Lance Armstrong's Brand And Image Take Major Blow

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Lance Armstrong beat cancer, and he conquered the Tour de France seven times. Armstrong now faces another formidable challenge as his brand takes a major hit after the U.S. Anti-Doping Agency released a voluminous report Oct. 10 saying he participated in "the most sophisticated, professionalized and successful doping program that sport has ever seen."

According to CNN, the USADA said the evidence involving the U.S. Postal Service-sponsored cycling team includes "direct documentary evidence including financial payments, e-mails, scientific data and laboratory test results that further prove the use, possession and distribution of performance-enhancing drugs by Lance Armstrong."

In its report, the agency said 11 riders, including George Hincapie, Armstrong's teammate for more than a decade, came forward to acknowledge their use of banned performance-enhancing drugs while on the team. According to the USADA, Hincapie testified that he knew the seven-time Tour de France winner used performance-enhancing drugs, and that Armstrong withdrew from a race in 2000 to avoid a positive drug test.

The USADA banned Armstrong from cycling for life and has ordered that his Tour de France titles be stripped.

The report had been expected. On Aug. 23, Armstrong, who retired from racing in 2011, declined to enter the USADA's arbitration process because he said he was tired of fighting accusations that have followed him since 1999.

"There comes a point in every man's life when he has to say, 'Enough is enough.' For me, that time is now," Armstrong said in a statement sent to the Associated Press. He went on to call the USADA investigation an unconstitutional witch hunt.

"I have been dealing with claims that I cheated and had an unfair advantage in winning my seven Tours since 1999," his statement continued. "The toll this has taken on my family and my work for our foundation and on me leads me to where I am today -- finished with this nonsense."

Armstrong apparently is not the only one finished with this situation, as many of his longstanding endorsers have distanced themselves from the embattled cyclist. Industry experts estimate that Armstrong annually pulled in between $15 million and $18 million from his sponsorship deals, and this scandal will cost him hundreds of thousands of dollars on the corporate speaking tour.

Nike, Armstrong's largest corporate supporter, terminated its arrangement with him Oct. 17.

"Due to the seemingly insurmountable evidence that Lance Armstrong participated in doping and misled Nike for more than a decade, it is with great sadness that we have terminated our contract with him," a Nike spokesman said in a statement. "Nike does not condone the use of illegal performance-enhancing drugs in any manner."

ESPN.com reported that Nike paid Armstrong close to $40 million during the course of the endorsement deal.

The Nike decision came on the same day that Armstrong announced he was stepping down as the chairman of Livestrong, the nonprofit he founded in 1997 to provide support for people affected by cancer.

"This organization, its mission and its supporters are incredibly dear to my heart," Armstrong, a cancer survivor, said in a statement. "Today therefore, to spare the foundation any negative effects as a result of controversy surrounding my cycling career, I will conclude my chairmanship."

Marty Conway, vice president of sports marketing for Imre Communications, said he didn't see Armstrong's stepping down as a public-relations move to help lessen any fallout the nonprofit may take in the court of public opinion.

"It seems to me that Lance believes in the 'it's not who is right, but what is right' principle,' " Conway said. "With his actions in the past, I think it's clear Lance could care less about any public relations, or opinion when he makes a decision. He cares about this cause, finding a cure for cancer, deeply and must believe that this move will help the cause, in some way."

Fortunately for Livestrong, Nike intends to continue its support of the charity's initiatives. Since 2004, Nike and Livestrong have raised more than $80 million for the nonprofit in the sale of the signature yellow Livestrong wristband. Nike also has a line of Livestrong-branded apparel.

Among the major companies following Nike's lead in separating themselves from Armstrong are Anheuser-Busch, Trek and RadioShack.

Trek, which made the bikes Armstrong rode while competing, released a statement saying the company was disappointed by the findings and conclusions in the USADA report regarding Armstrong.

"Given the determinations of the report, Trek today is terminating our long-term relationship with Lance Armstrong," the company said in a statement. "Trek will continue to support the Livestrong Foundation and its efforts to combat cancer."

Anheuser-Busch, which used Armstrong in campaigns promoting its Michelob Ultra line, will end its agreement with Armstrong at the conclusion of the year. Like Nike and Trek, the Missouri-based brewing company pledged to continue its support of the Livestrong Foundation.

Forbes estimated Armstrong's worth at around $125 million. Along with the USADA's report, the champion cyclist will take a hit in his wallet to accompany the damage to his credibility as the findings will likely end his career as a corporate pitchman.

"In the near term, yes, many of Lance's endorsements will terminate, or not be renewed," Conway said. "Those companies that are public, in particular, often flee to the safe harbor when their spokespeople are in deep trouble within the law, or within their sport. In this case, the topic, performance-enhancing drugs, are the new third rail of sports endorsements."

But Americans do love a comeback. Just ask Kobe Bryant. In 2003, a Colorado hotel worker accused the Los Angeles Lakers guard of sexual assault, and he was arrested. He denied the charges, but admitted to committing adultery. The court eventually dismissed the charges and the Lakers superstar proceeded to resurrect his image. Forbes estimates that Bryant's endorsement deals take his annual earnings to around $50 million a year, and the NBA announced in June that his jersey was the top-selling NBA jersey outside the United States.

Although Armstrong's situation is different than the scandal that Bryant faced, Conway said Armstrong should not be counted out either.

"Americans love sports, politics and entertainment," Conway said, "and it's the perfect setting for the three great acts of the American drama -- star on the rise, star takes a great fall and the rise again, though damaged or soiled.

"Lance will be back, on his time. You don't come as close to death as he did, with cancer, and fear anything or anyone. With enhancements or not, Lance Armstrong climbed the biggest mountains in sports. I would never bet against this guy climbing a new mountain."

Office Of Sports Marketing Gives Maryland Huge Boost

The sports-travel industry is a $182 billion business, responsible for bookings of more than 47 million hotel room nights annually in the United States. In the United States alone, 27 percent of all travel is sports-related, and more often involves parties of three or more.

As a result of this thriving industry and in an effort for the state of Maryland to become engaged in this arena, Gov. Martin O'Malley created the Maryland Office of Sports Marketing in 2008. The endeavor is a strategic partnership between the Maryland Stadium Authority and the Department of Business and Economic Development. Its mission is to enhance Maryland's economy, image and quality of life through the attraction, promotion, retention and development of regional, national and international sporting events.

Terry Hasseltine, the former deputy executive director of the Kentucky Sports Authority, leads the initiative. For his previous role, Hasseltine was successful in developing a 24-member community marketing collaborative to promote the state of Kentucky as a sports-travel destination. His accomplishments included bringing the 2008 Ryder Cup and 2010 AllTech FEI World Equestrian Games to the commonwealth.

Appointed in 2008, Hasseltine wasted little time establishing Maryland as a significant player in the sports industry. During the past four years, the Maryland Office of Sports Marketing has engaged in more than $1 billion in event recruitment and secured more than $400 million in economic impact for the state.

"My primary focus is to market and promote Maryland as a sports-event and -travel destination," Hasseltine said.

In May 2009, the office launched its first significant marketing tool with a state-of-the art Web site, MarylandSports.us, which features a searchable sports facility directory. The site's intended audience is sporting- event and -travel industries in the state, national and international markets. Currently, the Office of Sports Marketing is expanding its online efforts, tradeshow presence, marketing and attention to focus on a program known as TEAM Maryland (TEAMMaryland.us).

"TEAM Maryland is a statewide initiative designed to collectively market Maryland to the entire sports-event industry by creating a synergistic approach to the way we market all of Maryland as a sports destination," Hasseltine said. "TEAM Maryland is presently comprised of 13 county partners, but the network of venue/facility, sponsor prospects, corporate support, service providers, media, etc. … continues to grow daily here in Maryland, nationally and internationally."

Under Hasseltine's leadership, the office has been instrumental in leading various bid-development and event-support opportunities. Among the events and initiatives that Hasseltine's office has played a significant role in securing for the area are the Army-Navy Game (2011, '14 and '16); the NCAA men's lacrosse Final Four (2010, '11, '14); 2009 World Football Challenge, in which international soccer powerhouses Chelsea and AC Milan faced off before 72,203 people at M&T Bank Stadium; several key USA Track & Field events; the Atlantic Coast Conference men's soccer championship; and the Grand Prix of Baltimore.

The Maryland Office of Sports Marketing was also successful in bringing one of the world's premier season-long action sports events, the Dew Tour, to Ocean City. Hasseltine said the tour's first stop in 2011, the Pantec Open, set an attendance record, as 73,000 came to the event from July 21-24. According to the SportsBusiness Journal, there were more than 1.3 million viewers for the two days the Ocean City event was broadcast on NBC (July 23 and 24). That represents a 1.3-percent audience spike from the previous year for the overall five stages of the tour.

The event returned to Ocean City in 2012, and the Maryland Office of Sports Marketing reported that the Dew Tour drew the largest attendance on record, with 93,000 spectators. The agency has secured the event for a third consecutive year in Ocean City in 2013.

