Monday, September 12, 2011

Merger Counterfactual

This isn't the next coaching post. Big shock, huh? Relax, I will get around to doing them, the other coaching posts, that is, because the topic interests me (too) so be patient. In the meantime I couldn't resist a follow up of sorts on the latest NPPL rumorology particularly in light of a couple of comments under that post.

Oh yeah, before I get started a counterfactual (for those of you not steeped in geek speak) is basically a What If scenario. Roughly the idea is to create a scenario based on a set of conditions that might have been or could still be. At one end of the scale you get alternative history novels and at the other end you get hypothetical models that are (theoretically) useful in thinking about all manner of complex situations. For paintball purposes we's gonna keep things simple and stick with the What Ifs.

In the Mr. Curious comments Joe suggests that no merger means the end of pro paintball. Joe's statement is predicated (I assume) on the notion that the industry support of the leagues has been shrinking for years and that elements of industry have been making noises like they intend to play hardball over this merger issue. They want one league and one league only. So Joe's comment seems to have some merit but--

What If one league makes a good faith effort? What If the industry isn't united? (And we know that it isn't.) What If a merger happens? What does it mean and what will happen in the aftermath?

What If one league makes a good faith effort and no merger results? I ask the question that way given the split on the NPPL board but we could as easily ask What If both leagues make a good faith effort and no merger results? Will the PB Industry refuse to support either league or any of the pro teams as a consequence? It seems highly unlikely. For one I think it's impossible to make the case that industry is united--which it would have to be to enforce a no support decision. Two, it's not in industry's best interest to offer no support. For example, KEE is believed to be doing well with their new Axe in part because of the number of pro & divisional tourney teams using the marker. And if the rumors are true KEE signed up a number of pro teams for a relative pittance of paint. The cost versus the potential return definitely favors KEE. So while the industry, or elements within industry, may be making hardline noises it seems unlikely it would actually happen regardless of the circumstances.
What If the PB Industry isn't united? I ask this as the follow-up even though I've already decided it isn't because it's important to see what the ramifications of that lack of unity might be. Let's say for the moment no merger occurs and the industry--or some key players--announce they will no longer support the NPPL as a result. (Insert PSP for NPPL if you prefer as it makes no difference.) How long before some element--Let's, for the sake of the example say, Oh I don't know, Valken--steps in and offers to support the league? Five minutes? How long after that before everyone else jumps back in out of fear of somehow losing out? The point is that without a unified industry elements within the industry will seek to advance themselves if the opportunity presents itself. The issue has never been two leagues; it's been a divided industry that is constantly at odds and unwilling and/or unable to formulate a policy with respect to tournament paintball and two national leagues. The merger matters to parts of industry because they want forces outside the industry to do for them what they can't (or won't) do for themselves.
What If a merger happens? Does it preclude the possibility of another league forming? No. All it really can do is limit or preclude the participation of any of the principles involved in the merger. Is that enough to merit merging? I don't know but if it were me I would be taking a very hard look at what benefits I derive from a merger. I would also be looking at how such a deal would be accomplished. (Rumor has it the NPPL isn't in any legal sense a formal entity. If true who does the PSP make a deal with? A dozen different individuals or teams? And how do each of the "owners" represent and protect their interests if the NPPL exists in name only? That's a whole other What If post all by itself. And a serious complication to a merger if true.) If the best we can say is that a merger unites the existing leagues and leadership but does nothing to limit future league formation and competition how much does it really accomplish? If a merger occurs will the industry all of a sudden start throwing more support at the new unity league? (If you said when pigs fly, you guessed the likely correct answer.) It seems to me the industry hardball line is all threatened stick and no carrot at a time when the leagues have gotten used to barely enough carrots to flavor a weak broth. Not a whole lot of incentive to make a merger work (or so it seems to me.)
What does it mean and what will happen in the aftermath? I'm not sure there any answers to those questions except to suggest that perhaps a merger doesn't solve all of competitive paintball's problems--it may only defer some of them--and it may create new ones. It doesn't mean that multiple leagues will never again compete at the national level. It doesn't even guarantee united industry support--though that may be the default short term result. Is that good enough? For anybody?


Anonymous said...

1) What makes NPPL a national league and not 4 really organized Pro practices?

It's definitely not the reffing.

2) If some of the industry decides to not support NPPL next year, and someone like Valken does, what is the motivation for Valken's support to drive the rest of the industry to support NPPL too? Industry doesn't do this with regional leagues that have nearly the same participation NPPL does, so why would they do it with NPPL?

3) If Empire got NPPL Pro teams to use the Axe with a pittance of paint, doesn't that mean NPPL Pro teams can only demand a pittance of paint for gun sponsorship? If their gun sponsorships are worth that little, does Empire care if they don't do them anymore? Or gave the pittance of paint to D1 PSP teams instead?

4) If NPPL doesn't merge, and they do somehow attract out-of-industry attention, how long will it take the out-of-industry party to realize there's another league they can be involved with instead, and PSP gets 100% of the payoff for NPPL's work?

Reiner Schafer said...

Anon, regarding point #2, business tend to want to support the "top" level in sports. The NPPL has some decent venues and most importantly has some of the best paintballers in the world taking part in their series. Other leagues, other than the PSP do not have those players. Therefore supporting the other leagues is like supporting the "semi-pros" sporting event. It may not be a bad thing to do, but it's not associating yourself with the "top" league.

The fact that there are two "top" leagues is the frustrating part for industry bigwigs.

