THE MILL LEE SCHAFER
Nothing clever about Medtronic Plaza deal
After the Minnesota Vikings and Medtronic announced that Medtronic's name would go on the plaza in front of U.S. Bank Stadium, the e-mail notes came in again. Readers were insisting that Vikings Chairman Zygi Wilf is one clever dude and he's once again completely outfoxed us.
Why, just look at the money Wilf was already getting for the naming rights for a stadium owned by the public. And now, it turns out, he even will get money for selling the name to the plaza fans will walk through to enter the stadium.
Zygi, brother Mark Wilf and cousin Leonard Wilf are the principal owners of the team and they are certainly accomplished businesspeople. There's at least a chance that they are near geniuses at the art of the deal. But there sure hasn't been that much evidence of genius when selling the rights to name the stadium where their National Football League team will play.
The reason, of course, is that having a team get the money for the naming rights is hardly novel to Minnesota. It's done that way everywhere.
And the reason the teams get the money is that naming rights are really nothing more than the team selling paid advertising for their sporting event.
No big-time sporting event means no fans and no extensive media coverage, which in turn means no consumer eyeballs and no value in naming rights.
U.S. Bank is paying, best we can tell, $7.5 million per year to put its name all over what is now called U.S. Bank Stadium. Since that deal was announced, Mercedes-Benz bought the rights to have its name on the still-under-construction $1.4 billion stadium in Atlanta that will be the home field for the NFL's Atlanta Falcons and Major League Soccer's Atlanta United.
The Atlanta deal is for 27 years, and estimates for this one are up to $20 million per year. Mercedes also has the rights to the NFL stadium in New Orleans, and that figure is widely reported to be $6 million per year.
The Twin Cities was the nation's 15th largest media market in one recent ranking, with about 1.7 million TV households. Atlanta was bigger, with about 2.3 million TV households, but not so much bigger that it justifies annual payments that are more than twice what they are here. Meanwhile, greater New Orleans was the 51st largest media market, less than half the size of the Twin Cities.
These look like good deals for the teams, at least compared with what we think are the terms here in Minnesota.
Yet there is no particular reason to think Falcons principal owner Arthur Blank or Saints owner Tom Benson are exceptionally clever deal guys, or to suggest they have outfoxed anyone. In that way, they are just like the Wilfs.