Post by WBBDaily on Nov 5, 2023 10:17:42 GMT -5
The inside story of how MLSE walked away from the WNBA
On May 13 of this year, more than 19,000 basketball lovers packed Scotiabank Arena in downtown Toronto for a pre-season game between the WNBA’s Minnesota Lynx and Chicago Sky. From the first whistle to the final layup, by Chicago forward Kahleah Copper, the sellout crowd chanted, cheered and waved signs all designed to deliver one message: Canada is ready for its own women’s professional basketball team.
What those fans didn’t know is that by the time the Sky’s Alanna Smith won the jump ball to start the game that day, Toronto’s WNBA dream was already dead. Maple Leaf Sports & Entertainment (MLSE), the corporate partnership that owns the Toronto Raptors, the Toronto Maple Leafs and five other men’s professional sports teams in the Toronto area, had decided months earlier not to bid on a WNBA expansion team this year, the Toronto Star has learned.
That decision — which shut Toronto out from the booming women’s sports industry at a time of unprecedented growth — came at a contentious board meeting that split representatives from the three companies that control MLSE, sources told the Star. “It was (Rogers CEO) Tony (Staffieri) and (Rogers chair) Edward (Rogers) against, everyone else for,” said a source familiar with the discussion, who, along with other sources quoted in this story, was granted anonymity to speak frankly about confidential board matters.
The opposition from Rogers and Staffieri came despite an internal MLSE business case, presented to the board, that multiple sources say projected a potential path to profitability for the franchise (after several years of losses) and in the face of passionate support for the idea from some senior figures within the organization. It also flew in the face of external research suggesting the market for professional women’s sports in Canada is massively underserved.
“This is definitely a conversation about building something. It’s a conversation about growth,” said Allison Sandmeyer-Graves, the CEO of Canadian Women & Sport. “The benefits flowing to those that have invested are real.”
There is no guarantee professional women’s basketball would have worked as a business in Toronto. Even if MLSE had won the rights to a new franchise, the team would have faced multiple structural barriers to success, including the fact that WNBA games are played indoors in the middle of summer, a tough sell in the crowded Toronto sports and entertainment marketplace.
A second source familiar with the board debate, meanwhile, said the preliminary estimates they saw “showed there wasn’t a business case to warrant participating in a bid process.”
“The numbers didn’t even address the gulf in salaries paid to male and female athletes, and there was a clear view that this inequity needed to be addressed by anyone looking to purchase the asset,” the source said.
But some WNBA backers believe that if MLSE was going to jump into the women’s sports market, now was the time to do it. The upfront investment would have been relatively small: a $50-million (U.S.) expansion fee against MLSE’s estimated $8-billion valuation. And the rewards were potentially huge.
Toronto would immediately become the WNBA’s fourth- or fifth-largest market (depending on how you measure the Chicago area), with a population far larger and with far more spending power than current WNBA cities such as Indianapolis, Indiana and Uncasville, Conn.
The market for professional women’s sport in this country is already valued at between $150 million to $200 million, according to a 2023 Boston Consulting Group report put out by Canadian Women & Sport. What’s more, that market is “significantly underdeveloped,” the report said, with fan appetite far outstripping the available offerings.
“When we look at markets in Europe, when we look certainly in the U.S. and others, we can really see very quickly that Canada is frankly behind,” said Sandmeyer-Graves. “You look at growth in terms of soaring valuations for teams, records in media and sponsorship deals, growing viewership and attendance, sold-out jerseys and shoe lines: There’s so many proof points … we are seeing a global boom in women’s professional sport.”
Backers of the women’s game in Canada believe pent-up demand among desperate fans would be more than enough to fill Scotiabank Arena for years to come. “If anyone was anywhere close to that WNBA game here earlier this season, they would know,” said Natalie Achonwa, the captain of the Canadian women’s national basketball team, at an MLSE event earlier this week. “I just had my son maybe three weeks before and I came — and to be in that arena gave me chills.”
MLSE has never commented publicly on why it decided not to go after a WNBA team. Asked about the decision for this story, an MLSE spokesman said the company “is focused on its existing holdings” and confirmed that the organization “was never in the bid process for a WNBA expansion franchise.”
The spokesman added that MLSE is “a passionate supporter of women’s sports” and remains “committed to growing the game at the grassroots level.”
