Professional Cycling - Astana Fails To Pay riders, might go under

http://www.cyclingnews.com/news.php?id=news/2009/may09/may06news

The Astana cycling team may be getting its Giro d'Italia campaign underway, but its future in the sport appears to be under question. According to the website Sports.kz, the team is under real threat of financial collapse and has a week to sort things out before the International Cycling Union (UCI) withdraws the professional license.

lance armstrong to the rescue :D!

ed rader

I bet Bruyneel is ripping the last of his hair out. He has the team he wants, and no doubt was hoping this would be the year his team could win all three Grand Tours.

lance armstrong to the rescue :D!

ed rader

That's what I'm thinking. Here comes the new Livestrong team, or whatever it's going to be called.

I think I read somewhere that Bruyneel holds the UCI license. In this case, maybe it can transfer to the new team.

Lance hasn't been able to secure any funding/financing. He makes no bones about the fact he wants a team.

-R

Lance will have his team! I mean hell, a LIVESTRONG TEAM for Three Tours. What could that possibly cost? It would have to be a good investment. I mean, have you seen these shirts yet: http://www.cafepress.com/returndelance

Man, that doesn't look good.
Lousy year to have this happen. Money's gonna be really hard to find.

If they all stay clean, I bet someone will come up with some money.

If they all stay clean, I bet someone will come up with some money.

Team Livestrong - with Twitter and Mello Johnny's as sub sponsors.

Armstrong continues to race sans salary for two years. He asks his 800,000 Twitter followers to each send in $20 USD per year to sponsor the team (more if they sign up for multi-year/lifetime but better perks). They become honorary "owners" and get a fake stock certificate suitable for framing (a'la the old Boston Celtics stock certificates found throughout New England). 15% adoption rate - he gets about 2- 3 million a year.

He pulls in about $5m operating captial from Livestrong subject to the foundation getting net profits on team sales.

He contributes a few hundred from Mello Johnny's to get himself some advert space.

The rest is funded via normal channels - sub sponsors, maybe one more title sponsor. He leverages the Trek, Nike, Giro and Oakley folks for all they are worth to cover equipment, testing, etc.

This is a lower budget but could work - my guess is that it might be known as the (Prime Sponsor Name)/Livestrong team to ensure an anchor sponsor is there but Johan and Lance were in the hunt before and supposedly had folks lined up when Disco went under. It wasn't an issue of 'we can't find them' but 'we can't ethically bring people into this business when it is under this climate of crisis'.

He then links into US Development teams to create some cross-development/fund raising opportunities - this gives him a supply of lower cost talent to generate US interest, sub-teams, and potential stars.

Along the way he becomes the patron of US cycling. Love him or hate him ... he is good for the sports numbers ...

What the team needs is a sponsor with deep pockets and one who's image is not very PR sensitive. Like Exxon Oil or something.

But I would rather see 800,000 American fans support the team with donations. Much like Public television. That would be really cool. I'm not a Twitter subscriber but I would send a donation to a publicly funded team in a heartbeat.

Seems like Trek would be the one to take the reins of team ownership given that it's getting a boost from Lance being on their bikes again.

I'm not a Twitter subscriber but I would send a donation to a publicly funded team in a heartbeat.

I'm with you man, this would be real cool, here's an idea for a name: Team Livestrong brought you by People.

Levi, Horner, Lance, Jose, Pops, etc,...Contador will probably leave. Feeder team includes Phinney et. al and maybe they sign Stetina and other up and comers until Levi and Lance are gone. That would be three U.S. pro teams (High Road and Garmin) and I am not sure TdF organizers would allow that - seriously. Maybe somebody like Encana would co-sponsor and the team would be Canadian based....hmmm.

I like the idea of a publicly funded team, but it would be the Gramin boys, not Astana getting my dollars.

But being a consumer, you kinda already are sponsoring the squads....

Johann had an interview on U.S. yesterday. The team started the stage with all the logos and sponsors taken off the kit "To put pressure on the owners and sponsors to pay what they owe." He also said that he has another major sponsor lined up if necessary.

Johann had an interview on U.S. yesterday. The team started the stage with all the logos and sponsors taken off the kit "To put pressure on the owners and sponsors to pay what they owe." He also said that he has another major sponsor lined up if necessary.

i thought i read that all logos except for one were subdued, but not removed.

ed rader

I couldn't make out what they were, but then the TV picture sucks.

Yea, they are still there, just faded. The UCI told them they could not make any changes to the kits while the race is happening. There is a rule.

Probably also a question of breech of contract with the sponsors.