But Baca is correct, Supply and Demand will mean there will be some members of the industry that will always be willing to supply something to as many "top level" leagues as there are, as long as PBIndustry is not in collusion and industry thinks and acts as individual entities.

In reality, it gets down to a choice of those top players. If all the top players were to choose to play in one league, knowing that one league would get the lion's share of the resources than those players (and the league) would be better off. On the other hand they can choose to split themselves among two leagues and split the resources. That's what's been happening for quite a while and with the overall resources diminishing, it's hurting everyone involved. The control lies with the top players. Unfortunately, it's also the players that are at odds with one another.

Anonymous said...


There is only a small handful of top players that play NPPL but not PSP, so the sponsors are not reaching any additional top players, just additional times.

Reiner Schafer said...

First, sponsors aren't trying to reach top players, they are just trying to associate themselves with the top players in order to sell stuff to wannabe players. In the eyes of many wannabe players, there are two professional leagues and the players playing at the top level (PRO) are the best players in the world. The fact that at least some of the same players are playing both top levels affirms that. Obviously even the top players think this, otherwise they wouldn't be playing in both Pro leagues.

If the players truly felt they were best served by only having one league (reduced expenses and possible more lucrative sponsorships), then all they would have to do is stage a coup de grace and one of the leagues would fail, or at best become a second rate league, even in the eyes of most wannabe's, which is the important part because sponsors/advertisers are only advertising so they can sell stuff to those wannabes. Wannabes are a fickle bunch. They dream/fantasize about becoming the best, not the second best.

If, for instance, teams like Damage, Dynasty, Aftershock, Impact were to up and say, we are not supporting a second rate league anymore and will be concentrating solely on being the best team in the top league, it would cause quite a stir and most likely would be the final blow the NPPL could handle. At least that's the way it looks from the outside.

Baca said...

I don't know if it's a shorthand you're using or a misunderstanding but "top players" as a constituency don't have any power. Teams do, or more precisely team owners and/or primary funders have the power you seem to be assigning to players.

For example, Dynasty may be as close as you're going to get in that some group of original members are shareholders in Dynasty. Whereas teams like Damage, Impact & the Russians have singular owners. Then there are other teams that either have an ownership structure or a player run team (to one degree or another) but are dependent on the sponsorships they receive to continue to operate--and in such cases the sponsors can hold sway over a team's agenda--though they don't always use that leverage to dictate actions. The point is, players as individuals, generally have little say and the same could be said for a goodly number of teams who are, at present, just happy to be playing at all.

And the current iteration of the NPPL (What I call 3.0 but might more accurately be called 4.0) exists because some pro teams wanted to both control their own destiny and profit from the result. If Pro teams abandoned any league it would be the PSP--except the general consensus is that the PSP has more validity as the determiner of the best Pro teams.

Anonymous said...

Ability to profit does not depend on league ownership, see: NASCAR, or those European sports with promotion/relegation. Of course, if you are an owner of the league as well as an owner of the team, then you can profit both from being a team owner and a league owner, see: NFL/NBA/NHL. The catch, however, is that if you are going to profit by owning the league, you also have to actually operate the league.

It appears many of the NPPL Pro teams are dead-set on being league owners, but are unwilling/unable to be league operators.

And in the real world, you don't get profits by owning something, you get profits by doing something.

So a team can certainly choose NPPL over PSP to chase profits, but they might choose PSP over NPPL to chase a league that someone actually operates, especially if they think that operating a paintball league isn't going to be profitable anyway.

Baca said...

I don't disagree with you in principle but nobody has ever run a national paintball league looking to make money. The Pure Promotions NPPL (1.0) wanted to prove they could do it better but they also wanted to segue into TV. As has every version since. That's where everyone believes the money is. All the rest of their talk is smoke and mirrors.

The real issue vis-a-vis the pro teams (planning on longevity) with the PSP is after the NXL there isn't any way from here to there--should a TV future materialize--and the PSP has never shown any particular interest in working with the pro teams to at least have some sort fo understanding in place.

To be fair, from the PSP's perspective pro teams come and go so why should the league whittle off pieces of what they've worked hard for? On the other hand initiating an ongoing dialogue to discuss matters of interest to both parties should certain eventualities arise wouldn't cost anything and might, you know, just increase the peace.

Anonymous said...

There doesn't need to be a discussion. Teams just need to accept reality: They are not financing the league or operating the league and they don't get the benefits of owning the league.

But even with no league ownership benefits whatsoever, they will benefit if the league makes it, because the team itself has value. Dynasty doesn't need to own any of PSP to see a very significant financial gain if PSP "makes it".

Not different than the leverage NFL/NBA/MLB/NHL players have over the league owners when it comes to compensation, and the players in those leagues get well over 50% of the profits.

Baca said...

Sorry Anon
But you're assuming a couple of steps not in evidence.
And I didn't say anything about owning any part of the PSP as being relevant in any prior discussion of what might happen in the event competitive paintball "succeeds" on TV.

Should TV come in and do a deal with the PSP no pro team has any assurance they would be a part of that. And below teams come players who have less than no assurance they would have an opportunity to participate. And frankly any claim based on the 4 big pro sports in relation to paintball is laughable--at best.

My larger point before was that the team/owners in the NPPL went that route to try and guarantee they would be included should competitive paintball succeed in the shorter term. If they had that guarantee many of them might have little or no interest in running a league or even taking on shares (and liabilities) of a different league in a merger.