Tom Noonan is the president and CEO of Visit Baltimore, the official destination development and marketing organization for the Greater Baltimore region. He said that when he came to Baltimore in January 2007, he was surprised to find out that Maryland didn't have a sports commission, and was glad when he heard about the formation of the Maryland Office of Sports Marketing.

"Having Terry and his office has put Baltimore on the sports landscape," Noonan said, "and that didn't exist before. From professional sports to youth sports, Terry is constantly looking at events to bring to our area and build our recognition. From a city standpoint, we are continually looking at ways in which we can help the Office of Sports Marketing become more successful."

Hasseltine said the office was working to solidify a number of additional endeavors that would take place in Maryland.

Hasseltine said having good relationships with the Ravens, Orioles and the MSA was critical to his office's success, and having the assets of the Camden Yards Sports Complex was favorable and vital to its work.

Mike Frenz, executive director of the MSA, said the Maryland Office of Sports Marketing had helped the state profit from the big business of sports, while creating opportunities for citizens and visitors to enjoy new experiences in state-owned facilities.

"Where Terry has been invaluable to the state of Maryland in general and Camden Yards in particular is in identifying events and activities that are good for prospective venues, and helping submit bids to attract them," Frenz said. "Many facility operators around the state are not familiar with the process, especially those involved in youth and amateur sports, a particularly lucrative segment of the tourism market.

"Here at Camden Yards, Terry has been instrumental in big-ticket events, like neutral-site college football. We have Maryland and Navy playing games here in the next five years. … [We are] also welcoming the NCAA's men's lacrosse championship back to Baltimore, where it enjoys great popularity, in 2014."

As the national and global sports landscapes continue to transform, the Maryland Office of Sports Marketing has created a more robust means and developed a communication plan for helping the state become a desirable destination in the sports-event industry.

"We have helped numerous partners around the state grow existing events by helping them gain access to more facilities," Hasseltine said, "and engaging them in conversations with leadership that can make progressive changes to allow more opportunities for success."

There are a number of case studies, best practices and formulas to determine how sports affect the state's economy, but Hasseltine said the simplest way to think about the impact of sports travel was a phrase he often uses to define the measure of sports events on a community: "Heads in beds, food in bellies, gas in cars, credit cards and cash on counters, butts in seats."

Noonan said the Maryland Office of Sports Marketing had benefited the local community.

"We are starting to see more recognizable events," Noonan said. "What's great is to know we have the right person going after those events. ... We have the right guy in Terry as a partner."

October 2012 print edition of PressBox

The Dollars And Nonsense Of The NFL's Lockout Of Officials

NFL referees approved a new eight-year deal with the league Sept. 29, by a vote of 112-5, and officially ended a labor dispute that raised the ire of fans, players and coaches. The new agreement between the league and the game officials is the longest in NFL history.



"The long-term future of our game requires that we seek improvement in every area, including officiating," commissioner Roger Goodell said in a statement. "This agreement supports long-term reforms that will make officiating better. The teams, players and fans want and deserve both consistency and quality in officiating."

Both sides made concessions for the sake of getting a deal completed. Under the new agreement, which runs through the 2019 season, game officials' salaries will increase from an average of $149,000 per year in 2011 to $173,000 in 2013, and then rise to $205,000 by the end of the deal. A major issue for both the NFL and the NFL Referees Association was the retirement plan for officials. The current defined pension plan will remain untouched for current referees through the 2016 season, or until an official earns 20 years of service with the league. The defined benefit plan will then be frozen.

Beginning in 2017, retirement benefits will be provided for new hires, as well as existing officials, through a defined contribution arrangement. According to the NFL, that structure is composed of two elements: an annual contribution the league will make on behalf of each game official, starting with an average in excess of $18,000 per official and increasing to more than $23,000 per official in 2019; and a partial match by the NFL on any additional contribution an official makes to his 401(k) account.

Beginning with the 2013 season, the NFL will have the option of hiring a number of officials on a full-time basis to work year-round. The league will also have the option to hire additional officials for training and development purposes and may assign those officials to work NFL games. The NFL will determine the number of extra officials.

Unlike the officials in the other three major leagues in North America -- MLB, the NBA and the NHL -- NFL referees only work part-time. The majority of officials hold positions in full-time jobs. One of the league's most recognizable officials, Ed Hochuli, is a successful trial attorney, while 22-year senior referee Mike Carey owns a ski and snowboarding equipment manufacturer.

Although the contract was not ratified until Sept. 9 at a meeting in Texas, Goodell temporarily lifted the lockout so a veteran NFL officiating crew could work the "Thursday Night Football" game between the Ravens and Cleveland Browns Sept. 27. When that crew took the field at M&T Bank Stadium, the crowd greeted it with a standing ovation.

In an ESPN and Global Strategy poll conducted before the end of the lockout, fans surveyed said the replacement officials had a negative impact on the league's reputation and would impact how much football they watched if the entire season was played with the substitutes.

During games the replacement crews worked, teams appeared to play more aggressively and skirmishes between opposing players occurred more frequently than during previous seasons. The frustration about the replacement officials reached a crescendo when a controversial call on the final play of the "Monday Night Football" game Sept. 24 cost the Green Bay Packers a win against the Seattle Seahawks.

As time expired, Seattle quarterback Russell Wilson threw a Hail Mary pass into the end zone, and both Green Bay safety M.D. Jennings and Seattle wide receiver Golden Tate had their hands on it. One replacement official signaled touchdown, while another called it a touchback. The replacement officials ruled that Tate had caught the pass, resulting in a touchdown and a 14-12 Seattle victory, though replays showed that the ruling should have been in Jennings' favor.

The controversial call dominated not only the sports world, but also mainstream media during the days following the game. Moreover, the call dealt a major credibility blow to the worldwide brand that is the NFL. President Barack Obama and Republican presidential hopeful Mitt Romney even weighed in on the disputed call and the use of replacement officials.

Dave Curley, the senior vice president of the Maryland-based company Sandy Hillman Communications, has overseen media relations for events such as the World Series of Poker and the Grand Prix of Baltimore. He said the NFL brand may have taken a hit, but fans would likely have short memories as the season progresses.

"For a league that prides itself on delivering the world's premier sports entertainment experience -- and that is fiercely protective of its image -- there's no question the use of replacement referees diminished the NFL's standing in the minds of many in the short term," Curley said. "The issue is whether there will be any lasting impact on the NFL's reputation. I tend to doubt it.

"After a few weeks of business as usual, I suspect that debacles such as the one in the Seahawks-Packers game will be largely forgotten. That having been said, ask me the question again if the Packers miss the playoffs or home-field advantage by a single game."

Not only did the debacle during the Seahawks-Packers game affect team records, it also had significant financial ramifications. ESPN sports business reporter Darren Rovell said the call could potentially cost Green Bay around $2 million in postseason revenue if the team failed to host a home playoff game. Additionally, the call caused a seismic shift in the millions of dollars wagered on the game as oddsmakers listed Green Bay as a 3.5-point favorite. If the play had been ruled an interception, the Packers would have covered the spread with a five-point, 12-7 victory.

John Avello, director of the race and sports book at the Wynn in Las Vegas, told ESPN.com that the call shifted more than $150 million in total bets worldwide. Mike Perry of Sportsbook.ag told the Web site he estimated the swing in money to be between $200 million and $250 million.

During a conference call with reporters Sept. 27 to announce the tentative agreement between the NFL and the NFLRA, Goodell said the uproar about the "Monday Night Football" controversy was not connected to the timing of the deal. He said the two sides had been involved in significant negotiations during the previous couple of weeks, but did acknowledge the Seahawks-Packers game may have pushed the parties further along.

Brian Kessler of Pasadena watched the Monday night game with his son and said he thought the outcry about the controversial call was the impetus to end the lockout.

"I have been following football for over 30 years and never seen anything so ridiculous," Kessler said. "When you have guys from the Lingerie Football League officiating NFL games, something bad is just bound to happen. I think the NFL is probably lucky that the team that got screwed by the replacement officials is publicly owned. … If that happened to a team with a private owner, one of their own, I guarantee you the NFL would have been singing a different tune after that game instead of defending those officials."

The NFL announced it would pay the 112 replacement officials for Week Four even though they did not work the games. Replacement referees will receive $3,500, while the other fill-in officials will be paid $3,000.

Originally Posted Oct. 1, 2012 at PressBoxOnline.com

Fans And Players Throw Flags At NFL-Refs Labor Dispute

A year ago, the National Football League was absorbed in an ugly labor dispute. Just a season later, the league is embattled in yet another labor issue. This time, the issue involves referees and not players, and the quality of the on-field product is being diminished, and the use of replacement officials could have ramifications, depending on how long the clash lasts.

On Aug. 29, the NFL notified all 32 teams that it would use replacement officials during Week One of the regular season. In a memo sent to the teams, Ray Anderson, NFL executive vice president of football operations, said replacements would be on the field Wednesday night, when the Dallas Cowboys visit the New York Giants during the opening game of the NFL season. The memo also said negotiations between the NFL and the NFL Referees' Association were deadlocked. The NFL locked out the officials in early June.

As expected, the NFLRA countered the NFL's position by issuing a statement following the release of the league's memo.

