CMGI drops the Patriots' ball

The Super Bowl champion New England Patriots and the beleaguered dot-com holding company scrap their stadium sponsorship deal. Gillette suits up instead.

Reuters

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Sept. 5, 2002 8:00 a.m. PT

2 min read

The New England Patriots have punted on a stadium sponsorship deal with beleaguered dot-com CMGI and decided to go with Gillette.

Gillette said Monday it struck a 15-year deal for naming rights of the stadium where the New England Patriots play football.

Andover, Mass.-based CMGI said it will immediately relinquish all naming rights to CMGI Field, which will now be known as Gillette Stadium. In the technology sector, stadium naming rights have seemed to often be the kiss of death. High-flyers such as PSINet and Adelphia Communications unraveled shortly after inking NFL deals.

Terms of the new Patriots deal were not disclosed.

CMGI, whose vastly depreciated Internet holdings have made it a poster child for the failed dot-com era, said it will take a charge of $21 million in the quarter that ended Wednesday to cover the future payments to be made under the deal.

CMGI blamed both a downturn in the tech industry and the need to focus on its own restructuring for the change in the deal.

Under the old deal struck in 2000, the Internet company was to have paid $7.6 million a year for 15 years. Under the new deal, which comes with more limited rights, CMGI will pay $1.6 million per year from 2003 to 2015.

"We believe that these revisions of the sponsorship agreement, which will reduce our ongoing commitment to the Patriots by approximately $86 million, will better position CMGI for future success," George McMillan, CEO of CMGI, said in a statement.

Gillette said the major signs on the stadium will be replaced by the time the Patriots open their home season on Sept. 9, and more than 2,000 other signs will be replaced during the season.

The stadium's name change is just the latest in a wave that has swept the country in recent months, as companies find they can no longer pay for their deals, have gone out of business or in some cases no longer want naming rights.

In June, baseball's Houston Astros signed a deal to rename Enron Field as Minute Maid Park. Football's Baltimore Ravens had to replace PSINet as the sponsor for their stadium, as the St. Louis Rams had to do with former airline TWA.