At one point, the organization did consider making a bid, though. The Star has learned that senior MLSE staff put together an internal report arguing for more investment in women’s professional sports that was presented to the board. According to three sources with knowledge of the report, it laid out a case for going after a WNBA franchise.
The projections were anything but pie-in-the-sky. The proposed team would lose money for at least the first several years of its existence, the report said, even if payments on the $50-million expansion fee were spread over 10 years. There was also no guarantee the team would ever make a profit.
But backers of the idea within the organization felt the potential rewards were worth the risk. With the right development and the right media support, a WNBA team could thrive as part of the larger MLSE family, they believed. It would also cement MLSE’s reputation as an organization willing to put real skin in the game when it comes to promoting women’s sports.
And while the WNBA’s finances aren’t rock solid, there is no doubt the women’s professional game is growing, both in stature and support. WNBA attendance hit a 13-year high this season, according to the league.
Regular season TV viewership was up 22 per cent year-on-year, while the league finals, between the Las Vegas Aces and the New York Liberty, was the most-watched WNBA series in 20 years. The series averaged 738,000 viewers per game, still just a fraction of the numbers the NBA pulls in. But it’s a growing fraction, no small thing in a sports media landscape where TV viewership has been losing ground to social media and other platforms for years.
Team valuations are climbing, too. The owners of the Seattle Storm paid a $1-million expansion fee to join the league in 2008. In 2023, the franchise was valued at more than $150 million, according to Canadian Women & Sport.
(Things are not all rosy. This week, the WNBA revealed it was delaying a proposed expansion team in Portland over arena repair issues.)
When the MLSE board met to consider the idea of bidding on a WNBA franchise, the organization was already facing significant internal issues, according to sources. The board is split between representatives of the three MLSE stakeholders: Rogers Communications (three seats), Bell Communications (three seats) and MLSE chair Larry Tanenbaum’s Kilmer Sports (two seats). Bell and Rogers each own 37.5 per cent of the company. Kilmer owns the remaining 25 per cent, at least for now.
Traditionally, decisions at the MLSE board have been made by consensus. But in recent years, sources say, that consensus has been harder to find. Rogers controlling shareholder and chairman Edward Rogers has clashed at times with Tanenbaum, according to sources. The two reportedly disagreed over the terms of Raptors president Masai Ujiri’s new contract in the summer of 2021 and those wounds have apparently lingered.
Until recently, Edward Rogers also shared space on the board with his sister, Melinda Rogers-Hixon, with whom he fought a protracted public war for control over the family’s company in 2021.
Rogers-Hixon, whose name was quietly stripped from the MLSE website sometime between June and October, declined to comment for this story, as did Edward Rogers, Rogers Communications and Bell.
Debate at the board over the WNBA was heated, according to the source, with Edward Rogers and Tanenbaum in particular sparring. But the outcome was set. Without the unanimous support of the three major shareholders (Rogers, Bell, and Tanenbaum) the idea of bidding on a WNBA franchise was never going to fly.
The WNBA announced the Toronto pre-season game earlier this year, on Jan. 18. It was touted at the time as a “giant first step toward possible expansion” into Canada. Barely a month later, that “possible expansion” was already dead. MLSE, despite significant interest from the WNBA and within its own organization, had decided not to bid.
For some boosters, that choice was disappointing but not necessarily catastrophic. “I don’t think this is the end of it for the WNBA in Toronto,” said Kia Nurse, a Canadian WNBA star and basketball analyst for TSN. “I think that there will be a team here at some point, hopefully while I’m still playing.”
If so, it might not be with MLSE. Two different sources close to the board said Tanenbaum has had discussions about buying a WNBA franchise on his own or with a non-MLSE partner. One source said Tanenbaum asked the other MLSE partners about the idea and none were opposed.
Tanenbaum, through the Kilmer Group, declined to comment.
The consensus among industry sources who spoke to the Star, however, is that the WNBA’s best chance of success in Toronto would be as part of MLSE.
Between them, Rogers and Bell own Canada’s largest sports networks (TSN and Sportsnet). MLSE owns Scotiabank Arena and the country’s deepest roster of sports marketing, ticketing and development staff — not to mention the Toronto Raptors and all the basketball facilities and expertise that come with a top-end NBA team.
It wouldn’t be easy to establish a WNBA franchise without that institutional backing, in other words. But in today’s market, it might not be impossible.