"It now appears the NFL is willing to forgo any attempt to reach a deal in the last seven days before opening night," the NFLRA statement said. "It is unfortunate, because the referees want to get back on the field. Our members have been engaged in extensive preparations and are ready to go. If the NFL is serious about negotiating, we are ready, but we can't negotiate with ourselves."

Anderson told league-owned NFL Network that the NFL was "committing to the replacement officials for as long as we need them to perform their services. It's a week-by-week basis, but they are prepared to go the distance if required."

Anderson said he thought it would take full-time officials 7-10 days to be fully prepared to officiate games once an agreement was reached. A number of rules were changed following last season, and the NFL has not shared those revisions with the regular officials since they were locked out. With all teams in action by Sept. 10, the longer it takes to reach an agreement, the more likely the 2012 season will be tainted.

The NFL used replacement officials -- none of whom came from NCAA Division I ranks, according to the NFLRA -- throughout the preseason, and their performances received unfavorable reviews by players, fans and commentators.

During the Ravens' 31-17, preseason win against the Atlanta Falcons in August, replacement official Craig Ochoa's mistakes weren't limited to his penalty calls. Throughout the game, he referred to the Falcons as "Arizona" when explaining various penalties to the crowd.

Cary Williams shares a few words with an official during the Ravens' preseason opener.

Sporting News conducted a poll of 146 players from 29 teams. The results showed that 90.4 percent, or 132 players, think games would be negatively impacted if replacement officials were used. Of the 132 players that responded, approximately 50 percent said the game would suffer intensely, while around 42 percent said the difference would be marginal. Fourteen players thought the season would proceed normally.
DeMaurice Smith, executive director of the NFL Players Association, is not making fans feel any better. He told Sports Illustrated the NFLPA didn't rule out the possibility of a strike, because of concern for player safety.

"In America, it is the employer's obligation to provide as safe a working environment as possible," Smith told SI's Jim Trotter. "We believe that if the National Football League fails in that obligation, we reserve the right to seek any relief that we believe is appropriate.

"The NFL has chosen to prevent the very officials that they have trained, championed and cultivated for decades to be on the field to protect players and -- by their own admission -- further our goal of enhanced safety. That is absurd on its face."

Although some players, such as Indianapolis Colts safety Antoine Bethea, have voiced support for the officials, it's highly unlikely any player would vote to give up a game check as a sign of solidarity for referees.
Fifteen-year NFL veteran Charles Woodson told USA Today that he was not going to draw any conclusions before the preseason. But when the preseason was finished, Woodson said: "They [replacements] haven't been very good. That's the honest opinion. Before preseason started, I think you're optimistic. But it's almost like a young guy coming into the NFL. The game goes too fast for them."

Two of the primary issues on the table during the negotiations between the parties involve money. There are currently 119 part-time NFL referees, who are paid an average of $8,000 per week. According to several reports, the focal point of the disconnect involves the initial pay increases for NFLRA members. The NFL has offered increases ranging from 5 to 11 percent, while the NFLRA is seeking an increase closer to 20 percent. The sides are reportedly about $16 million apart on a multiyear deal.

Brian Frederick is executive director of Sports Fans Coalition, the largest nonprofit fan-advocacy organization in the country. He said the salary differences were drastic for referees working other professional sports and those officiating in the NFL, which is the most profitable league in America. Fredrick's research showed that an NFL official would make $42,000 after being in the league for five years. But a fifth-year Major League Baseball umpire makes $141,000, while an NBA official with the same tenure earns $128,000.

Frederick said the difference in games played didn't matter when it came to player salaries. For example, New Orleans Saints quarterback Drew Brees earns more than Los Angeles Lakers superstar Kobe Bryant for playing in significantly fewer games.

Another issue the NFL is no stranger to when it comes to controversy is pensions. The league seeks to do away with the traditional pension model under the previous agreement with the NFLRA, freezing pensions and eventually terminating them in favor of a defined-contribution model ranging between $16,000 and $23,000 per year.

The NFL cites how the economic climate has changed dramatically since the agreement in 2006 and that corporate America and many NFL teams have moved to the defined-contribution model. The NFLRA is not biting on this proposed item, instead working to protect the retirement packages the union has as part of its previous deal, from six years ago.

The NFL and the NFLRA broke off talks on Sept. 1 after a third day of meetings failed to produce any results. The longer the NFL uses replacement officials, the greater the risk to the integrity of the game. In the long run, the fans may suffer the most.

Originally Posted Sept. 4, 2012 in "The Sports Business Report" at PressBoxonline.com

Freiberg Proves Auto Racing Isn't Just A Boys' Club

The Baltimore Grand Prix will feature a number of storylines during the three days of racing throughout downtown. Although the spotlight will be on the IZOD IndyCar race on Sept. 2, an intriguing story of the weekend involves Ashley Freiberg. The 20-year-old will race in the Star Mazda Series events on Sept. 1 and Sept. 2.


Freiberg did not compete in the inaugural Baltimore Grand Prix, but she attended the event and said Baltimore was impressive.

"My fondest memory was definitely how enthusiastic and amazing the crowd turnout was," Freiberg said. "I have never been to a race weekend that was as packed with fans as this race was, and I have to say it was very cool to have that energy surrounding the weekend."

A year later, Freiberg will be part of creating that energy as her TrueCar Racing team competes in the Labor Day weekend event. The Star Mazda Series is part of the Road to Indy program, a ladder system designed to help drivers progress from the USF2000 National Championship to Star Mazda and then to Indy Lights before making the step to the IZOD IndyCar Series. Both the USF2000 National Championship and the Star Mazda Championship include road courses and ovals -- similar to the IndyCar Series -- to help drivers hone their skills as they progress through the system. The Grand Prix of Baltimore will feature Rounds 13 and 14 of the Star Mazda Championship.

Freiberg is competing as a member of TrueCar Racing and its "Women Empowered" initiative. TrueCar is empowering women that aspire to become championship drivers by providing full sponsorship support, professional coaching and training, marketing exposure and top-tier racing opportunities throughout the United States. Freiberg joined the initiative in December 2011.

"I have always loved being a role model for girls and women of all ages," Freiberg said. "So to become a part of something I already believe in and support was a perfect fit for me. What is really cool about the Women Empowered initiative is not that we are screaming feminism in everyone's face, but rather that we are showing that we are equal to men in many ways … that we can compete against them equally and do just as good of a job as the best of them."

According to its Web site, the TrueCar Racing "Women Empowered" initiative is unique in that no other company has actively pursued supporting an all-female race team encompassing various series. In this respect, TrueCar is paving the way and raising awareness of women as viable competitors in a male-dominated sport.

The team is composed of six competitive and motivated female athletes. It is now open to being challenged -- and challenge they will, with the TrueCar Racing Team drivers' eyes all firmly set at becoming the first female drivers to win major races and championships.

Katherine Legge, who is currently in the IndyCar Series, is one of the six female drivers competing as part of the TrueCar initiative. TrueCar Inc. is an online automotive information and communications platform focused on creating a better car-buying experience for dealers and consumers.

Freiberg started racing go-karts when she was 13, and spent time developing the basics of her driving. During her second year of competition, Freiberg won her first national championship, an accomplishment that made her decide to move into formula cars in the Skip Barber Racing Series.

She kept her karting seat for a few more years before moving completely out of karts to run the regional and national series of Skip Barber full-time. Freiberg said her first competitive sponsor was Akzo Nobel, a global paints and coatings company, which produces specialty chemicals. The company paid $2,800 to cover her racing suit and helmet.

In 2010, she won 25 Skip Barber races, including two championships and one national race. To expand on her driving skills, she also raced in a few Skip Barber MX-5 Cup races and won four out of the six she entered. Because the next step was moving to the Star Mazda Championship presented by Goodyear, Freiberg decided to run in one of the races at the Autobahn Country Club. She finished fifth in a field of 23.

Racing is an expensive sport. Following the 2010 season, Freiberg found herself without any funding.

"I spent 2011 making phone calls, writing emails, going to meetings and going to racetracks searching to find a way to get back into the seat," she said. "At the end of 2011, I was called back by TrueCar and earned a fully funded ride in the Star Mazda Championship for 2012."

This year, Freiberg competed in 10 race weekends, running in 18 total races. She said the cost of a full season depended on the number of people on a crew, how many test days a driver runs, etc., so the pricing fluctuates, with the average cost falling around $500,000 annually. Freiberg's crew consists of an engineer, mechanic, truck driver and her team owner.

Freiberg said she did face challenges outside of funding, competing in a male dominated sport.

"I would have to say the biggest challenge is not really ever having a legitimate chance to be the underdog," Freiberg said. "Being a woman definitely has put more of a spotlight on me than most of the other drivers I race against. Sometimes it can be a great thing. Other times, it can be not so great. I can tell you that it has toughened me up in a lot of ways, though."

She also said she hoped TrueCar Racing's women's empowerment initiative and her involvement would lead to other female drivers competing in open-wheel racing.

"My advice to young girls thinking about competing is to work hard, be strong, be you and have fun," Freiberg said. "There will be pressures coming at you in all different angles, and you just have to find a way to block them out and do the job you came there to do.

