It makes the money more steady for the teams included, and makes the entire system more predictable for all parties included. It does pretty much kill cinderella stories, but it creates a system where a franchised team's season isn't over just because they lost a few games.
Havent they basically died already? Those were only possible in the first months when orgs still were looking to pickup teams. You don't even see full f/a 5 stacks getting picked up now. You can point to The Guard maybe, but they have a super rich backing
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