Column: 2012 - Business in sports will see also-rans, surprises
I was so successful (read: Didn't fall flat on my face) with last year's sports business predictions, I'm back for more.
Of course, looking into last year's crystal ball was the equivalent of a gimme putt. CBA's in three of the four Major League team sports were set to expire in 2011, guaranteeing that labor issues would top the agenda. I correctly predicted a lockout in the NBA, but came dangerously close to being wrong on my prediction that the NFL players and owners would find common ground before losing regular season games.
This year's only labor negotiation will be in the NHL, with the current CBA expiring on Sept. 15. There is way too much at stake for either side to even think about playing chicken, but a work stoppage is still a real possibility. With former MLBPA executive director Don Fehr now leading the NHLPA, owners won't be able to dictate to the players as they did in the last negotiation.
The NHL lockout of 2004-05 begat a salary cap designed to guarantee teams cost certainty. In a case of be careful what you wish for, the cap hasn't been the panacea the owners anticipated. Under the current CBA, players have faired better than the owners and many clubs - perhaps as many as half - are still bleeding millions. One way to remedy the situation is to adopt greater revenue sharing, an issue that will pit large market owners against their small market brethren more than it will owners against players.
Player safety also will be a key issue throughout the year in both the NFL and NHL. Three NHL enforcers passed away in a three-month period last year and concussions have sent literally dozens of players, including arguably the league's best, Pittsburgh Penguins center Sidney Crosby, to the bench for extended periods of time. That's hardly the best way to market the game.
Concussion related news also dominated the NFL during the waning months of 2011. At least a dozen lawsuits have been filed against the league by a number of former concussed players. All that litigation makes an 18-game schedule, which seemed inevitable a year ago, DOA.
Regrettably, you can count on more sports-related instances of child sexual abuse making the news this year. While the revelations at Penn State and Syracuse dominated the headlines in 2011, similar disclosures were made in women's tennis, swimming and gymnastics. The problem is deeply rooted throughout society and the sports world - where young people look up to athletes, coaches and authority figures - is fertile ground for such abuse.
In baseball, one major development will be the sale - at some point during the year, but unlikely to occur by the self-imposed deadline of April 30 - of the Dodgers. It will likely be the first MLB franchise to sell for more than $1 billion. If an all out bidding war ensues in bankruptcy court, look for a final sale figure between $1.2-1.3 billion, depending on what assets are included in the transaction.
Other baseball related news will include the approval of the Oakland A's relocation to San Jose, territory currently claimed by the San Francisco Giants. However, the Giants will be compensated in some fashion, similar to the indemnity the Orioles received when MLB moved the Expos to Washington. Soon enough, perhaps this year, MLB also will be forced to address the growing financial disaster that is the Mets, assuming the team's creditors don't take action first.
An election year practically guarantees that Congress will continue to delve into the sports world, on issues such as HGH testing, the BCS, conference realignment, and perhaps player safety issues.
Barring a financial meltdown, perhaps triggered by the unsettling financial issues facing Western Europe, the economy will not affect teams and leagues to the same extent that it has in the past 3-4 years. The NFL recently extended its TV agreements at a 60 percent increase over current contracts.
Count on a least one major surprise in the world of sports during the coming year that no one can even imagine at this point, although it will be difficult to top the Penn State sex abuse scandal.
Will I be as prophetic as I was last year? Hopefully, we'll all be around at this time next year to find out!
Happy New Year!
Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Associate Professor of Sport Management and Sport Law at Eastern New Mexico University, teaches the Business of Sports at the University of Wyoming, and is a contributing author to the Business of Sports Network. Jordan can be reached at email@example.com.
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