Showing posts with label Jordan Kobritz. Show all posts
Showing posts with label Jordan Kobritz. Show all posts

Wednesday, May 13, 2009

PED's in MLB no longer Selig's Fault

For years, Bud Selig has been taking heat from the media and the public on the issue of PED’s in baseball. And for years, the commissioner has fended off his critics with a combination of fact, fiction and bluster, maintaining that he did everything he could to rid the sport of chemical enhancers. Selig has never passed up an opportunity to detail the efforts he and the owners have made to eliminate PED’s, only to be thwarted at every turn by the players and their union.

Despite Selig’s protestations to the contrary, the owners dragged their feet in trying to eliminate steroids from baseball. When the bosses look the other way, and in some instances overtly encourage the use of performance enhancers, it’s difficult for the worker bees to keep their hands out of the substance jar. But we can finally say that it’s not the commissioner’s fault that there are still players in baseball using banned substances.

This isn’t 2002, before there was a drug testing program in baseball and the likes of Jose Canseco, Mark Maguire, Sammy Sosa, Barry Bonds and who knows how many hundreds of others were juicing. This isn’t 2003, when the results of a test survey to determine the extent of drug use in baseball were supposed to be anonymous, and Alex Rodriguez’ name was leaked from a list of 104 players who tested positive.


This is 2009, when MLB, as Selig is only too proud to proclaim, has the strictest drug testing program in all of team sports, and imposes the stiffest penalties for testing positive of any sport this side of the Olympics; when notice of that drug policy and those penalties is posted in every Major League clubhouse. And yet players are still ingesting banned substances, as evidenced by the fact that Manny Ramirez tested positive for a prohibited substance during spring training this year.

Ramirez is just the latest MLB player to take a seat in drug-suspension purgatory. If you think he’ll be the last, you also think the federal government will soon embrace fiscal responsibility. Won’t happen. Many people, including this correspondent, have called for stricter penalties for those caught using, including a one-and-done policy. But even the ultimate penalty won’t eliminate PED’s in baseball. Want proof? How long have we had the death penalty? And that has eliminated murders, right?

Illegal drug use in baseball is a matter of individual choice, and as long as the cheaters are ahead of the testers - and it will always be thus - some players will be willing to take their chances. There’s too much money to be made and too little time to make it.

The responsibility to stamp out drugs in baseball rests not with the owners or the commissioner, but with the players and their twin enablers, the MLBPA and the agents, neither of whom appears willing to fulfill their fiduciary responsibilities to their clients on the issue of PED’s. From fighting the commissioner and owners in negotiations, arbitration and court, to spinning fairy tales for the players when they’re caught red-handed, the union and the agents have been the ultimate co-conspirators.

For all the money the players make, not to mention all the money members of the Scott Boras Fraternity make, you’d think they could afford to employ someone who would guard against players ingesting anything that wasn’t “certified kosher.” It may not be fair to single out one agent, but Boras has had his share of clients snared by the drug police. Boras’ list of scofflaws includes Ramirez, Barry Bonds, Alex Rodriguez, Kevin Brown, Garry Sheffield, Eric Gagne, Ivan Rodriguez and Rick Ankiel, among others.

Ramirez will lose approximately $7 million during his suspension – deducted over the four years his 2009 salary will be paid - but will still earn almost $38 million under the terms of his two-year contract with the Dodgers. So, what exactly is the penalty for getting caught using - shame and embarrassment? No bust in the Hall of Fame? Some players obviously prefer the money to their reputations and eternal enshrinement.

And as long as that remains true, PED’s in baseball will be a reality. But the pendulum has swung. It’s no longer Bud Selig’s fault.


Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.

Wednesday, April 15, 2009

Do Golfers Need Glasses

Golfers are a strange lot. I’ve never understood the attraction in chasing a little white ball around a mile-and-a-half expanse of land for half-a-day, trying to putt the ball into a hole in the ground, something even golfers would admit is difficult and frustrating. There seems to be enough stress in everyday life without voluntarily spending time on a golf course.

Now, there’s another reason to be skeptical of golf and golfers. In an online survey commissioned by the Callaway Golf Company, 78% of respondents said they would rather play a round of golf at Augusta National, home of the Masters, than have a date with 2009 SI Swimsuit cover girl, Bar Refaeli. The survey results are great news for sports business, especially the golf industry and companies such as Callaway.

According to Darren Rovell of CNBC.com, the survey was taken by people who say they “play golf.” If ever there was a reason not to play golf, this may it. How, exactly, can a red-blooded male choose playing golf over a date with a supermodel? On the other hand, the poll results may not come as a surprise to many wives and girlfriends who have become golf “widows,” giving up their weekends – and their husbands and boyfriends - to the golf course.

In an effort to obtain additional information about the survey, I contacted Callaway. I was interested in whether the company collected information about the respondents, including such things as their age, income level, how often they play golf, whether they are married or single, and their gender. Unfortunately, a spokesperson said he hadn’t heard about the survey and neither had his supervisor. He admitted, however, that he would have responded with the majority, perhaps understandable given his employer.


Admittedly, Augusta National is a gorgeous expanse of land. But in spite of its history, aura, and exclusivity, it’s still just a golf course. And any golf course pales in comparison to the lovely Refaeli.

Ironically, Augusta National is the same club that refuses to allow female members, regardless of how much money they have or what they look like. The National Council of Women’s Organizations picketed the Masters in 2003 in an effort to force the club to open its doors to distaff members. When the heat became too hot for the tournament sponsors, Augusta National purchased its own TV time on CBS and broadcast the Masters sans advertising.


But the club membership refused to knuckle under and the NCWO got tired and went home. When they did, the advertisers returned. Women are allowed to play the Augusta National course - with restrictions - but aren’t allowed to step foot in the hallowed clubhouse.


In analyzing survey results, it should be noted that polling is an inexact science, especially when done by amateurs. The wording of the question can influence the result. For example, in the Callaway survey, the question doesn’t suggest the nature of the relationship with Refaeli. What exactly is the meaning of the word “date?” Where would the date be held? What would the parties be doing? For how long? Who else would be present? On the other hand, golfers think they know what they’re getting – or at least, what they’ve dreamed about – if they play a round of golf at Augusta National.

According to the National Golf Foundation, there are an estimated 26.2 million golfers in this country, 45 percent of whom are between the ages of 18 and 39. Another 33 percent are considered seniors (over the age of 50). If the survey was limited to senior golfers, that might explain the results, at least in part. Still, it’s hard to reconcile the survey results with a photo of Refaeli. “Nearly 80% of respondents choose round of golf over date with supermodel” isn’t a headline that goes down easily with the morning coffee.


