The Phoenix Mercurys are reaping the rewards of their 15-year deal with Bally’s Corp, a deal that is already paying dividends. The high-profile partnership, worth about $66 million, is generating revenue that Mercury Chairman Vince Kozar calls transformative.
“This is an opportunity for us to invest in our business in a way that we haven’t been able to do in a long time,” Kozar said.
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Already, the Mercurys have increased their advertising budget for subscriptions and soon have new team-oriented docu-series thanks to revenue generated from the sponsorship game deal.
The WNBA as a whole is attracting more interest than ever and expects to set new ratings milestones this coming season. But the fastest path to prosperity for some franchises lies not in future media rights deals, but in lucrative market access deals with sports betting operators.
Mercury’s largest sponsorship deal in team history was made possible last year after the Arizona legislature passed a sports betting bill that allows local professional teams to acquire mobile sports betting licenses. While the Phoenix deal is the most public and active, a slew of WNBA teams have already been in touch with potential betting partners. And others, including the Atlanta Dream, are pushing for team-friendly language in yet-to-be-passed sports betting bills in hopes of reaping similar benefits.
“It would be a huge game-changer for us,” Dream President Morgan Shaw Parker said.
Sports betting has been approved in 30 states, some of which grant teams the power to acquire limited licenses and sell them to operators eager to access newly opened gambling markets. While the market access deals are great financial opportunities for the already valuable men’s major league franchises, the deals create an even bigger windfall for WNBA teams.
Bettor Capitol CEO David VanEgmond, who has worked on related deals, says licensing could be considered a commodity. The former FanDuel trader says that while the Phoenix Suns NBA sponsorship assets sell for a higher price than the Mercury’s, his license theoretically offers the same economic value as the WNBA club.
“In a free market, those should be the same,” VanEgmond said of the two teams, which are owned by Western Alliance Bancorporation chairman Robert Sarver. “And obviously that has more impact for Mercury than for the Suns.”
The new flow of some teams is unlikely to immediately reverse the league’s stance on charter flights or directly help acquire elite players as the salary cap remains in place.
But league executives believe the extra cash flow could do wonders in terms of improving player recruitment and accommodation, including team-issued cars and free housing.
More money could also lead to a WNBA arms race in player facilities, with franchises forced to offer quality performance and rehab facilities, for example, or losing top free agents.
More than that, the guaranteed millions could drive up team valuations, potentially making WNBA teams much more desirable to prospective owners, as happened recently with MLS.
Houston Dynamo FC recently signed a deal with Fubo Gaming worth $178 million, one of the biggest trade deals in MLS history, and it’s in a state where the game is still. illegal. The partnership, which includes a signing bonus and pre-legalization revenue, provides insight into the attractiveness of the potential Texas betting market for operators.
But passing the necessary legislation is not easy. Texas sports betting legislation stalled last year, while Georgia legislation stalled earlier this month. There are also many nuances, including the size of the state, casinos, lotteries and the role of Indian tribes. Some states like New York have taken full control of licensing and impose high tax rates on operators.
Even though lawmakers allow sports entities to acquire licenses, it is uncertain whether WNBA teams will be included in local professional team consortia, which has been a point of contention for some like the champion in league title, Chicago Sky.
The WNBA, half-owned by the NBA, has made progress in sponsorship deals with high-profile companies like Nike and recently completed its biggest ever funding round. Sports economist and professor David Berri agrees that passive income licensing for teams is a short-term win, but thinks such long-term deals with operators may actually be counterproductive.
“They may say it’s a good deal now, but 15 years from now you might think it’s a crap deal,” he said. “You have to imagine what your product will be like in 10 years.”
WNBA commissioner Cathy Engelbert was quick to say that sports betting and gaming will help take the league to new heights. League-wide sports betting partnerships are expected to be a new way to attract more fans and will likely coincide with future media deals.
But in the meantime, teams are working with lobbyists in state capitals, doing their best not to be left behind by WNBA clubs already cashing sports betting checks or those run by property with built-in infrastructure. NBA like Indiana Fever, New York Liberty, Minnesota Lynx. and Mercury.
“We are the first, but we definitely want others to join us,” Kozar said. “We will not be the last.
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