Ipswich co-owner criticizes MLS valuations and Apple deal

In an interview with the Business of Sport podcast, Ipswich Town co-owner Brett Johnson voiced his opinion on several topics. This included Major League Soccer’s media rights and valuations of MLS teams such as LAFC. He also touched on his experiences as an owner of USL team Phoenix Rising.

The American entrepreneur previously helped establish Phoenix Rising back in 2014. He then went on to invest in Ipswich after failing to secure a deal to buy Newcastle United.

Since Johnson arrived at the English club, the Tractor Boys have gone from League One to the Premier League. This coincided with the club hiring Kieran McKenna as their head coach.

In his appearances on the podcast, Johnson criticized the terms of Major League Soccer’s deal with Apple.

“You don’t have great media rights in Major League Soccer,” stated the businessman.

“You’ve got a headline number of $2.5 billion over 10 years behind a paywall on Apple that when you split it among 30 teams, and then you factor in production costs and everything else.”

“You can start to do the math and start to recognize that [media rights] is really not the panacea in terms of the economic model for a lot of clubs.”

American businessman is in favor of bringing pro/rel to MLS

Johnson also helped explain why foreign soccer leagues are more popular in the United States than the domestic MLS. “I think what’s going to come to the rescue relative to media rights for USL will be the adoption of promotion and relegation,” continued the investor. “Games of consequence in the United States is what’s missing in this market.”

“With the utmost respect to Major League Soccer, if you’re an American consumer of the Beautiful Game, you’re far more interested in watching the foreign leagues with their games of consequence where teams are going up or going down than two mid-table MLS teams that are both going to miss the playoffs because everyone makes the playoffs.

“There’s no consequence of putting a good team on the pitch or a bad team on the pitch.”

The argument regarding implementing promotion and relegation in MLS is a heated topic between fans and the league. Many American soccer supporters are open to the idea of bringing the process to North America. MLS execs, however, are less than welcoming to the idea.

Club valuations are inflated because MLS is a closed league

Finally, Johnson claimed that MLS team evaluations are inflated directly due to the lack of promotion and relegation. “With LAFC, [the team] is worth well north of a billion dollars by a lot of estimates. I feel like that [valuation] is largely inflated obviously because there’s no relegation risk,” Johnson proclaimed.

“I also feel like long-term, ten years from now with the absence of games of consequence in North America, I’m not sure we’re getting global eyeballs to focus on this market.”

“If I talk to my friends and extended network in the United States, increasingly they are getting so passionate about the Beautiful Game. But a lot of their time and attention is focused on their Premier League, Bundesliga, and Serie A [teams]. They’re really loving the passion of those different types of leagues.”

“I’m not hearing that same level of passion [for MLS] where they go ‘Oh my god, did you see Sporting KC the other day with what they did to Cincinnati? It was incredible.’ I’m sure it exists with some hardcore fans within those local markets. No guy from London is calling me up and saying ‘I can’t believe what I just saw the other day in MLS.’”

Along with LAFC, three other MLS clubs are reportedly worth at least $1 billion now. This list includes Atlanta United, Inter Miami, and LA Galaxy. In comparison, just six Premier League teams were valued at over this sum in 2023.

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