More realistic is the headline in a recent story in The New York Times on golfer Steve Wilson, a 39-year- old Mississippi gas station owner and amateur golfer who shot an opening round 79 at the Masters. The article was titled, “A Bad Day on the Course Beats Any Day Pumping Gas.” Now that’s a headline even I can buy.



Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 atjkobritz@mindspring.com.

Tuesday, March 31, 2009

The "Real" March Madness

The term “March Madness” was first coined by Henry V. Porter in 1939 to describe the excitement surrounding the Illinois state high school basketball tournament. The words are currently used in reference to the college tournament, as fans focus on the players and the games for three weeks in March and April. But the real madness associated with college basketball is how much money is being made and how little of it goes to those who make it all happen – the players.

Of course, players are considered “amateurs,” if nowhere else but in the eyes of the NCAA. This convenient un-truth allows the governing body and its member institutions to profit from cheap labor, not unlike what U.S. corporations do when they outsource jobs to foreign soil. Not content to avail themselves of the cheap labor in this country, colleges and universities also import cheap labor from foreign countries, as a number of top programs recruit players from abroad.

And everyone but the so-called student-athlete is getting a piece of the action. The NCAA defends the current system by pointing out that players receive a scholarship, worth as much as $40,000-50,000 per year at some private schools. But students at those same schools – some of which operate athletic budgets in excess of $100 million annually - are getting a free education for playing in the band or running track, activities that don’t bring in enough revenue at most schools to purchase a music book or a pair of running shorts.

Not so with men’s basketball. The NCAA is in the midst of an 11-year, $6 billion contract with CBS to broadcast a number of championships; but virtually all of the money is related to men’s basketball, specifically the March/April tournament. The New York Times recently reported that the NCAA can opt out of the contract with CBS after the 2010 season. By opting out, the NCAA would forfeit three guaranteed years for the opportunity to sign a more lucrative deal with another suitor, most likely ESPN. Although the economic climate is dismal, ESPN’s dual revenue model – subscription fees along with advertising – gives it a huge bidding advantage over traditional networks.

The NCAA distributes approximately 90% of its revenues to member institutions, and the lion’s share of that amount goes to schools and conferences that participate in the tournament. And the further a team goes in the tournament, the more revenue it receives. Participating schools also benefit from increased merchandise sales. According to the Collegiate Licensing Company, the University of Memphis’ merchandise sales increased by 82% in the most recent fiscal year after the Tigers played in last year’s championship game.

Coaches also share in the gravy train. At $3.5 million per year, Billy Donovan of the University of Florida was, until recently, acknowledged as the highest paid college basketball coach on the planet. His team didn’t make the tournament this year, but he did win back-to-back championships in 2006 and 2007.

The tournament also serves as an audition for coaches seeking higher paying jobs at other institutions. After his Rams were eliminated from this year’s tournament, Virginia Commonwealth University coach Anthony Grant doubled his salary by signing on with Alabama for $2 million-a-year. ESPN.com reported that John Calipari, who was hauling down $2.5 million per year at Memphis, has agreed to an 8-year, $35 million deal at the University of Kentucky, bouncing Donovan out of the top earning spot.

Most schools – Boston College and West Virginia are recent exceptions - are afraid to enforce contracts for fear of discouraging applicants for future coaching positions, leaving coaches free to flee their current schools without penalty, contract law be damned. Not so for players, who generally must sit out a year if they want to transfer to another D-1 institution. And if they are deemed expendable by their coach, a player’s scholarship can be revoked with little recourse.

The system is overwhelmingly weighted against the athletes, but don’t hold your breath waiting for the current environment to change. Players only have four years of eligibility and any challenge to the status quo would take longer than that to wind its way through our legal system.

Madness is definitely the operative word associated with college basketball. Just not in the way most fans think.

Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.

Wednesday, March 25, 2009

World Baseball Classic is what it is...

The second edition of the World Baseball Classic ended its three-week run amidst a torrent of criticism, most of it undeserved. Critics pan the Classic for a number of reasons, chief among them the timing and lack of interest in the U.S. Baseball purists decree the imposition on Spring Training and the lack of topnotch talent on the rosters of most countries.

Much of the criticism comes from those who don’t understand the impetus behind the event. The WBC was never designed to determine which country has the best talent. The intent was to promote the game worldwide. In that respect, it has achieved as much if not more than its supporters could have hoped for. Game attendance, TV ratings and media coverage around the globe all increased over the first WBC in 2006.

While fans in this country have been lukewarm towards the event, fans in other participating countries have embraced the WBC in ways never dreamed of before the Classic became a reality. The Netherlands defeating the Dominican Republic – twice – to move into the second round of this year’s Classic gave hope to nascent baseball countries around the globe that they, too, can play the game on the world stage.

As a marketing tool, the WBC has been wildly successful. The exposure the game has received from the WBC will undoubtedly increase baseball’s revenues, benefitting owners and players alike. No surprise, therefore, that this is one of the few areas of agreement between MLB and the players association.

Owners and managers have voiced concerns - however muted, given the support of the Classic from the commissioner’s office- about the well being of the players, especially pitchers. And the media has chimed in with both criticism and suggestions on how to improve the event, both in terms of timing and format.

The major misconception about the WBC is that this is a world tournament. That’s hardly the case. Some of the best players decline to participate, for reasons ranging from fear of injury to the outright disapproval of their clubs. Because the Classic is held during Spring Training, with the exception of the Asian teams - who begin practicing for the event months in advance - most players aren’t in regular season shape. Pitchers who do agree to participate are held to set pitch counts. Position players are assured of a certain number of innings or at bats, regardless of the dictates of the games. The result is the tournament is a global version of Spring Training.

And the format – this year’s Classic was double elimination for the first two rounds and single elimination for the final round – isn’t conducive to the sport of baseball. MLB playoffs are best-of-seven affairs (five in the Division Series). But playing a best-of-seven series would extend the WBC beyond the acceptance of even its most ardent supporters.

The timing of the WBC is admittedly horrible. Playing games during Spring Training upsets the natural rhythms and rituals of baseball. But although a number of critics have suggested alternatives – playing the final round of the classic in July, either around or instead of the All Star Game, or after the MLB season ends – those options are even less palatable than the status quo. MLB teams would not be inclined to give up lucrative July dates for the WBC. And playing the WBC after the MLB season ends doesn’t make much sense either, given that the World Series can extend into November. The fact is, there is no perfect time to hold the WBC.