"Without doing these four things, unless you are the one out of a million with supernatural talent, it will be challenging to be successful."

Freiberg's advice comes from experience.

She said she couldn't recall the exact number of races she has been in and awards she has won. But she said her biggest achievements included her five national karting championships, two Skip Barber Series Championships, the Skip Barber National Series win, four Skip Barber MX-5 Cup wins, being honored with the 2010 Best All-Around Driver Award in Skip Barber and being nominated as a Team USA Scholarship candidate. Because most of her winnings from these races went to her teams, Freiberg estimated that she earned approximately $5,000 from these accomplishments.

Freiberg said her ultimate goal was to become an IZOD IndyCar Series Champion.

"I guess it is the drive I have to always want to better myself," Freiberg said. "I would label myself the nerd of racing because I love to get completely absorbed in every aspect of it and I am always learning something new, whether it is about the car, my driving, the tracks. … I can never be satisfied with what I already know.

"I just love every single bit of driving the car, and the way it feels when I drive a corner really well or make a good pass. I can't really say specifically when the moment was when I decided I wanted to make a career out of racing. I think that it was sort of a domino effect of things. I got into racing because I simply loved to drive, and I loved driving well even more, and as a result of that, I have always pushed myself to be as good as I could be.

"Any success that I have had has happened as a result of that desire, and has also shown to myself that if I really commit myself and work hard at something, I could achieve it."

Posted Aug. 31, 2012 in The Sports Business Repot at PressBoxonline.com

Orioles And Fans Prepare For Run At Postseason

The Orioles and their fans are encountering an unfamiliar experience. For the first time in 15 years, they are feeling what it is like to be involved in a postseason run, and they're enjoying the experience.

On Aug. 23, the Orioles mailed invoices for possible playoff games to season-ticket holders. Greg Bader, the Orioles' director of communications, said the team had had to turn down employees that volunteered to stuff the postseason mailing, because the interest was larger than the number of people actually needed for the task. He said the staff's excitement level was high, and the increased workload was not discouraging anyone.

"For us, the mailing is significant in that we all recognize this is not an every-year occurrence," Bader said. "There are preparations and steps during this process that create work, but not one person has expressed concern about adding that work, as that's what we are in this for. … The success of the ballclub drives morale, and whether you judge the season on or off the field as a success."
That level of excitement can be found in the team's fan base as well.

Mike Decker of Towson has been going to Orioles games for more than three decades. Although he is not a season-ticket holder, he said he had attended more games this season than he had during previous years because of the improbable run the Orioles were making.

"To be talking Orioles baseball in August, and in a good way, is just an awesome feeling," Decker said. "Traditionally, I go to Opening Day and then about a dozen other games a season. But this year, I've been to more games than the last two seasons combined. If we make the playoffs and I can get a ticket, it won't matter the cost. … You could say I've been saving that money for years."

Bader said the team started preparing for a potential postseason berth shortly after the All-Star break. After the Midsummer Classic, Major League Baseball sends postseason manuals to all 30 clubs.

"When we received the postseason manual this season, it was done with a little more interest and relevance, so that was an exciting first step," Bader said. "Late July, early August, we began having regular internal playoff meetings to get ready for a potential postseason."

Preparing for the playoffs requires a lot of work. Bader said the process was similar to what the team underwent when preparing for the regular season, just during a condensed time frame.

"You have the regular season going on, so it's a challenge, but everyone agrees it is worth the extra effort," Bader said. "MLB and its broadcasting department, as well as the postseason TV rights holders, TBS and FOX, came to town recently to do a site walk-through. That has not happened since 1997.

"While most elements for the park are the same, there are some changes, and TV broadcasts have changed in relation to camera angles during a broadcast. So we face some challenges finding locations to accommodate a postseason broadcast, but we have plenty of time to prepare, and the effort is worth it for the short term with the 2012 playoffs and future regular seasons/postseasons."

Fans that have full-season plans can purchase tickets for all of the 10 potential home playoff games. Tickets for the wild-card and divisional rounds cost roughly the same price as a prime regular-season game. Championship Series tickets would cost close to 50 percent more than prime regular-season games, while a World Series ticket could cost approximately three times as much as a regular-season prime game. Bader said that, for example, a $99 regular-season field box ticket would cost slightly more than $300 for a World Series game.

The Orioles are providing fans that have 29-game plans the opportunity to purchase one ticket for the wild-card game, one for the divisional-series matchup, two tickets to the American League Championship Series and one World Series ticket. Bader said fans with this plan were guaranteed only three games in their contract, but the Orioles were giving them the opportunity to buy five games.

Justin LaRue of South Baltimore has been a 13-game season-ticket holder since the 2008 season. For him, waiting for his postseason mailing from the Orioles was like wishing Christmas morning would get here already.

"When the envelope arrived, I just stared at it for a moment, because I couldn't comprehend it," LaRue said. "This means a lot because we were stomped on for 15 years. The O's went from being the standard in baseball to the laughingstock, so this year is very special.

"I was going to 30-40 home games every year, so I decided to become a season-ticket holder four years ago for this exact reason -- to get playoff tickets when they became available. I knew this day was eventually going to get here."

The Orioles pre-select the postseason-game tickets for 13-game ticket holders. LaRue has one game in each of the main series: Game 2 of the ALDS, Game 3 of the ALCS and Game 5 of the World Series. Bader said plan holders like LaRue were guaranteed only two games in their contract, but the organization is giving them a chance to purchase three games.

Plan holders that pay their postseason invoice in full can request a refund if the Orioles don't make playoffs, or they can roll that money into their 2013 tickets. Season-ticket holders also have the option to pay half of the invoice now, and if the team doesn't make the playoffs, that payment will be credited directly toward their 2013 season-ticket plan. Regardless, plan holders have until Sept. 7 to purchase postseason tickets. Single-game playoff tickets for non-season-ticket holders will go on sale to the public following that payment deadline for plan holders.

LaRue said it would be spectacular if the Orioles made the playoffs, but their play this season had already been rewarding in other ways.

"The feeling reminds me a lot of the 'Why Not' season of '89," LaRue said. "We have a lot of players that no one else wanted; guys like [Miguel] Gonzalez, [Nate] McLouth, [Omar] Quintanilla. … Other people's castoffs have become our treasures. Plus, the atmosphere at the Yard is different. I see a lot more young faces, a lot more families and kids. The morale is definitely better in the stands, because you just know this team is never out of it."

The team's per-game average attendance is running about 20 percent higher than last year's final average, according to the Orioles. Bader said he expected to see pro-Orioles crowds when the team hosts the Yankees and Red Sox in September.

"It's great to see more orange in the stands," LaRue said, "especially when the Red Sox and Yankees come to town. It's also a special season because of the 20th anniversary of the opening of Oriole Park and the job the team has done to celebrate its history through the unveiling of the statues. They [Orioles] did an amazing job with the renovations to Camden Yards, and the statues are terrific.

"It's a lot of fun to see the true fans coming back to the stadium. I absolutely think the Orioles have a shot of winning the AL East."

The Orioles' competitive play is also paying dividends with TV ratings. According to Sports Media Watch, a Web site covering the American sports media, the Orioles' ratings are up 48 percent this season on MASN, MASN2 and WJZ-TV.

"Baseball and the Star-Spangled Banner are both synonymous with the city of Baltimore and the state of Maryland," said Terry Hasseltine, director of the Maryland Office of Sports Marketing. "A postseason run by the O's would bring a great deal of energy and pride to our citizens, revenue to our city and state and exposure to a national audience while showcasing Baltimore's ability to come together and deliver a world-class event, in a world-class venue, all in short turnaround time."

Posted Aug. 27, 2012 in Sports Business Report at PressBoxonline.com

Military To Remain Force In Sports Sponsorship Arena

Sponsorships have become significant in sports. Everything is for sale -- naming rights to stadiums, dugouts, scoreboards, a car's left quarter-panel, etc.

The National Basketball Association is even expanding sponsorship to uniforms. The league's board of governors is expected to approve a measure in September that will allow sponsorships on jerseys for the 2013-14 season. The move is projected to net the league upward of $100 million per season. According a study Forbes conducted, the Los Angeles Lakers could generate $4 million from ads on jerseys, while the New York Knicks and Boston Celtics could each pull in about $3 million.

Now, the federal government is weighing in on sponsorships in sports. But they aren't telling others how to spend their money. Instead, Republicans and Democrats are bickering among themselves about spending dollars on sponsorship to help promote the U.S. Armed Services.

In May, Georgia Republican Jack Kingston and Minnesota Democrat Betty McCollum got the House Appropriations Committee to approve their amendment to the Fiscal Year 2013 Defense Appropriations Bill that prohibited taxpayer funds from being "used to sponsor professional or semi-professional motorsports, fishing, mixed martial arts, wrestling, or other sporting events or competitors." The amendment passed the committee and moved to the floor of the U.S. House for consideration.

Marco Gentile, an adjunct professor of sports marketing at Loyola University, has industry experience that includes developing corporate sponsorship programs for several professional sports franchises. He disagrees with the representatives' perspectives and said sports marketing was an effective tool for the military to promote its mission and reach potential recruits.

