MLS On The Rise


The Major League Soccer (MLS) playoffs have been in full swing over the last 2 weeks. It has been full of excitement, especially for soccer fanatics.  There has been surprising upsets, spectacular goals, and a dramatic penalty shootout featuring American hero, Tim Howard.  Despite the excitement and quality of play the MLS seems to be overlooked in America. It has remained in the shadow of more popular sports such as football, basketball, and baseball.

With the league moving into its it’s third decade it shows potential to become a premier league of soccer in the world and also a premier sport in America.  When the league began in 1996, it had a total of 10 teams. It has steadily grown and today, the league has doubled to 20 teams. Two more will join next year.  As this growth continues, it is important to look at the franchising fees that these clubs must face in order to join because it points toward the league’s value.  Since 1996, expansion franchise fees for starting a team have grown by an average of 18%.  To put this in perspective, the original 10 teams of the league had a franchise fee of about $5,000,000.  Last year, New York City FC faced a franchise fee of $100,000,000. Estimates are that next year Atlanta United could face a franchise fee of upwards of $200,000,000  By looking at how much more it costs to start a team, it can seen that the MLS is truly growing and is becoming more economically viable.

The growth in number of teams has and will lead the MLS to have more local markets and in turn more supporters. This boosts viewer ratings and creates a larger consumer market for the league.  In addition, the league has attracted big name players from Europe such as Andrea Pirlo, Steven Gerrard, David Villa, Frank Lampard, Didier Drogba and perhaps the most famous footballer ever, David Beckham. These names are very recognizable and are as much publicity signings as they are for team success. They come to America and increase the caliber of play while also getting more fans to flock to the stadiums.  This shows because in 2015, attendance records for the MLS were shattered.  They had 161 matches sold out, which was 28 more games than previous year and 10 teams averaged 20,000 fans per game.

While these signings are significant for publicity and attendance numbers, these players are coming at the end of their career. They provide a few good seasons and bring a few more fans to the stadium it does not appear to be a sustainable approach to increasing the level of the play overall.  The league has not been able to compete for talent with the likes of european leagues. This can perhaps be explained by the place of soccer in American sport.

The MLS does great in getting fans to the game, but struggles in getting fans to watch the game on TV.  The MLS Cup has not gotten a 1.0 rating since 2001 and when the MLS is on primetime, it gets outdrawn by the WNBA.  To be fair, the MLS faces the challenge of having to compete with four or five other major sports for TV attention.  Whereas in Europe, soccer is the one dominant sport. To give a comparison

However, this does not mean that the MLS can’t grow.  There are many factors that are in the league’s favor.  One, the league is very attractive for investors because it is cheap to get involved in.  Even though the franchise fees are climbing in the MLS, it still comes nowhere near to other sports.  Owners and investors don’t have to shell out billions of dollars in order to get associated with the league.  This makes the league appealing because it has a low risk to start, but likely contain high reward.  Two, demographic changes in the U.S, especially the increase in the Hispanic population, will provide more viewers.  Hispanics tend to have more interest in soccer and they will be a big and important audience for the MLS.

The rise in popularity of European soccer in america also points to a potential market for the MLS. The european system faces drawbacks, though, that perhaps the MLS can capitalize on to draw american fans. Due to the system of promotion and relegation in all european leagues and lack of salary caps, top teams can pay whatever they want for talent, poaching it from lower levels. While lower teams are never able to reach success. Champion League teams continue to do well, while other teams continue to struggle. The top leagues have teams in debt and lower level teams can’t keep up with all the infrastructure needed to maintain the standards if they wish to move up leagues. The MLS doesn’t face this issue. There is just one league, no relegations, no promotions, and a salary cap. This leads to ultimate competition. Any team can climb to the top and vice versa, any team can fall to the bottom. For example, look at Toronto F.C. and the Montreal Impact.  In 2014, both teams failed to make the playoffs. Then in 2015, they signed some players and made some changes, and that propelled them to the playoffs.  Now, they are facing off against each other in the conference finals.

Major League Soccer has steadily grown since its start 20 years ago, but this growth is still not enough to make it contend with the other sports in America. Though, the goal may not be to compete with these leagues but carve out a sustainable niche in the American sport. The more attainable goal could be to create a competitive association and create a platform to develop american talent. As the MLS continues to expand with teams, players, and fans the potential for the league is trending upwards.


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