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					Bucs fans are paying the price for Manchester United

SUMMARY
Buccaneers fans are facing a 30% increase in ticket prices for the 2008-2009 season, a massive price hike that has been
confirmed by Joel Glazer.

         Original story: http://www.sptimes.com/2008/02/09/Bucs/Bucs_raise_prices____.shtml

This would bring the price of an average ticket (not including premium seats!) to nearly $100 and raise a family of four’s
expected costs to more than $500 per game.

Why are they doing this?

Considered only in terms of the Buccaneers’ own circumstances, there is no apparent reason for prices to increase so
substantially. The Bucs were $21 million short of the salary cap this year – spending among the least in the League on player
salaries – yet they won their Division and have done so twice in the past three years. The Team Marketing Report, the
independent “gold standard” for NFL ticket and cost information, shows that Bucs fans pay the 8th highest costs in the
League – a ranking that doesn’t include premium seats or the cost of Personal Seat Licenses. These facts suggest a healthy
franchise, both financially and on the field of play. Why then is Joel Glazer saying that these price increases were the result
of the Bucs falling “way behind” other teams when the independent Team Marketing Report shows this to be patently untrue,
that the Bucs raised prices by 12% and 19% the years following their Super Bowl win and have kept pace with the League
average increase ever since?

The only rationale for these increases then (apart from greed) is that Bucs fans are now paying for the Glazers’ £660 million
($1.3 billion) takeover of Manchester United and the debt that currently demands £77 million ($144 million) in principal and
interest repayments per year. Originally the Glazers attempted to load the debt onto Manchester United and escape direct
liability. Crucially, however, the Glazers have had to shift the debt off of Manchester United and onto their holding company,
Red Football Ltd. This action, according to published reports, was necessitated by their inability to refinance the debt to more
favorable terms due to turbulence in global credit markets and, one must conclude, because the funds generated by United
alone were insufficient. Red Football’s General Partner is Malcolm I Glazer, GP, whose General Partner is Malcolm Glazer,
who controls the Buccaneers Limited Partnership, which controls the Bucs. In short, there is nothing to stop the Glazers from
robbing Peter to pay Paul. Further, this allows them to use the Buccaneers (or rather their fans) to subsidize their acquisition
debt – something they could never have done directly since the NFL prohibits the use of its franchises as collateral.

In summary, the 30% increase in Bucs ticket prices is perfectly explained by the Glazers’ desperate need to make their
Manchester United loan payments, and their recent move to take on the debt under the aegis of the family partnership allows
them to do divert funds from the Bucs to accomplish this. In fact, this is the only conceivable reason for moving the debt. The
Bucs are the Glazers’ only business that can be manipulated to provide significant additional cash flow; this is the only lever
they can pull. The inescapable conclusion is that the Bucs fans are indeed paying for the takeover. Manchester United fans
find no comfort in this arrangement though, for as unlikely as it may be, they know the flow might one day be reversed.

As the Glazers have done in Manchester, there is now every reason to expect them to begin pressuring Bucs fans into
renewing. In advance of the 2007-2008 season, Manchester United claimed a waiting list in excess of 15,000. This list was
quickly exposed to be a fiction, its only purpose to create anxiety among the fans that “someone was waiting to take their
ticket.” Even halfway through the season the Club was still offering Season Tickets to anyone and still spending money on
Season Ticket advertising – a consequence almost certainly of the multi-year double digit price increases United fans
themselves have had to bear. If the history from Manchester is any guide, Buccaneers’ fans will soon find out whether there
is anyone waiting at all.

                                                - Detailed analysis follows -
DETAILED ANALYSIS

The Story in Tampa: No justification for a 30% price increase

        The Team Marketing Report indicates that Fan Costs (based on average tickets, not premium/club tickets, and not
        including Personal Seat License costs!) were already 8th highest in the NFL, yet…

        …the Bucs have $21 million in salary cap room, indicating they have spent among the least in the League and have
        a strong cash position. See http://blogs.tampabay.com/bucs/2008/04/lots-of-cap-spa.html

        There’s no performance reason (e.g., a Super Bowl appearance) that enables the Glazers to opportunistically
        capitalize on fan enthusiasm by raising prices. Two division wins in three seasons culminating in two first round
        Wild Card exits hardly justify a 30% increase.