"The demographics that sports offers align perfectly with who the military branches are trying to reach in both potential recruits, as well as parent and guardian ‘influencers,' as recruiters call them," Gentile said.

A release Kingston and McCollum issued said the Department of Defense was spending more than $80 million this year to sponsor NASCAR racing teams, Indy racing, professional bass fishing, pro wrestling and ultimate fighting. In 2011 and 2012, the National Guard alone allotted $121 million on professional sponsorships, including $20 million for professional fishing and $90 million for NASCAR, Indy car and motorcycle racing.

The Kingston-McCollum Amendment also specifically targeted NASCAR's most popular driver, Dale Earnhardt Jr., stating that the National Guard spent $136 million between fiscal 2008 and 2012 to sponsor Earnhardt Jr.'s No. 88 car/team -- a move the two representatives said would come to an end if their amendment became law.

But the NBA, the National Football League, Major League Baseball, IZOD IndyCar Series and NASCAR joined together to ask Congress to continue to allow the military to spend money on sports sponsorships.
"Sports marketing has long been an important element in the U.S. Armed Forces' efforts to reach young adults and active duty personnel regarding the military's missions and objectives that serve our country," said the letter the leagues sent to House Speaker John A. Boehner and other House leaders.

The leagues said the services branches' professional sport sponsorships had directly impacted military recruiting. They cited an example in 2010 in which the Army's recruiting efforts at NASCAR events resulted in 46,000 qualified leads, and noted that similar relationships with the other leagues had resulted in comparable outcomes. The letter also cited that the benefits of these types of sponsorships offset the minimal costs to taxpayers.

On July 18, the professional sports leagues scored a victory against the Kingston-McCollum Amendment. In a vote of 216-202, the House rejected the effort to cut more than $70 million for sports sponsorships from the $608 billion defense bill.

Maryland Congressman Dutch Ruppersberger was a member of the House Armed Services Committee until late June, when he stepped down to allow Rep. Ron Barber of Arizona to join the committee. A message left for Rep. Ruppersburger's director of communications seeking comment from the congressman on the House's decision was not returned. Fort Meade and Aberdeen Proving Ground are located in Ruppersberger's district. 

Approximately a week before the vote on the Kingston-McCollum Amendment, the U.S. Army announced it was ending its decade-long relationship with NASCAR as it would not be returning next season as a sponsor of Stewart-Haas Racing's No. 39 car, driven by Ryan Newman. An Army News Service report said the military branch committed more than $8 million to a NASCAR sponsorship for fiscal year 2012.
According to John Myers, director of marketing support element for the Army Marketing and Research Group, "the Army is looking to reach a particular segment of the population, men between the ages of 18 to 24. But the NASCAR audience is starting to skew older."

"It's very possible that the Army is simply re-evaluating their efforts in NASCAR, which is smart considering we are not at war," Gentile said. "Instead of spending tens of millions a year on a car sponsorship, they could spend the money via individual track sponsorships that would allow them to have recruiters on-site during race weekends directly recruiting.

"Ultimately, being on-site with recruiters directly reaching out to teenagers, young adults and their influencers is the type of sponsorship that the Army should be involved in, which would offer the best [return on investment]."

Earnhardt Jr. told the Associated Press that, despite the U.S. Army's decision, he was optimistic about his sponsorship relationship with the National Guard and thought Hendrick Motorsports' program with the National Guard was productive.

Originally posted July 23, 2012 in the Sports Business Report at PressBoxonline.com

Decision Close In MASN-Nationals TV Rights Squabble

In a two-part series on July 2 and July 6, the Sports Business Report at PressBoxonline.com analyzed the ongoing dispute between the Mid-Atlantic Sports Network and the Washington Nationals about the allocation of television rights fees from the regional sports network. PressBox has continued to monitor the situation and sources close to the negotiations say that the framework of a resolution has been assembled and is before the three-person ownership panel charged with ruling on the matter. That committee is composed of the owners of the New York Mets, Pittsburgh Pirates and Tampa Bay Rays.

At the Baseball Writers Association of America luncheon before the All-Star Game July 10, Major League Baseball commissioner Bud Selig said MLB employees were in the middle of intense discussions about the MASN-Nationals situation and he had sought a resolution to the situation a month ago.

Industry sources said debate between the two entities centered on the interpretation of a longstanding MLB television formula, which was part of the 2005 relocation settlement agreement between the league and the Orioles when MLB moved the Montreal Expos to Washington. That move infringed upon the Orioles' TV territory, as determined by MLB.

According to a source close to the negotiations, representatives from the Orioles, including principal owner Peter Angelos, returned from the All-Star Game feeling confident that MLB would adhere to the stipulations in the 2005 agreement. A source close to those 2005 dealings said the agreement specifically required the use of this formula, which MLB has used for more than 15 years when calculating rights fees.

The formula, which Bortz Media & Sports Group developed, factors into consideration the local market size, geography, network revenue and expenses and other relevant data to determine rights fees for clubs that have a stake in their TV partners. It has been used in determining TV rights fees for the likes of the Boston Red Sox, New York Yankees and Toronto Blue Jays.

Based on the parameters of Bortz's formula, the payment due to the Nationals is expected to fall roughly between $40 million and $42 million per year. This number includes the TV rights fees, as well as revenue from the club's equity stake in MASN. During the next five years, that number would increase to almost $60 million. The next re-set would correspond with the 2012 season, according to sources. The Nationals currently hold 13 percent equity in the regional sports network and will receive a percentage increase up to 33 percent during the next two decades.

This settlement amount would be a far cry from the number the Nationals' representatives think MASN owes the team. Chris Bevilacqua, founder and CEO of Bevilacqua Media Company, represents the Nationals in these negotiations with MASN. A message to him seeking comment about the proposed resolution was not returned.

A concern for MASN, according to sources, is whether the committee's findings about the application of the Bortz formula will now be accepted as the procedure for use in the future. If not, the network and Nationals could have to undergo another intense series of negotiations when the next re-set activates.

As part of the current TV agreement with MASN, the Nationals receive $29 million annually.  But the deal that was negotiated between MLB and the Orioles entitles the Nationals to a re-set, or increase in rights fees, from the network every five years. MASN representatives argue that the Nationals should receive $35 million per year, a 20 percent increase from their current annual payment. The Nationals are arguing for a deal that would pay them in excess of $100 million each year. Because MASN did not secure the rights to all Nationals and Orioles games until 2007, that re-set kicked in this season instead of five years from the time the team arrived in the District of Columbia in 2005. 

Washington has argued that the current open-market conditions in baseball should determine the rights fee, and not the pre-existing formula. A number of teams, including the Texas Rangers, Houston Astros and Los Angeles Angels, recently entered lucrative long-term network deals. MLB recently approved a deal between the San Diego Padres and Fox Sports Net to establish a regional sports network in San Diego County. The 20-year deal is reportedly worth an estimated $1.2 billion. As part of this arrangement, the Padres' annual fee is comparable to what the Nationals will receive during the course of the next five years.

Although the ownership panel reviewing the case may rule that the formula holds, an industry source said Selig could exercise creative ways to balance the equation to favor both clubs. Such items range from the allocation of the All-Star Game (the Orioles have applied to host the 2016 game) to excluding the Nationals from the list of clubs in the 15 largest markets that will no longer be allowed to receive revenue-sharing funds by the end of baseball's labor deal in 2016. Currently, the Nationals are among those 15 teams.
Ironically, the source involved with the negotiations said Angelos had always supported the idea that the

Nationals not be included on that list of teams that would lose revenue.

The arrangement MLB made with Angelos regarding MASN was included in the deal when the Lerner family purchased the team from MLB, meaning the family was aware of the TV situation before agreeing to buy the team.

Selig was asked about that 2005 deal during the Baseball Writers Association of America event and voiced no regrets.

"No, that was part of a process that was really complicated," he said. "You can second-guess anything in history ... but I can't second-guess that.

"We just have to work our way through this, and disputes between clubs are not uncommon. That's frankly why you have a commissioner. So I wouldn't say that. That was a deal that had to be worked out."

Angelos did not achieve the success he has today without being a smart, strategic businessman. When MLB infringed upon the Orioles' TV territory, he could have taken a lump sum fee from the league as restitution. Instead, Angelos saw the long-term value a regional sports network would have, the source close to the 2005 negotiations with MLB said, and is now simply protecting that investment.

According to a source with knowledge of the process, a final decision about the recommended amount is likely to be handed down at the owners' meetings in August.

Originally posted July 19, 2012 at PressBoxonline.com

The Economic Battle Of The Beltways -- Part II

On July 2, my Sports Business Report at PressBoxonline.com took an initial look at the ongoing dispute between the Mid-Atlantic Sports Network and the Washington Nationals surrounding the allocation of television rights fees from the regional sports network.

According to industry sources, at the center of the debate between the two entities is the interpretation of a long-standing Major League Baseball television formula that was part of the 2005 relocation settlement agreement between the league and the Baltimore Orioles when MLB moved the Montreal Expos to Washington, D.C. The relocation agreement reportedly called for the use of this formula, which MLB has used for more than 15 years.

