the platform... sign the petition.

Thanks, but no thanks

Group calling for USSF reform to release platform

What is "#ProRelForUSA"?

Pretty simple question right?

Well... yes and no.

By now we all know the simple definition of what the competition format of "Promotion and Relegation" is... but #ProRelForUSA is much bigger than that. Our great friends at www.ProRelForUSA.com summed up what the movement is quite succinctly.

Open The Pyramid

We believe that soccer (football) clubs in the United States and Canada deserve the same opportunity as clubs in the rest of the world.

Per FIFA statutes, national federations throughout the world organize their professional divisions within open and fluid pyramids where the most competitive clubs rise to the top based principally on sporting merit. Through a system of promotion and relegation, the best-ranked teams in the lower division are promoted to the higher division for the next season, and the worst-ranked teams in the higher division are relegated to the lower division for the next season.

The United States, Canada, and Australia are the only federations in the entire world that have a closed and locked pyramid that suppress their member clubs and confine them to pre-defined classes. The continued deployment of such a system has residual effects throughout every level of soccer in our country.

It is our mission to drive positive change within the sport and our federation through a grassroots movement & awareness campaign that supports:

• “opening the pyramid”
• a logical roadmap for member clubs achieving sporting success
• inclusion of our entire country, regardless of geography or population
• providing development incentive for players, coaches, and clubs
• providing financial incentive for investment in the game at all levels
• development of the most competitive professional structure possible
• transparency of the United States Soccer Federation
• a strong and incorruptible governing body
• neutralizing conflict of interest among stakeholders

We are not anti-MLS. We are advocates for a healthy U.S. Soccer.
We believe America is the land of opportunity.
We believe in the American Dream.

Obviously this includes items other just the competition format known as Promotion and Relegation, many more.

No matter where you fit in the struggle to improve US soccer we think that you can find something that you agree needs addressed. It is easy to see that the #ProRelForUSA fight is one to reconstruct the system from the ground up for not only the professional game, but also the adult amateur game, youth soccer and how they are governed in this country.

 Join us... please speak up on all social media platforms using the #ProRelForUSA hashtag. Invite your supporters group to officially speak up in support of the changes needed at US Soccer to give the club you love the same opportunity as clubs the world over. Ask your clubs ownership/leadership to speak up and speak out in favor of the changes so desperately needed to give lower division local soccer in the US the stability needed to achieve long term growth in the US.

The pressure on those who govern the sport we all love in this great country needs to be raised to the level that it can no longer be ignored.