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MLS steadily builds toward goal of profitability

By Kevin Baxter

Los Angeles Times

Published: Monday, Nov. 28 2011 10:04 a.m. MST

Los Angeles Galaxy forward Landon Donovan holds up the MLS Cup after they won their championship soccer match against the Houston Dynamo, Sunday, Nov. 20, 2011, in Carson, Calif. The Galaxy won 1-0. (AP Photo/Bret Hartman)

Associated Press

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Clark Hunt's business card is a little crowded given that he's chief executive of the NFL's Kansas City Chiefs and owner of Major League Soccer teams in Dallas and Columbus, Ohio.

"I probably most frequently introduce myself as someone who's involved with both professional football and professional football," he says with a grin.

Hunt is also smiling because with attendance, TV revenue, franchise values and expansion fees all at record highs, this is a very good time to be involved with futbol.

Oh, and the NFL isn't doing too badly either.

"Without doubt, this has been the best year in the history of the league," says MLS Commissioner Don Garber.

And at that he may be selling himself short since no U.S. professional sports league has grown as much as MLS over the last five years.

MLS attendance is up 7 percent to 17,872 per game, better than last season's NBA and NHL averages, and leaving MLS behind only the NFL and Major League Baseball among U.S.-based pro leagues. And nearly one-third of MLS' regular-season matches sold out this season.

Expansion fees have increased fourfold since 2007, to $40 million, and will go up again before the league adds a 20th franchise, perhaps as early as 2013.

By the end of next season, 15 of the league's 19 teams will play in soccer-specific stadiums. Nine were built in the last five years, including Kansas City's $200-milllion Livestrong Sporting Park, which opened last season.

The league, which once had to pay broadcasters to air its games, recently signed a $30-million, three-year deal with NBC, supplementing agreements it already had with ESPN, Fox and Univision. And the Galaxy, the league's marquee team, agreed this week to an MLS-record deal with Time Warner Cable worth $55 million over 10 years.

"That's pretty amazing to think that's happened in such a short period," says Hunt, who was captain of a nationally ranked soccer team at Southern Methodist and is now a member of the MLS Board of Governors. "We've really become a nation that loves the sport of soccer."

One thing MLS hasn't done, however — and this is a big one — is turn a profit.

Even with revenue at an all-time high, fewer than one-third of the league's teams will make a profit this season. Even the Galaxy, with an estimated value of more than $100 million, will finish in the red after paying more than $12 million in salary to three designated players, David Beckham, Landon Donovan and Robbie Keane.

"Major League Soccer is a business. And at the end of the day, profitability is one way the main business is measured," Hunt says. "I would just say the needle is pointed in the right direction.

"If you go back 10 years, I'm not sure any of the teams made money. If you go back 10 years, I'm not sure the franchises were worth anything.

"I'm sure (now) there are some franchises that, if they were sold, would command prices similar to what some of the teams trade for in the other four major professional sports. That is definitely a sea change."

But there are still other choppy waters left to navigate. D.C. United, one of the league's original members, has been unable to secure funding for a new stadium or for needed upgrades at its current home, the deteriorating RFK Stadium, and may be forced to move.

A long-planned expansion that would put a second team in the New York market, has repeatedly hit snags. And though Garber prefers to sing the praises of the league's success stories in Portland, Seattle, Vancouver and Philadelphia, four teams — including winning franchises in Columbus and Dallas — are drawing fewer than 14,000 fans a game.

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