Bortz Media & Sports Group developed the formula and used it to determine how TV rights fees were derived for the Boston Red Sox and the New England Sports Network, the New York Yankees and Yankees Entertainment and Sports Network, and the Toronto Blue Jays and Rogers SportsNet.

Among the items the formula uses to determine rights fees for clubs that have a stake in their TV partners include local market size, geography and network revenue and expenses.

Representatives for Washington argue that the current open-market conditions in baseball should determine the rights fee, a scenario that favors the Nationals. Many industry sources cite the Texas Rangers' contract with Fox Sports Net as the deal that has now set the standard. The Rangers have a 20-year deal with FSN, worth an estimated $3 billion.

Other teams have also negotiated long-term broadcast deals, including the San Diego Padres, who recently signed a 20-year deal with FSN worth $1.2 billion. Both Texas and San Diego are smaller markets than Washington, D.C.

As part of the current TV agreement with MASN, the Nationals receive $29 million annually. But the deal that was negotiated between MLB and the Orioles entitles the Nationals to a reset, or increase in rights fees, from the network every five years … and that time has come.

According to the Sports Business Journal, MASN is willing to give the Nationals a 20-percent increase, taking their annual payment to $35 million per year. But the Nationals are asking for a deal in which they'd receive more than $100 million annually, a fee that would put the team on par with other franchises in the top 10 media markets.

According to a source close to the negotiations, the Nationals did not agree with MASN officials' assessment, and elected to waive mediation in hopes of reaching a resolution more favorable to the team. As a result, the issue is now before a three-team MLB committee composed of the owners of the New York Mets, Pittsburgh Pirates and Tampa Bay Rays. The group is led by Rob Manfred, MLB's executive vice president for economics and league affairs.

The Nationals have reason to take full advantage of this opportunity to raise their annual rights fee, because the club will soon lose a different source of revenue. By the end of baseball's labor deal in 2016, teams in the 15 largest markets will no longer be allowed to receive revenue-sharing funds, regardless of their TV contracts or attendance. In addition to the Nationals, three of the other four teams in the National League East -- the Braves, Mets and Phillies -- are also among the group of 15 that will be impacted.

According to a source close to the original negotiations between the Orioles and MLB, one key element that makes the situation more complex is a parity clause in MASN's contract stating that the Orioles must receive the same amount in rights fees as the Nationals. Therefore, if the Nationals are awarded a new deal worth $100 million per year, the Orioles also would receive $100 million annually. The source said MASN was not in a position to support such figures, because of its economic limits based on its total revenue.

MASN is the result of MLB infringing on the exclusive and protected TV territory of the Orioles by placing a team in D.C. -- Nationals Park is only 61 miles from Oriole Park at Camden Yards. According to the source close to the 2005 negotiations, the Orioles were entitled to a larger share of the regional sports network in exchange for MLB taking away from the team's value by reducing that TV territory. The Orioles hold the majority stake in MASN, while the Nationals present equity sits at 13 percent. Washington's equity will rise to 33 percent during the next 20 years.

Despite the turmoil about fees, each team's improved play this season has resulted in elevated TV ratings. According to Sports Media Watch, a Web site covering the American sports media, Nationals broadcasts are up 53 percent on MASN, MASN2 and WDCW-TV (CW affiliate in Washington), while Orioles ratings are up 48 percent on MASN, MASN2 and WJZ-TV (Baltimore's CBS affiliate).

A decision from the specially appointed MLB committee is expected within the next week. Industry sources say it's unclear as to which direction the committee is leaning, but agree that the fees paid for increasing media rights deals will eventually find their way to the bills of cable and satellite subscribers.

MASN, Nationals Differ On TV Rights Deal

PART I IN A TWO-PART SERIES



"The Battle of the Beltways" is the phrase used to describe the on-field interleague matchups between the Washington Nationals and Baltimore Orioles. That phrase can also describe the ongoing dispute between the Mid-Atlantic Sports Network and the Nationals as it relates to the distribution of television rights fees.

The sports landscape along the Baltimore-Washington corridor changed dramatically in 2005 when Major League Baseball elected to relocate the Montreal Expos to the nation's capital to become the Washington Nationals. MLB purchased the struggling Expos in 2002 and its decision following the 2004 season marked the first time a MLB franchise moved since 1971, when the second Senators franchise left Washington for Arlington, Texas. In May 2006, MLB sold the Nationals to Bethesda developer Theodore N. Lerner and his family for an estimated $450 million.

Under the settlement agreement that was negotiated between MLB and the Orioles when the league announced the relocation of the Expos, the Nationals hold the right to seek a reset, an increase in rights fees, every five years from MASN. The regional sports network and the Nationals have been negotiating for months, even missing an expected June 1 settlement date.

According to a source close to the negotiations, representatives from MLB were in Baltimore June 28, presumably to speak with the Orioles' principal owner, Peter Angelos, about a resolution. The inability to reach a solution about the distribution of TV rights fees will not impact fans' abilities to view Nationals games on MASN or MASN2. 

When contacted about the negotiations, MLB spokesman Jeff Heckelman said the league did not have any comment on the MASN situation at this time. Chris Bevilacqua, founder and CEO of Bevilacqua Media Company, represents the Nationals in the negotiations with MASN. In a reply to an email seeking comment, Bevilacqua said he was not able to comment on this matter.

According to the Sports Business Journal, MASN officials think the Nationals should receive $35 million per year, a 20-percent increase from the $29 million the team receives annually. But the Nationals are arguing for a deal that would pay them in excess of $100 million each year. 

Several industry sources with knowledge of the negotiations say that the number the Nationals are proposing is unrealistic given the limitations of MASN's revenues. MASN receives distribution fees that cable companies and satellite providers pay as well as advertising revenue. From that amount, MASN must pay expenses for items that include producing Orioles and Nationals broadcasts, acquiring other programming for the network, day-to-day overhead, etc.

The original contract stated that each team should receive an equal amount from MASN in the payment of rights fees. But a source close to the original negotiations between the Orioles and MLB said the settlement for the Expos moving to D.C. allowed for Baltimore to receive a disproportionate stake in MASN in exchange for the franchise value the Orioles lost when its MLB-delineated TV territory was diminished. As a result, Baltimore currently has the majority stake in MASN, with the Nationals holding 13-percent equity in the regional sports network. Washington's percentage will increase up to 33 percent during the next two decades.

Those same industry experts also said the current percentage split was high, and unfairly compensates the Nationals. Nonetheless, they said, the MASN arrangement was included in the deal when the Lerners purchased the team from MLB, so the family was fully aware of the TV situation before agreeing to buy the team. At the same time, the Orioles should not be surprised the Nationals are attempting to get more money in rights fees now that the reset has kicked in.

A key element in the negotiations dates back to MLB's decision to award a franchise to D.C. and the subsequent agreement MLB negotiated with the Orioles.

The MLB commissioner's office is the governing body for the game of baseball, both on the field and in matters related to business aspects of the sport. Because the Nationals are part of the National League, MLB did not violate its own rule that precludes two teams in the same division from being located within a certain number of miles from one another. But the source close to the original negotiations between the Orioles and MLB said the move did infringe upon the television territory that MLB itself clearly defined as belonging to the Orioles.

MLB rules specify that each team has exclusive and protected defined TV territories, according to this source. In the case of the Orioles, that territory -- as MLB defined it -- spanned from Harrisburg, Pa., to Charlotte, N.C. Therefore, placing a team in D.C. violated the geographically protected area that MLB defined as belonging to the Orioles.

Because local TV rights are factored into MLB's overall revenue sharing, an industry source said teams that own regional sports networks artificially lowered the revenue-sharing dollars. In an effort to reach a resolution, MLB has organized a committee composed of owners of several teams. A decision is now expected early this month.

NASCAR’S BIGGEST PITCH MAN FINALLY RETURNS TO VICTORY LANE

It took four years and 144 races, but Dale Earnhardt Jr., one of NASCAR's most popular drivers and marketable personalities, won a race.



Earnhardt led 95 of the 200 laps at the Quicken Loans 400 in Michigan June 17, and he held a comfortable 5.468-second lead with just 10 laps remaining. His win on Father's Day came almost four years to the day (June 15, 2008) since his last Sprint Cup Series win, also at Michigan International Speedway.

It's fitting that both of Earnhardt's Michigan wins were on Father's Day, because he is the son of a man many consider the greatest driver ever, seven-time Sprint Cup champion Dale Earnhardt Sr.

Earnhardt Sr. died in 2001 when he crashed during the final lap of the Daytona 500. On that day, Junior -- as he's known now in the NASCAR world -- was given the torch, whether he wanted it or not.

Earnhardt Jr.'s lack of success for so many years had many wondering whether he would ever win another race. His 143 races between wins was the sixth-longest streak in Sprint Cup history. Additionally, 26 different drivers won a Sprint Cup Series race during Junior's winless streak.

Despite his inability to get to the winner's circle during recent years, Earnhardt Jr. has been named NASCAR's Most Popular Driver, as chosen by the fans, for nine consecutive years and was the highest-paid driver for the fourth year in a row.