        Owner Joel Glazer’s comments about the team’s relative standing in terms of ticket prices and the current price hike
        are demonstrably untrue.

        Rick Stroud, SP Times (March 2008):
        http://blogs.tampabay.com/bucs/2008/03/glazers-feel-yo.html

        Glazer: “Because our price increases the previous years were not equal to a lot of other teams, we fell way behind.
        We're almost paying that price today because we kept it lower over the last 10 years.”

        Facts: The Bucs won the Super Bowl in the 2002 season and instituted a 12% increase in average ticket prices for
        2003 just $3 short of the average NFL ticket price. The following year prices rose a whopping 19.3%, bringing them
        to a price nearly $5 over the NFL average and a true Fan Cost 8 th highest in the League. Since then they have
        maintained this position with a cumulative annual growth rate (CAGR) equal to the NFL average.

        Glazer: But what we found after surveying around the National Football League, even after our prices this year,
        there's still 15 teams with a higher general seat price than our top seats.

        Facts: The TMR indicates the Bucs ranked 8th in Fan Cost and 10th in Average Ticket Price ($1.20 separates 8th
        through 10th). Joel Glazers’ unapologetic statement therefore cannot possibly be true for 2007. If this assertion
        relates to 2008 prices, it is completely absurd. Since 2002 no more than two teams have raised prices more than 20%
        each year. It exceeds the bounds of mathematical credibility to suggest that a team already 10th in cost would lose
        ground after a 30% increase.

The Story in Manchester: An ocean of red ink as the Glazers take ownership of the $1.3 billion debt

        Despite strong revenues and “record profit” (EBITDA, or pre-tax and pre-debt payments), the Glazers currently pay
        an eye-watering £77 million ($154 million) per annum to cover their Manchester United takeover debts of £660
        million ($1.3 Billion). The annual debt service does not include approximately £136 million ($272 million) in hedge
        fund debt at 14.25% APR whose interest is not being paid and therefore rolling up into principal at a cost of about
        £25 million ($50 million) per annum. The club faces further obligations of £56 million ($112 million) on net player
        transfers (signings) in the next two years.

        MUST Press Release (Sept 2007):
        http://www.joinmust.org/forum/showthread.php?t=39945

        Manchester Utd Ltd accounts for 2007:
        http://joinmust.org/docs/MU_Ltd_Accts_2007.pdf
If one includes the debt payments, the profits disappear. At best the Glazers are breaking even.

Crain’s Manchester Business ( January 2008):
http://www.crainsmanchesterbusiness.co.uk/apps/pbcs.dll/article?AID=/20080107/FREE/867380221

Though they are desperate to reduce the cost of their borrowing, the Glazers cannot refinance due to turbulent credit
markets. They have been especially keen to securitize ticket sales, yet an attempt to refinance during the summer of
2007 had to be abandoned.

Kabir Chibber, Bloomberg (July 2007):
http://www.bloomberg.com/apps/news?pid=20601087&sid=aJvJGsfngvbM&refer=home

Paul Kelso, Guardian: http://football.guardian.co.uk/Columnists/Column/0,,2199736,00.html

Perhaps in a bid to raise cash, the Glazers have divested themselves of controlling stakes in two companies they
owned through the Zapata Corporation, a self-described “shell” company that owns nothing and does nothing.

SEC 10-K report for Zapata March 2008):
http://www.secinfo.com/dsvr4.t2Jy.htm

The Glazers have already asked Manchester United fans to pay the debt through a nearly 50% increase in ticket
prices since the takeover.

David Conn, Guardian (May 2007):
http://blogs.guardian.co.uk/sport/2007/05/16/the_borrowers_make_united_fans.html

Demand for tickets has softened. The purported Season Ticket Waiting List was revealed to be little more than a
smokescreen to pressure fans into renewing after their tickets had gone up nearly 50% since the takeover and now
include the unpopular Automatic Cup Scheme (ACS) which forces fans to buy tickets for mid-week games
regardless of their ability to attend or afford them. Even halfway through the season the Club was still offering
Season Tickets to anyone and still spending money on Season Ticket advertising – a consequence almost certainly
of the multi-year double digit price increases United fans themselves have had to bear.

