What makes Major League Soccer’s race to the top so unique
And 4 ways to help us get there
If you're like me, you didn't grow up watching Major League Soccer.
Why would you?
You're not unAmerican but if your choices are between the 5 star steak house or the crummy burger shack down the street, I'd understand if you picked the steak house. It's just about better taste, and according to viewership stats, the majority of this country thinks so as well. Jabari Young's column for CNBC Sports, shows us that MLS has averaged 276,000 viewers for the 2021 season across ESPN channels, while NBCUniversal has averaged 414,000 viewers for the English Premier League. Nearly double of the eyeballs are on the Premier League. While still an impressive amount of growth for MLS viewership over the course of the last few years, we are still a shadow compared to Europe.
So what really separates us from most leagues in European football? What makes European football more competitive, and more enticing? What is the secret sauce and can we apply it to our own burger shack?
An open league vs a closed league
Most of European football operates on a promotion and relegation system. For example, in The Premier League, the 3 teams to finish last in the league are relegated to the second division, known as The Championship, and the top 3 teams to finish in the Championship are promoted to the Premier League.
This enables a few things.
For one, teams have a lot more on the line to compete for. A drop in league is not just a drop in status, but a significant drop in revenue dollars. In the worst case, a team that continuously loses money faces the fear of insolvency.
On the flip side, ambitious teams that fight their way up the ladder are rewarded with more revenue and a higher status. The beautiful thing about this system is that small clubs have the opportunity to work their way up to the limelight. Loyal fans across Europe show up and support their lower level teams on a given weekend. They buy cevapi rolls, pints of cold beer, and rub the team's crest that is tatted on their inner thigh. They preach team chants, chastise the referee, and hope that one day, a billionaire will come pump money in their team, giving them the chance to become a top contender. This is the cinderella story, just look at what Ryan Reynolds is doing to Wrexham F.C.
Ultimately, European football clubs are swimming in a vast ocean of sharks, minnows, and a very free market competition where freedom of opportunity is only leniently looked over by a country's governing body. For sake of example, the English Premier League answers to the FA (Football Association). The system is hyper competitive and players are allowed to make as much (or as less) money as they can.
Ironically, the major league system ( we're talking all American sports leagues, not just our soccer league) is a closed league system. They don't share the same freedoms as Europe. Instead, Major League Soccer operates a lot more like a Colombian drug cartel, in that, each team owner has a say in establishing rules and regulations of the league. For example, the salary cap (maximum amount of money that can be spent on 18-20 rostered players) for the 2021/22 season is $4.9 million dollars (about the cost of Lionel Messi's dog house). Our teams self regulate each other, ensuring limited competition and future sustainability, just like a cartel. They understand that they need each other to successfully survive, and therefore, they don't experience the same rates of insolvency. There is also no promotion or relegation, denying chances to newcomers, and, arguably, blowing out the incentive flame to winning and losing. The stakes are less. Even some of the major leagues have the autonomy to negotiate a player's release for international duty, like the Olympics. European clubs are threatened with a ban if they withhold players from international duty.
So what does any of this mean ?
My goal is not denounce our American system, or for that matter, glorify Europe's free market soccer. The very real truth is that our closed league system attributes more financial value into sports franchises than most teams on a global scale. According to a 2021 Forbes ranking of the 50 most valuable sports teams in the world, the only contenders with American teams are F.C. Barcelona, Real Madrid, Bayern Munich, Manchester United, Liverpool, Manchester City, Chelsea, Arsenal, and PSG. It is also true that there are no MLS franchises in the running here, but if this can teach us anything, it's that Americans understand the framework to maintaining a valuable sports business model, ethical or not.
To dive a bit deeper, Forbes uses specific metrics in identifying a valuable sports team, like the price/earnings ratio ( essentially, the share price or stock price for a certain team divided by the annual earnings per share). This is an efficient way for measuring growth. Well, when a soccer club faces the possibility of relegation, the certainty of growth diminishes. This danger applies to most soccer clubs in Europe, minus the power houses listed above in our top 50 list. These powerhouses all have heavy reputations, and have become giant global brands, ensuring that they are too big to fail.
While Europe's soccer teams are fueled with more passion, tradition, and fight, American soccer teams are, economically, more cautious, and, logically sustainable. We are the nerdy younger cousin that just showed up to the family reunion, trying to hide a calculator in our pocket, and a stack of cash in the other.
But what does economics have to do with football ? Sorry...soccer.
Maybe we are not as "behind" as we think. Just maybe, our system does pose significant economic advantages. Otherwise, why else would 12 European power houses come together try and emulate our ideas? I'm talking about the proposal of a newly formed super league, the plans that broke soccer headlines and undermined FIFA's legitimacy. This Super League's 2021 press release stated, "The pandemic has shown that a strategic vision and a sustainable commercial approach are required to enhance value and support for the benefit of the entire European football pyramid." Although these plans failed to materialize, thanks to our die hard European soccer supporters, I do believe this proposal will not fade out in history as a silly attempt of greed. Is this a money-grabbing move? Absolutely. Yet it is also a move towards commercial sustainability, and team owners, along with the powers that be, are smart enough to find a way towards this path in the near future.
If the future is a soccer league that can ensure profit and maintain value, we are already there. I just hope it will trickle down from the top. I constantly ask the question: how long until our American soccer system becomes as great as Europe? Yet, maybe the better question to ask is: what exactly can we adopt from the European soccer system?
Let's start with the fans.
Europe puts our fans to shame. Yet teams like Seattle and LAFC have successfully created exciting soccer atmospheres that produce people in numbers to games and create more revenue. My hat goes off to these clubs. Whether these face painted barbarians know anything about the sport or not, they are indeed passionate. We should keep growing their passion with more soccer related media, and more access to youth soccer. The point is, we need more footy, in the paper, on the TV, in the streets, and the bars. Footy everywhere.
Incentive.
We need greater incentive in our leagues to win, and disincentive to lose. Maybe our closed league regulations are not going anywhere, but we can make progress through our American semi professional systems with the allocation of more resources and credibility. Just now, I am starting to see 16 and 17 year olds find teams within NISA and the UPSL, that are able to use these platforms as stepping stones towards bigger clubs. This is progress. I would have never heard of an opportunity when I was 16. As much as I would like to cry about this, this is the type of opportunity we need to be giving our younger players.
Pay our players more.
Compared to leagues in Europe, our players get pennies. I know the job is in high demand, but most players don't earn enough to incentivize a playing career. Actually, most players are not financially stable AFTER a playing career. I know it's easier said than done but more incentive for players can leave us with a bigger pool of players.
Specific attention to college ball.
We have produced a great thing in this country, and that is giving soccer players an opportunity to use the sport to help pay for their education. But our American college soccer system is ineffective in taking players to the next level. Can we do more to open the door to clubs across the country, partner with professional soccer systems, and maybe even overseas?
By the way, "overseas" is not such a bad word. I know it gets a bad wrap, but players that have the opportunity to step their game up in Europe can develop a better sense of the game tactically and professionally. We don't lose players forever. They always come back. I think the solution can really be found in the long term.
With all these lamentations aside, I understand that no system is perfect and every system has its own flaws, but in the best attempt to understand weaknesses and turn them into strengths, I really believe we have the potential to shift our culture, become a badass soccer country, and just one day, lift a World Cup.
René Collazos
P.S. While the emotions in this piece are my own, some of this very important information comes from Stefan Saymanski's Money & Football.
