Arthur: What the sale of the Argos to MLSE could mean

So the Toronto Argonauts are safe, but they were already safe. The team that has teetered on the edge of dissolution so many times has been purchased, officially, by Maple Leaf Sports & Entertainment, which also owns the Maple Leafs, Raptors, Toronto FC and Marlies. Now, they are in the safest neighbourhood there is.

Of course, that does leave the Blue Jays, but this isn’t about them. That’s what some people at Maple Leaf Sports & Entertainment will tell you, that tires haven’t even been kicked yet. Rogers Communications will say the same: they will send you a statement that reads, “As we have said, there are no plans to sell the Jays. We continue to look for the best way to get credit for our incredible sports portfolio in our overall company valuation.” Well, we all want to get credit for something, eventually.

But on Wednesday, Rogers did something it didn’t have to do: it agreed to own a part of the Toronto Argonauts. Officially, Maple Leaf Sports & Entertainment now owns the venerable and lonely CFL team, but it had already been co-owned by MLSE partners Bell Communications and Larry Tanenbaum since 2015. All this did was bring Rogers on board.

“Clearly, MLSE has built a winning culture with spectacular capabilities,” said CFL commissioner Randy Ambrosie, who now has one fewer problem on his plate. “And the fact that the Argos can be part of that culture, bring their own winning culture to the table as well, and then tap into corporate capabilities on the business side … it is good news for the league, and it’s good news for Toronto. And I’m a commissioner with a big smile today.”

So it’s great for the Argos, who couldn’t crack 14,000 last season, even in the pleasant confines of BMO Field. When the Argos were sold in 2015, then MLSE CEO Tim Leiweke tried to convince Rogers to come aboard, and it was one of the few grand visions that Leiweke couldn’t bring to life. Rogers and Bell have agreed to divide and share most of the sports universe in Toronto. But the Argos and the Jays have stayed in separate camps.

So Bell and Larry Tanenbaum suffered through two difficult years. The franchise stabilized the front office and coaching staff last season, and somehow won the Grey Cup, but it’s still believed to have lost approximately $10 million last year.

Yes, that’s a rounding error for Rogers, especially split three ways; it’s a smaller rounding error if they can goose attendance using the MLSE marketing machine. Attendance has been a tough slog, after so many years of neglect: When BC Lions owner David Braley salvaged the team in 2010, he all but turned out the lights. That’s a lot of neglect.

But Rogers agreed to share the burden, so now the Argos have access to the marketing and ticketing and influence engines and whatnot. MLSE has been batting around the Argos question for almost as long as there has been an MLSE; like Christmas, it comes up every year. They never said yes, until now.

Which means, in all likelihood, something was traded somewhere. Rogers and Bell are competitors whose existence is interlaced in hundreds of different ways, and it could have been anything.

As for the Jays, and any sale of the franchise — Rogers opened the door last week, talking about “surfacing value” — would be a much, much bigger thing, both strategically and financially. If you want to sell interest in a franchise valued at $1.3 billion (U.S.) by Forbes, that’s different than a little piece of a CFL team. It might make some sense for the Jays to be folded into MLSE, dispersing the future costs of renovating the Rogers Centre, estimated in the range of $200 million to $300 million, and creating a sports powerhouse unlike anything else in North America.

But you have to at least run the numbers, and it doesn’t sound like they have. Meanwhile, the Jays may seem crazy to be attempting to extend their competitive window in the face of a newly revitalized American League East. But if it came to that, would you rather try to sell a team with 40,000 people in the seats, or 20,000? Monster TV ratings, or merely decent ones? Team president Mark Shapiro told The Fan 590 on Wednesday, “If we were just running our teams without fans, and it was just an intellectual exercise, we probably would have hit a reset over a year ago.”

Which is another way of saying, it’s past logical to do what we figured we would do when we first got here, but someone figured out the money is great. This is probably not the ideal way to run a franchise, but here we are.

So while this might extinguish the final embers of Rogers’ dream of an NFL team in Toronto, it doesn’t necessarily pave the way for Bell to give Rogers a billion dollars to expand MLSE, and divide up the rest of the pie.

