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The New York Yankees are apparently having few difficulties in selling off the hugely expensive corporate boxes in their new ballpark. But as the world credit crisis deepens this might change.
However, there are so many billionaires in the USA that the couple of hundred boxes should be safe enough for the Yankees to bank on.
I’m reminded of the Hunt family, the Texas millionaires who bought the Dallas Cowboys in the 1960s. When they were told by some journalists that the team lost a $1 million the year before, one of the family mused for a while and then replied: ‘In that case we’ll be bankrupt in a couple of hundred years times.’
Right now the suggestions from people who should know is that while there will be some problems, in general the huge sponsorships of big-time sport will continue.
The UK Telegraph, for instance, has looked into most of the world sports and has concluded that right now the sponsorships will carry on. The Texas billionaire, Sir Alan Stanford, for instance, is intent on pushing ahead with his $20 million Twenty20 series in England next year.
There will be some spectacular failures, though, given the steep dive in the profits of financial institutions and the collapse of share prices around the world. The US market is at a 10-year low, with all the gains made in the decade wiped out. Some of the big bank sponsorships will now disappear.
So too will once-wealthy club owners like West Ham United’s Bjorgolfur Gudmundsson who has lost his fortune with the banking crash in Iceland.
Incidentally, this case points to the way that clubs in a number of sports in Europe have made themselves vulnerable by being taken over by wealthy individuals. This raises the issue of how some of the A-League clubs in Australia are going to get on if the crisis hit their owners.
Also, one would think that the franchise idea put forward by the ARU’s John O’Neill might have to be put on the back-burner. Macquarie Bank which is one of the strongest supporters of rugby had its share price down to $28 on Friday, after being as high as the $80 a year ago.
Rugby League has its TV contracts established for the next year or so and with the relative strength of the Australian economy, the localised nature of the sport has an advantage, for once.
Cricket has the Twenty20 game’s popularity and the vast numbers of Indian fans to keep the game afloat with money for years to come.
One benefit for Australian rugby is that its contracts with News Ltd are written in US dollars. With the Australian dollars plunging from almost parity a year ago with the US dollar to below 70c recently, the ARU has had a bit of windfall.
The days of gratuitous expenditures and outlays on players and their trips and training camps, though, is probably over. One would think that player contracts in sports like rugby will be pruned and that the excessive amounts of money offered to southern hemisphere players to play in the northern hemisphere will be cut back.