The bottom line is the WBC is all about the bottom line. It was designed to generate revenue for the owners and players. The WBC isn’t so much a tournament, as it is an exhibition. That doesn’t make it bad, nor does it mean it shouldn’t be held. Just don’t make it out to be something it isn’t or something it was never intended to be.

In the face of mounting criticism, even from the ranks of owners, Commissioner Bud Selig insists the WBC will continue, with the next version scheduled for spring 2013. Give Selig credit for holding firm to his position. We should be appreciating the WBC for what it is, not criticizing it for what it isn’t.

Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Wednesday, March 4, 2009

Oliver Decision One for Common Sense

Andy Oliver started the 2009 baseball season for Oklahoma State University the same way he ended the 2008 season – pitching the Cowboys to a victory. But it was a win in the courtroom that enabled the lefthander to resume his college career on the diamond.

Oliver was suspended indefinitely by the NCAA last May, and in December, the NCAA decreed that the pitcher should sit out 70% of OSU’s 2009 schedule. Oliver’s transgression was a violation of the “no agent” rule in NCAA Bylaw 12.3. The bylaw states that an individual is ineligible for participation in an intercollegiate sport if he or she ever agrees to be represented by an agent, a rule that is virtually impossible to enforce and is therefore more honored in the breach than in the observance.

But Bylaw 12.3.2 creates an exception to the no agent rule by allowing a student-athlete to “consult” with an attorney, with the additional proviso in Bylaw 12.3.2.1 that an attorney cannot discuss a contract with a professional sports team, nor can an attorney be present during such discussions.

In June of 2006, Oliver was drafted out of high school by the Minnesota Twins. His attorney at the time requested that he be present during contract discussions with a Twins representative in the Oliver home. The attorney assured the pitcher and his family that his presence would not endanger Oliver’s college eligibility.

The discussions proved fruitless and Oliver accepted a scholarship to OSU. When Oliver informed his attorney early last year that he would be consulting another “advisor” - code for agent - the attorney sent the pitcher a statement in the amount of $113,750.00 for legal services related to the failed negotiations with the Twins. When Oliver refused to pay the bill, the attorney reported the bylaw violation to the NCAA. After the NCAA suspended Oliver, he obtained an injunction pending the outcome of a trial.

In a decision that, if sustained on appeal, will have far reaching consequences for student- athletes, a Federal District Court in Ohio ruled that NCAA Bylaw 12.3.2 was an attempt to regulate the role of attorneys; that such action was against the public policy of every state in the union and was therefore void. Judge Tygh Tone said the NCAA can’t tell a student-athlete he can consult with an attorney and then tell the attorney how to represent his client, i.e., when he can be present for negotiations and when he should stay in his office.

During the trial, the NCAA countered that the no agent rule was actually designed to protect student-athletes, pointing to Article 2.9 of the NCAA Constitution, which states that “…student-athletes should be protected from exploitation by professional and commercial enterprises.” How that is to be accomplished without adequate legal representation at the most crucial stage of negotiations - especially when the other side is far more experienced and prepared than the student-athlete - the NCAA was unable to say.

The no agent rule is absurd on its face. If an athlete’s parent is an attorney or an agent - or even a former professional athlete – he or she may have adequate representation. But if you failed to choose your parents wisely, you are at an extreme disadvantage when it comes to one of the most important decisions of your young life.

The judge also took a swipe at Bylaw 19.7, which states that the NCAA can impose retroactive punishment on student-athletes and member institutions if a student-athlete is allowed to play under an injunction and that order is later overturned. The bylaw serves as both a disincentive to seek court redress and a reluctance on the part of member institutions to allow a student-athlete to participate in athletic competition until the litigation process is complete.

The NCAA has already stated its intention to appeal Judge Tone’s decision. Critics have taken issue with some of the judge’s language, calling it overly broad and not based on sound legal reasoning. And a number of issues remain unanswered, including whether an agent who is not an attorney can represent a student-athlete to the same extent as an attorney.

But for now, thanks to Andy Oliver, the NCAA can’t deny student-athletes effective legal representation.

Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Monday, February 23, 2009

Barry Bonds Trial Gets Under Way

After more than five years and the expenditure of tens of millions of taxpayer dollars, it’s show time for the government. The case known as the United States of America vs. Barry Lamar Bonds is coming to San Francisco on March 2 for what is estimated to be a four week run.


The feds will attempt to prove that Bonds committed perjury when he testified before a federal grand jury in December 2003 that he did not knowingly use steroids. In layman’s terms, perjury is lying under oath about a material fact when you know your statement is false.


Under questioning by prosecutors, Bonds admitted using two substances – the Cream and the Clear – that he later determined to be steroids. But he said he didn’t know they were steroids at the time he used them. Bonds insisted he thought his former trainer, Greg Anderson, gave him flaxseed oil and an arthritis balm to alleviate the aches and pains that come with the daily grind of playing professional baseball.


Most Americans, save, hopefully, the members of the jury who will hear evidence in the case and determine Bonds’ guilt or innocence, have made up their minds about Bonds. And polls suggest that in the court of public opinion, Bonds is guilty as charged. But fortunately for him, not to mention the rest of us, our system of justice requires that the government prove its case beyond a reasonable doubt in a court of law. And by all accounts, the government will have its work cut out for it. The case is more porous than the Yankees 2008 defense.


Judge Susan Illston’s pre-trial rulings have generally favored Bonds. The most recent government setback came last week when Judge Illston refused to allow evidence of three positive steroid tests and documents alleged to be doping calendars. Prosecutors will be allowed to enter evidence of one positive test, taken on a sample from the infamous 2003 survey testing of MLB players, the same test that tripped up A-Rod.


Those test results were supposed to be confidential and the samples destroyed. But the union, for some inexplicable reason save incompetence, failed to dispose of the evidence before the government seized it in a raid on several testing facilities in conjunction with the BALCO investigation.


The key to the government’s case against Bonds is and always has been Anderson. The trainer was among the BALCO defendants who plead guilty to conspiracy to distribute steroids and spent three months in prison. Upon his release, he was paraded before a grand jury investigating Bonds and refused to testify. He was sent back to prison on two separate occasions and served an additional year behind bars.


The feds tried to procure Anderson’s testimony by putting pressure on his wife and mother-in-law, threatening each with tax charges and staging a raid on the mother-in-law’s house. Prosecutors are determined to call Anderson as a witness against Bonds. But Anderson’s attorneys say he will never rat on Bonds and Judge Illston is on record as being loath to find him in contempt a third time.

Prosecutors intend to call several witnesses who claim Bonds discussed his use of steroids with them and another witness who claims she watched Anderson inject Bonds, with what, no one knows. Most of the witnesses are a defense attorney’s dream, including a jilted mistress and individuals who themselves engaged in criminal activity.