One thing mentioned yesterday, if the Pro license changes hands, then all the rider contracts are up for re-negotiation...

You would think Trek could be on board as a major sponsor. Then they could mass produce black and yellow livestrong bikes, which would probably sell nicely.

Yea, they are still there, just faded. The UCI told them they could not make any changes to the kits while the race is happening. There is a rule.

After the Giro take all the faded jerseys, have the team autograph em & sell on scambay. $$$$ problems solved. I was thinking of making a collection of jerseys of folded teams but I don't have enough wall space!

Probably also a question of breech of contract with the sponsors.

One thing mentioned yesterday, if the Pro license changes hands, then all the rider contracts are up for re-negotiation...

That would let them dump Kloden - who might be in for some rough sledding with the authorities. Aside from that, I don't think there would be many changes.

I would imagine that some of the Spanish teams would pay big money for Contradope.

yep then the Trek yellow and black Livestrong bikes would on the market lightning fast.

I would imagine that some of the Spanish teams would pay big money for Contadore.

fify...

I genuinely believe Bruyneel wants to retain the relationship with him. I agree that he could get a big contract with a Spanish team, but I seriously doubt he'd switch mid season.

With Armstrong onboard its virtually become Tailwind Sports mark2. Lance and Johan couldnt get the money men to back them last time when Discovery did the wise thing and pulled out and I doubt they will get it now.

Talk of Trek taking over the reigns is unlikely - its not often a bike company is the sole sponsor of a premier team, they get enough coverage from supplying the bikes.

I doubt companies external to the sport will be queuing up either , theres too many possible risk factors to bring bad pr. Kloeden is not looking too clever at the moment, Lance is prone to spats with the media which no sponsor wants, there's an outstanding hair sample that hasnt been tested yet and the distinct possibility that last years Giro winner could be implicated in Operacion Puerto or come up positive in the retesting of last years Giro blood samples.

With any of these things being a not too impossible scenario big corp will be wary of getting involved.

Lance is already a part owner of Demand Media (livestrong.com profit taking website), SRAM and FRS sports drinks. If these companies put big money in then you might be talking but I would think its unlikely.

Actually thinking about it maybe Lance and Johan could get Amgen to sponsor their team? They already sponsor a major US race so sponsoring a team and getting global coverage for what is a global product would be the next logical step. And who better than the most successful rider of the modern era and the most successful DS?

That would let them dump Kloden -
Now that you mention it, I wonder why he isn't in the Giro? (or if he is why he's invisible)

Lance and Johan couldnt get the money men to back them last time when Discovery did the wise thing and pulled out
That's a bad mis-characterization of what went down.

First, Discovery Channel pulled out because there was a management coup and the new management needed to save $M to satisfy its backers.

Second, there were more than enough willing sponsors for a successor, but Lance had signed a personal services contract with Discovery Channel. The new management at DC refused to release those contracts unless they were bought out. If Lance was to be involved with the successor to Team Discovery, the new sponsor was on the hook for $xM for the sponsorship plus $yM to buy out the old contracts. No sane sponsor would agree to that, so the only alternative was for Tailwind to fold.

I wonder how that is affecting current situation? It would clearly explain why Lance is taking no salary if it's still in force.

So are you telling me that because of Lance's personal greed the whole cycling team went down the pan? Shrewd businessman! I wonder how many prospective sponsors this will now impress!?

Actually thinking about it maybe Lance and Johan could get Amgen to sponsor their team? They already sponsor a major US race so sponsoring a team and getting global coverage for what is a global product would be the next logical step. And who better than the most successful rider of the modern era and the most successful DS?

And of course Amgen sponsoring Lance would provide much fun for the members of the doping forum! ****, I can't get over the fact that there is a stage race sponsored by Amgen. Sponsoring a team would just be way over the top!

So are you telling me that because of Lance's personal greed the whole cycling team went down the pan? Shrewd businessman! I wonder how many prospective sponsors this will now impress!?

Boy, you have a way of putting things ass-backwards. No one would want to sign such a contract "for greed". Undoubtedly Discovery Channel insisted on it as a way to ensure that Lance and his big bright marketable image remain associated with the sponsor, even after he inevitably retired. In a sense, Lance sold his soul for his team. All would have been well thereafter, except that DC decided to screw the pooch and Lance's company went under as a result. If there's any karma yet to roost, it's not his.

boy, a rest day in the giro filled with sponsor shopping can't be much of a rest day at all. popovych's breakaway on stage 16 may have been more than just insurance for leipheimer up the road. it sure looked like yaroslav was gunning for the stage; wouldn't have hurt team morale and potential suitors if he had.
if they are to fold, are they going out with both guns blazing or just a whimper? the kloden thing was not
the best timing. really wanted to see contador smoke lance in the tdf shades of team infighting 1986 with lemond/hinault or giro 2004 cunego/simoni but it's looking less likely to happen. if menchov or sastre wins the giro, either would have a much improved chance of doing the double sans contador.

