An excellent sign of growth for any business is how much other businesses are willing to pay to put their name on your product. By that measure, MLS just received a significant boost to their rate of growth.
After signing an eight-year, $200 million sponsorship deal with MLS in 2010, Adidas has extended their partnership with the league for an additional six years and $700 million, reports Yahoo Finance. The new total is more than triple the previous value and takes place over a shorter time span, marking a significant increase in the valuation of MLS by one of its key partners.
“If it was a typical league deal, where you only get to put your logo on the jersey, I think we’d still be interested because soccer is our core sport around the world, but it really becomes interesting when you look at all the programs that help build the sport,” says Adidas U.S. CEO Mark King. “My guess is within 10 years, from a youth participation standpoint, soccer will be the biggest sport. And if kids who play soccer continue to be fans of the sport, then yeah, if you’re talking 20 to 30 years from now, I think MLS can be as big as NFL.”
(UPDATE: MLS confirmed the deal on Wednesday afternoon.
“Major League Soccer has built a legacy with Adidas that has been essential in the rise of our league,” MLS Commissioner Don Garber said in a statement. “Adidas has been a major collaborator with us since the inception of MLS, and we are proud that our partnership with this globally-respected brand will continue to enhance the growth of the game in North America for many more years.
We will work with Adidas on innovative concepts to showcase the sport and our elite athletes, and we will intensify our mission to develop top North American soccer players for generations to come.”)
That’s a major vote of confidence from a key figure in the sports world. With MLS growing significantly in recent years, up to a proposed 28 teams by 2022, King is placing a bet that the league can grow into a dominant figure in the American sports landscape.
Garber didn’t mince words and said that the deal is “a strong statement regarding where MLS is today and how we are poised and energized for the future”.
I’m glad that there is more money flowing in! There needs to be simple and substantive reform on salaries, roster rules and such. My list for consideration:
How about reforming the whole DP, GAM, TAM, HAM and etc.
1. Expand Senior Rosters (33 senior players)
2. Establish maximum foreign roster rules (11 international players)
3. Establish a league minimum salary (3.3M minimum)
4. Establish a Soft Cap/Luxury Tax mechanism (6.6M + %__ Penalty)
5. Reform DP designation to Cap/Tax Exempt players (5 highest salaries off the books)
Raise on Salary Cap? raise on bonuses? raise on TAM? Just raise of 100k-300k on each of the three things would make huge difference in the Champions League, where MLS looked like a joke and performed as a second rate league.
Adidas sponsors slavery in Qatar. I won’t give them my money.
Adidas threatened to pull out of the World Cup because of the work conditions in Qatar.
They haven’t pulled out yet, have they?
MLS is booming. Very nice, because I don’t miss the “MLS house of cards” posts. No longing for “MLS will fold in 3 years” type comments
The question is how do they grow? It would be very easy to say, double the salary cap as Gary Page said to do. But I am against that if it kills the parity. If it is workable for every team to do it, do it. I would even say, lets have a salary minimum in the next CBA. MLS teams HAVE to spend X. Players should be for that and owners looking for growth should be too.
They are in danger right now of some teams not keeping up. We can’t have Euro leagues, it won’t work, In the US with the Bayn Munich of the US winning every single year, you won’t have a league for very long.
Nice job MLS keep it going.
I think a salary cap and reverse order draft will do a lot to maintain parity. It provides a pretty even playing field so that good personnel decisions and good management/coaching become the most pertinent reasons for success rather than how much you have to spend. That assumes the salary cap is not so high that some teams can’t afford it. Obviously they’re nowhere near that point now.
Remember the league was created by NFL dudes. So parity is important and roster are constructed around a salary cap. Teams are required to spend a minumim and a maximum, the all the hoops of TAM, DP, etc.
Going into the next players negotiations I expect more money overall with increased pay for the low rung players. I also expect general managers to demand expanding senior club rosters to 30. The biggest weakness for all teams is roster lintitatiins in numbers and talent. For years all the teams have been drilled whenever injuries occur. Especially with international call ups, US Cup games, and CONCACAF Champions League.
Honestly, the biggest hit to parity right now is not the salary cap, but the DP rule. All of the teams will max out the salary cap – that’s almost guaranteed by the money given to the teams from MLS. The big spending happens at the top of the roster, where parity is thrown out the window. Over the last few years this divide has only grown.
Intentional parity should not be a virtue in a mature league, and MLS needs to allow more room for teams willing to spend money on players to do so. Winning as a crapshoot isn’t real. Fans root for winners and root for underdogs — that is how a team gets an identity and creates a culture that goes beyond the result in a particular season. The Yankees have an unparalleled tradition of success. Lots of people love that and lots of people hate that, and the crowds show up to see them whenever they are regardless. Same is true in European football, where parity is nonexistent.
Please, MLS, if you want to become a top league, it is time to at least double the salary cap.
They should have done at the last CBA. Absolutely my biggest disappointment coming out of the negotiations. Minimum salary was a close #2.
Well, the 2017 Cap is less than $4M and there’s rumors of $2M in TAM per team coming next year. Are you willing to settle for a defacto 50% increase in the salary cap?
Corporate dollars falling inline with current market growth and future market speculation. Already with a tv deals which pay an estimated 30 million annually. I wonder how much the next tv deal will pay when it expires in 2022?
There is a basic anology with grow or maturation of a brand over time. Gap started in SF in 1969 and eventually grew throughout the 70’s and 80’s. Eventually the brand growth slowed and diversified. However, Baby Gap took off solely because the parents that grew up in Gap bought their kids Baby Gap. Soccer is the number one participation sport in the US and eventually all these adults growing up MLS fans will give way to their kids growing up with MLS. The inertia has already started and momentum is exponentially increasing every year.
Pretty sure TV deal is way bigger than that.
Quit Whining, you are correct! The old contract was annually 30 million the new deal is around 90 million annually.
This is good. I just wish every team kit wasn’t made by Adidas. I rather see some variety but I understand it.
Been screaming this for years…
Not trying to downplay how great this increase is, but the increase in total dollars is a bit misleading when looking at the per year basis…
…rather than per year/per team basis
Not sure why the 2nd link broke
The increase is smaller each year as more teams are added up to the target of 28
i ‘ll bet the fans in Chicago are liking parity right now. parity to me means that a “bad year” for your club wasn’t necessarily all that bad, and a good year might not be that far away. 🙂
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Well, this $700 million dollar deal and the $700 million dollar TV deal they signed in 2015 will make for some very interesting negotiations with the MLSPU in 2020 when the current CBA expires.