But here’s what it does do. It shows a little good faith. Maybe it’s the recent championships, the winning, new leadership at Rogers. But now Ambrosie is talking about his meetings with Sportsnet’s Scott Moore, and maybe more of a partnership there; you could even imagine a future CFL game on Sportsnet, especially if they expand to Halifax. You can see a more equitable approach to coverage from the two media superpowers. Where the Argos are concerned, you can see co-operation where there used to be a little war. As one MLSE source described it, if anything, this is like bringing flowers to a first date. It’s a nice, safe neighbourhood. And a little nicer today.

Bruce Arthur

Bruce Arthur

Bruce Arthur is a columnist for the Toronto Star and prolific and accomplished Twitter user. He writes on the CFL, sometimes.
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Bruce Arthur
About Bruce Arthur (7 Articles)
Bruce Arthur is a columnist for the Toronto Star and prolific and accomplished Twitter user. He writes on the CFL, sometimes.

50 Comments on Arthur: What the sale of the Argos to MLSE could mean

  1. Get Real – it’s all about MLSE acquiring an NFL team within 3 years if the Jays are sold .

    • I think you are right.
      This is what was talked about several years ago, MLSE purchasing the Jays then folding them and no obstacle in the way of an NFL team.
      NFL teams are looking at smaller stadiums with premium seats and private boxes.
      BMO with a new West upper and lower deck and an NFL field would allow an expansion of the end zone areas to seat at least 10k each. BMO could easily seat 50k and with premium prices it would be the equivalent of 60k in present NFL stadiums.
      Please don’t use the Bills example as lack of support, Toronto wants their own team not sharing the Bills once or twice a year

    • Not very likely … the NFL has very good reasons to not expand to Canada. It is not in their business interests to destroy the CFL (which would be the end product). Second, the only clear winners in an NFL to Toronto scenario are Shaw and Telus. Bell and Rogers would pay a massive price in consumer retribution in the other CFL markets if it damaged the CFL by virtue of bringing the NFL in Toronto.

    • Get Real – the NFL has ZERO interest in the Toronto market. And for those that don’t agree, tell me what the NFL has been waiting for over the last FORTY years. It is less likely now than it has ever been.

    • Go Argos, Love the CFL. As for Toronto FC? I am a big soccer fan but only of the Premier League, no decent soccer is played in North America…GO ARGOS

    • NFL won’t fly In Toronto. They can’t get people to an NFL exhibition game in TO…

  2. Something is up, and right now everyone except the insiders are guessing. Wouldn’t surprise me to see broader TV distribution for the CFL (what other league puts all their eggs in one basket?) Could mean Bell / Rogers will try to build a U.S. – sized stadium for an NFL team, run alongside the Argos. Until someone talks, we’ll just have to wait and see. The one sad thing is the apparent demise of any competition in Toronto sports: we’re getting a complete monopoly.

    • I think you are right, let’s face it Rogers would not buy into the Argos when their attendance is at an all time low and TV ratings very low among the 18 – 40 demographic. They know the CFL fans in Toronto are older and are less and less every year.
      It’s an opportunity for their way in for an NFL team.
      They are not joining in to lose money.

  3. MLSE can’t acquire an NFL team. The NFL prohibits corporate ownership.

    • That is the rule now but it’s likely that will change. Even then the Chairman Tanebaum can be the front man and named as the owner of MLSE

      • It’s not “likely it will change”. In fact, it will never change. The NFL wants to ensure stability as best as possible. Corporations change hands all the time, and there would be no way for the NFL to contain and control who owns the team. Look at the Disney-Fox sale that’s in the papers today. Hypothetically, if Fox owned a team and the NFL had an issue with Disney, how could they possibly prevent the team from trading hands in the sale? They couldn’t, outside of revoking the franchise, which they would never do.

        You also can’t have a front man with a corporate backer. That’s why the NFL does all it’s exhaustive due diligence to make sure that owners have their own money. To ensure if a corporation tanks that it doesn’t instantly destabilize the team. You can have a consortium of individuals owning the team and a corporation with a small stake, but not the corporation being in charge of a puppet.

