I am off to beautiful Baltimore Maryland for the 2011 MLS draft and business meetings. The biggest thing on my mind is how am I going to deal with a HIGH of 29 degrees?!?! I am looking forward to the trip however. Teams from around MLS will be meeting to discuss the commercial strategy and structure of the future. MLS has operated under a single entity structure since its inception, but over the last few years, the league has begun to evolve through transfer of rights to the teams.

Four years ago, the league allowed teams to sell the space on the front of the jersey so long as they were not a conflict of a current MLS partner. Three years ago, the league allowed teams to "split" the automobile category when they (MLS) failed to renew Honda as a long term partner. This was a "test" of how this model could operate to maximize revenues enterprise wide. It worked because two years ago the same thing occurred when the wireless category was given back to the teams.

How does this "split" work? The league sponsor in a certain category (lets say automobile) is given the prime commercial assets (TV view field boards for example) when you play a home game on national television, All locally televised games you retain the category and ALL of the commercial assets in the deal. So say the Houston Dynamo is playing a home game on ESPN, the national auto sponsor Volkswagen will have the field board space. If it was a game on Fox Sports Houston, The Dynamo's local partner, who just so happens to be Volkswagen as well but let’s pretend it is Chevy (we have done a great job of keeping things constant with the same local partner as the national one), gets the space on all local games broadcast at home.

The new commercial model is that of "global" league partners (Adidas and Gatorade) will continue to be provided with complete exclusivity on the league and team side. The rest of the categories are being shared as stated above.

Single entity is what started and saved this league (heck, our ownership group AEG had owned 6 teams at one time) Is this the start of an individual ownership model?

Bryan Kraham
Senior Director of Corporate Development
Houston Dynamo
bkraham@houstondynamo.com