MUST Press Briefing (July 2007):
http://www.joinmust.org/forum/showthread.php?t=38744

Another punitive price increase or continuation of the ACS is likely to see demand soften further. These immense
hikes have resulted in mass outpouring of criticism and at least one law suit which was been quietly settled out of
Court. This is despite the fact that United were Premier League Champions in the 2006-07 season and are odds-on
favorites to repeat.

MUST Press Release, Legal Challenge to Cup Scheme (July 2007):
http://www.joinmust.org/forum/showthread.php?t=38307

CRUCIALLY, the takeover debt has been moved. Formerly shouldered by Manchester United Ltd, it has
been shifted back to Red Football, the takeover company the Glazers formed to buy Manchester United.

When the Glazers bought Manchester United, they did everything they could to secure the debt on the Club’s assets,
thereby avoiding their own direct liability. They did this in recognition of the fact that they had explicit EBITDA
targets that were guaranteed to their creditors. Nevertheless they have now decided to move the debt over to Red
Football, their original UK-based takeover company. This fact is evident in the filing of their most MU Ltd recent
accounts and David Gill, the Manchester United Chief Executive, has effectively said this in his briefings. The only
conceivable reason for doing this would have been if United’s revenues alone were not sufficient to pay the
       debt and meet their creditors’ EBITDA targets. The Glazers wouldn’t have funneled money into Manchester
       United Ltd either in the form of a shareholder loan or a direct equity investment (capital increase) as it would have
       been very risky to pump more cash in the form of debt into an already struggling debt-laden entity – and they would
       have been ranked behind all the other creditors in the event of bankruptcy.

       Thus, given the choice between the banks calling the loans and accepting the liability on their own plates, the
       Glazers have moved the debt over to Red Football. This new arrangement allows them to divert funds from their
       other businesses (and to use any dividends from Manchester United) to pay their debt. They will, of course, have
       had to pledge their United shares as collateral.

       With the debt being loaded on Red Football, there is nothing to stop the Glazers from taking from their left
       pocket to fill the right.

       As the Offer Document notes, the ultimate parent of Red Football in the UK is Red Football Limited Partnership, a
       Nevada company, and the General Partner of Red Football Ltd is MALCOLM I. GLAZER G.P., INC. Similarly, the
       Buccaneers are owned by the Buccaneers Limited Partnership, which is 100% controlled by the Glazers. In short,
       for all practical purposes and despite the obscure web of partnerships, there is nothing that separates Manchester
       United and the Tampa Bay Buccaneers and the money that their respective fans pay to support their teams.

       The movement of the debt onto Red Football combined with the massive price increases in Tampa point to
       the inescapable conclusion that profits from the Buccaneers (taken from the wallets of their fans) are being
       used to pay off the Glazers’ United debt.

       The Glazers could have never used the Buccaneers as collateral for their United debt: the NFL explicitly prohibits
       this. However, the NFL has no rules about how owners can use their teams’ profits. By assuming the debt under the
       aegis of the family partnership, there is nothing to stop the Glazers from using funds from the Buccaneers to pay
       their Manchester United debt. The available evidence suggests this is exactly what they are doing. The
       Buccaneers are the only business the Glazers own that can be manipulated so as to provide significant
       additional cash flow. Short of further divesting their own assets or selling Manchester United, this is the only
       lever they can pull.

       While this may seem to be good news for United, the net effect for Manchester United is still the same. The
       debt must still be repaid, and the club is still on the hook. Further, United supporters will also take no delight
       from the fact that the debt is being repaid from other sources. For while it’s difficult to envisage in the near
       future, there will be nothing to stop the Glazers from doing the reverse: from taking money out of United and
       funneling it to the Buccaneers or any of their other businesses.


