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August 25, 2019

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How the WNBA could be a winner for MGM

WNBA Team Las Vegas Aces Announced

Courtesy Photo

From left: Bill Hornbuckle, Lilian Tomovich, Lisa Borders, Lisa Alexander, Jim Murren, Moriah Jefferson, Bill Laimbeer, Ann Rodriguez, Jay Parry, Chuck Bowling pose for a photo during a WNBA and MGM Resorts announcement at the House of Blues at Mandalay Bay, Monday, Dec. 11, 2017. MGM Resorts International announced that its WNBA franchise will be called the Las Vegas Aces. Las Vegas first major professional basketball team formerly the San Antonio Stars will begin play in its new home in the 2018 season.

Judging by the promising roster, the proven coach and the deep-pocketed ownership group, the Las Vegas Aces look like they’ll eventually win their fair share of games. But will that make the team a winner in the business sense?

While league representatives, MGM Resorts International executives, players and the head coach expressed nothing but optimism when the team was officially introduced at a glitzy press conference at Mandalay Bay, there is no guarantee that the Aces will be a profitable venture.

The WNBA has historically not been a moneymaker. The NBA backs the league financially, and about half the teams are run by owners who also control a corresponding NBA team in the same market. Independent WNBA franchises, like the Aces, face a difficult road.

When the fledgling San Antonio Stars were put up for sale by the Spurs Sports & Entertainment (which also owns and operates the NBA’s San Antonio Spurs), MGM was a natural suitor. It was looking to add a live sports component to its entertainment portfolio, and the WNBA’s 17 home games per season made the league an attractive option to fill seats at the Mandalay Bay Events Center.

MGM is committed to making the team work. The company announced it will pour $10 million into upgrading the Events Center to prepare for the Aces’ arrival, and executives put on a full-court press to lure Bill Laimbeer, one of the WNBA’s most accomplished coaches.

Laimbeer has been smitten by MGM’s willingness to fund the team.

“I came here thinking I had to do everything myself,” Laimbeer said. “And I realized, ‘Holy cow, look at this. Oh, you’ve got that? And you’ve got that too?’ ”

“We were talking practice site. What do we do about a practice site? You know, in Year 1, I’m figuring (we’ll practice) anywhere we can go. And they’re like, ‘Why don’t we go build this?’ And I’m like, ‘Well, that’ll take a while.’ And they’re like ‘No, we’ve got our own construction company, we’ve got our own designers, we can build it quick.’ ”

The question is the return on investment: Can a winning team be effectively monetized in Las Vegas? The Aces are accepting season ticket deposits, and while there is no media rights deal in place, expect the games to be televised.

Building a devoted fan base that is willing to spend could take time, but WNBA President Lisa Borders said Las Vegas will support and embrace women’s basketball.

“If you look at the data for the market, according to ESPN and ESPN2, (Las Vegas) is a top-10 market for basketball,” Borders said. “For women’s basketball particularly, we look at data when we’re talking about our business, because we look at the WNBA as a business first. Oftentimes, people think of sports as purely emotional, and there is emotion, but I would tell you there is emotion but there is empirical data that supports the decisions we make.”

Even if the Aces aren’t a big revenue-generator, the franchise will still hold value for MGM.

If the Aces prove successful, it could pave way for an NBA team to eventually land in Las Vegas.

MGM President Bill Hornbuckle noted the NBA’s longstanding relationship with Las Vegas through the Summer League and alluded to NBA Commissioner Adam Silver’s openness to legalized sports betting nationally as a possible entryway to an eventual NBA franchise.

“We have an intimate relationship (with the NBA),” Hornbuckle said. “The NBA owns the WNBA, and so Adam knows exactly what has happened here. … The NBA, over time, hopefully becomes a part of this community in a bigger way.

“But one day at a time. It’s a long way away.”