‘Soccernomics’ author says MLS’ collapse is imminent; how far off is he?

‘Soccernomics’ author says MLS’ collapse is imminent; how far off is he?

  • Posted by Drew Epperley
  • On April 24, 2015

A lot of you have probably seen this article by now. If you have, take the time and read it. Economist and Soccernomics co-author Stefan Szymanski wrote up this piece on how Major League Soccer has a financial issue going on that could end up ruining the league. From the numbers reported all the way to the end of the article where he draws the conclusion that MLS is a pyramid scheme, the whole article raises a lot of questions.

We know the league is losing money each year, Don Garber has said so for a while (Garber said $100M a year last fall). But that loss of money hasn’t driven away sponsors, new investors, players from coming over here and more fans attending games.

I won’t dive into the source of Szymanski’s findings or even claim that the numbers are entirely wrong. I have no intimate knowledge of any of that as it is. And quite honestly, I don’t care right now how much the league spends on certain ventures. Many people have already come out and argued against a lot of the findings. I look at Peter Wilt, president of NASL side Indy Eleven and former president of the Chicago Fire. He also led an effort to get Milwaukee an MLS expansion team at one time. His comments are about as valid as they will come in regards to how the league operates.

There is way more on Wilt’s timeline that is worth reading. These three tweets jumped out more to me in reading all of this yesterday. Like Wilt says, Szymanski assumes a lot of things in this piece and he leaves out a bunch of revenue items as well (such as stadium sponsors, international and local TV rights, merchandise sales to name a few). This all doesn’t even take into account MLS’s marketing arm SUM and what they have on the books as well.

But is MLS going to run out of money anytime soon like this all suggests? No. If you think about it, MLS has survived a couple financial crashes in the US already during their 20 years of existence. As the league continues to grow with more investors, there is more money available to help keep things afloat. Once the expansion race is all said and done, things could be trickier but they should also become more stable too.

To sum it all up, the sky isn’t falling on the league. Not today, and certainly not anytime soon.