Judge Illston will allow the government to enter expert testimony concerning the effects steroid use can have on the male body, including back acne and shrunken testicles. The government’s only witness on the condition of Bonds’ private parts is his former mistress, Kimberly Bell, who seems all too eager to confirm the expert’s testimony as it relates to Bonds. This won’t be a trial so much as a pilot for a reality show on Fox.


The government is unlikely to prevail against Bonds, in spite of their vast resources and huge expenditures in time and money. Even if Bonds is convicted, Judge Illston is likely to give him probation instead of jail time. Regardless of the trial’s outcome, we all lose.


In comparison, the government throwing hundreds of billions of dollars at banks and auto companies doesn’t seem like such a bad deal.


UPDATE


The federal government has publicly admitted what many of us have known for years: Without the testimony of Greg Anderson, Barry Bonds’ former trainer and childhood friend, the game is over. The feds don’t stand a chance of convicting baseball’s home run king of charges that he committed perjury when he testified before a grand jury that he didn’t knowingly take steroids.

The government’s admission came on Friday afternoon in Federal District Court in San Francisco. Prosecutors told presiding Judge Susan Illston they would appeal her earlier ruling that without Anderson’s testimony, evidence of three positive drug tests, along with doping calendars and ledgers that allegedly relate to Bonds’ use of steroids, was inadmissible in her courtroom.

The appeal means the trial against Bonds - set to begin on March 2 – could be delayed for months, if not longer. The government has already spent more than five years and tens of millions of dollars preparing their case against Bonds. But when Anderson was asked in open court on Friday morning whether he would testify against Bonds, he replied in the negative. Shortly thereafter, the government effectively conceded defeat.

But rather than fold their house of cards and move on to prosecuting real crimes against the citizens of this country – Was the Bernie Madoff Ponzi scheme just a hoax? Are there no current or former bank officers at Citibank or Bank of America who committed crimes against the American taxpayer? – the government elected to throw (our) good money after bad.

The sole issue on appeal is Judge Illston’s ruling concerning the admissibility of the drug evidence. Regardless of the decision of the appellate judges, the government has nothing to lose. A win in the Court of Appeals, and the additional evidence could persuade a jury to convict Bonds. If the government loses the appeal, which is likely, the trial could still go forward but the result will almost certainly be a not guilty verdict for Bonds. In either case, the appeal represents an abuse of prosecutorial discretion and power reminiscent of the McCarthy era.

The case against Bonds long ago passed the demarcation line between prosecution and persecution, with each successive move by the government confirming the latter. The government has conducted a witch hunt against Bonds since December 2003, when he testified before the grand jury investigating the BALCO case involving steroid distribution to athletes in a number of sports.

A reading of the grand jury transcript suggests that Bonds – and only Bonds – was targeted for prosecution even though he wasn’t the only baseball player who testified to illegally using performance enhancing drugs. Thus began a five-year crusade that included sending Anderson to prison on two separate occasions for failing to cooperate with government investigators, and intimidating his wife and mother-in-law in an effort to loosen the trainer’s tongue.

The government’s actions in the Bonds case have been unconscionable. Despite the fact that Bonds is an admitted steroid user, and his testimony before the grand jury was less than forthright, the campaign against him exceeds all manner of perspective. The crime(s) Bonds committed, and the likely punishment in the event he is ever convicted, do not merit the time and expense the government has expended in his pursuit.

There’s a new administration in Washington. But the action taken by the Department of Justice in the Bonds case – they almost certainly would have had to approve an appeal of this nature - confirms that the new administration is hardly distinguishable from the old one. While the bombastic Barry Frank, Representative from Massachusetts, rails against the sports related marketing expenses of bailout recipients Citibank and Bank of America, he and others of his ilk turn a blind eye to the wasteful spending associated with the Bonds persecution.

If prosecutors had to make the money necessary to pursue a conviction, as Bonds did in order to fund his defense, it’s unlikely this case would have ever seen the light of day. Instead, the government gets to wield its abusive powers using our hard earned dollars.

Here’s hoping Anderson’s lips remain sealed, regardless of the next move taken by the wayward prosecution. In spite of his shady past, the trainer is clearly the only honorable person in this drama.


Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.









Tuesday, February 3, 2009

Super Bowl Advertising

The Super Bowl game is history and most viewers not having an Arizona or Pittsburgh zip code will be hard pressed to remember the final score.  But the ads that aired on NBC - and some that didn’t make the cut - will be the subject of endless conversation. 

NBC sold 69 advertising spots for the game to 32 different advertisers, grossing a Super Bowl record $206 million.  Each in-game ad sold for between $2.4 million and $3 million per 30-second spot.  Given the state of the economy, the figures were nothing short of astounding.  Jeff Zucker, president and CEO of NBC Universal, told the AP, “The Super Bowl has become one of our country’s biggest holidays, a uniquely American day, and advertisers recognized the value in being a part of it.”  Not all advertisers. 

General Motors, a major advertiser during prior Super Bowls, took a pass on Super Bowl XLIII after receiving a $13.4 billion bailout from Congress.  The company is drowning in red ink in the midst of a precipitous decline in automobile sales.  Ditto for FedEx, another Super Bowl regular that sat on the sidelines this year for the first time in over a decade.   

NBC was able to offset those losses with revenue from new advertisers as well as additional commitments from advertising regulars such as PepsiCo. and Anheuser-Busch InBev.  But the final figure wasn’t achieved easily.  In past years, Super Bowl ads were sold out months in advance of the game.  Not this year.  NBC had to lower its original asking price of $3 million per 30-second spot - up 11% from what Fox charged for last year’s game - to sell its entire inventory.  The final two spots were sold literally hours prior to kickoff.   

But NBC didn’t have to wait that long.  While the network accepted sexually suggestive ads from a number of advertisers, including GoDaddy.com which featured Indy racing’s pin-up girl, Danica Patrick, it rejected an ad from PETA on grounds that it depicted “a level of sexuality” which exceeded the company’s standards.   

All potential ads must be submitted for review to Victoria Morgan, NBC’s Vice President for Advertising Standards.  The PETA ad, titled “Veggie Love,” showed scantily clad women, uh, cozying up to vegetables, and proclaimed that “Studies Show Vegetarians Have Better Sex.”  True or false, NBC declared the ad too risque for an audience that included children. 

The irony, if not the hypocrisy, of that position was brought home by an organization calling itself Common Sense Media.  During the week leading up to the Super Bowl, the group released a report titled “Broadcast Dysfunction:  Sex, Violence, Alcohol and the NFL.”   

