Don Garber Q&A: MLS commissioner talks expansion, pro-rel, NASL, more
MLS is coming off perhaps its best season. The league enjoyed record attendance, and TV ratings -- long a sticking point -- are up as well. MLS also appears to be inching toward bringing in more younger, high-level players as opposed to the aging stars of yore. And there seems to be no let-up in the number of cities interested in grabbing an expansion team.
This could be interpreted as heady stuff for commissioner Don Garber, but he's the first to admit that MLS hasn't yet "cracked the code" in terms of reaching its potential. There are unsettling developments further down the North American soccer pyramid that he needs to keep an eye on as well.
Ahead of MLS Cup, Garber took time to chat over the phone about those issues as well as others. The interview has been edited for clarity and brevity.
ESPN FC: What do you make of the year just past for MLS? Did you reach all of your goals?
Don Garber: We've been saying this a lot over the last couple of years because we are a league that continues to grow and continues to achieve our goals, but it's pretty clear that 2016 was a really great year for MLS. We had record attendance, we had record ratings, we exploded our social media metrics. We were able to have an incredibly competitive and compelling season culminating in a Cup that we're all very excited about. But you've heard me say this over many years; we still believe that our best days are still ahead.
ESPN FC: In terms of TV ratings, what did you make of that, and how much did having those dedicated time slots on Sunday help things?
DG: We have worked very closely with ESPN, Fox and Univision on trying to establish our own dedicated destination programming schedule, and I think that's beginning to pay off. Certainly the increase in network games with Fox, and the increase in the number of ESPN games, and the huge Univision rating we had with the LA-San Jose match this summer really helped. And it shows that if MLS is programmed properly and promoted well, and if we're able to create big-event matchups, which we were able to do around Rivalry Week and Decision Day, that the fans will come out and pack our stadiums and watch our games on television.
Certainly this past two weeks in Canada that's proven to be true, where we set all sorts of records for both MLS and the sport. We've really worked hard, particularly with ESPN, to find the right schedule, to come with a very creative and energized promotion package around our big games, and that's really helped drive our ratings.
ESPN FC: Now that you've got these dedicated time slots, and I'm assuming that's going to continue going forward, where do you go from here in terms of building that TV audience even further?
DG: The sports-media landscape is changing dramatically, and while our focus will always remain on growing our audience amongst our network partners, it's also about providing our fans and viewers with a wide variety of different platforms to be able to both watch games and interact with it. I think we'll start seeing, as you've seen with all the other leagues and premier programming, a comprehensive and integrated approach to providing fans access to games wherever they are, and on whatever platform they want to watch. We will be very focused on that next year and the years to come.
ESPN FC: Given the uncertainty surrounding the NASL and USL, what do you make of the current soccer landscape in North America?
DG: Well, we're a firm believer that having a vibrant and successful lower-division structure in the U.S. and Canada is going to help grow the game at all levels. The fact that MLS has been stronger and increasingly popular, that's allowed us to lift the game up from the bottom and to be able to withstand some instability below us. That's OK, because we've gone through some of those challenges many, many years ago.
I will say that I don't believe the USL is having the same issues that the NASL is going through. They are growing at an unprecedented pace, they are taking a leadership role in trying to sort all this out. They have forged a very important strategic relationship with our clubs that's allowing for the development of players, but also for providing fan connections in many, many cities throughout North America, and I think that's very positive.
I was in U.S. Soccer board meetings last week, and I know [U.S. Soccer Federation president Sunil Gulati] has been very engaged, as has the U.S. Soccer Pro Standards Council, in trying to ensure that there is a positive and viable structure going forward and I'm hopeful that when the dust settles, that's what we're going to end up with.
ESPN FC: How do you feel about the NASL possibly going under?
DG: I have a view that everyone involved in this sport is contributing to its growth at some level. Certainly many of their clubs have become popular in their respective markets. I think that their strategy was one that didn't have full alignment amongst all their owners, and that is a really important aspect of what any league needs in any sport in any country in order to be successful. I'm confident that one way or the other, this is going to sort itself.
ESPN FC: The NASL was very up front in trying to get Division I status. There was competition for markets -- I'm thinking of Minnesota as one example -- do you feel MLS contributed to their demise in some way?
