Friday, October 10, 2008
Tech, Money & Sports: The Valour and The Horror
This is the moment where everything has changed. Again.
While OOLF is about sports, my particular niche here on the team has to do with the business of sports. The money game, as it were.
For years now, Americans have freely spent a breathtaking amount of their disposable incomes into sports: overpriced game tickets, merchandise, nights out at the bar watching the game with friends. There’s always been a certain level of comfort in using sports as a distraction, a shared journey into the conflicted beauty and horror that watching hockey, baseball, basketball, football or whatever brings.
But as anyone with even a passing interest in sports knows, the games we love are pricy endeavours, indeed. The days of average families being able to afford four tickets, food and drink at a baseball game without going into the triple-digit cost range passed us by years ago.
Yet now – this day, October 10, 2008 – things are about to change for the worse.
Much, much worse.
While it’s never good to turn what will be, in the long run, a moment in history superseded by whatever is to come, into a near-biblical calamity, there's no denying what many Americans (and much of the world, including Canada) are realizing today.
The U.S. economy is profoundly screwed – possibly for years to come.
And while the super-rich of America – you know, that five per cent of Americans who control 95 per cent of the country’s wealth? – bask in the knowledge they will be safe from the horrors of this nearly unprecedented financial collapse, the rest of America – the innocent victims of this terrible mess – will be punished for their leaders' mind-blowing incompetence.
The howls of anguish, disgust and outright rage from those analysts on CNN today is really just the final requiem for the Bush administration – a neo-conservative wet dream destroyed by years of greed, hubris and grotesque disregard for the American people. It’s pointless to even list off Bush/Cheney's CV of political disrepute now. That’s not the point of OOLF, even if we’re angry enough to say how we really feel.
No, what this blog is about is about sports – a global institution that is most definitely not recession-proof. Not anymore.
Case in point: the New York Yankees and New York Mets’ new stadiums, Citi Field and Yankee Stadium.
Now that the term “living within your means” will become the new and unavoidable mantra of economic success in the coming years, the cynical, middle-finger raising act of raising ticket prices at the new Yankee Stadium - $19 for one seat in the bleachers? – could spell serious trouble for the franchise’s shiny new Bronx-based three-ring circus. Granted, the average fan is nowhere near as important to an organization’s bottom line as he or she once was. But even in a media-drenched society like ours, the Yankees and Mets could simply not have released these Shrines to Super-Wealth at a worse time. It’s a symbolic act of self-indulgent, “they’ll pay what we say” logic that no self-respecting New Yorker would dare put up with (yes, even New Yorkers).
The already-precarious state of various NHL teams in less-than-solid markets – Atlanta? Florida? – could be pushed to the brink now, given how dependent most NHL teams are on ticket revenues. The potential financial collapse of teams unable to support themselves is a huge black eye for any sports-mad city. It’s even worse for the NHL itself – an unstable brand that lacks stickiness among loyal fan bases outside of long-term markets like Toronto, Boston or Chicago.
In normal economic cycles, most sports leagues would be classified as "recession-resistant" because of factors outside of individual sports fans' control: television contracts, in particular, sustain sports leagues in bad times because the revenues generated from eyeballs watching TV is lucrative enough to keep the gravy train going. A league like the NFL, which benefits from all four major U.S. network consortiums covering the sport, is one example of this.
But these are not normal times. Nobody knows how much worse things can get on Wall Street yet or when the pork-laden $700 billion bailout package will "work its way through the system" to restore faith in the U.S. banking industry. The real impact of this financial collapse has yet to be felt in large, wide ranging waves among ordinary Americans, which could be the real game-changer for the future of the U.S. economy. What happens when millions of people are foreclosed on or go into bankruptcy? What will be the long-term economic impact on American people and institutions alike?
In other words, it's virtually impossible to say with any certainty whether the old rules of sports economics will hold up in the next few years. Perhaps this is only a momentary blip, a final, terrible moment for the Bush administration before, hopefully, a new President comes in to inspire hope and change we can believe in. Perhaps things will get better. Or worse. Who knows?
In any event, the global economic uncertainty we all face now is part of a brand new economic cycle that may result in changes the likes of which we’ve never seen before. I have no answers, no predictions, and no idea. None of us do here.
All we do know is that everything has changed. Yet in the history of the world, there's always comfort in knowing nothing lasts forever. The bad times happen, the good times happen. Nations bounce back, economies bounce back. And America - once the world's shining light for the ideals of democracy, freedom and Dreams - is a strong nation that will and should recover.