According to Forbes, Earnhardt earned $28 million in 2011, largely because of the highest licensing income in the sport and an assortment of personal endorsements with companies such as Wrangler, Nationwide Insurance, Chevrolet and AMP Energy. To put that number into perspective, Earnhardt's winnings throughout a 36-race schedule in 2011 were more than $4.1 million, of which he received a 50-percent share.

Award-winning motorsports journalist Liz Clark covered NASCAR for nearly two decades as a reporter for outlets that included USA Today. She said NASCAR was better when Junior was competitive and winning.

"Every sport needs stars and villains, and NASCAR is better when its largest personalities are doing something," said Clarke. "In a sport where drivers are bland naturally or by design so as not to offend anyone, Junior connects authentically with people, as he is natural, speaks his mind and makes no apologies for being himself."

Although he is still the highest-paid driver in NASCAR, Earnhardt Jr.'s earnings in 2011 were down from his income during each of the previous years. Forbes estimated that Earnhardt made $29 million in 2010, slightly less than his 2009 total of $30 million. In 2008, Junior raked in $35 million.

Clarke is also the author of One Helluva Ride, an intense account of how NASCAR swept the nation. While covering the sport, she got to know many of its champions, including the late Earnhardt Sr. Clark said part of Junior's likeability came from the role he was thrust into after his father's passing.

"Junior's popularity cuts along generational lines," Clarke said. "He is someone who has tremendous goodwill among fans, some that he inherited from his father and those he's earned who have been incredibly loyal to him throughout his drought."

In Clarke's opinion, Junior was charged with the burden of helping NASCAR deal with his father's untimely death. She likened his situation to that of John F. Kennedy Jr.

"[Earnhardt Jr.] inherited the role of helping the NASCAR fan base grieve the loss of his dad, while he grieved as well," Clarke said. "Junior handled it with great dignity, and that endeared him to a lot of people. There was no one quite like his dad. … Junior's been great for both groups, old-school fans who followed his father, and the new generation that embraces him."

Junior's popularity extends into the social universe as well. His official Facebook page has more than 1.3 million likes. In comparison, five-time NASCAR Sprint Cup champion Jimmie Johnson has less than half that number.

While he has excelled on Madison Avenue and in merchandise sales, Earnhardt began to turn things around on the track in 2011, as he was one of 12 drivers to qualify for NASCAR's season-ending Chase for the Sprint Cup. It was the first time he had made the Chase since 2008. He finished 2011 ranked seventh in the final standings, his best showing since a fifth-place finish in 2005, when he raced for Dale Earnhardt Inc., the organization his father had started.

Junior left DEI after the 2007 season to sign a five-year deal with Hendrick Motorsports. Earnhardt extended his contract, worth an estimated $10 million annually, with Hendrick in September 2011. The extension reportedly keeps Junior with Hendrick through 2017.

Junior's win June 17 was his 19th Cup victory. He is second in points in the NASCAR Sprint Cup standings, with a series-best 12 finishes in the top 10 during 15 races this season.

Asked after the race about Earnhardt's victory ending his winless streak, reigning Sprint Cup champion Tony
Stewart said, "It's not a national holiday." Stewart is right as it was only one race.  Attendance has been down at many NASCAR tracks around the country, while television ratings are off about 5 percent on average this year, according to the Los Angeles Times.

Dover International Speedway in Dover, Del., has lost roughly 45 percent of its attendance during the past five years. If the reason for lower attendance and TV ratings is less excitement for the sport, more appearances by Junior in victory lane could provide an economic boost NASCAR needs.

Baltimore Looks To Shine Again As Host For 2016 All-Star Game

Baltimore could again host the Major League Baseball All-Star Game.

Greg Bader, Orioles director of communications, confirmed that the team presented its request this past offseason to the commissioner's office for Oriole Park at Camden Yards to host the 2016 MLB All-Star Game.

Baltimore hosted baseball's Midsummer Classic in 1993, one year after the opening of Oriole Park. The stadium has commonly been referred to as the ballpark that forever changed baseball, because its look and feel have influenced other cities to build stadiums modeled after the design, amenities and geographical positioning of Oriole Park.

Should MLB grant the request, the All-Star Game would take place during Oriole Park's 25th-anniversary season.



Terry Hasseltine, executive director of the Maryland Office of Sports Marketing, said employees from his office and the Maryland Stadium Authority discussed with the Orioles how Maryland residents had interest in bringing the event back.

"We initially talked about 2014, because of the tie to the War of 1812 commemoration and the anniversary of the writing of the Star Spangled Banner," Hasseltine said. "But we learned that year was unavailable and the following year, the game would be played in a National League park."

This season, the All-Star Game will be played at Kauffman Stadium, home of the American League's Kansas City Royals, and the NL's New York Mets will host the 2013 contest at Citi Field. Although the game traditionally rotates between the leagues, there have been exceptions. NL parks hosted back-to-back All-Star Games in Pittsburgh in 2006 and San Francisco in 2007.

Marla Miller, senior vice president of special events for MLB, said commissioner Bud Selig had always liked to rotate the site, but decided to alter that 2006-07 process to help showcase those two teams' new stadiums.

"There are a number of different categories we need to have from both an operational and logistical standpoint," Miller said. "But my office doesn't do anything until we are informed by the commissioner of the cities that have formally submitted interest to MLB."

Miller said the commissioner's office had heard from a number of clubs, but that MLB hadn't made any decisions beyond the 2013 game. Helping the Orioles' case for the 2016 game are the improvements the team made to the stadium before the season.

The renovations feature a new roof deck in center field, with outdoor deck seating, a full-service bar and seats facing the field. Additionally, the wall of the out-of-town scoreboard in right field has been reduced in height to improve views of the game.

Another enhancement is in the bullpen picnic area, where six statues will immortalize legendary Orioles Frank Robinson, Brooks Robinson, Earl Weaver, Jim Palmer, Eddie Murray and Cal Ripken Jr.

"A major factor in these iconic events is the fan experience that supports the activities surrounding the game," Hasseltine said. "There are few places that offer the critical mass of hospitality, culture, history and fun, all within walking distance. Oriole Park easily stands out as a destination spot."

Of the active AL ballparks, there are only three that have never hosted an All-Star Game: Tropicana Field in Florida, Target Field in Minnesota and the new Yankee Stadium in New York. Although the Tampa Bay Rays have never hosted an All-Star Game, they play in a facility that was built in 1990 and is lacking many of the modern amenities of parks across the league. Minnesota did host the All-Star Game in 1985 at the Hubert H. Humphrey Metrodome, but the team began playing in its newly constructed ballpark in 2010, and is currently bidding to host the All-Star Game in 2014. The old Yankee Stadium was the site of the All-Star Game just four seasons ago (the new park opened in 2009).

Baltimore's other AL competition comes from Oakland and Toronto, which have gone more than 20 years without hosting an All-Star Game. The stadiums in those cities, like Tampa, are older venues that don't offer the modern-day amenities of Oriole Park.

"Improvements to Oriole Park would be taken into consideration," Miller said. "Given the sophistication of the game and all things involved with it, renovations and improvements are certainly reviewed."

When a MLB team submits its formal bid to host the game for a particular year, the process is detail-oriented.

"MLB provides the club with an All Star Specification Book that requests information on hotels, convention centers, city services, tickets, size of stadium … all things taken into consideration and reviewed by MLB once the club has made its submission," Miller said. "It also includes a specific breakdown of the operations and logistical needs for the entire time the game would be in the city."

According to Baltimore's Department of Planning, the weeklong festivities surrounding the 1993 All-Star Game generated $31.5 million for the area and its businesses. City officials estimated that the game and related events from July 8-13 that year brought more than 230,000 visitors to Baltimore, who spent an estimated $16.4 million on items from hotel rooms to souvenirs.

Although some have questioned Baltimore's ability to handle the All-Star Game more than two decades later, Hasseltine said the area was more than qualified to meet any requirements.

"A few years ago, as we were preparing information on the city to be a part of the U.S. bid for soccer's World Cup, we developed an impressive list of assets critical to competing for national and international sports events," Hasseltine said. "While the U.S. ultimately was not selected, Baltimore was part of the final package, because it met the stringent requirements necessary to successfully stage an event of that magnitude."

Hasseltine also said he thought Baltimore had a track record for successfully hosting top-tier events through the years. Among the items he cited were the Army-Navy football games (2000 and 2007), Chelsea versus AC Milan soccer match (2009), NCAA men's lacrosse national championships (2003, 2004, 2007, 2010 and 2011) and the Baltimore Grand Prix (2011).

Hotel rooms and convention space are two key items in the MLB All Star Specification Book. Tom Noonan, president/CEO of Visit Baltimore, shares Hasseltine's opinion that Baltimore can accommodate the All-Star Game in relation to hotel and convention space needs.

"There are about 9,000 rooms right now in downtown Baltimore," Noonan said, "all in walking distance to Oriole Park. Not to mention another 4,000-5,000 rooms near [Baltimore/Washington International Thurgood Marshall Airport], plus hotels in surrounding counties and located between Baltimore and D.C. So I don't see there being any problems, as we can clearly accommodate the hotel needs."

Noonan said there were about 6,000 hotel rooms in Baltimore in 1993.