“There are a lot of historical biases against women’s sports: Not seeing value in it; not believing that fans have any interest in it; not believing that people would go to games; that they would buy the merch; that they would engage as fans,” said Sandmeyer-Graves.
“What’s so interesting is that when we look into other markets, very similar markets with similar cultures, we see that those assumptions and those biases are being challenged every single day.”
What those fans didn’t know is that by the time the Sky’s Alanna Smith won the jump ball to start the game that day, Toronto’s WNBA dream was already dead. Maple Leaf Sports & Entertainment (MLSE), the corporate partnership that owns the Toronto Raptors, the Toronto Maple Leafs and five other men’s professional sports teams in the Toronto area, had decided months earlier not to bid on a WNBA expansion team this year, the Toronto Star has learned.
That decision — which shut Toronto out from the booming women’s sports industry at a time of unprecedented growth — came at a contentious board meeting that split representatives from the three companies that control MLSE, sources told the Star. “It was (Rogers CEO) Tony (Staffieri) and (Rogers chair) Edward (Rogers) against, everyone else for,” said a source familiar with the discussion, who, along with other sources quoted in this story, was granted anonymity to speak frankly about confidential board matters.
The opposition from Rogers and Staffieri came despite an internal MLSE business case, presented to the board, that multiple sources say projected a potential path to profitability for the franchise (after several years of losses) and in the face of passionate support for the idea from some senior figures within the organization. It also flew in the face of external research suggesting the market for professional women’s sports in Canada is massively underserved.
“This is definitely a conversation about building something. It’s a conversation about growth,” said Allison Sandmeyer-Graves, the CEO of Canadian Women & Sport. “The benefits flowing to those that have invested are real.”
There is no guarantee professional women’s basketball would have worked as a business in Toronto. Even if MLSE had won the rights to a new franchise, the team would have faced multiple structural barriers to success, including the fact that WNBA games are played indoors in the middle of summer, a tough sell in the crowded Toronto sports and entertainment marketplace.
A second source familiar with the board debate, meanwhile, said the preliminary estimates they saw “showed there wasn’t a business case to warrant participating in a bid process.”
“The numbers didn’t even address the gulf in salaries paid to male and female athletes, and there was a clear view that this inequity needed to be addressed by anyone looking to purchase the asset,” the source said.
But some WNBA backers believe that if MLSE was going to jump into the women’s sports market, now was the time to do it. The upfront investment would have been relatively small: a $50-million (U.S.) expansion fee against MLSE’s estimated $8-billion valuation. And the rewards were potentially huge.
Toronto would immediately become the WNBA’s fourth- or fifth-largest market (depending on how you measure the Chicago area), with a population far larger and with far more spending power than current WNBA cities such as Indianapolis, Indiana and Uncasville, Conn.
The market for professional women’s sport in this country is already valued at between $150 million to $200 million, according to a 2023 Boston Consulting Group report put out by Canadian Women & Sport. What’s more, that market is “significantly underdeveloped,” the report said, with fan appetite far outstripping the available offerings.
“When we look at markets in Europe, when we look certainly in the U.S. and others, we can really see very quickly that Canada is frankly behind,” said Sandmeyer-Graves. “You look at growth in terms of soaring valuations for teams, records in media and sponsorship deals, growing viewership and attendance, sold-out jerseys and shoe lines: There’s so many proof points … we are seeing a global boom in women’s professional sport.”
Backers of the women’s game in Canada believe pent-up demand among desperate fans would be more than enough to fill Scotiabank Arena for years to come. “If anyone was anywhere close to that WNBA game here earlier this season, they would know,” said Natalie Achonwa, the captain of the Canadian women’s national basketball team, at an MLSE event earlier this week. “I just had my son maybe three weeks before and I came — and to be in that arena gave me chills.”
MLSE has never commented publicly on why it decided not to go after a WNBA team. Asked about the decision for this story, an MLSE spokesman said the company “is focused on its existing holdings” and confirmed that the organization “was never in the bid process for a WNBA expansion franchise.”
The spokesman added that MLSE is “a passionate supporter of women’s sports” and remains “committed to growing the game at the grassroots level.”
At one point, the organization did consider making a bid, though. The Star has learned that senior MLSE staff put together an internal report arguing for more investment in women’s professional sports that was presented to the board. According to three sources with knowledge of the report, it laid out a case for going after a WNBA franchise.
