simplicity

Recession or no recession, many NFL, NBA and Major League – 03.23.09 – SI Vault

Ran across the “Recession or no recession, many NFL, NBA and Major League article” article on SI.com courtesy of an article on stretchdollar.com. I’m not surprised that even though these athletes are making millions of dollars that they are losing a good portion of their money. What does surprise me though is how many of these athletes it’s happening to. I guess when you start making that much money the fear of losing it all is the furthest thing on your mind. Some of the great notes from the article

• By the time they have been retired for two years, 78% of former NFL players have gone bankrupt or are under financial stress because of joblessness or divorce.

• Within five years of retirement, an estimated 60% of former NBA players are broke.

Wow, seventy-eight and sixty percent respectively. Read that again so it soaks in. I want them to break it down by divorce, child support payments, etc… That would help to make sense of this, cause I can see that becoming a major cause of the money hemmoraging.

• Numerous retired MLB players have been similarly ruined, and the current economic crisis is taking a toll on some active players as well. Last month 10 current and former big leaguers-including outfielders Johnny Damon of the Yankees and Jacoby Ellsbury of the Red Sox and pitchers Mike Pelfrey of the Mets and Scott Eyre of the Phillies-discovered that at least some of their money is tied up in the $8 billion fraud allegedly perpetrated by Texas financier Robert Allen Stanford. Pelfrey told the New York Post that 99% of his fortune is frozen; Eyre admitted last month that he was broke, and the team quickly agreed to advance a portion of his $2 million salary.

Say it ain’t so Jacob, say it so!

The following seems to make sense, obviously there is a different level of intelligence and workload -

“There’s a far shorter peak earnings period [in sports] than in any other profession, and in many cases they lack the time and desire to understand and monitor their investments.”

[...]

“Chronic overallocation into real estate and bad private equity is the Number 1 problem [for athletes] in terms of a financial meltdown,” Butowsky says. “And I’ve never seen more people come to me about raising money for those kinds of deals than athletes.”

And now we get further explanation. It’s all making sense!

SALARY ASIDE, the closest analogue to a pro athlete is not a white-collar executive. It’s a lottery winner-who’s often in his early twenties. “With athletes, there’s an extraordinary metamorphosis of financial challenge,” says agent Leigh Steinberg, who has represented the NFL’s No. 1 pick a record eight times. “Coming off college scholarships, they probably haven’t even learned the basics of budgeting or keeping receipts.” Which then triggers two fatal mistakes: hiring the wrong people as advisers, and trusting them far too much.

One of the best items from the article though is the amount of money associated to Shaq’s spending

Perhaps the upper limit on spending was set by the famously profligate Shaquille O’Neal, who-according to a document obtained by the Palm Beach Post during O’Neal’s canceled divorce filing in January 2008-spends a total of $875,015 each month, including $26,500 for child care, $24,300 for gas and $17,220 for clothing. But O’Neal, who also has been known to fund charities anonymously and cover medical bills for complete strangers, has the wherewithal to remain solvent.

Wow, impressive. That’s insane. I can’t wrap my head around the amount of money they earn, let alone spend to become bankrupt. I don’t have the mental capacity to understand the amount. But generally, I think they fall into the same category as a good portion of the public, a lot of people in general just don’t try to understand their finances and how to effectively prepare for retirement.

After its own set top box bombs, Blockbuster partners with TiVo

Can’t Blockbuster just face the music and die quietly. The business took way too long to adapt and it’s trying to reinvigorate itself in a multitude of ways that aren’t innovative at all.

I feel like I keep writing the same sentence over and over again: Blockbuster has a new plan to reinvigorate its business. Sadly, I feel like I’m going to keep writing that sentence until Blockbuster goes under.

Unfortunately, what the company has been trying is not working when it comes to transitioning into the digital distribution age of movies. So now it’s on to plan H, or perhaps plan I – who can keep track anymore? – a partnership with the digital video recorder maker, TiVo.

Blockbuster will offer its on-demand movie rentals service to current TiVo customers, in exchange for placement of TiVo devices in Blockbuster stores. Oddly, no money will changes hands in the deal, reports The New York Times.

Also odd is that TiVo already offers services from Blockbuster rivals Netflix and Amazon on its boxes. But while the Blockbuster offering is different from Netflix because it is a pay-per-movie (rent or buy), it is the same as Amazon’s service on the device. And Netflix’s service, which is free to almost all Netflix subscribers, has some 12,000 titles available compared to the 5,000 to 10,000 Blockbuster will apparently have available. Though, Blockbuster’s will be newer films, while Netflix offers mostly catalog films. But then again, Amazon offers the newer films as well.

So I’m not really sure where Blockbuster fits in on TiVo. It would seem that the prices are going to be the same as Amazon’s service, which TiVo subscribers are already used to using, and the content will largely be the same. And if those users want something else, they probably have Netflix. But, this is just the first of many devices the Blockbuster service will be on, the company says.

