MLS and the market for TV soccer in the US

This article first appeared in three installments at WorldSoccerTalk.

Like many people I have long argued that the real challenge for MLS is to break the TV market. Europe’s big leagues typically generate about half of their revenues from TV, while MLS is probably below 20%.  The current MLS contract will run until 2022 and pays around $90 million a year of which a significant fraction goes to run the national teams. With less than $5 million going to each of the franchises, the size of the broadcast deal limits the willingness of owners to pay the big bucks that will attract the top talent. This is a Catch 22 for the league, since better players means better soccer and a more attractive product for broadcasters to sell. MLS needs to find a way to boost their product on TV by the time the next contract comes along.

The national TV rating data collected by Collin Werner provides an interesting insight into the current position of MLS. He has been collecting national viewing figure for MLS over the last season and for all TV soccer since August. He kindly allowed me to looks at the data and here are some of the highlights that struck me:

1. MLS share of TV soccer is scarily small. Over the period August – December MLS accounted for only 7% of total viewing of soccer in US- while Liga MX accounted for one third.

Note that MLS accounted for 6% of all games played, including post-season play which in theory should be the most attractive. MLS plays more games than are actually broadcast nationally. The figures here do not include local broadcast numbers. I have not heard anyone claim that local TV audiences are on average very large, so I don’t think their inclusion would change much.

To have any chance of attracting a large contract MLS would surely need to have a much larger share of its own market. It’s true that there were twice as many EPL and Liga MX games shown, and MLS will indeed expand its supply of games in the next few years with the expansion teams. That should help to increase market share. But…

2. MLS games are lagging behind Liga MX, the EPL and international games in terms of audience per game:

Once again the big rival is Liga MX, with double the average audience size. Obviously Liga MX has a large following among those of Mexican origin. But there’s another factor at play too- Liga MX has a time-zone advantage over the EPL…

3. Prime time is the most attractive programming slot, which runs from 8pm to 11pm, and there are never any EPL games played in this slot (since the UK is 5 hours ahead of Eastern Time, they would have to play in the middle of the night). By contrast, 70% of Liga MX games are played in prime time, 48% of international games and, notably, 53% of MLS games (note: I based my prime time definition on the Eastern time zone). Here is something I think should worry MLS. Compare prime and other time audience size:

The table shows that while audiences rise for Liga MX and international games played in prime time, they actually fall for MLS (and note the data includes the MLS Cup final which attracted a 2 million audience in the US). Why would the MLS audience fall in prime time? One reason could be that in prime time there’s more competition from other sports. This is the double bind of MLS: the EPL can draw a 50% larger audience going head-to-head in daytime TV while Liga MX can draw an audience that is twice the size in prime time. The problem for MLS is competition…

4. MLS does better when the other soccer leagues are not playing. The table below shows the monthly figures for MLS viewing this year since March:

Cleary the best months are June and July, when only baseball is being played in the US and the other major soccer leagues are between seasons (of course, Euro 2016 ran from June 10 to July 10, so there was still some competition, but none of that was prime time).

MLS is competing in an overcrowded market. Between August and December MLS supplied only 6% of soccer games shown on TV, at the same time as facing competition from the NFL and college football, as well, for at least part of the time, from MLB, NBA and NHL.