Should We All Get Along? A Look at Soccer in America
April 03, 2016
A SIGNIFICANT PART of Major League Soccer's success is attributable to the consolidation of soccer as a brand in the United States through Soccer United Marketing (SUM), which licenses the commercial rights to Major League Soccer, the United States Soccer Federation (USSF), promotional and marketing rights to Mexican national team games played in the United States, and the marketing and promotion of various CONCACAF events.
A decade into the decision to unite under one promotional umbrella, it remains to be seen whether U.S. Soccer and MLS should continue to profit-share with one another through vehicles like SUM, particularly since the goals of MLS and U.S. Soccer do not perfectly intersect. This article examines how the goals of U.S. Soccer and MLS coincide and diverge and addresses whether their relationship should continue in its current form.
The Goals of MLS and U.S. Soccer
MLS and U.S. Soccer share some goals but not others. Indeed, certain of their goals work at cross-purposes against one another, particularly with respect to the Men’s National Team, since the Women’s National Team is far more successful than its male counterpart. Some of the most important goals of U.S. Soccer include:
1. Achieving success in international competitions and for U.S. national teams to be the best in North America, as evidenced by regularly winning CONCACAF competitions like the Gold Cup;
2. Developing a large pool of world class players from which to draw;
3. Growing the sport in the United States (this is perhaps USSF’s primary goal);
4. Increasing revenue for U.S. Soccer, USSF and Development Academy clubs;
5. Creating an established domestic pathway for the soccer community by providing a clear definition of the demands and challenges of the modern game, an understanding of individual players’ qualities, and to implement a functional framework for scouting in the United States.
Some of the most important goals of MLS include:
1. Increasing revenue to MLS, particularly through television rights, and to control costs;
2. Increasing the brand recognition of MLS and avoid brand tarnishment;
3. Improving the quality of play in MLS and become one of the top leagues in the world by 2022;
4. To secure itself financially by having nothing but MLS-owned soccer specific stadiums in the league;
5. To expand in an intelligent and sustainable manner, and pay heed to the lessons learned from the missteps of NASL’s collapse.
Where the Goals Align
Both entities maintain an interest in growing soccer in the United States because doing so increases the likelihood of adding fans, and more fans means increased revenue. Both have an interest in increasing the revenue to U.S. Soccer since MLS shares in the benefits that accrue to U.S. Soccer through SUM. And both want to improve the quality of play in MLS, since one of the major pools of players from which the national teams derives its talent is MLS. Improving the quality of play in MLS will also improve the regard with which others view the league, and the more MLS can persuade soccer fans it has a quality product, the more likely it is to amass viewers and, hence, revenue.
I understand some of the thinking, and the belief that if you go there [to Europe] everything is going to be better, and your development will be more accelerated. We know from experience that European clubs are more experienced and have more resources than us. I don’t think they necessarily know anything more about soccer. I don’t think there’s any reason to believe that we can’t develop elite players here. And we should encourage our elite players to stay here, and we should have the resources to keep them here. We can develop players here. –Bruce Arena (from interview February 2016)
This process is already underway. In 2010 only four MLS players made the U.S. World Cup team; in 2014, 13 MLS players made the roster. In some respects, cooperation between U.S. Soccer and its domestic leagues is critical to establishing a U.S. soccer identity and instilling a high standard of play in its leagues, which will aid the fortunes of MLS and also that of the national team in international competition.
Where the Goals Diverge
The two goals that stand out as being most at odds with one another are U.S. Soccer’s goal of developing a large pool of world class players from which to draw and MLS’ goal of improving its brand recognition and avoiding brand tarnishment.
Jurgen Klinsmann wants to develop the deepest and best talent pool possible. Acknowledging that MLS is not the best league in the world, Klinsmann encourages players to play at the highest possible level which, if a player is talented enough and his circumstances support such a move, means going abroad to the Bundesliga, English Premier League, La Liga, Serie A, etc. Klinsmann has made this position clear through public comments and player selection in various competitions. This position is reasonable and consistent with what other national team coaches the world over want for their players, and is supported by the fact that there is a positive and high correlation between a national team’s success and the number of players it has playing for the best teams in the world.
MLS, meanwhile, has a strong and understandable focus on building its brand. Portrayal of the brand in a negative light threatens to destroy its commercial value because it increases the likelihood that the public will associate the brand with a lack of quality.