Of course, it needs to say that, because its previous strategy to launch its own set top box has failed. Yes, that was the set top box it launched quickly after saying it was in no hurry to launch a set top box. Instead, the company decided it needed to focus on kiosks, which has worked out well for the company Redbox, except that Blockbuster wanted to digitally transfer movies to portable players that can play movies – without supporting the most popular of those, the iPod and iPhone. And of course, users get content for those devices over the Internet already, not through some kiosk.

And here’s what else worries me: Blockbuster chief executive Jim Keyes saying things like, “Ultimately, our vision is to work with TiVo so that their subscribers can access movies not only through our On Demand service but also from our stores and through our by-mail service as well,” to The New York Times. Does Blockbuster really think it’s going to convert TiVo subscribers to frequent Blockbuster store visitors and by-mail subscribers? I don’t think that Blockbuster realize the transition is happening the other way.

A story earlier this month that suggested that Blockbuster was going to file for bankruptcy, proved to be a bit premature as the company instead reached deals with its lenders to extend its credit into 2010. But make no mistake, Blockbuster is in trouble. And unless one of these seemingly endless strategies pays off, it will not, ultimately, survive.

The company has been trying to shift the focus of its stores to consumer electronics and to video games. This makes some amount of sense as the stores are a huge expense for the company, but are going to become less and less important as consumers transition to by-mail and over the Internet movie distribution. But it’s still going to ultimately need to stay in the movie distribution game, otherwise it will be just be a version of Best Buy with really small stores and worse prices.

In my opinion, Blockbuster needs to think outside the box a bit to save itself. It simply won’t work to come late to a device that all your rivals are already on. Instead, it should try to cut a deal with a company like Nintendo, to exclusive provide movies to the hugely popular Wii gaming console.

Instead, I’m sure we’ll hear in the coming weeks that Blockbuster’s service is coming to the Roku box (which also has both Netflix and Amazon as well), and Blu-ray players, that have the other services as well, and aren’t exactly catching fire when it comes to sales.

[photo: flickr/stranglv]

Source – After its own set top box bombs, Blockbuster partners with TiVo

NFL Fantasy Files [VIDEO]

Most of these are pretty old, but there are a few new ones that I haven’t seen before like the Maroney one. It’s fun to watch. I recommend turning on the HD version of the video.

Jon Stewart Disses CNBC

Saw this today and thought it was hilarious. It was great how they included all the scenes from the various shows.

For Twitter C.E.O., Well-Orchestrated Accidents (Evan Williams/New York Times)

Reaffirm your faith that what you are doing now is not what you will be doing later.

Evan Williams / New York Times:
For Twitter C.E.O., Well-Orchestrated Accidents – I GREW up on a farm in Nebraska, where we grew mostly corn and soybeans. During the summers I was responsible for making sure the crops were irrigated. – After high school, I enrolled at the University of Nebraska at Lincoln, but I stayed only a year and a half.

Source – For Twitter C.E.O., Well-Orchestrated Accidents (Evan Williams/New York Times)

F-Bomb Dropped on the MLB Network

Saw this on Barstool Sports today thought it was pretty hilarious. I love how they black it out for a little bit before coming back. I bet the producer is like ‘Shit, what do we do now?’.

Hilarious Video

Found this video today thought it was pretty good. It happened last night at the Wake/UMD game.

rediff.com: Must-read entrepreneurial tips

Michael Saul Dell was not even a teenager when he began first venture, Dell Stamps. When it earned him $2,000, he was hooked. He knew being an entrepreneur was what he wanted to do.

When he was 16, he began selling newspaper subscriptions. He sifted potential customers through the city’s mortgage and marriage licence lists. The idea was spectacularly successful. Within a year, he had earned over $18,000; it was more than what his teachers at school were paid. By the time he finished school, he had bought his own BMW.

He launched PC’s Limited, a company that would custom build computers and sell them directly to users, while he was still in college. As the company grew more and more successful, and Dell grew more and more disinterested in his studies, he struck a deal with his parents — he dropped out of college and had three months to prove that the business was doing well.

Dell never looked back. Today, he is the most profitable PC manufacturer in the world. He is worth $17.3 billion and is ranked No 11 on Forbes’ richest Americans list.

via rediff.com: Must-read entrepreneurial tips.

I don’t know if these are ‘Must-read entrepreneurial tips’, some of them are straight from ‘Direct from Dell‘

A few of the other tips such as

I learned very early to surround myself with talented people who challenge convention, offer new ideas and relentlessly drive for improvement. And to let those people thrive. Try never to be the smartest person in the room. And if you are, I suggest you invite smarter people… or find a different room.

Are things that you come across in reading about successful businesses and successful entrepreneurs. Even though, I think it is still a good refresher.