Introducing promotion and relegation in MLS could reflect US Soccer’s maturity – originally posted on Nixusblog.com
Introducing promotion and relegation to the United States’ club soccer will bring positive economic impact, according to a by Deloitte, one of the “Big Four” accounting firms. The report is commissioned by Silva International Investments, an owner in the North American Soccer League club Miami FC.
The report concludes that while US club soccer has come a long way since the early days, it still has a long way to go to reach its full potential. MLS’ fee expansion model has a limited lifespan, according to the report, and it will experience challenges in increasing broadcast and matchday revenue in the future. The reason for this is due to continuously expanding interest in foreign-based leagues, which go on to serve as competition for broadcast revenue as people are more interested in watching those than the Major Soccer League, the domestic football league of the United States of America.
For soccer to grow in America, it needs to develop further so that it becomes as attractive for people as the foreign leagues are.
Deloitte suggests there is evidence that an open league system can drive more interest, translating into increased attendances and broadcast audiences. The increased interest in US club soccer brought about by promotion and relegation could drive revenues that more than offset the potential losses for MLS owners. Deloitte writes that promotion and relegation could drive more investment at all levels of the game, and that would be better for player development in the country, which would ultimately lead to a stronger United States national team.
It points to the evidence in an open league system that increases attendances and broadcast audiences. The growing interest in US club soccer brought about by promotion and relegation could drive revenues.
Promotion and relegation are unmistakably excellent for other aspects which will subsequently help to generate revenue as well.
There is added interest throughout the season due to a club’s survival in the respective league “at stake” and creates narratives and “stories” for the fans, which they thoroughly enjoy.
The threat of a “drop” to a second tier and the attraction of getting promoted can lead to a drive in increased attendance and matchday revenue. This will occur over time as the current gap between Division I (MLS) and Division II (NASL) in terms of attendance is large. However, there are positive indicators for the future as this gap can be bridged over time, and even at the current stage, help the net overall attendance in US soccer.
The ancillary benefits of promotion and relegation would result in increased motivation and ambition from the owners, who will want to improve their organisations in the hope of getting promoted and being part of the top tier. Owners will want to improve facilties, coaching and grassroots programmes to aid the development of players which will finally even assist in the US National Team’s ambitions in the international arena.
Promotion and relegation will result in the growth of US Soccer in an organic way and will align the nation with European football associations where promotion and relegation is a natural concept. Implementing this would also show that football in the USA has indeed matured.
The flipside to this would be that a large number of Americans didn’t grow up supporting their MLS teams, and hence relegation of the team from the top tier might just result in the club losing out on those new fans. Long-term investors also might fear that relegation represents a major new risk which would impair and imperil this investment.
While the risks that this would pose cannot be underestimated, and it must be mentioned that US Soccer is not yet immediately ready for promotion and relegation, this should be part of a long-term plan for the United States Soccer Federation.