Oh oh... Someone misspelled "MLS".
The Ponzi Scheme of Major League Soccer
IS MLS A PONZI SCHEME?
good one. ;D
Beckham has an agreement with MLS going back several years requiring his ownership group to pay $25 million for an expansion team in Miami. Works out to $1 million per team. Hardly seems like a period scheme to me. More like a continued push to expand the MLS footprint into key US markets.
Until they run out of buyers. That's when it falls.
It looks like a pyramid scheme to me but, of course, I have not seen the internal numbers.
TBH, since Rogers bought the Argos, I no longer hate Rogers or TFC.
But that Deadspin article does point out some good points ie. A very poignant point the article makes that sometimes it can be too late to figure out what exactly is going on when you see a league adding franchises so quickly as a means to quickly add revenues.
It’s a bit of a strange course for a sports league that isn’t exactly lighting it up in terms of attendance, viewership, or revenue. MLS may be allegedly growing in popularity—you can’t swing a dead cat without hitting a claim of its popularity with urban millennials—but it’s still miles behind the England’s Premier League and Spain’s La Liga and Germany’s Bundesliga and probably another half-dozen leagues around the world in terms of both talent and viewership. And as far as North American sports leagues go, it’s a distant fifth behind the NFL, MLB, NBA, and NHL. When Forbes last looked at MLS finances, it had to perform mathematical contortions to explain why franchise values are rising even as annual losses continue to mount.
That business model and this financial trajectory suggests that MLS’s sea of red ink is either a loss leader or a Ponzi scheme, and it’s not always easy to tell the difference between the two until it’s too late. Several sports economists, though, aren’t optimistic.
“The best indicator of expansion franchise worth is success at the bottom of the league? in revenues, says Stanford economist Roger Noll. For MLS, “that still looks more like AAA baseball except for a few million per year more in TV revenue.?
The University of Michigan’s Stefan Szymanski, co-author of Soccernomics, is even more blunt about MLS’s shortcomings. “Any modern professional sports league, to be profitable, needs to generate a large revenue from broadcasting, and that means you have to have large TV audiences,? he says.
Re : But that Deadspin article does point out some good points ie. A very poignant point the article makes that sometimes it can be too late to figure out what exactly is going on when you see a league adding franchises so quickly as a means to quickly add revenues.
I know I am far from objective but, like it or not, the MLS has all the markings of a pyramid scheme.
From the S.E.C. See if this sounds familiar?
What is a Ponzi scheme?
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors to create the false appearance that investors are profiting from a legitimate business.
Why do Ponzi schemes collapse?
With little or no legitimate earnings, Ponzi schemes require a consistent flow of money from new investors to continue. Ponzi schemes tend to collapse when it becomes difficult to recruit new investors or when a large number of investors ask to cash out.
is anyone really serious about calling the mls a Ponzi scheme?
Yes and no. When it was first created, everyone's intentions were pure. However, due to it's own success, the MLS has morphed into a Ponzi scheme.
Again, many teams lose (a lot of) money and are only around because of :
- Expansion money;
- Franchise values.
If/When the expansion money runs out, the original owners may feel owning the team is no longer good business, and head for the door. If enough head for the door, the franchise values will collapse.
20 years from now, I'd say there is at least a 50% chance that MLS is seen as one of the great Ponzi schemes in history.
Fantastic addition to the back line!
Good game overall - watched a Spanish stream. Gio with a brace and Marky Delgado playing Johnny on the spot with a clean up goal. Red card on Bono took the Reds down to 10 men and putting defender Nick Hagglund in goal. Came up with a fantastic save to maintain the win.