NFL to end revenue sharing? Is this a bluff?

[digitaldean]

http://sports.espn.go.com/nfl/news/story?id=4718965

Just read this and it either looks like a poker player's bluff or a colossal mistake by the NFL.

Essentially, since 2010 is an uncapped year the owners the $100 million supplement given to 8 to 12 teams will be done away with. Supposedly due to the current labor agreement, the NFL is saying it only applies to capped seasons.

NFLPA is protesting this move.

So is this the first move to kill Pete Rozelle's golden goose? Somehow I have a BAAAD feeling about this.

[Rastak]

Just a small piece of it.


Here is what Florio had to say


http://profootballtalk.nbcsports.com/2009/12/06/legal-fight-looms-over-revenue-sharing/



In 2006, the NFLPA hinged its final proposal for a new CBA on the league's adoption of a meaningful system for sharing the unshared revenues, such as naming rights on stadiums and luxury suite fees.

The league complied, via a process that reallocates certain revenues generated by the team's earning the most money based on need.

But now ESPN reports that the league has informed the union that the supplemental revenue sharing plan will be scuttled in March 2010.

Per the report, the union plans to challenge the move via a "Special Master" proceeding, an arbitration-style legal claim resolved under the auspices of the federal court that supervises the Collective Bargaining Agreement.

The union plans to argue that the league can't make the change without the union's approval. The league contends that it has the right to do so without NFLPA consent.

The supplemental-revenue fund represents only 1.5 percent of the league's total revenue. Still, the redistributed money helps to ensure that all teams are profitable. Without it, some could be hurting -- and for a team like the Vikings it could be the final straw that forces a move to Los Angeles.

[CaliforniaCheez]

A Vikings move to LA means more revenue for the Packers.

At least $200K more for a game in LA than in the crappy Metrodome.

Plus the Packers don't have to give money anymore to the vikings.

[Waldo]

The Packers pay into, not take from, that fund, and it has only been around a couple of years. It isn't the main profit sharing from the TV contracts.

The team in the crosshairs that this pretty much screws the most is the Vikings.

All of the other very low revenue teams also tend to be very low expense teams. Minnesota is the only team that is spending like a wealthy team while earning like a poor team.

I've seen a couple estimates at how much money Wilf is bleeding into the team, as he has been operating big time in the red for a few years. Basically what I've seen has said that he can't sustain this, and shortly if he doesn't get a new stadium or sell/move the team, he'll have to pull a Bills and turn it into a poor house team. Like within the year shortly.

[pbmax]

The revenues in question are local revenues, not the National TV contracts, advertising or merchandising/licensing deals. The Florio quote was correct; they include things such as naming rights, concession deals, stadium advertising, lottery deals, etc. It used to be a very small share of overall revenues, but with new stadiums and new streams of revenue increasing faster than TV deals, it has become much more important. It is the driving force between creating have and have not teams in the NFL.

[Patler]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.

[ThunderDan]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the world.

[pbmax]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.
And this only works until the current bottom of the league teams (in revenue and profit) relocate. Then they will need new bidding parties to up the ante for the next stadium, parking and concession deal. For short term cash, teams will then move back to the lower revenue cities, starting the whole cycle again. As long as public money is available for new stadiums, teams are going to rotate, revenue sharing or not. There cannot be a free market with only one buyer.

Regardless of local revenue sharing, teams will relocate. It happened well before local, revenue sharing and it will happen after it too.

In terms of the CBA, this is part one of the owner's bargain among themselves. Lower revenue teams will lose revenue sharing, which they don't believe compensates them fully for market size discrepancies. Large revenue clubs get to keep their revenue. Without a salary floor, everyone will keep more cash in reserve if a lockout looms in 2011.

[Patler]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the world.

Doesn't necessarily have to be the largest cities.
Doesn't necessarily have to be in the United States.

[Patler]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.
And this only works until the current bottom of the league teams (in revenue and profit) relocate. Then they will need new bidding parties to up the ante for the next stadium, parking and concession deal. For short term cash, teams will then move back to the lower revenue cities, starting the whole cycle again. As long as public money is available for new stadiums, teams are going to rotate, revenue sharing or not. There cannot be a free market with only one buyer.

Regardless of local revenue sharing, teams will relocate. It happened well before local, revenue sharing and it will happen after it too.

In terms of the CBA, this is part one of the owner's bargain among themselves. Lower revenue teams will lose revenue sharing, which they don't believe compensates them fully for market size discrepancies. Large revenue clubs get to keep their revenue. Without a salary floor, everyone will keep more cash in reserve if a lockout looms in 2011.

There will always be a bottom group of revenue producers, and there will likely always be another location trying to lure them away. It is a cyclical process that has stalled for a number of reasons. The owners, (and I suspect the players, too) want to get it started again.