  4. Exactly Brockleigh – in all due respect , this opens the door for Tannebaum to exit with grace to purchase his NFL dream

  5. Larry Tannenbaum doesn’t have an NFL dream. Paul Godfrey does. It’s Godfrey that was pulling the strings in the background at Rogers and talking in Ted Rogers ear before Ted died to get the company behind an NFL push.

    • Tannenbaum is the Chairman, he has to listen to the board. It is likely that MLSE would want an NFL team, they want MAJOR league sports. Sorry but Torontonians do not see the Argos as Major league.
      Rogers doesn’t want to be left behind

      • “It is likely that MLSE would want an NFL team”

        That has no basis in fact. None whatsoever. If they did, we would have heard about it. Rogers advances to the NFL are well known, but you have heard nothing about Bell being interested.

        Your comments still haven’t addressed the obvious fact that the NFL has zero interest in Toronto.

  6. If you go back into the archives of the ‘The Star and Sun ‘ newspapers , you will read where Tannebaum has been clearly mentioned as a – purchaser .

    But – yes , your are correct about mouth piece Godfrey

  7. It doesn’t pass the smell test though, Stage. Tannenbaum has always been partnered with Bell, and together have focused on extant Canadian properties. If he was so interested in an NFL team, he would have jumped ship and joined forces with Rogers the day after Ted Rogers passed away to make it happen. With Tannenbaum’s long history of sports ownership, he’s have a much better cachet with the powers-that-be in the NFL than Rogers, who can’t seem to do anything right without tripping over it’s own feet. The Jays flirted with irrelevancy themselves in the Toronto market before their recent run of success, which I would attribute more to ‘blind squirrel finds a nut’ rather than excellent sporting accumen on behalf of Rogers leadership.

    The Sun and the Star can spout their unnamed sources, but with Paul Godfrey’s connections with Sun Media, and Damien Cox being a longtime contributor to the Fan590’s, I would put those rumours down to attempting to unsettle the competition than actual fact.

    Bottom line, then NFL dream is finally dead in Toronto. Doesn’t mean the Argos are out of the woods, but at least they can see the treeline.

    • No this is the beginning of the NFL dream, it’s not dead.
      I don’t think the Jays were ever “irrelevant” in Toronto.
      It’s about “now” not what was going on 10 years ago.
      If you told me 10 years ago that a Toronto soccer team would be drawing an average of 27,000 fans a game to an outdoor stadium in Toronto I would’ve said you were crazy.
      Times have changed, CFL football is dead in Toronto and their fans are not coming back.

      • “Beginning of the NFL dream”.

        So the corporation trying so hard to destroy the team it sees as the impediment to getting the NFL team it covets, all of a sudden gets on board despite the fact it would have very little to no ability to tank it from inside, seeing as they don’t have controlling interest in the parent company? And that somehow furthers the dream? Whatever you’re drinking, I’ll have one as well.

        You still haven’t addressed that the NFL has zero interest in Toronto as the home of a member team.

      • Wrong once more.

  8. Could it be that they are buying the competition out to streamline a future NFL bid? Heck, if you own the Argo’s, I’m sure they will be happy to share the market or even fold should an NFL franchise become available. How to avoid a messy situation.

  9. I thought of that too, Ziggy, but Rogers doesn’t have controlling interest in MLSE, so they can’t swing their weight to try and torpedo the Argos. This means that Rogers is on board to make it work.

    Besides, if an NFL franchise does become available, I can name at least eight markets both domestic and international that the NFL would rather move to than Toronto. The NFL isn’t waiting breathlessly on the edge of it’s seat for a green light in Toronto.

    • Eight markets ahead of Toronto? I don’t think so.
      Toronto is the biggest market in North America right now without an NFL team. 10 MILLION people live within 100km radius of Toronto and it’s a rich market with huge TV potential. There are no population centers in the US that have that potential.

      The NFL has been quiet about Toronto because they don’t want to appear to be interfering with the CFL.
      But it’s not up to the NFL to start the ball rolling, it’s up to whoever bids and submits a proposal to the NFL.

      MLSE could continue to operate the ARgos, afterall they do operate a Major league (Leafs) and Minor AHL hockey team in Toronto

      • Dumb post.