DG: Not in any way. We have never competed in any market in the NASL. There were quite a few NASL owners -- and USL owners -- who as they saw the opportunity that could be delivered to their investors, their fans, and most importantly their respective communities, would be better served by being an MLS team as opposed to having a team in the lower division.
I want to be very clear about that: At no time did MLS ever reach out to a lower-division team and pitch them on leaving their league and coming into MLS. In every case the opposite has been proven to be true. I don't look at where they are as believing that one league has won and one league has lost. I think this is all a journey that we're on together to try to grow the popularity of professional soccer, in many ways to convert sports fans into becoming soccer fans, and to convert fans of other soccer leagues which have become very accessible here in this country, into being passionate fans of the pro game in the U.S.
In that we have been successful in doing that with MLS, it's proven to help the sport grow overall in the U.S. and Canada. We've created a soccer supporter culture that I think has reverberated throughout stadiums in the U.S. and Canada. We've been able to drive and in many ways lead the world of soccer programming on broadcast television. We've created a relationship in communities across North America between the public sector and the private sector and have built what will soon be 20 soccer stadiums. All that is going to help the U.S. and Canada become popular and powerful soccer nations.
When I look at what the future holds for both our countries, it must have a very viable pyramid with teams at the lower level and teams at the highest level. I see us being on the path to achieve that.
ESPN FC: Not to quibble, but don't you feel like you forced Minnesota United's hand by exploring that market and by talking to the Minnesota Vikings as possible owners?
DG: You're way off on this. Not in any way whatsoever. We were approached by Bill McGuire to come into MLS. When that bid was made public, we were approached by the Vikings, who provided an alternative plan that included a potential new team to be playing in their new football stadium. Then we had a competitive process and selected Bill and his group and are incredibly excited about them joining our league next year, and playing in their new soccer stadium in 2018. But if anybody has any belief that we sought any club in the lower divisions to come into MLS, they're just absolutely wrong.
ESPN FC: What do you make of the promotion/relegation study that Deloitte published?
DG: I don't make much of it. I think we have been very, very clear in our views on our structure, and the fact that our structure has worked very well in helping to develop our league, and the sport in the U.S. in Canada. We believe very much in playoffs, and that they create an unbelievably competitive and exciting and entertaining atmosphere and that's been evidenced by the playoffs this year.
We are playing the world's game, but we are playing it here in North America that has a very, very competitive structure that has proven to work very well for the other major leagues that are in many ways the model for professional sports throughout the world. When I read that that report was funded by an owner in one of the other leagues, it did not surprise me and it didn't in any way sway us from our view that our structure is one that has gotten us to where we are, and one that I see us keeping certainly for the foreseeable future.
ESPN FC: Do you see any potential positive benefits from promotion/relegation?
DG: If you could wave a magic wand and not have to address things like: What do you tell a municipality who invests in a public stadium and expects to have the revenue streams that come from being in the first division, and broadcast agreements and other revenues that you have to abide by and manage through Collective Bargaining Agreements and a myriad of other elements? Certainly I can see how fans would think it is exciting and fun, but we are investing billions and billions in dollars in growing professional soccer in North America, and that has us laser-focused on building the right facilities, investing in the right player development programs -- which obviously have proven to be successful -- to create the right digital and social media activities, and to do it in way that ensures that we have this slow and steady path that ensures viability.
So that is our North Star, and frankly when I look at some of the instability in the lower leagues, I see that it would be very difficult to think about how we would be able to merge it all into one vertical system and have it not create enormous chaos. I have been very consistent in that view, and I understand that there are some fans who don't agree with me on that.
ESPN FC: The study did conclude that North America wasn't ready for promotion/relegation. Did you feel any vindication from that?
DG: I didn't really pay much attention to it. I have a lot of stuff on my plate, so I didn't pay much attention to it. What I will say is that we are in the midst of conducting a year-long research study that went out and interviewed 20,000 sports and soccer fans throughout North America to get their views on what motivates them to be a fan, what drives their passion, and what kinds of things should MLS be focusing on. It also segmented the market to divide up the size of various groups that are self-selected as soccer fans. And the numbers of them that are very hardcore folks that are committed to the European structure is very small. But clearly they're very loud and we have to listen to all fan groups if we are to continue to grow.