The Conclusion: Robbing Peter to Pay Paul

       With ticket prices and true fan costs near the top of the League and player salaries near the bottom, the Buccaneers
       cannot claim poverty to justify massive 30% ticket price hikes. While there is no NFL statute that prohibits an
       owner’s greed, the economic prudence of this is questionable at best. The outcry from fans is palpable. Why then do
       the Glazers risk it?

       More fan reaction (Feb 2008):
       http://blogs.tampabay.com/bucs/2008/02/some-perspectiv.html

       Now responsible directly for their Manchester United debts, the Glazers must find a way to pay them. The debt has
       been transferred to a company directly within their control. There is nothing to keep them from migrating funds
       from one team to another, and there is every reason to believe that their recent actions and movement of the debt is
       designed to do this explicitly.
Just as they did in Manchester, the Glazers are pressuring fans to renew. And, just as in Manchester, it is likely that
the purported 175,000-strong Season Ticket waiting list is far shorter than they claim. The ST waiting list for
Manchester United was proven by fans to be nothing more than a marketing tactic to create anxiety and compel fans
to renew.

Tampa Bay Buccaneers official online discussion board:
http://bbs.buccaneers.com/showthread.php?t=156628&highlight=ticket+prices
NOTES TO EDITORS
Bucs costs already rank 8th in the League – information from the Team Marketing Report

Information on the Buccaneers and NFL ticket prices and true Fan Costs has been compiled from the Team Marketing
Report, an independent “gold standard” source of information on the subject. This report uses publicly available information
from their website. Their website is www.teammarketing.com . Note that their methodology for reporting prices changed in
the 2002-03 season to more consistently reflect prices and costs by reporting premium facilities separate from regular seats.

According to the Team Marketing Report for the 2007-2008 season, the Bucs had the highest Fan Cost of a non-major market
team that wasn’t building a new stadium or in financial distress.

1 New England Patriots, 2 Chicago Bears, 3 Washington Redskins, 4 New York Giants
5 New York Jets, 6 Baltimore Ravens, 7 Dallas Cowboys, 8 Tampa Bay Buccaneers

Patriots prices reflect performance over the past several years as they follow the trend of owners raising prices (somewhat
opportunistically) given the enthusiasm generated from a Super Bowl victory. Notably though their prices remained constant
from the previous season. The Redskins and both NY teams could perhaps be understood by the fact that they are major
market teams, though Washington’s prices remained stagnant year over year and both NY teams’ prices rose at the average.
Dallas is building a new stadium, and clearly fans are paying for it. Baltimore is a team in a tight financial position whose
owner is short on cash, yet rumor has it that they will remain stagnant this year.

What about the Bucs though? As the attached tables show, they took their boost after the 2002-2003 Super Bowl win, with
average ticket prices going up 12% in the 2003-2004 season and more than 19% the season thereafter (despite a 7-9 record).
Their recent record of weak wins in the division and summary dismissal in the Wild Card round of the playoffs is hardly
grounds for an opportunistic price increase.

Note also that this list does not include the cost of a Personal Seat License. From this list, only the Bears, Ravens, Cowboys
and Bucs require PSLs. This suggests that the true cost borne by the fan is even higher.

More from Tampa Bay

         Fans expect the worst (Stephen Holder, SP Times) (demand already flagging)
         http://blogs.tampabay.com/bucs/2008/02/some-perspectiv.html

         Fans fears true, prices expected to go up dramatically (Stephen Holder, SP Times)
         http://www.sptimes.com/2008/02/09/Bucs/Bucs_raise_prices____.shtml
         http://bbs.buccaneers.com/showthread.php?t=154049&highlight=ticket+prices

         Glazers “feel your pain” (Rick Stroud, SP Times)
         http://blogs.tampabay.com/bucs/2008/03/glazers-feel-yo.html

         Will original ST holders renew?
         http://bbs.buccaneers.com/showthread.php?t=154049&highlight=ticket+prices

         Bucs ticket office putting on pressure
         http://bbs.buccaneers.com/showthread.php?t=156628&highlight=ticket+prices