[digitaldean]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the world.

Doesn't necessarily have to be the largest cities.
Doesn't necessarily have to be in the United States.

So, that's the reason ol' Roger is pushing the London games???

[digitaldean]

http://www.twincities.com/ci_13941316?nclick_check=1

According to this report, the Vikes would stand to lose $15 to $20 million per year with this change.

With the way things are going with the Minn. legislature and the current budget deficit at $1.2 billion, it makes REALLY hard to push for a new Vikings stadium. Where could they come up with the money unless Wilf gets another partner?

[pbmax]

The interesting thing is that the players are opposing it. In the long run it is in the leagues interest and ultimately (long term) in the players interest to get rid of franchises in areas that do not adequately support them, and get those franchises into cities that will support them. More money for everyone. This move will hasten the weeding process.

The fans are the losers.
And this only works until the current bottom of the league teams (in revenue and profit) relocate. Then they will need new bidding parties to up the ante for the next stadium, parking and concession deal. For short term cash, teams will then move back to the lower revenue cities, starting the whole cycle again. As long as public money is available for new stadiums, teams are going to rotate, revenue sharing or not. There cannot be a free market with only one buyer.

Regardless of local revenue sharing, teams will relocate. It happened well before local, revenue sharing and it will happen after it too.

In terms of the CBA, this is part one of the owner's bargain among themselves. Lower revenue teams will lose revenue sharing, which they don't believe compensates them fully for market size discrepancies. Large revenue clubs get to keep their revenue. Without a salary floor, everyone will keep more cash in reserve if a lockout looms in 2011.

There will always be a bottom group of revenue producers, and there will likely always be another location trying to lure them away. It is a cyclical process that has stalled for a number of reasons. The owners, (and I suspect the players, too) want to get it started again.
I think it stalled because of a flurry of new buildings in existing cities and the fact that, despite the fractured broadcast network audience, football still has had rising contracts, in some cases, despite all evidence of ratings. One reason is that football is one of the few properties left that can deliver a sizable audience frequently and regularly.

Eventually, those numbers for contracts will come down as the NFL is already searching the sofa cushions for more games to put on TV. A regular Saturday and Thursday schedule is already being discussed. Then there is the 18 game schedule and London. It will not be long before they hit saturation like baseball and basketball.

Relocation is peanuts compared to those discussions. I think its essentially the byproduct of larger revenue clubs not wanting to give up the cash and lower revenue clubs thinking they got screwed by the last CBA. The cash cow I really fear is expansion.

[Patler]

Schedule expansion and geographic expansion certainly make sense. League expansion to more teams will be a hard sell when you have teams struggling to sell out playoff games, let alone regular season games. Those franchises need to be relocated before expanding the number of teams will get much traction. The owners of the struggling franchises will insist on help in improving their situations before they will get on board with adding more teams. Even their division foes (and other opponents, but especially those who go there every year) have a financial interest in seeing those teams improve their gate receipts through better attendance, which could lead to higher seat prices.

I suspect going to an 18 game schedule, with just 2 or 3 preseason games might be the first significant change. There were concerns going from 12 to 14 games, and from 14 to 16, but it didn't matter in the end. Money ruled, and it will again.

The next round of TV contract discussions will give a lot more indication of where the league intends to go. They openly admitted many years ago that pay-per-view for home viewers was what they wanted to get to. They haven't been quite so open about it, but the NFL network gives them a vehicle for getting there.

[RashanGary]

Minnesota would take a death blow if they stop revenue sharing. It would get us over time, but it would get Minny right now.

[Fritz]

It's getting clearer that an 18 game schedule is on the way - and we thought injuries were a problem before!

I think too that the NFL network is going to become a more important option - better, more marquee games will start appearing as pay-per-view, but the networks still offer too much exposure for the NFL to dump them.

What I would like to see, if they're going to go to pay per view, is a menu in which I can select and pay for all the NFL games I want to see. That way, I could pay to see the Packers on television for the whole season.

I think the longer season is going to hurt the NFL and I think the travel involved as they eventually move to Europe will hurt as well. I think, though, Mexico and Canada are the next stopping grounds. Lots of people up in Toronto and down in Mexico City. Untapped markets.

[Smidgeon]

I think, though, Mexico and Canada are the next stopping grounds. Lots of people up in Toronto and down in Mexico City. Untapped markets.

But the question isn't "How large are the markets?", but "How many people in those markets like American football?"

[Patler]

It's getting clearer that an 18 game schedule is on the way - and we thought injuries were a problem before!

I think too that the NFL network is going to become a more important option - better, more marquee games will start appearing as pay-per-view, but the networks still offer too much exposure for the NFL to dump them.