The report looked at ads in more than 50 NFL games this season, and every game included ads depicting sex, violence or erectile dysfunction drugs, in addition to the omnipresent ads promoting alcohol consumption.  Common Sense Media founder and CEO James Steyer said the study determined that, “one in six of the ads shown during the broadcasts features content that’s wildly inappropriate for kids.”

 

According to the group’s website, 40 per cent of the games included ads for Viagra or Cialis; nearly 500 of the ads involved gun fights, explosions and murders; 80 of the ads featured significant levels of sexuality, including scenes featuring prostitution and strippers; and 300 of the ads were for alcohol.  Almost half of the violent or sexual ads were promos by the networks for their own programming.  And a sexy woman cavorting with a stick of broccoli is inappropriate?   

Professional sports and TV networks don’t have an exclusive on hypocrisy.  Last year, the NCAA turned down a full-page ad from Hooters which the restaurant chain sought to include in the Final Four program.  At the same time, the NCAA allows member institutions to accept advertising from gambling interests and permits networks to air alcohol ads during the broadcast of college sports.  No sport or network, it seems, can resist the temptation to accept ad revenue from gambling interests.   

Maybe NBC can rationalize its rejection of the PETA ad while allowing other ads depicting sex, alcohol consumption and violence during the Super Bowl.  But if using scantily clad women to market products is ever appropriate – a debate beyond the scope of this column – I prefer to have them promote veggies.


Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Capitalism, Yes; Salary Cap, No!

The old adage, “Be careful what you wish for,” should be a siren call to Major League Baseball owners and executives calling for a salary cap in the wake of the Yankees’ off-season spending spree. 

Oakland A’s owner Lew Wolff, Milwaukee Brewers owner Mark Attanasio, Houston Astros owner Drayton McLane, and Pittsburgh Pirates President Frank Coonelly took turns lamenting baseball’s status as the only Major League team sport without a salary cap. All four suggested that a salary cap would be a panacea for both parity in MLB and preventing the Yankees from acquiring the best – and most expensive - free agent talent.  As my father used to say every time I made a suggestion he was loath to embrace, “It sounds good.”  

Indeed it does.  After all, in leagues with a salary cap, there is no equivalent of the Yankees, a team that can purchase any free agent it chooses regardless of the price.  And, so the theory goes, there is more parity in leagues with a salary cap, particularly the NFL which is the poster child for sharing revenues equitably.  Except it’s just not true.   

The NFL shares a higher percentage of revenue (approximately 70%) than the NBA, NHL and MLB.  But the revenue discrepancy between the richest and poorest teams in the NFL exceeds $100 million.  Because a salary cap in sports also includes a floor - a minimum amount each club must spend on payroll – the lower revenue clubs make significantly less money (they spend a higher percentage of their revenue on payroll) than the higher revenue clubs.  

The NFL does have parity - how else to explain the Arizona Cardinals in the Super Bowl?  Most teams, with the exception of Detroit and Cincinnati, begin each season with a reasonable chance of making the playoffs.  But that’s as much a function of the nature of the sport and the limited number of games in a season as it is a salary cap. 

The NBA’s salary cap would be laughable, except it’s no joke.  The intricacies of the salary cap are known to only a handful of humans, living or dead.  And the bottom line in constructing a team has nothing to do with talent and everything to do with the bottom line:  Making sure each team stays within the parameters of the salary cap/floor.   

As for parity, unless the Celtics decide to guard anyone other than LeBron James in their expected playoff matchup with the Cleveland Cavaliers, does anyone believe the two teams in the NBA finals will not be named the Lakers and the Celtics – again?   

In the NHL, clubs such as Nashville and Columbus are hemorrhaging millions thanks to the minimum salary requirements, while Phoenix will reportedly lose $30 million this year and teeters on the brink of bankruptcy.  The strongest teams in the salary cap era – Detroit, San Jose, New Jersey – were also dominant prior to the advent of a salary cap.  Can you say good management? 

A salary floor in MLB would require teams such as the Florida Marlins to increase payroll by as much as $50 million over last year’s figure. 

The only realistic source for that money would be increased revenue sharing -  taking more money from the Yankees to distribute to other clubs.  Which is what all the crying and grandstanding is about.  Clubs want to reduce the Yankees’ spending power; but owners can’t increase revenue sharing or implement a salary cap without the consent of the union.  Peace will come to the Middle East before MLB negotiators convince the union to agree to a salary cap.    

What the whiners fail to acknowledge is that parity in MLB doesn’t take a backseat to any league, including the NFL.  In the last eight years, 13 different MLB teams have played in the World Series – the Yankees only twice and they lost both times - compared to 12 different NFL teams that played in the Super Bowl.       

A salary cap in MLB is merely a pipe dream.  It’s also a convenient crutch for incompetence on the part of team management.  If the Pirates had drafted as well as Tampa Bay over the past 12 years, they - not the Phillies - would have played the Rays in last year’s World Series.  Now that’s something for Coonelly to focus on.



Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Boston College AD Gene DeFilippo Drops Ball

Boston College athletic director Gene DeFilippo gets no sympathy in this corner.

DeFilippo is the type of person who believes a commitment is a commitment – at least, when he’s on the receiving end. But if he’s the one making the commitment, well, that’s a different story.

DeFilippo fired his football coach, Jeff Jagodzinski last week for interviewing with the New York Jets. There was nothing in his contract, which had three years remaining at an annual salary of $1 million, which prevented Jags from exploring coaching options with the Jets or anyone else. It’s also standard practice for successful coaches like Jags, who lead BC to a 20-8 record and successive bowl appearances in two years at the helm, to cast about for better opportunities, something DeFilippo, as AD at BC for the past 11 years, should have known better than anyone.
But DeFilippo maintains that Jags verbally assured him at the time he was hired that he would remain at BC for the length of his contract. Never mind that oral commitments at the time a contract is signed are rarely enforceable in a court of law. And never mind that BC isn’t exactly the most desirable coaching position in college football. DeFilippo was furious nonetheless.
To be fair, DeFilippo issued a public warning to his coach that he would be terminated if he interviewed with the Jets. But Jags was so determined to return to the NFL – where he had been an assistant coach for several teams prior to taking his first head coaching position with BC – he went ahead with the interview in spite of DeFilippo’s threat.
There’s no doubt Jags could have handled the situation better. DeFilippo first heard about the interview with the Jets from the media. When DeFilippo sought confirmation from Jags, the coach failed to return his call until after the interview took place. That’s no way to treat a superior, even if you don’t value your job. The fact that BC would still be on the hook for the $3 million remaining on his contract if he was fired may have influenced Jags’ course of action.
Jags’ repudiation of his verbal commitment to DeFilippo is unlikely to affect his ability to obtain another coaching position. In the coaching profession, contracts are meaningless and your word takes a back seat to your record. Win and you get to stay, unless a better offer comes along, in which case you leave. Lose and you get fired. If only the financial markets were that simple to understand.