ESPN FC: Expansion, how big can MLS get? Stay at 28 teams? 32 teams? More?
DG: Obviously Atlanta and Minnesota begin to play next year, LA in 2018. Both teams are doing very well in preparing for their inaugural seasons. Atlanta has over 20,000 season tickets; I believe Minnesota is at 15,000. Both have been heavily focused on their facilities. We are making progress with our plans in Miami. That will get us to 24.
We announced last year our plans to expand to 28 teams. We expect to have more detail, including a process and a timeline before next year, possibly on Dec. 15, following the MLS Board meeting in New York, where we hope to be able to reach agreement on a timeline to be able to provide details on what prospective applicants should be thinking about as they submit their bids, so 28 is our target. I don't expect we will go beyond that, but I never thought that we would, when I came into the league at 12 and went down to 10 that we would ever get to 14 or 18, let alone where we are now at 23, soon to be 24.
ESPN FC: Can you share some of the expansion criteria?
DG: I'll do that in great detail on the 15th.
ESPN FC: Can you provide some broad strokes?
DG: Nothing has changed from the very beginning. The most important quality that we are looking for in any market, is a committed owner or ownership group that has a passion for our sport, a deep belief in our league and the resources to be able to invest in infrastructure and player development and marketing and brand building and help be the pied piper of the sport in their respective market.
It goes from there to ensuring that we have a market that has either a history of supporting the game or has shown real energy with a minor-league club. Cincinnati would be a good example of that. Then thirdly is a comprehensive stadium plan that will ensure the club is able to have a proper home for their fans and players and can serve as a home base for the sport in the community.
ESPN FC: Given all the interest in MLS, would an MLS2 lying underneath MLS ever be possible?
DG: Certainly that's something we have discussed, and it's important to all of us that are focused on growing the game that the lower divisions have a structure that makes sense. I know that the USL and the NASL owners and the federation's committees are working to try to achieve that. That's what I think all of us are focused on for right now.
ESPN FC: Recent expansion fees have been around $100 million or so. Why make the barrier for entry so high?
DG: Well, I think it starts if you think that's high. The NHL just announced a $500 million expansion team in Las Vegas. I don't even know the exact number in the Los Angeles move. Expansion fees aren't about rewarding owners for the work that they have done in working to build the league. It is entirely about the dilution of their interest. As you add teams, you are sharing revenues for the rest of time. All of those who have built the business and have created value are now asked to accept less and expansion fees are a one-time contribution to compensate for that.
ESPN FC: What do you make of Tampa/St. Petersburg and North Carolina bids that have come out in recent days?
DG: Rather than talk about two, what I will say is that there is tremendous interest in professional soccer, particularly in the U.S. right now. That is really positive, and frankly it's empowering to be able to travel around the country and see the level of interest at so many different levels in so many different cities. Because it speaks to the fact that professional soccer can likely work in any market in our country, and that is something that I'm thrilled to witness.
People ask me all the time, "What get's you the most excited?" And I remind them of what we remind ourselves, and that is we have certainly not remotely cracked the code on having professional soccer be the most popular sport in our country. But what we have been able to do, is create a soccer culture and to be able to prove that we are a soccer nation. And with that level of support, you get a trickle-down effect into cities and communities that now has those [fans] that we never thought would be believers standing up and saying "I get it."
The best example is when I spoke at a black-tie dinner two weeks ago in Cincinnati, and a gentleman who was in his 70s stood up and said, "I never thought I would ever go to a soccer game, let alone watch one on television, or ever come to a dinner like this where I can lend my support to the city that I love and their bid to bring FC Cincinnati into MLS. But I was drawn in hook, line and sinker when my son and daughter who are in their 30s, brought me with their kids, my grandchildren to a game, and I've never experienced a sporting even quite like that."