What I would like to see, if they're going to go to pay per view, is a menu in which I can select and pay for all the NFL games I want to see. That way, I could pay to see the Packers on television for the whole season.

I think the longer season is going to hurt the NFL and I think the travel involved as they eventually move to Europe will hurt as well. I think, though, Mexico and Canada are the next stopping grounds. Lots of people up in Toronto and down in Mexico City. Untapped markets.

There has been discussion of an 18 game schedule with two bye weeks for each team, perhaps weeks 6, 7 and 8 for the first set of byes, and weeks 13, 14 and 15 for the second. There was even some talk of having just two bye weeks in each half of the season, with half the league off each week. I wouldn't mind that, NFC off one week, AFC the next. Then, schedule only intra-conference games the week after the second bye week, and no team would have to face a team coming off a bye unless they were too.

There was a suggestion that two bye weeks over a 20 week schedule of 18 games might decrease some types of injuries. If you cut out two pre-season games and perhaps expand rosters a little, it might not be a big deal from the injury front.

I think a routine, extended schedule in Europe would be a real pain for the teams. But, again, money will rule that decision, in all likelihood.

[RashanGary]

Obviously there are hurdles to overcome that I have no clue of, but I've developed some ideas of what I think works best.



1. Set revenue sharing at a limit where the poorest teams can just barely afford to spend all of the cap money.

2. Set two caps: the first is a tax threshold and the 2nd would be a hard cap.


For example: Tax threshold of 100 Million dollars with revenue sharing just high enough that Minny, Cincy and the other poorer teams could afford to spend all of it. Then there would be a hard cap of 115 Million, but that money get taxed 1 dollar for every dollar spent over 100 Million with the tax money getting split up proportionally to the teams below the tax limit, with teams with the lowest revenue getting the most and tapering it down as you move up the revenue chain.


This would do a few things:

1st, the biggest markets with the most support would benefit from their support. Washington and Dallas will actually get something for having the most fans. However, it's not as dramatic as Baseball where the Yankees and Redsox are in it every year. It's a 15% extra spending limit that also has a tax attached to it.



If the players and owners were smart, they'd recognize that what is good for the league is good for everyone. Buffalo, Minnesota, Cincy and others might not bring in crazy money like Dallas and Washington, but it's still more money for the players to spend and it makes the league more interesting to have teams all over the country instead of just the major markets. Find a way to keep revenue sharing and as a reward to teh teams that have to share so much, give them the opportunity to spend a little more money on players. Ultimately, make the total pie for the players about what it is today, but give a little more to the rich and a little less to the poor. Plus, then you can further identify with your team. We're small market, we don't spend quite as much and we still beat you. Or, "yeah, we're the big boy on the block, how do you like it". . . etc. . . .

[MichiganPackerFan]

We may be down on Daryn Colledge because of his offensive line play, but I really liked his quote on this subject:


"I think every guy wants to continue to work. Nobody wants to be without a job but I think for Green Bay a lockout would be devastating for a lot of vendors and owners and restaurants and bars in this area (who) rely on these eight home games and hopefully playoff games to survive. It would be a huge blow. You're not just locking out the players, you're locking out the hundreds of people who work inside the stadium, the thousands of fans who come every single weekend and the people who watch at home. I think that's the biggest hurt."

Are players talking about it, Colledge was asked? "Everyone is aware of it but everyone is focused on the season right now. Everybody has got their own plan for it; I have already planned for it, you just can't be blindsided like that."

You mean financially? "Exactly. Steps are being made by our union if the CBA is abolished and we do get locked out. I think everybody has to."

[Guiness]

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the United States.

Fixed.

[Guiness]

We may be down on Daryn Colledge because of his offensive line play, but I really liked his quote on this subject:


"I think every guy wants to continue to work. Nobody wants to be without a job but I think for Green Bay a lockout would be devastating for a lot of vendors and owners and restaurants and bars in this area (who) rely on these eight home games and hopefully playoff games to survive. It would be a huge blow. You're not just locking out the players, you're locking out the hundreds of people who work inside the stadium, the thousands of fans who come every single weekend and the people who watch at home. I think that's the biggest hurt."

Are players talking about it, Colledge was asked? "Everyone is aware of it but everyone is focused on the season right now. Everybody has got their own plan for it; I have already planned for it, you just can't be blindsided like that."

You mean financially? "Exactly. Steps are being made by our union if the CBA is abolished and we do get locked out. I think everybody has to."

Guys like him get it. Remember Tony Fischer our former 3rd down back? Never spectacular, never a big contract, but by all accounts took care of himself, and retired very comfortable life, never having to worry about working again. Then, of course, you get the Barry Bonds of the world, who when baseball was locked out, couldn't meet his child support obligations!!! I wonder how many of those stories, or guys losing their houses, we'll hear if they get locked out?

