The private ownership of major sporting teams – seen as the only way ahead in several sports – has suffered a setback with the collapse of two high profile National Basketball League teams because of the financial problems facing their owners.
The Sydney Kings and the Brisbane Bullets were integral to the early success of the national men’s basketball competition, and their demise is the most serious setback the sport has suffered.
The Sydney Kings, chaired by the owner of the controversial fuel-additive manufacturer, Firepower, had its license revoked by the NBL yesterday. Firepower, owned by Tim Johnson, also had multi- million dollar sponsorship and other arrangements with the Western Force rugby team and the South Sydney Rabbitohs rugby league team.
The Brisbane Bullets were owned by ABC Learning CEO, Eddie Groves, whose personal finances have collapsed as a result of ABC’s problems. Proposals to sell the Bullets to two business consortiums, the latest being Sarina Russo, have fallen through. Most of the players have already gone elsewhere so it is only a matter of weeks before the Bullets are consigned to basketball history as well.
The problems facing the Rabbitohs have been well documented. At a time when private ownership may be the only hope for NRL clubs currently funded by their licensed clubs, the plight of private sector sport team ownership in general is ominous.
Of the privately owned NRL clubs, only the Brisbane Broncos – majority owned by News Limited – consistently turns in a profit. But the Broncos are in a one team town with a huge fan base.
The disaster facing the NBL, and the problems facing a number of NRL clubs, will surely not go unnoticed looking at private ownership, notably rugby union and cricket.
The simple truth is that, in a comparatively small market, profitable ownership of sporting teams is the exception rather than the rule.
Attracting private owners is going to get even harder given the number of failures. About the only businesses or entrepreneurs capable of funding a sporting teams are those with deep pockets, someone else’s money, or an individual passion that compensates for multi-million dollar losses!
If any of the Sydney NRL clubs currently in dire financial straits fall over, not even the $8 million the NRL is offering clubs to re-locate to new areas, such as Gosford, might be enough to save them.
The sobering message to come out of the demise of the Kings and the Bullets is a simple one – the era of “entrepreneurs” throwing money at sporting teams like confetti are almost certainly over!