I’m demanding that he refrain from making comments that are critical of our players and damaging to our league...Jurgen’s comments are very detrimental to the league. They are detrimental to the sport of soccer in America. Not only are they detrimental, they are wrong...Sending a message to any player and obviously to U.S. players that signing to Major League Soccer is not going to be good to their career or good to their form is detrimental to Major League Soccer. —Don Garber, October 2014
One could argue that MLS focuses too much on increasing its brand recognition and perceived quality through marketing, including its efforts to discourage public comments that cast it in a negative light, as opposed to increasing its brand recognition and perceived quality through improving its actual quality.
I don’t think you’re going to find a single MLS owner who’s going to be an advocate for Jurgen Klinsmann. This is a guy who’s got a clear agenda that’s an anti-MLS agenda. He makes emotional decisions. Landon Donovan would be a case in point. There’s very much an agenda to get people playing abroad and probably rewarding some people playing abroad who don’t deserve to be playing. That’s one opinion, that’s my opinion. —Merritt Paulson, Owner of the Portland Timbers, 2016
On the one hand, it makes some business sense from the league’s perspective to, for example, defenestrate Klinsmann when he says players should go abroad to test themselves at the highest level, because it is less expensive to try to dictate the public narrative than to make huge financial investments in things like salaries and academies, which are two major hurdles for MLS in terms of improving quality of play.
Our picture is the global picture. We need to know what England, Germany, and Spain are doing in Europe, and then what Brazil, Argentina, and Uruguay are doing in South America. But our benchmarks are internationally. So for a lot of people they define their world domestically, which is totally cool. They should think maybe a little bit more before saying things from the outside about the national team program. —Timo Liekoski, former U.S. national team assistant coach, former U.S. Men’s Olympic soccer team coach. (from interview February 2016)
However, while expensive, concrete improvement is real whereas brand improvement is always subject to dilution. Take diamonds as a case in point. Diamonds are not rare, they are plentiful. De Beers has spent a fortune attempting to maintain the illusion that diamonds are rare, and therefore precious, because absent that illusion diamonds are nothing but blocks of compressed carbon. Over time, De Beers’ efforts to maintain the illusion of scarcity have had diminished effectiveness—hence the collapse in diamond values over the past five or 10 years.
Concrete improvement in the quality of play is also preferable to brand improvement through marketing because, to a certain class of fans, e.g., North American fans that follow the European leagues, it is vaguely insulting for MLS marketers/ownership to deny that there is a substantial quality gap between the top four European leagues and MLS because it suggests that MLS owners either (1) think American soccer fans are stupid; or (2) don’t understand the sport into which they’ve invested billions of dollars.
One of MLS’ biggest opportunities for growth is through capturing crossover fans, i.e., those fans who love the sport and follow it abroad but do not love MLS. While MLS is trying valiantly to improve its brand, in some ways it only undermines these efforts when it lashes out at those that criticize it, particularly with respect to these crossover fans. After all, a quality product doesn’t fear the marketplace of public opinion, it welcomes it, because it knows the marketplace will weed out the inferior product.
Can This Relationship Be Saved?
The problem is not that MLS owners are unabashedly pro-MLS: after all, they have invested billions of dollars in the league. MLS owners should do everything and anything to advance their own interests.
My job is to do everything that I can to grow Major League Soccer and to ensure that MLS is going to be a driver of the growth [of] soccer at the highest level in the U.S... It’s not a short-term goal. It's a long-term objective. And I do believe our national team coach has a short-term objective. That’s what he’s hired to do. That doesn't mean next week, but it's to win the Gold Cup, it’s to have the best possible team in 2018. And our goals and objectives are broader than that, and that's why we agree on some things but don't agree on others. —Don Garber
MLS owners understand that they do not work for U.S. Soccer. If MLS owners believe that squelching criticism will dampen public awareness regarding the disparity in quality between MLS and the biggest leagues in Europe, then their conduct is rational. After all, one of the peculiarities of the single-entity structure is that the owners do not criticize one another (being joint venturers after all) and the soccer world receives so little media attention that MLS owners have partially immunized themselves from the type of public criticism that occurs in Europe.
The conundrum for MLS and U.S. Soccer is this: What level of financial interdependence should they have and how can they prevent their interdependence from confounding the traditional national team/national league dynamic? In most countries, the national team coach tells his players to go the best team they can reach and the soccer league in that country plays no role in that directive. However, MLS and U.S. Soccer share financially in each other’s fortunes due to SUM which means in some ways they need to focus in the same direction. While this relationship made sense when MLS was a fledgling league, as it has transformed into a thriving part of the U.S. sports landscape, MLS has become more outspoken in trying to curtail public criticism, which in turn impinges on the ability of national team coach to set clear mandates for his players.