      • Returning to St. Louis and San Diego, which the NFL has shown time and again it values it’s former markets. Orlando, San Antonio, Birmingham, Memphis, with International markets in London and Mexico City. Maybe the domestic markets aren’t as large as Toronto, but they have an appetite for football that is far more tangible than what’s proven in Toronto

        Census figures are meaningless. Toronto may have a lot of people in the region, but the GTA has shown time and again it is unwilling to support football on the scale the NFL would need. The current local team gets less that 15,000 people out now, two universities inside the city limits can’t draw flies to their games, the Arena Football team that was here (led by Rogers) failed after two seasons, and the Bills In Toronto series (led again by Rogers) was a massive failure.

        Toronto as an NFL market is all sizzle and no steak. The NFL isn’t on an altruistic mission to spread four-down football to the world. It’s a business looking to make itself more profitable and going where the money is. They look at existing football within an area to gauge it’s hunger for football on the whole, not just for the pro game. In Toronto it’s not there.

        The only way that the NFL will take notice and want to examine Toronto as a potential market is if every game for the Argonauts, Varsity Blues and York Lions is sold out with waiting lists for prospective buyers, TV ratings for the Argos games to increase dramatically, merchandise sales go through the roof, and for any Grey Cup game played in Toronto to be an unqualified success.

        Then for that to be the trend in Toronto for 10-15 years. Two or three years of 50,000 fans at Argos games in the 70’s isn’t enough.

        Any hope of an NFL team in Toronto absolutely requires that. How likely do you think that scenario is?

        • cvmurrieta // December 14, 2017 at 3:02 pm //

          Brockleigh,

          I like your in-depth analysis. As a former San Diego resident (and current LA Chargers fan), I can back up from my own experience that attendance at most games in San Diego were near capacity until 2016. If the stadium situation ever gets resolved in San Diego to the NFL’s liking, the NFL will return to San Diego if the NFL ever decides to expand again. While league officials were high-fiving each other when the Rams returned to LA, they were more muted in the response when the Chargers left San Diego and traveled up I-5 and I-405 to Carson for a couple of seasons.

          Fans in San Diego with a new NFL team would definitely turn out to cheer against the LA Chargers.

          As for a team in either London or Mexico City or both, both are spot on. If I recall correctly, I think at least 2 regular season games a year are being played in London. I think the NFL would like to be the first major North American sports league to break into the Mexico City market.

          • For 2017, there are four NFL games in the UK (3 in Wembley and Twickenham) plus a fifth game in Mexico.

            Lowest attendance is reported as 73K+ with the higher 84K+.

        • Your insights on this are spot on Brockleigh except perhaps where you suggest tv ratings for the Argos or in fact the CFL are poor. That is the paradox or the head scratcher, Toronto won’t support any level of football attendance-wise except it seems where the Argos are concerned. Southern Ontarians still watch football on the tube but don’t ask them to watch soccer, those ratings are death ! – Rather shameful that both Hamilton and Ottawa enthusiastically embrace the CFL where GTA folks won’t. EXCEPT on tv – great post by the way !

          • CFL Lover, by no means did I mean to suggest that the TV ratings for the Argos were poor. Even the lesser watched games on TSN pulled in respectable numbers. I meant to say that for the NFL to be impressed, they’d have to be even better. Basically, the Argos fan interest in the stands, on the tube and in jersey sales would need to rival that of the Maple Leafs. Such is the damage the “football fans” in Toronto have done to their city’s NFL that they would need something miraculous for the NFL to care about T.O. at all.

      • Three NFL teams are approved to relocation in fourteen months.

        The Rams to LA, with the Chargers to join them. That’s despite the LA fan passion level being described as “dubious” and that the Chargers will play in a stadium that is half the usual size of an NFL one.

        The Raiders go to Las Vegas in 2020.

        It seems that two US markets were able to snap up three NFL teams.

      • Oh man, this is laughable. You honestly think the NFL cares about Toronto? For starters, St Louis, San Diego, London and soon to be Oakland would be ahead of the football dead zone known as Toronto. Oh, the NFL kool-aid, with no actual facts.

  10. Brockleigh – your comments make sense , but as you say – there will be a smell test

  11. I will NEVER support an NFL team in Toronto

    • Well there even more people in Toronto that don’t support the CFL

      • Why do you post on this site Joe? Please troll somewhere else.