In the real world, contracts set forth the obligations of the parties, and all parties expect those obligations to be fulfilled. In the event of a breach, parties often become litigants on opposite sides of a courtroom.
Coaching contracts, on the other hand, aren’t really contracts in the literal sense. They merely serve as a reference during the inevitable termination. Litigation between schools and coaches is rare – West Virginia vs. Rich Rodriquez is the exception - if for no other reason than a litigious coach may find himself with a paucity of offers and a litigious school with few applicants. So the “system” is self-regulating. A coach is free to leave with no impediments and a school can fire a coach, as long as they pay him the balance of his contract.
DeFilippo’s holier than thou stance with Jags rings hollow. Sure, he’ll get a few slaps on the back from his compatriots at the next AD convention. But those backslappers will be secretly pleased that DeFilippo has effectively prevented most of the better coaches in the country from ever applying at the Chestnut Hill school. Who wants to take a position where the AD expects you to stay the length of your contract?  

And then there’s the matter of DeFilippo’s word. On DeFilippo’s watch, BC abandoned its long term affiliation with the Big East Conference for the supposedly greener pastures of the Atlantic Coast Conference. During private negotiations with the ACC, while rumors circulated in the media, DeFilippo repeatedly denied any interest in moving to a new conference. When the move became public, DeFilippo was forced to retract his earlier denials. In short, he did what he accuses Jags of doing: Going back on his word.

At least Jags never lied about his interest in the Jets



Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Tuesday, December 30, 2008

Yankees Do What Yankees Do

Enough already.

After the Yankees swooped in and signed Mark Teixeira for eight years and $180 million, most of the civilized and nearly bankrupt world predicted an end to the baseball firmament as we know it. Spare me.

What did their critics expect them to do? These are the Yankees. They were only doing what they normally do, what only they can do, and what we all should have expected them to do after missing the playoffs last year for the first time in 14 seasons.

After their latest indulgence, the Yankees now feature a lineup with the four highest paid players in MLB, not to mention the highest paid players in all of baseball at six different positions. They’ve spent $423 million on free agents this off season and they’re not done yet. Add that to the more than $400 million they spent on their own free agents last year and you can be excused for thinking Wall Street and the auto industry should have hit up the Steinbrenner family for a bailout instead of the U.S. taxpayer.

But the vitriol aimed at the Bronx Bombers is misplaced. If you’re looking for a scapegoat, blame the system. The Yankees play in the biggest and best market, are moving into a new stadium that will generate obscene amounts of money, and own a one-third interest in the YES Network. In short, they’re the sports equivalent of Fort Knox.

Even with revenue sharing, to which the Yankees will contribute in excess of $80 million this year on top of a luxury tax bill of $27 million, the imbalance in the ability to generate revenue among MLB clubs continues to grow. As pointed out in an earlier column, the 300 seats that go for $2,500 per game in the new Yankee Stadium will yield more in ticket revenue than the amount that at least half of MLB clubs generated last year from their entire ballpark.

And lest we forget, MLB doesn’t have a salary cap and no amount of wishful thinking will result in one. The union will never agree to a salary cap and MLB isn’t in a position to pull an NHL and close up shop for an entire year in an effort to implement one.

If you want to criticize the Yankees, there are ample grounds on which to do so. They bullied and intimidated the City of New York for $940 million in tax exempt bonds to subsidize their new ballpark. Not satisfied with that handout, they have the chutzpah to request an additional $259 million of tax exempt bonds while lavishing exorbitant contracts on free agent players.

Acres of parkland in the Bronx that were appropriated to build the new ballpark will likely never be replaced, in spite of a commitment by the team to do so. That’s unconscionable, and yet the Yankees can get away with flaunting the agreement because…well, because they’re the Yankees, which means they operate with an arrogance that is unrivaled in professional sports.

Yankee haters, of which there are legions, should take solace in the fact the team has spent almost $2 billion in salaries, revenue sharing, and luxury taxes since their last World Series title. And this year’s shopping binge won’t guarantee a playoff berth in 2009, let alone the team’s 27th title. The Yankees’ annual payroll has exceeded the second highest total in the game by approximately 50% for the past several years, and they haven’t won the World Series since 2000 or a playoff series since 2004.

Last year at this time, the experts were predicting a World Series title for the Detroit Tigers after they acquired Miguel Cabrera and Dontrelle Willis in a trade with the Florida Marlins. But a check of the final standings for the 2008 season shows the Tigers looking up at every other team in the AL Central Division.

After gorging themselves in the free agent market, the Yankees will certainly enter the 2009 season as one of the favorites to win it all, and on paper, they should be. But games – and pennants – are won on the field, not with a checkbook.

Criticize the Yankees if you will. But remember, they’re only operating within the system.



Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Sunday, December 28, 2008

BCS Should Listen To Critics

Everybody’s talking at me

I don’t hear a word they’re saying

Only the echoes of my mind.

Everybody’s Talkin’, by Harry Nilsson

The song and words made popular by Harry Nilsson in the 1969 movie, Midnight Cowboy, accurately describe the Bowl Championship Series (BCS) conference commissioners. Everyone is talkin’ at them and they don’t hear a word they’re saying.

The controversial manner in which the BCS conferences anoint a football champion – through a myriad of complex polls that would make a derivatives expert blush – is the basis for frequent and vocal criticism. Even President-elect Barack Obama got in on the act, threatening to “throw my weight around,” as he put it, in a post election interview on CBS’ 60 Minutes. Like so many other college football fans, Obama believes a national football champion should be determined by a playoff.

Such a concept isn’t unique. A playoff is held in every other football division and every other NCAA sport. But the BCS isn’t affiliated with the NCAA. The six conferences that comprise the BCS broke away from the governing body in the aftermath of a 1981 lawsuit brought by the Universities of Oklahoma and Georgia.

The major football schools wanted to divvy up the TV and bowl money among themselves, without contributing to the NCAA’s revenue sharing arrangement. Any reversal of course that includes a playoff system would most likely require the participation of the NCAA. Which makes the idea of a playoff a non-starter for BCS schools.

Now, I’m no fan of the NCAA. Their pious blatting about the welfare of student-athletes rings hollow when their actions over the years clearly prove otherwise. But in this case, there is no rational reason why the NCAA administers all national collegiate championships – 88 annually - save one.