[ThunderDan]

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the United States.

Fixed.

Why did this need to be fixed?

[KYPack]

Just looking at the 50 biggest cities in America to potential support an NFL team.

Los Angeles with 3.8 million, lost teams numerous times.
San Antonio with 1.5 million is the biggest city (non-NFL) without a team.
San Jose with 1 million but SF and Oakland are close.
Columbus, OH with 750,000.
Austin, TX with 750,000.
El Paso, TX 600,00
Milwaukee, WI 600,000 22nd biggest city in the USA.

Then you're down to the Las Vegas and Oklahoma Cities of the United States.

Fixed.

Why did this need to be fixed?

The NFL is looking at 4 foreign markets real hard:

London Everyone is hip to this one
Mexico City Get 'em to build a 150 - 200K capacity Stadium
Tokyo Pre the 2008 slump this was a no-brainer.
Berlin/Paris NFL Europa was really NFL Germany. Most observers are shaky about French NFL football.

Add 50 million NFL fans and increase worldwide revenues many times? That's the mountain to climb. US expansion? Move Minny and Jax to strong markets and you got that addressed.

Goodell is real bullish on all this, but I don't feel he's slick enough to pull it off.

[Guiness]

Of course, everyone has their own opinion KY.

My spin - you have to go to cities that show they will support football because they enjoy the sport - not because it's hip.

So ditch London, England, because when the 'hip' wears off, you've got yourself another LA Rams situation. They couldn't support an NFL Europe franchise, no way does an NFL team, especially a non-winning expansion franchise survive there.

Berlin is the no-brainer as far as I'm concerned; as you said, they faithfully showed up for the Europa games.

Another potential? If you're looking to Canada, no laughing, but ever hear of the Saskatchewan Roughriders? Manic fans. Sure, population of the whole province is ~750K, but every last one of them support that team.

[KYPack]

Of course, everyone has their own opinion KY.

My spin - you have to go to cities that show they will support football because they enjoy the sport - not because it's hip.

So ditch London, England, because when the 'hip' wears off, you've got yourself another LA Rams situation. They couldn't support an NFL Europe franchise, no way does an NFL team, especially a non-winning expansion franchise survive there.

Berlin is the no-brainer as far as I'm concerned; as you said, they faithfully showed up for the Europa games.

Another potential? If you're looking to Canada, no laughing, but ever hear of the Saskatchewan Roughriders? Manic fans. Sure, population of the whole province is ~750K, but every last one of them support that team.

I actually agree with you, G.
By "hip" I meant familiar. They've been shoving London down our throats. I saw some stuff on TV when the London game happened this year. They may draw 80K fans, but that's about all the people that are interested in the NFL product in London. The other things that go with an NFL franchise wouldn't go in England.

I also think they are looking at Toronto.
Sure, I've heard of the Saskatchewan Roughriders. Some of those Canuck teams have fan ownership like the Pack. The NFL will only look at Toronto for NFL expansion, IMHO.

I just can't figure out how they could handle the far-flung markets and global travel. They fell in love with worldwide expansion and then cool on the idea. I don't think they will ever pull it off, in my lifetime any way.

[digitaldean]

Another potential? If you're looking to Canada, no laughing, but ever hear of the Saskatchewan Roughriders? Manic fans. Sure, population of the whole province is ~750K, but every last one of them support that team.

That would beat the Toronto gig that Buffalo is doing, IMO as for rabidness of the fanbase.

Really felt bad for them the way they lost the Grey Cup. But win or lose, they do support the Roughriders.

Not sure if Goodell could make an outside of the box move like that however.

[Guiness]

That Grey Cup loss was something else. Coming out of half time, the Alouettes weren't even in the same league.

I don't think Toronto would work as an NFL town. They're a one team town, the Maple Leafs. They'll barely support a second hockey team. The Argonauts don't draw well at all.

I think that if there's long term viability in a market, it's because there are football fans there. Otherwise, football is merely kitsch, and you're going to get fans for a few years until the next new thing comes along.

[MJZiggy]

Interesting thought, but football is kind of addicting...

[red]

Another potential? If you're looking to Canada, no laughing, but ever hear of the Saskatchewan Roughriders? Manic fans. Sure, population of the whole province is ~750K, but every last one of them support that team.

That would beat the Toronto gig that Buffalo is doing, IMO as for rabidness of the fanbase.

Really felt bad for them the way they lost the Grey Cup. But win or lose, they do support the Roughriders.

Not sure if Goodell could make an outside of the box move like that however.

would they become fans of the nfl team though? or would they continue to support the roughriders?

thats such a small market to support 2 teams