If Astana isn't reconstituted, I bet Caisse D'Epargne would love to give Contador a contract.

wow, what a team of climbers they would have adding contador. who would pull on the flats and in the valleys to protect the grimpeurs though?

So it was poor business from Lance then?
Discovery Channel arent doing it to bring cycling to the masses, they are doing it to sell more advertising. If the deal with Tailwind/Lance wasnt profitable enough then no wonder the new execs ditched it as soon as they could.

Good luck to Lance and Johan though, maybe they can qualify for an Obama welfare grant to keep their business running? Still, what with signing Basso by looking into his eyes and seeing he was clean and then getting Kloeden I'm not sure a man who is prepared to put hard earned into General Motors would want to take that risk. They might have to stop the 'donations' to Hein and Pat though, not sure the greenback is strong enough to cover that sort of heavy expense.

So it was poor business from Lance then?
Discovery Channel arent doing it to bring cycling to the masses, they are doing it to sell more advertising. If the deal with Tailwind/Lance wasnt profitable enough then no wonder the new execs ditched it as soon as they could.

Good luck to Lance and Johan though, maybe they can qualify for an Obama welfare grant to keep their business running? They might have to stop the 'donations' to Hein and Pat though, not sure the greenback is strong enough to cover that sort of heavy expense.

The Discovery Channel sponsorship was all about Lance. No Lance, no reason to sponsor. Lance and Johan will have no trouble getting new sponsors, even in this economy.

Considering how much Coke is drunk during a stage race, I'm surprised Coke doesn't sponsor a bike team. It would be a drop in the bucket for Coke, and the global reach of cycling would appeal to the global brand of Coke. It would also promote the idea that you can drink Coke and be healthy.

I guess we will see in a few days time!

+1 on Coke. i hadn't thought about it before but my gf was shocked when lance went back to the car for a-gasp-COKE (and possibly a smile?) and said if everyone drinks so much Coke why don't THEY become the new sponsor. i can already see the uniforms. sorry. "kits."

Considering how much Coke is drunk during a stage race, I'm surprised Coke doesn't sponsor a bike team.

I don't know if I'd laugh or cry if they co-sponsored Quick Step. Probably both.

That would be great! Coke sponsoring QuickStep and Amgen sponsoring former astana team.

The Discovery Channel sponsorship was all about Lance. No Lance, no reason to sponsor. Lance and Johan will have no trouble getting new sponsors, even in this economy.

Considering how much Coke is drunk during a stage race, I'm surprised Coke doesn't sponsor a bike team. It would be a drop in the bucket for Coke, and the global reach of cycling would appeal to the global brand of Coke. It would also promote the idea that you can drink Coke and be healthy.

They won't, they get enough free exposure by just having the riders drink it to begin with. Also, with the way professional cycling is going, there is way too risk involved with putting one of the worlds most recognized brand on a bunch athletes who will, is previous cases, stop at nothing to win. Forget it.

That would let them dump Kloden -


Now that you mention it, I wonder why he isn't in the Giro? (or if he is why he's invisible)

You user title sums it up.

edit: Team "the new" GM

Baed on the info out yesterday and today, they're solvent for now. They have guys in the TdL, and and Astana rider is in 4th after prologue.

Who could not see this coming , this a country run by a man who is President for life and runs everything . And we expect these folks to be good sponsors, give me a break.

Oh I dunno. Dicta .. er.. Presidents For Life need all the good press they can get.

Besides, Kazakhstan was not the sponsor(s) that got their logos "subdued". Hmm.. I wonder if the sponsors paid the team owners but it didn't get passed on down. Hmmm..

maybe LA could get some stimulus money since jobs could be lost....

It may very well be that companies looking for global marketing opportunities simply do better with soccer than cycling.

Saved just in time....

http://www.google.com/hostednews/canadianpress/article/ALeqM5g1aPDJwq0VJenD45SSBwbGlOYGjQ

"Astana receives most of its financial support from Kazakh state holding company Samruk-Kazyna, but the country's economy has been badly hit by the global financial crisis."

Is that name on their kit?

The state-owned companies sponsor the team and named it after the state capital. I suppose their reasoning behind sponsoring a cycling team is a nationalistic one along with a desire to raise the profile of their country and increase money flowing in.