BCS commissioners are quick to defend the status quo, arguing it protects the tradition and sanctity of the bowls. They even admit to leaving millions of dollars on the table by eschewing a playoff system. But if the extra money is distributed by the NCAA to non-BCS schools, the thinking goes, why bother?

Even worse than their unwillingness to share the wealth with their less fortunate brethren, BCS conferences don’t even maximize their own revenue potential under the current system. A survey of tax documents by Yahoo!.com uncovered what can only be described as gross overspending and mismanagement on the part of bowl committees, at the expense of BCS schools.

The Sugar Bowl, for example, took in revenue of $12.9 million in 2006 and paid only $6 million into the BCS pool (participating teams will receive $17 million for a BCS bowl appearance this season, but much of that amount is derived from TV contracts). The majority of the remaining revenue was spent on such “necessities” as entertainment, media relations, decorations, committee meetings, gifts, bonuses and employee compensation, including $453,399 to Sugar Bowl CEO Paul Hoolahan.

The Sugar Bowl isn’t alone. The Orange Bowl took in over $17.9 million in revenue in 2007, and after their contribution to the BCS pool, spent most of the remainder. The Arizona Sports Foundation, which staged two BCS games in 2007, did the Sugar and Orange Bowls one better. They took in $19.7 million and still managed to “lose” a million dollars.

The reality is BCS conferences don’t need the bowls, whether they use the present system to determine a “national champion” or conduct a playoff. They proved as much when they began staging conference championship games - in effect creating their own “bowls” - which have turned out to be extremely profitable. To wit: The 2007 SEC championship game grossed $13.7 million in revenue and distributed almost $12 million to conference schools, according to Yahoo!com.

So why allow yourself to be ripped off by the existing bowls? The answer has nothing to do with tradition or the sanctity of the bowls. The current system suits the BCS conferences just fine. They get to decide who gets how much money and they don’t have to deal with the NCAA. In this case, power is more important than money.

Those who argue for a playoff, including the President-elect, be damned. Despite all the talkin’, the BCS commissioners don’t hear a word they’re saying.


Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Sunday, November 30, 2008

Name of New Mets Ballpark

Bailout Ballpark. Taxpayer Field. Subsidized Park.

All the names are catchy, and perhaps appropriate. Nevertheless, the new ballpark under construction for the New York Mets will continue to be called Citi Field. But that name may be subject to change, based on the shifting tide of the financial landscape and the equally uncertain future of Citigroup.

At a time when Citigroup could still pretend that all was right with its balance sheet, the financial giant entered into the largest sports facility naming rights deal in history, a 20-year, $400 million contract with the Mets.

Now that the toxicity of Citigroup’s assets has been confirmed, and the government has agreed to a $345 billion bailout - $45 billion in direct investments and another $300 billion in guarantees – critics of the naming rights deal are having a field day, no pun intended. But their criticism is misplaced. Neither the naming rights deal nor its amount should be the issue.

When times are tough, marketing budgets should be among the last areas businesses seek to cut. Companies need to market their products, and to do that they need name recognition and exposure. The question that should be asked is whether a company receives value for its investment in marketing.

The visibility of the naming rights deal with the Mets makes it an easy target for those who are rightfully upset with the callous and reckless way Citigroup operated, which resulted in the need for a government handout. But that visibility merely suggests that the naming rights deal may in fact be an appropriate and effective use of marketing dollars.

If critics of Citigroup’s government subsidy want to get worked up over the company’s actions, a more appropriate target would be the compensation package afforded the bank’s executives. Those responsible for leading the financial giant down the road to ruin earned as much as $30 million per year. When he was finally asked to leave last year, Citigroup’s chief executive, Charles O. Prince III, was “rewarded” with an additional cash bonus of $12.5 million and stock valued at $68 million according to The New York Times.

Citigroup isn’t the only recipient of taxpayer funds to have naming rights sponsorships with sports entities. The list is long and includes a number of other financial institutions. Among the largest: PNC Bank ($7.7 billion) holds naming rights to the Pittsburgh Pirates’ ballpark, “PNC Park;” J.P. Morgan Chase ($25 billion) calls the Arizona Diamondbacks stadium “Chase Field;” Comerica ($2.3 billion) has its name on the Detroit Tigers’ stadium, “Comerica Park;” and Capital One ($2.3 billion) is the title sponsor of the “Capital One Bowl”.

AIG, the insurance giant that is being propped up by a $150 billion subsidy from Uncle Sam, has a $125 million sponsorship agreement with Manchester United, the British soccer club. At least with the Citi Field sponsorship, the argument can be made that bailout funds are being spent on American soil.

Not every company seeking a handout from the American taxpayers is continuing or expanding its sports sponsorships. General Motors, which along with the other Detroit automakers is on life support and seeking $25 billion in aid from Congress, has announced cutbacks on advertising in NASCAR and will eliminate all Super Bowl ads next year. The company has also cancelled a sponsorship agreement with Tiger Woods to endorse its Buick line. The original 10-year deal would have expired next year, but the parties mutually agreed to an early termination, saving the beleaguered company $7 million.

The sponsorship deal between GM and Woods was a one-way street - beneficial to Woods, but unproductive to the company and its shareholders. GM hoped to reduce the age of Buick buyers by aligning the brand with the youthful golfer. But the average age of Buick purchasers in 2008 was 68, the same as in 1997, according to a study by the auto research division of Strategic Vision, Inc. Sales of Buicks plunged 58% from 1999 to 2007, and fell an additional 24% this year.

Which brings us back to Citi Field. The issue shouldn’t be the amount of the sponsorship, but whether the deal will benefit Citigroup and its stockholders, a group which now includes the U.S. taxpayers. Based on early returns, the answer to that question is still unknown.

Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Athlete Clustering at NCAA Institutions

If you think student-athletes are more the former and less the latter, you also believe the Bowl Championship Series (BCS) crowns a true football champion. A recent USA Today report suggests that NCAA schools are more concerned with eligibility than education.

The paper compiled data on juniors and seniors in five sports – football, men’s and women’s basketball, baseball and softball – at 142 colleges across the country and found that athletes “cluster” in certain majors at many of those institutions. Which begs the question: Are athletes encouraged to enroll in easy majors and easy courses in order to maintain eligibility?

Coaches and administrators who defend the practice of clustering say no, and suggest that athletes are merely enrolling in popular majors. That position would be more defensible if the percentage of athletes mirrored the percentage of the student population enrolled in such majors. But that isn’t the case at most institutions.

