Mighty Ducks and the mightier dollar
Gerard Wright in Denver finds sport belongs only to the super- rich
Sunday 13 December 1998
Or, as happens more and more often nowadays, the sports of companies: Time-Warner (Atlanta Braves, baseball, $299m, and Hawks basketball, $140m); Disney (Annaheim Angels, baseball, $157m, and Mighty Ducks, ice hockey, $109m); and News Corp (Los Angeles Dodgers, baseball, $236m, and 20 per cent of the New York Knicks, basketball, $296m).
The above figures come from an extensive survey by Forbes magazine, itself owned by a billionaire, Steve Forbes. By the Forbes estimate, the most expensive and wealthiest sports team in the United States and Canada are the Dallas Cowboys, the property of the Arkansas oilman Jerry Jones. "America's Team" were valued at $413m, with income in 1997 of $41.3m.
The operative word is "estimate". While an educated assessment could be made based on publicly available figures from income sources such as TV contracts and stadium revenues, and from costs such as player contracts, there was no way for this survey to take into account the process that drove the price of the New York Yankees into the stratosphere. The Yankees won the World Series in October for the second time in three years. Despite, or because of that, their owner, George Steinbrenner, has them on the market. Forbes' assessment of the champs was $362m. But in negotiations with Cablevision Systems, who also own the New York Knights, the price was put at anywhere from $500m to $1bn. Cablevision want the Yankees to tighten their stranglehold on cable television contracts in the New York area, the largest market in the United States. How do you put a price on such corporate desires?
At the other end of the food chain were the Carolina Hurricanes, formerly the Hartford Whalers, of the National Hockey League. The Hurricanes were priced at a relatively affordable $80m, according to Forbes.
In keeping with their new nickname, the Hurricanes are in transit. This is the second of two years in Greensboro before they move 200km to Raleigh and a new stadium worth $154m, which they will share with North Carolina State University.
The Carolinas are basketball and football country. Michael Jordan grew up in North Carolina. The Hurricanes are the only major professional franchise in the state, but so far they are a taste the locals have been slow to acquire. Now well into their second season, average attendance is 7,200 in the 11,000-seat Greensboro Stadium.
Dean Jordan, the team's chief operating officer, disputes the valuation of the Hurricanes, but acknowledges that some corporate, if not competitive, ambitions have to be adjusted to their present situation.
"It's a fact of life that we live with every day," he said of competing against richer teams in bigger, established markets. "It's the haves and the have nots. It's the same thing in every sport. Take a look at baseball. Your big-market clubs have the big local TV contracts and have the ability to do more things."
The Hurricanes are owned by Peter Karmanos, the chairman of the software company Compuware. For his team's first year in its new hockey- ignorant home, Karmanos decided his team should be a "have", offering Sergei Federov, the star of the Detroit Red Wings' back-to-back Stanley Cup winning teams, a $38m contract.
"Obviously, our owner is a very wealthy individual," Jordan said. "He can make a decision like that if he so chooses because he thought it was in the interest of the franchise. He had sound business reasons for making that decision. In many different ways, it increases interest in the team, increases corporate support. That would have paid for itself."
Federov, better known in other walks of life as the paramour of the tennis player and erstwhile sex kitten Anna Kournikova, stayed with the Red Wings ($184m) and laughed all the way to the bank anyway.
Jordan stayed up late the night before this interview to watch his team fall 2-1 to the Boston Bruins ($185m) and yawned between soliloquies.
The Hurricanes lead the South-east Division of the NHL's Easter Conference by five points.
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