In deciding on the type of relationship that MLS should have with the U.S. Soccer Federation, the experiences of other countries afford the United States ample insight on what could work for both the league and the national team.
For example, there are countries where the league and national team largely operate independently of one another. In England, the Premier League enjoys relative autonomy from the Football Association (FA). The Premier League makes all its own commercial decisions, e.g., awarding television contracts, setting parachute payments for relegated teams, etc. The FA’s authority over the Premier League is narrowly circumscribed to issues which relate directly to the game itself—such as sanctioning players for disciplinary offenses. The commercial freedom clubs enjoy in England has spurred investment—the EPL not only has more foreign owners and foreign players than other major European soccer leagues, it also makes the most money. However, there are those, including FA Chairman Greg Dyke, who believe club independence has contributed to the England national team failing to perform well in international competition.
There are countries where once interconnected leagues and national teams de-coupled after the league stabilized in order to ensure both continued success. In 1962, the German national team endured a humiliating defeat during the World Cup quarterfinals at the hands of Yugoslavia. That day, the German national soccer association, the Deutscher Fußball-Bund (DFB), elected a new president, Hermann Gosmann; shortly thereafter, the Bundesliga was formed. For decades, the DFB controlled the Bundesliga—indeed, the DFB successfully navigated the Bundesliga through years that bore witness to hooliganism, declining attendance and German reunification. However, when the DFB and Bundesliga reached a cross-roads where the Bundesliga was no longer plagued by crisis and was enjoying popular success, the Deutsche Fußball-Liga (DFL) was formed to independently manage the Bundesliga and 2. Bundesliga.
The DFL oversees the business decisions of the Bundesliga: it awards its television contracts, is responsible for its marketing, and the club owners now exert more influence over their teams than they did when clubs were managed by the DFB. However, the DFB’s governing documents ensure cooperation between the two entities and the DFL is also contractually obligated to transfer a small portion of the money it receives from media rights and gate receipts (something like 3%) to the DFB for the benefit of the national team. The Bundesliga now enjoys great commercial stability and competitive success and is one of the best managed soccer leagues in the world, reporting 11 consecutive seasons of record revenue.
There are also countries where the league and national association remain closely interconnected. In France, the Fédération Française de Football (FFF) manages all aspects of the game, including the Ligue de Football Professionnel (its professional league) and its national team. The management of soccer as a state enterprise facilitates unanimity: youth development, coaching, its professional league and national teams act in concert with one another. France consequently can lay claim to having some of the best coaches and players in the world. However, clubs’ inability to control their own fortunes and make their own rules has hampered Ligue 1. For example, until recently clubs were prohibited from paying their own directors, which deterred investors. French soccer clubs do not perform especially well among their cohorts in the UEFA Champions League and make far less in television money than leagues that operate more independently such as the EPL.
Twenty years ago, when MLS began, there was understandable concern that it would never last. The NASL’s implosion in the 1980s cast a shadow for MLS’ founders and has served as a constant reminder of how big dreams can go bust in the U.S. sports landscape. Since the birth of MLS sprang from a conditional promise that the U.S. could host the World Cup in 1994 provided it founded a professional soccer league, it stands to reason that U.S. Soccer would play a role in ensuring the success of MLS. However, now that MLS has secured its foothold among global soccer leagues, one wonders whether, and at what point, MLS and U.S. Soccer will modify their relationship.
The irony is that MLS’ financial security has facilitated its increasing antagonism with U.S. Soccer yet its financial security may also be what justifies U.S. Soccer changing its relationship with MLS. Because it makes less sense for U.S. Soccer to operate in a joint venture with MLS if MLS is going to continually interject itself in the decisions being made by the national team coach.
All coaches have a limited time period in which to work. Some are longer, some are shorter, but I believe every coach wants to leave the organization in a better shape than it was prior to his/her arrival. —Timo Liekoski (from interview February 2016)
MLS and USMNT have to work together. Growing together is win-win, it’s really that simple....Build from within, build home-grown players, build your youth system. And finally build U.S., American, and Canadian stars. —Charlie Flowe, Assistant Coach Ocean City NoreastersWomen, Host of World Sports Show (from interview February 2016)
Ideally, U.S. Soccer and the U.S. domestic leagues would construct a pathway that commences at the local level and proceeds all the way through the professional and, eventually, international levels, with the aim of creating a healthy soccer culture that is expansive enough to include every young person with a passion for the sport. In order to do this, U.S. Soccer and MLS may need to either redefine their relationship or acknowledge and then set aside their respective differences, so that the long-term goals for soccer in the United States can be achieved.