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Major League Soccer Teams Will Sell Ad Space on Players' Jerseys

By Jon Weinbach
Wall Street Journal

Major League Soccer doesn’t have the talent, tradition or TV ratings of more storied American sports leagues. But starting next spring, MLS will be the first major team sports league in the U.S. to showcase ads where viewers can’t miss them: on the fronts of player jerseys.

Aside from Nascar, no major American sports league permits prominent advertising on team jerseys, though the practice has long been accepted in Europe, Asia and Latin America. The MLS deal allows clubs to sell their own jersey rights and keep a majority of the revenue, a marked change for the 11-year-old league, which in the past has conducted most of its business through a central office and pooled sponsorship dollars.

Corporate logos on MLS jerseys could be a sign of things to come. A few years ago, Major League Baseball toyed with the idea of selling sponsorships on jersey sleeves, and MLB and the National Football League already allow apparel makers such as Reebok and Majestic to display their logos on team uniforms. In an interview last year, National Basketball Association commissioner David Stern conceded that the league would “consider changing our policies” on uniform sponsors. The reason: In an era of soaring player salaries and sagging TV ratings, teams and leagues are under increasing pressure to generate ancillary income from merchandise, stadium amenities and local media deals.

No advertiser has officially signed on to sponsor an MLS jersey yet for next season, but the Los Angeles Galaxy club is in discussions for a “multimillion dollar” deal, according to people familiar with the situation.

The MLS operates as a “single entity,” with investors owning all the teams collectively and players signing contracts with MLS rather than with a single franchise. The system was designed to control spending by owners and limit free agency for players until the league generated significant revenues.

Players’ paychecks remain low—the average salary is about $90,000, including bonuses—but the league is beginning to attract real dollars. MLS recently completed TV-rights deals with several networks—including ESPN, Univision and Fox Soccer Channel—that will pay about $20 million a year, the first time MLS will be compensated for its games. (Previously, the league either bought air time or shared advertising.)

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