That is not something that we would have seen 10 years ago, or maybe even five years ago. And it's that level of support throughout the community, from the mayor, to governors of states, to CEOs of major corporations, to fans lining our tours. We're building something special here, and all of us who are involved in the game, whether you're a media person or a sponsor or a player or a fan should be feeling pretty good about that. And we hope that it can continue to deliver value to everyone, to our national teams, to that young player who might be thinking about whether they stay in the game or play another sport. All of this is collective energy that is very positive and very empowering.
ESPN FC: What is the latest situation on Miami? Is there a clock ticking where you move on?
DG: Well, there is a clock ticking on every expansion opportunity, because at some point you need to take a step back and decide whether or not the opportunity really exists. And if it does, we go forward, and if he doesn't we move onto another market. We very much believe in the Miami opportunity. We believe that the stadium is a good one. We are very supportive of David Beckham and Marcelo Claure and Simon Fuller and their partners. And we remain optimistic. I have said for so long that we are making progress, and we are continuing to do so, but we have not finalized a deal yet.
ESPN FC: Is that contingent on finding additional investors?
DG: It's contingent on a lot of things, from ensuring that we have the right site, to ensuring that we have rounded out our ownership, and ensuring that we have the right level of public support.
ESPN FC: Has there been any progress on New York City FC's stadium site search?
DG: They continue to remain focused on it, but NYCFC will have to be the ones to talk about that. I for one am thrilled to go to games in Yankee Stadium, and I know I and 30,000 other fans go to a lot of games. It's turned out to be much better than I ever thought it would. The Yankees have been terrific partners. I think they probably have the best groundskeeping crew in the entire world. What they've been able to do to turnaround that revered park into a soccer pitch and stadium has been remarkable. I hope that they continue to make progress on whatever their stadium plans might be, but I for one thank that Yankee Stadium is turning out to be pretty exciting for everyone.
ESPN FC: You made some comments on Bruce Arena's hiring as national team coach, but what are your thoughts on the end of the Jurgen Klinsmann era?
DG: Well, I don't' know who said it, but you never like to see anybody lose their job. It's a function of the pro sports industry, and eventually we all move on. I think Jurgen did a lot of things really well, and certainly brought enormous recognition to our national team around the world and found players I'm not sure would have gotten the call-up if not for Jurgen's energy in finding young players playing overseas. But I am excited about Bruce taking over the reins and look forward to him taking the team through qualification. I've spent quite a bit of time with him over the last number of weeks. He'll be with us again at MLS Cup and I'm really enjoying it.
ESPN FC: How profitable are teams these days?
DG: Profitably is a function of your revenues and your expenses, and we continue to spend more than we are obligated to do so in our own CBA and our own original plans. There are a number of teams that are able to turn a profit, even with significant incremental investments that we're doing, and we continue to be in the investment mode.
ESPN FC: So is the Forbes article that said 10 teams are profitable accurate?
DG: I didn't read how many turned a profit or didn't. I was curious as to their values and pleased that they turned out to be as high as Forbes indicated. But I didn't look into the report in terms of its statement on profitably. That report is not something we're very focused on.
ESPN FC: What is the rationale behind the Targeted Allocation Money (TAM) increase that was reported recently?
DG: TAM has become a very important initiative for us. We made a decision in '06 and '07 to invest in the top of our rosters, and now have three designated players. And several years ago we made a decision that we wanted to strengthen spots four, five and six, and to increase the depth of our teams by signing some high-quality players. If you look some of the players, whether it's Ola Kamara in Columbus, or Jelle van Damme or Luciano Acosta or Ronald Matarrita, all young players that have done quite well, the initiative has proven to be successful. And the investment is significant and will increase even further.
ESPN FC: MLS has lost some youth players, academy kids to overseas clubs. Where does the league stand in terms of training costs and solidarity payments?
DG: The whole solidarity and training compensation is a complicated one. The league is working with the federation, and even working with FIFA to try and sort it out. Those are ongoing discussions and I'm not going to comment on that specifically.
But what I will say is the investment in player development is massive. It's almost $50 million league wide and that's including the academies that are being built. Atlanta just announced that they are building a $60 million facility. Real Salt Lake just broke ground on a $50 million facility. So it represents our commitment to development and in our business we fully recognize that you're not going to be able to sign every player that you develop. But we have been successful in signing the vast, vast majority of them, and not just those that have been developed, but those who are promising and come out of college.