Critics suggest that clustering is one method of complying with the NCAA’s Academic Progress Rate (APR) system. The APR, instituted in 2003, was designed to encourage higher graduation rates for athletes by imposing penalties such as forfeiture of TV revenue, exclusion from bowl and tournament appearances, and loss of scholarships for universities that did not meet the NCAA’s retention and eligibility guidelines.

When the NCAA instituted the APR, it also adopted more stringent rules regarding the progress athletes make towards their degree. But the governing body simultaneously lowered admission standards, allowing schools to accept less academically qualified students.

Talk about your perfect storm. Universities across the land were faced with pushing “academically challenged” students through school more quickly. All while making sure said athlete fulfilled the primary purpose for which he/she was enrolled: To bring glory to State U. on game day. And the latter activity was always more important than the former, at least in the eyes of coaches and many members of the administration.

The existence of athlete clustering is undeniable. At the University of Michigan, for example, 31 of 41 junior and senior football players majored in “general studies” in 2007. General studies, referred to as “university studies” at schools such as the University of Nevada at Las Vegas and the University of New Mexico, is best described as a major that really isn’t a major.

At many institutions, students enrolled in general studies are allowed to cherry pick the easiest courses from all the majors offered on campus. The result might be a degree plan that includes, say, an activities class such as basketball or golf from Health and Physical Education, basket weaving from Early American Studies, and sports public speaking from Communications.

None of those courses in and of themselves are irrelevant. But cobbled together in a degree plan, they prepare a graduate for exactly what kind of career? But I digress. A scholarship athlete’s career goal at many institutions is to remain eligible. Which, given the time commitments required of athletes at Division 1 institutions, is difficult to do by taking chemistry, engineering and physics.

Athletes face enormous pressure - from coaches, administrators, parents, peers - to maintain eligibility. An additional source of pressure exists in the form of academic advisors who are employed and paid by the institution. C. Keith Harrison, an associate professor at the University of Central Florida, told USA Today academic advisors help student-athletes “major in eligibility with a minor in beating the system.”

There are athletes who compete at the highest level and still obtain a quality education. One example is Florida State safety Myron Rolle, who missed part of the November 22 game against Maryland while interviewing, successfully, for one of the 32 Rhodes Scholarships awarded annually. But he’s the exception, not the rule. And even Rolle experienced pressure from a coach, Seminoles’ defensive coordinator, Mickey Andrews, who publicly criticized him for studying too much last year, saying it affected Rolle’s preparation to play football.

The NCAA’s position is that if clustering exists, it’s a problem individual institutions should address, since curriculum and course quality issues aren’t the concern of the national governing body. But if the NCAA created the problem initially - which can’t be definitively determined without further research – shouldn’t they be the ones to initiate changes to benefit student-athletes?


Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.






Monday, November 17, 2008

The Economy Hits NASCAR Hard

How quickly the mighty have fallen. After a meteoric rise over the past 10-15 years, NASCAR was on the verge of challenging the NFL, America’s number one sport, for the top spot in television ratings. No more. NASCAR has taken a hit. Make that multiple hits.

Where to begin? Hopefully, it can’t be as bad as the recent headline in The Boston Herald which screamed, “Will NASCAR Survive?” But the reality is many of the teams that form the backbone of the sport are hurting. And the worst is apparently yet to come.

Attendance at Sprint Cup races around the country took a nosedive this year. The drop in attendance was evident prior to the meltdown in the economy, but coincided with the run-up in the price of a barrel of oil and a gallon of gas. Fans, apparently concerned with paying their mortgages and fearful of the floundering stock market, were staying close to home.

Merger talks aimed at strengthening teams struggling for sponsorship dominated the garage throughout the season. Some of those talks have been successful, including the recent announcement that Dale Earnhardt, Inc. and Ganassi Racing will merge, with the latter assuming control. In effect, DEI ceases to exist, barely one year after CEO Theresa Earnhardt rejected a bid from Dale Earnhardt, Jr. to purchase controlling interest in the company founded by his father. Theresa’s stubbornness personifies the old adage that a smaller percentage of something is better than 100% of nothing.

With the Cup season ending last Sunday, expect a blizzard of pink slips in the garage, reflecting a number of teams’ uncertain future in an unstable economy. Some teams are fortunate to have long-term sponsorship agreements with stable companies. But teams with expiring sponsorship deals are justifiably concerned about qualifying a car in next year’s Daytona 500.

The Big Three American automakers, bleeding cash and lobbying Congress for a bailout, are reassessing all marketing expenses and sponsorship relationships. It’s hard to imagine what NASCAR would look like without direct subsidies from Detroit. But for now, none of the three auto manufacturers, Ford, Chevy or Chrysler (Dodge), have announced plans to pull out of NASCAR entirely. Their position acknowledges the obvious: They need to move inventory, and one of the best ways to draw buyers into the showroom on Monday is to have a presence at the track on Sunday.

In an effort to reduce team costs, NASCAR last week announced a ban on all testing at tracks that host NASCAR events. The move was controversial, with some arguing it will give multi-car teams who share information an advantage over smaller, less successful teams. Although NASCAR admitted it didn’t know how much the move would save teams, some estimates put the cost of testing at $100,000 per day, meaning industry-wide savings could total as much as $30 million per year.

The falling popularity of NASCAR was made painfully obvious during the penultimate Sprint Cup event of the season, the November 9 race at Phoenix International Raceway. With 34 laps remaining, and Jimmie Johnson, who was leading the race, on the verge of becoming only the second driver in NASCAR history to win three Championships in a row, ABC switched the telecast to another Disney network, ESPN2, in the Eastern and Central time zones. Seems ABC was committed to showing America’s Funniest Home Videos in its entirety.

The move was reminiscent of the infamous “Heidi Game” of 40 years ago. With the New York Jets leading the Oakland Raiders 32-29 and 1:05 left in an American Football League game, NBC elected to begin showing the movie “Heidi.” The Raiders proceeded to score two touchdowns in those final 65 seconds and won the game, 43-32, creating a firestorm of complaints from viewers and provoking criticism from the media. ABC was spared similar scorn, as Johnson won the race and increased his points lead over runner-up Carl Edwards.

But the message to NASCAR was clear: You aren’t relevant, at least, not as relevant as America’s Funniest Home Videos. Who would have thunk it just two short years ago?

The economic times are tough for many Americans, and destined to get tougher. And the sports world won’t be spared. NASCAR is just the first of the big-five sports to feel the pinch.



Jordan Kobritz is a former attorney, CPA, and Minor League Baseball team owner. He is an Assistant Professor of Sport Management 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 jkobritz@mindspring.com.