"Obviously we want the game in Baltimore," he said. "It's a major asset from a standpoint of exposure, considering what the All-Star Game brings. The event would probably drive more rooms in two days than what a convention would do over a five- or six-day period."

The All-Star Game includes a weeklong celebration known as FanFest. The convention centers for the last two games (Anaheim, Calif., and Phoenix) are each about three times the size of the Baltimore Convention Center, which is roughly 300,000 square feet. But Noonan said he was confident that the facility could handle the needs of FanFest and other activities throughout the week.

Greg Schwalenberg has been a beer vendor at Orioles homes games since 1979. He has been around for the 20 years of Oriole Park and worked the All-Star Game in 1993.

"I didn't get to see the Home Run Derby or the game, as I was running the stands working," Schwalenberg said, "but there were certainly a lot more unfamiliar faces in my section those nights and there was such a tremendous buzz about the entire event."

As for hosting the All-Star Game in 2016, Schwalenberg said he would be ready ... and so would the city.

"I think the fans of Baltimore would love it," he said. "Fans in general would love Oriole Park, and it would be a win-win for everyone."

Orioles' Hot Start Is A Win For Local Retailers

When a team puts together 14 consecutive losing seasons, its merchandise isn't typically flying off the shelves of local retailers. In fact, Majestic Athletic, the on-field provider of Major League Baseball, released its list of the top-selling jerseys from 2011 and not one Oriole made that list. To the contrary, a combined seven New York Yankees and Boston Red Sox made the top 20. The company's projections for the top 10 in 2012 did not include an Oriole either.

Of course this was before the Orioles started the season hot. They have been in sole possession of, tied for or within striking distance of first place in the AL East through more than one-third of the season.

In addition to the team's competitive start, the Orioles unveiled a new look for 2012, highlighted by the return of the cartoon bird as the logo on the club's home and road caps, and the introduction of an alternate orange jersey for Saturday home games. The 2012 cartoon bird head is a new design, using elements from both the 1970 and 1983 versions.



Greg Bader, Orioles director of communications, was unable to divulge numbers for the official team stores inside Oriole Park at Camden Yards and the York Galleria in York, Pa., so far this season, but did comment on the up-tick in merchandise sales.

"The popularity of the new cartoon bird has been as the club anticipated," Bader said, "with sales numbers reflecting significant interest in the new mark."

Although the new uniforms and on-field performance won't likely move the needle on Majestic's list, they certainly help local retailers.

Mike Durham and his wife, Jerry, own The Sport Shop, with locations in Harborplace and Towson. Their store at the Inner Harbor has been open 26 years, so they have lived through the ups and downs of the Orioles. This season has been productive at the cash register.

"Between the new logo and the team's hot start, our business is definitely better than it was this time last year," Durham said. "At Harborplace, we are up 15 percent for April and May."

Durham said his store in Towson -- whose clientele is more local than that of the Harborplace shop, which attracts more tourists -- had its best May in 16 years. According to Durham, the introduction of something new, like the new logo, helps business.

"Without question, the most popular sales items for us continue to be the Orioles hat with the new bird logo," Durham said. "Fans have also been very excited about Adam Jones, and we saw an increase in the sales of the center fielder's T-shirt after he signed his contract extension."

Even the larger retail chains are enjoying a spike in sales, thanks to the Orioles' performance so far.

"Looking at the numbers last year as compared to this season, we are absolutely seeing a rise in sales with how the team is playing," said Sheila Morrison, the store manger for Modell's Sporting Goods in Arundel Mills Mall. "It's not necessarily the new logo as much as it is fans seeing a player doing well, so they come in to get that jersey. Anything fans see at the game, they want."

Merchandise also expanded this year from traditional items as the Orioles partnered with the Maryland Motor Vehicle Association to create Orioles-themed, state of Maryland license plates that feature the new cartoon bird. Bader said there had been a tremendous response from fans about the plates, and the number of sales continues to rise.

Sales of MLB-licensed merchandise were up 10 percent in 2011 from the previous season. On April 4, Howard Smith, senior vice president of licensing at MLB, told the Wall Street Journal's MarketWatch that MLB was even more optimistic that sales would continue to increase in 2012 and that the league hadn't had a start like this during the 14 years he had been with MLB.

As part of MLB's revenue sharing agreement, all 30 teams receive an equal portion of the money generated via league merchandise sales. According to The Licensing Letter, an industry newsletter, MLB reported more than $3 billion in retail sales in 2011.

Mike Gibbons is the executive director of the Babe Ruth Birthplace Foundation, owners and operators of the Sports Legends Museum at Camden Yards. His attraction sits directly next to the main gate of Oriole Park. He said he would have liked to see the schedule pan out differently to increase revenue opportunities, but he still thought it had been a good start to the season.

"I don't think the schedule has been favorable for the Orioles or local businesses by having two series against New York and one against Boston so early in the season," Gibbons said. "I think everyone would like to see those games played later in the summer, or at least as weekend games if played in April and May."

"But as the season has progressed, our store at Sports Legends Museum has certainly seen an increase in traffic. One example is the Kansas City series in late May. We had a great turnout during that home stand, doing twice as much in sales as the same time last season."

Gibbons said this was not the case during previous seasons, when the Orioles played teams outside the AL East during a weekend series in May.

"The club's hot start is certainly good for everyone," Gibbons said.

State Moves Into Phase Two Of Study On Proposed Soccer Stadium

At the request of Gov. Martin O'Malley and Mayor Stephanie Rawlings-Blake, the Maryland Stadium Authority voted May 23 on a Memo of Understanding between the MSA and D.C. United to perform the second phase of a study to build a soccer-specific stadium at Westport.

The venue would be part of Turner Development Group's planned revitalization of the Westport waterfront area, located on the Middle Branch of the Patapsco River.

D.C. United is one of the 10 charter clubs of Major League Soccer and has played its home games at RFK Stadium in Washington since the league's first season in 1996.

In a letter to the MSA dated May 11, O'Malley and Rawlings-Blake said they would like to explore further the viability of this project, based on the results of the previous market and economic study Crossroads Consulting performed on behalf of the MSA.

In December 2010, the Baltimore Development Corporation released the findings of that study to determine the feasibility of a professional soccer stadium in Baltimore. The report analyzed the potential success for two possible scenarios, including a 25,000-seat stadium for D.C. United at Westport.

"The first study looked at whether there was a market for the team and what the economic impact would be in terms of revenue for both the city and state," said Mike Frenz, executive director of the MSA. "In phase two, we will look at the estimated hard costs involved in actually building the proposed stadium."

The initial study determined that a relocated stadium in Westport would have approximately 49-54 events a year, including 17 D.C. United games. It projected that total attendance would vary from 584,750 to 695,100 per year, with total annual spending between $65.7 million and $78 million.

The report estimated a creation of 780 to 940 jobs per year, with annual state tax revenues of approximately $3 million-$3.5 million. The study also concluded that the stadium project would generate $2.3 million-$2.8 million annually in city taxes.

The Maryland legislature has committed $175,000 to pay for this next phase of the study, but the Memo of Understanding requires D.C. United to repay that amount to the state should the team relocate somewhere other than Baltimore. According to Frenz, that provision does not have a time deadline. Should the club choose to relocate 20 years from now to somewhere other than Baltimore, it would still be required to reimburse the state for that amount.

Doug Hicks, senior vice president of marketing and communications for D.C. United, wrote in an e-mail that the items the MSA was exploring represented the final phase of the economic feasibility study for a possible stadium in Baltimore.

"These steps are consistent with the process they follow with any major project and in line with previous statements provided by both MSA and D.C. United," Hicks said. "D.C. United continues to explore opportunities for a new stadium in Baltimore and in Washington, D.C., in order to assure the long-term financial viability of the team."

RFK Stadium is a 50-year-old facility and D.C. United has been reviewing its options for a potential new deal in an updated venue, either in D.C. or another location. Last season, the team signed a two-year lease to remain at RFK Stadium through 2013.

According to March article in Sporting News, the deal afforded both the team and District of Columbia officials "additional time to search for a more permanent home for the league's most decorated club." D.C. United has won the MLS Cup a record four times, while appearing in five league championship matches.

In the Memo of Understanding, D.C. United has agreed to complete 5-percent architectural and engineering plans for the proposed stadium. D.C. United has engaged Dallas-based architectural firm HKS Inc. for the design. The firm's Web site lists Cowboys Stadium, Dodger Stadium and Liverpool Football Club Stadium among projects in its sports portfolio.

Joseph Oakton of Bel Air has played soccer his entire life and said he supports any efforts that could lead to D.C. United playing in Baltimore.

"As an avid soccer fan, I think it would be exciting to have a MLS team playing in Baltimore," Oakton said. "I enjoy the United, but traveling to D.C. is just too inconvenient. But if they were to relocate to Baltimore, I would absolutely go to more of their games."

Later this summer, teams from Barclay's Premier League in England will play at M&T Bank Stadium when Tottenham Hotspur and Liverpool square off on July 28. The game will mark the third time in four years that Baltimore has hosted soccer fixtures featuring elite European teams.

Posted May 28, 2012 on PressBoxonline.com