         Why are prices going up if TB is $21 million under the cap?
         http://blogs.tampabay.com/bucs/2008/04/lots-of-cap-spa.html
                                                                  Glazers confirm Bucs ticket prices will go up 30%
                                          Average price                                  Premium Tickets                                          Fan Cost Index (FCI)                                    Buccaneers
                                  Bucs             NFL            % chg             Bucs             NFL          % chg                         Bucs              NFL         % chg                   Previous Season Record
                            index        $          $       Bucs      NFL      index       $           $       Bucs      NFL       rank index            $         $       Bucs      NFL     Wins Playoffs
2002-03 actual                   89   44.41        50.05                         120     178.25      148.39                             23       93    270.10     290.41                        9-7 lost in Wild Card
2003-04 actual                   94   49.78        52.95 12.1%        5.8%       131     204.69      155.80 14.8%        5.0%           19       98    296.63     301.75    9.8%     3.9%      12-4 Super Bowl XXXVII Champs
2004-05 actual                108     59.38        54.75 19.3%        3.4%       145     233.13      160.89 13.9%        3.3%           8      110     343.51     312.62 15.8%       3.6%       7-9
2005-06 actual                108     63.59        58.95    7.1%      7.7%       137     242.23      176.26     3.9%     9.6%           6      110     363.85     329.82    5.9%     5.5%      5-11
2006-07 actual                109     67.97        62.38    6.9%      5.8%       127     242.23      191.25     0.0%     8.5%           6      110     381.38     346.16    4.8%     5.0%      11-5 Div champs, lost Wild Card
2007-08 actual                108     72.44        67.11    6.6%      7.6%       124     247.55      199.40     2.2%     4.3%           8      111     406.76     367.31    6.7%     6.1%      4-12
2008-09 projected            131 94.17 71.82                30% 7.0%            150 321.82 214.19              30% 7.4%                        136 528.79 387.59            30% 5.5%           9-7 Div champs, lost Wild Card
CAGR from 04/05 - 07/08               6.9%         7.0%                                    2.0%        7.4%                                              5.8%      5.5%
* Source: Team Marketing Report (www.teammarketing.com). TMR provides "gold standard" information on NFL ticket prices.



    The Index calculates the Bucs prices relative to the rest of the League. An index of 100 means Bucs prices equal the NFL average, 120 means Bucs are 20% higher, etc.
    The Fan Cost Index (FCI) represents the price of 4 avg price tickets, 2 sml beers, 4 sml soft drinks, 4 hot dogs, parking for 1 car, 2 game programs, and 2 least expensive caps.
    CAGR stands for Cumulative Annual Growth Rate and represents the average growth trend from 2004-05 to 2007-08. Bucs ticket prices had been rising in line with the NFL
    average at about 7% per year. The projections on this page assume a 30% increase in ticket prices as has been reported in the St Petersburg Times and confirmed by Joel Glazer
    himself. It also assumes a 30% price hike in concessions (beer, soft drink, hot dog), parking, a program, and a cap as these are the components of the FCI.
    The average ticket price is nearly $100, and a family of four would pay over $500 per game!



                                                                  Projected 2008-2009 prices - 30% growth scenario
                                                         Charts below reflect what Tampa Bay average ticket prices will look like with the looming 30% price increase.


                                         Average Ticket Price Trends                                                                                         Annual Ticket Price Increase (%)
    $100                                                                                                                        35.0%

      $90                                                                                                                       30.0%

                                                                                                                                25.0%
      $80
                                                                                                                                20.0%
      $70
                                                                                                                 Bucs                                                                                                        Bucs
                                                                                                                                15.0%
      $60                                                                                                        NFL                                                                                                         NFL
                                                                                                                                10.0%
      $50                                                                                                                       5.0%
                            SB            7-9            5-11         11-5       4-12          9-7         Prev Season                                  SB        7-9       5-11      11-5        4-12      9-7         Prev Season
      $40                                                                                                                       0.0%
              2002-03     2003-04        2004-05        2005-06      2006-07   2007-08     2008-09                                           2002-03   2003-04   2004-05   2005-06   2006-07    2007-08 2008-09
               actual      actual         actual         actual       actual    actual     projected                                          actual    actual    actual    actual    actual     actual projected

				
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