Jordan Morris is an example of that. That was a very, very important signing for us. To have him in the MLS Cup final and be Rookie of the Year speaks to the fact that we remain focused on signing the best young players and having them make MLS a league of choice.
ESPN FC: Have there ever been any conversations with the NCAA about allowing youth players to sign with MLS clubs and without jeopardizing NCAA eligibility?
DG: It is complicated. Obviously we have a unique structure here in this country that doesn't exist in most other countries around the world, and I think it does inhibit our ability to develop players at the same pace as they are able to develop throughout the world. Jurgen said a number of years ago, we announce rookies coming into our league at 21, and a rookie in the rest of the world could be 16.
Now we signed a number of teenage kids throughout the league, and that will allow them to have a professional path and then we've worked with Southern New Hampshire University to create a program for those who do bypass college to get an online education and that is a program we're really proud of. We are encouraged that the NCAA does understand the peculiarity of the North American soccer development pyramid as it relates to the college pathway. We look forward to continuing to work with them and a number of committees that U.S. soccer has put together to see if there is a different approach that can be taken that allows us to be more competitive while at the same time not depriving kids the opportunity to get a subsidized education.
At the end of the day, I do not want to be the commissioner that convinces some kid to bypass college and become a pro and then not have the ability to have a college scholarship. In a perfect world I could wave a magic wand and be able to do both.
ESPN FC: What plans if any do you have for tweaking the playoff system? Any plans to do away with away goals?
DG: There's no doubt that when I'm at a playoff game, and there is a potential for a team to win the second leg, but lose the round and not advance, that it represents some head scratching in the broader sports market. But when it works as it did this year, it's incredibly compelling and exciting, and continues to align us with the international format, at least as it relates to home-and-home and away goals.
So I believe we need to continue to discuss it at our player product committee meetings and ensure that we're getting it right. I for one do not mind making changes if we think it will make our format more exciting and drive television and fan interest. We will talk about the format as we do every year at our upcoming meetings in a few weeks.
ESPN FC: Right now the league still has a lot of control over player signings. Do you anticipate that this will continue? Do you ever see a day when this will be the exclusive domain of the teams?
DG: What is the exclusive domain is the actual holding of the player contract, but the days of the league determining salaries and engaging in negotiating on behalf of clubs, are really over. Each team now has really smart and experienced GMs and technical directors and coaches who understand our system. There's become a whole new role for guys like Tim Bezbatchenko (of Toronto FC) and Ali Curtis (of the New York Red Bulls), who came out of the league and understand how to manage the cap in ways that similar positions do in other leagues. And I believe that's going to become more and more important to drive team success going forward. Our single-entity structure is so much more about our owners being partners than it is about the league engaging in player negotiations.
ESPN FC: What's the latest with video replay?
DG: I don't think there's anything that gets our fans more engaged socially than officiating. And I will not limit it just to our fans. Certainly our coaches and even our owners do.
I for one have been a strong proponent for using technology in soccer where it can enhance the game. I was really pleased to see that IFAB has risen up to understand that a fan in the stadium or at home can see whether or not a call is right or wrong. To not provide our officials with the same opportunity, to me is just not right. FIFA and IFAB have been so focused and so ambitious in this, and I think it's a really positive statement about the sport at the highest levels as it relates to rules. So we have been deeply analyzing the use of video assistants for referees for more two years.
We were one of the first leagues to do so, and we will be one of the first leagues to hopefully roll it out after the All-Star Game in 2017. We still have a lot of work to do with IFAB and FIFA and the other leagues to finalize the plan, but I think it's really going to be a great enhancement for the game. The situations in which VAR will be used are goals, penalty decisions, straight red cards and mistaken identity. It will all be done in-stadium, and will have a mechanism to be able to do it without stopping or slowing down the game. I don't think it will be perfect, and it will certainly take a lot of time before it becomes part of the ecosystem of the game here and everywhere around the world, but it's a big focus of ours and a deep investment that we're preparing for in 2017.
Jeff Carlisle covers MLS and the U.S. national team for ESPN FC. Follow him on Twitter @JeffreyCarlisle.