Does Major League Soccer Have Legs?

The new season could be crucial as it struggles for acceptance

A new TV ad for Major League Soccer shows six players wildly celebrating goals they just scored. They peel off their jerseys and strut to the sound of striptease music. Emotion so overcomes one player that he falls to his knees to thank the heavens.

Unfortunately for MLS, which kicks off a new season on Mar. 15, too few of these moments occur in real life. Soccer remains one of the lowest-scoring and lowest-rated TV sports in America. Following in the footsteps of previous failed U.S. soccer leagues, MLS has lost $40 million in its first two seasons. Though it had a surprisingly strong inaugural year, drawing 3.1 million fans, MLS attendance had dropped 16% by the end of 1997--and it could get worse: This summer's World Cup will draw attention away from MLS and possibly exacerbate the slump. As if that weren't troubling enough, MLS is being sued by players disgruntled over their relatively low pay. It all begs the question: Is pro soccer just a bad fit for a nation of sports fans with short attention spans?

Of course, soccer is still the most popular sport in the rest of the world. And "soccer moms" became part of the political lexicon in 1996 because American kids have embraced the game so enthusiastically. But professional soccer has never taken root in the U.S. as a major league sport. In the past, U.S. leagues were always financed one season at a time. None ever secured a TV deal. The longest surviving, the North American Soccer League, ran from 1967 to 1985 but was a dumping ground for second-tier European players. It flourished only when Brazilian great Pele played for the New York Cosmos in the 1970s. More typical was the 14-season Major Indoor Soccer League, which folded in 1992. Only 1 of 40 teams that played in that league ever made a profit.

MLS is trying hard not to be as bush-league, but it's not easy. Just 10% of its players have a shot at making a World Cup roster this summer, says MLS Commissioner Douglas G. Logan. "American soccer is a level below our top division," gloats David Endt of Amsterdam's Ajax Football team, one of Europe's best. "No one dreams of going to play in the U.S."

If they did, they wouldn't be allowed to, anyway. MLS limits international players to five per roster and may lower the number to four. That means more Americans get a shot at gaining world-class experience. But it also prohibits top international talent from improving the overall quality of play. Currently, most of the international players MLS attracts are unproven youngsters placed in markets with high concentrations of immigrants from their respective countries.

PAY PIQUE. Because of its structure, MLS probably couldn't afford top-tier foreign players even if it wanted them. MLS operates like a franchise system: The league owns the teams, caps salaries, and prohibits free agency. The average MLS salary is $83,000, and the minimum a scant $24,000. "We don't have superstars. Our players drive Honda Civics," brags Brian I. O'Donovan, general manager of the New England Revolution.

Apparently, that's not good enough for MLS players: They have filed a federal antitrust class action against the league that is scheduled to go to trial this fall. They want to be paid more in line with European-league players, who command between $300,000 and several million dollars per season. "I'm shocked they're suing, as opposed to collectively bargaining," says Alan I. Rothenberg, the founder and chairman of MLS. He would prefer to see the players form a union. But if they did that, they would forfeit their right to sue on antitrust grounds, says John Kerr, executive director of the MLS Players' Assn. "The players just want a free market with the ability to negotiate--anything but this scam."

Even the backbone of the league--the growing U.S. Hispanic market--is proving unreliable. Hispanic attendance dropped 10% last year. To reignite that market, the league has hired Dieste & Partners, a Dallas-based ad agency that specializes in Hispanic marketing. But in the meantime, MLS has reduced the number of Sunday games this season by almost 25%. That could prove to be a blunder with Hispanics, for whom soccer is a Sunday ritual. MLS also miscalculated that Hispanics would purchase season tickets. "We now know they're more spontaneous and aren't as likely to buy a package," admits Logan, a former Mexico City concert promoter.

SUMMER SWEAT. This summer's World Cup, which will be held in France from June 10 to July 12, could "bury us" for a month, admits Rothenberg. But MLS is playing through. While the eyes of the world follow their favorite national teams--playing a level of soccer above that of the MLS--the U.S. league will stick with a slightly reduced schedule.

Despite those possible negatives, the league says it's on course to sell more season tickets this year than it did in '96, its first and best year. It expects expansion teams in Miami and Chicago--where there are large Hispanic contingents--to give slumping league attendance a boost. And it's crossing its fingers that the major-market New York/New Jersey MetroStars won't finish in the basement of the Eastern Conference standings again this year.

Besides securing $80 million in sponsorship money over a five-year period, MLS's major coup to date is a guaranteed $5 million TV deal with ABC and ESPN that will beam 47 of its 210 games into U.S. homes. That's still small change compared with ABC's $25 million deal to broadcast all 64 World Cup games to the States this summer. But it's better than making zilch on a TV deal, which MLS did the past two seasons.

To become the fifth major sports league in this country, as MLS fashions itself, league officials know they must secure higher-paying TV deals. They also must make more than a measly $2 million off licensing, which was all they mustered last year. As it stands, MLS relies primarily on ticket sales--a formula that killed other soccer leagues. "We've got a good baseline of support, but it might take another 10 years for this to work," says Rothenberg.

MLS Commissioner Logan is preparing for a $20 million loss in '98. Fortunately for him, though, $20 mil here and there doesn't seem to deter the league's backers, who include billionaires John Kluge, Philip F. Anschutz, and Robert K. Kraft. In recent meetings, backers have reportedly assured Logan that "nothing's terminal." But a legitimate major league must survive the nation's fickle remote control, where history is just a click away.

Before it's here, it's on the Bloomberg Terminal.