The projections were anything but pie-in-the-sky. The proposed team would lose money for at least the first several years of its existence, the report said, even if payments on the $50-million expansion fee were spread over 10 years. There was also no guarantee the team would ever make a profit.
But backers of the idea within the organization felt the potential rewards were worth the risk. With the right development and the right media support, a WNBA team could thrive as part of the larger MLSE family, they believed. It would also cement MLSE’s reputation as an organization willing to put real skin in the game when it comes to promoting women’s sports.
And while the WNBA’s finances aren’t rock solid, there is no doubt the women’s professional game is growing, both in stature and support. WNBA attendance hit a 13-year high this season, according to the league.
Regular season TV viewership was up 22 per cent year-on-year, while the league finals, between the Las Vegas Aces and the New York Liberty, was the most-watched WNBA series in 20 years. The series averaged 738,000 viewers per game, still just a fraction of the numbers the NBA pulls in. But it’s a growing fraction, no small thing in a sports media landscape where TV viewership has been losing ground to social media and other platforms for years.
Team valuations are climbing, too. The owners of the Seattle Storm paid a $1-million expansion fee to join the league in 2008. In 2023, the franchise was valued at more than $150 million, according to Canadian Women & Sport.
(Things are not all rosy. This week, the WNBA revealed it was delaying a proposed expansion team in Portland over arena repair issues.)
When the MLSE board met to consider the idea of bidding on a WNBA franchise, the organization was already facing significant internal issues, according to sources. The board is split between representatives of the three MLSE stakeholders: Rogers Communications (three seats), Bell Communications (three seats) and MLSE chair Larry Tanenbaum’s Kilmer Sports (two seats). Bell and Rogers each own 37.5 per cent of the company. Kilmer owns the remaining 25 per cent, at least for now.
Traditionally, decisions at the MLSE board have been made by consensus. But in recent years, sources say, that consensus has been harder to find. Rogers controlling shareholder and chairman Edward Rogers has clashed at times with Tanenbaum, according to sources. The two reportedly disagreed over the terms of Raptors president Masai Ujiri’s new contract in the summer of 2021 and those wounds have apparently lingered.
Until recently, Edward Rogers also shared space on the board with his sister, Melinda Rogers-Hixon, with whom he fought a protracted public war for control over the family’s company in 2021.
Rogers-Hixon, whose name was quietly stripped from the MLSE website sometime between June and October, declined to comment for this story, as did Edward Rogers, Rogers Communications and Bell.
Debate at the board over the WNBA was heated, according to the source, with Edward Rogers and Tanenbaum in particular sparring. But the outcome was set. Without the unanimous support of the three major shareholders (Rogers, Bell, and Tanenbaum) the idea of bidding on a WNBA franchise was never going to fly.
The WNBA announced the Toronto pre-season game earlier this year, on Jan. 18. It was touted at the time as a “giant first step toward possible expansion” into Canada. Barely a month later, that “possible expansion” was already dead. MLSE, despite significant interest from the WNBA and within its own organization, had decided not to bid.
For some boosters, that choice was disappointing but not necessarily catastrophic. “I don’t think this is the end of it for the WNBA in Toronto,” said Kia Nurse, a Canadian WNBA star and basketball analyst for TSN. “I think that there will be a team here at some point, hopefully while I’m still playing.”
If so, it might not be with MLSE. Two different sources close to the board said Tanenbaum has had discussions about buying a WNBA franchise on his own or with a non-MLSE partner. One source said Tanenbaum asked the other MLSE partners about the idea and none were opposed.
Tanenbaum, through the Kilmer Group, declined to comment.
The consensus among industry sources who spoke to the Star, however, is that the WNBA’s best chance of success in Toronto would be as part of MLSE.
Between them, Rogers and Bell own Canada’s largest sports networks (TSN and Sportsnet). MLSE owns Scotiabank Arena and the country’s deepest roster of sports marketing, ticketing and development staff — not to mention the Toronto Raptors and all the basketball facilities and expertise that come with a top-end NBA team.
It wouldn’t be easy to establish a WNBA franchise without that institutional backing, in other words. But in today’s market, it might not be impossible.
“There are a lot of historical biases against women’s sports: Not seeing value in it; not believing that fans have any interest in it; not believing that people would go to games; that they would buy the merch; that they would engage as fans,” said Sandmeyer-Graves.
“What’s so interesting is that when we look into other markets, very similar markets with similar cultures, we see that those assumptions and those biases are being challenged every single day.”