      • To Brockleigh and Dano T’s point 4.3 Million Canadians tuned in to the Grey Cup at BMO this year, it peaked at nearly six million late in the fourth Q. (TSN-RDS) if you want even more dramatic numbers almost 10 Million watched part of that classic nail-biter. (source: Numeris) Joe that’s about one third of this country’s total pop. Troll away all you want but those numbers completely blew away the audience for NFL football, everywhere in Canada.

  12. If the marketing is done right and group season tickets are bundled correctly within certain teams it could work out nicely for the Argos and MLSE. If the inefficiencies are not corrected it will not pay off for anyone.

    • 100% correct, Jim. There’s a huge potential for cross-marketing that the Argos and their new corporate ownership have to capitalize on. NEED TO capitalize on. It would surprise me if some concerted effort wasn’t in place by New Year’s Day.

  13. Joe, you are overlooking the huge TV market for the CFL in the GTA. it swamps TFCs TV market.

    Bills in TO series was a test of the market for NFL in TO and if there were real NFL fans in the GTA they would have realized this and supported the Bills series even if “the Bills are not their team”. The NFL may indeed come to TO one day and the owners of the Argos will possibly be a player but thanks to the failure of the Bills series it will be quite a long time from now, imo.

  14. People love their conspiracy theories don’t they?
    This is good news. Larry Tannenbuam (sp?) was instrumental in the hiring of Jim Popp last year and MLSE recognizes the potential of the Team- just look at Grey Cup 100 and this years Eastern Final!
    It’s not completely Toronto or MLSE’s choice to have NFL football. The approval of the existing owners is also required. To date the NFL’s desire for “international” participation is far more focused on Europe and Mexico. It’s not happening for Toronto anytime soon.

  15. Joe, you troll this site quite often.
    It seems every time a good news article for the CFL comes out you need to put your negative spin on it.
    There are plenty of NFL sites for you to play on.
    Your comments may or may not be valid but please let us CFL fans enjoy our moments.
    Long Live the CFL.
    FYI. I believe there is a law prohibiting the NFL or any other pro football league into Canada. Something old man Trudeau did right back in the 70’s.

  16. My guess is that Rogers has seen how MLSE has been making a tidy profit off of another “minor league” team (TFC), and decided that the Argos are poised to do the same.

    As mention in the article, the Argos haven’t exactly been lighting Toronto on fire, so the buying price is probably pretty low. But you see how the league is talking expansion to Halifax, deals with the NFL Network, and so on, Rogers has probably decided that now’s a good time to jump on the bandwagon, especially since the NFL in Toronto dream has been dead for a few years now

    • Where did you get the idea that TFC was making money? They’ve been losing money for years, bug money. Last year their operating losses were around 9 million. Good thing they own the Leafs, which they basically can’t lose money on, because those profits are paying for the Raptors’ and TFC’s losses. forbes.com/sites/chrissmith/2017/08/16/major-league-soccers-most-valuable-teams-2/2/#3a6e443e199c

  17. Haha. I would never describe the Jays as having monster ratings. In fact, until 2015 the CFL was easily beating out the Jays in ratings on a regular basis.

  18. Yeah, I would say that probably one of the main reasons Rogers is selling the Jays is because over the time they’ve owned the team the ratings have been very poor. They’ve lost a lot of money on this team and while the ratings do spike up when they have a contender they always drop back down to well below the ratings for an average CFL game, for example. And to be a top tier team they have to spend upwards of 150 million. That’s double what an NHL team has to pay. Rogers owns the stadium – which they bought for nothing but which will require at least major upgrades in the near future or perhaps a replacement at $1 billion+ – the team, and the cable network that airs the games. If Rogers can’t make a go of it in Canada nobody can. Portland is in the market for a team now and I’m guessing Rogers sees that as a way out.

  19. I’m not thrilled about this. MLSE is a bumbling, stumbling, mess that pretty much screws up every thing they touch. I see many Raptors games are back on the second tier sports channels, because nobody is watching anymore. TFC has been around for 10 years and still draws ratings well under 100,000. At lest the Leafs are winning now, for the first time in forever. Maybe MLSE has finally turned over a new … leaf?

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