World's Most Boring Thread: The CBA

[pbmax]

There were two (OK, three) reasons to read the early incarnation of PFT.

1. Contract analysis.

2. Legal wranglings.

3. Rumors.

The newer version of his site is less boorish, breaks down fewer contracts and still has no feel for the actual game matchups or X and Os.

But this post is why its worth scrolling through all the Seinfeld references. He explains why the 18% cut is not exactly an 18% cut. But he also tells you why 59.6% of Total Revenues is not really anywhere close to 59%.

The full, unabridged story on the "18 percent pay cut" claim (http://profootballtalk.nbcsports.com/2010/02/24/the-full-unabridged-story-on-the-18-percent-pay-cut-claim/)

Posted by Mike Florio on February 24, 2010 11:16 PM ET
We recently pointed out one of the three areas in which the NFLPA is taking liberties with the facts of the current labor dispute, regarding the ongoing payments the league would receive under the television contracts even if there's a work stoppage in 2011.

Another factual inaccuracy articulated during the NFLPA pre-Super Bowl press conference on February 4 relates to the extent to which the league has proposed reducing the money currently devoted to labor costs. On that day, Executive Director De Smith harped on the allegation that the league wants the players to take an "18 percent pay cut." At one point, Smith characterized the reduction as $340,000 per player, calculated based on the literal notion of an 18 percent pay cut.

In a conference call that convened after the Smith press conference, NFL general counsel Jeff Pash said that "[t]hese kinds of figures are misrepresentations of what our proposal is." Pash then explained that the league has requested an 18 percent credit against the revenue base. In other words, the league wants to shrink the total pie by 18 percent before applying the 59.6-cents-on-the-dollar formula for determining the players' total compensation.

As Pash pointed out at the time, the actual reduction is closer to nine percent. But 18 percent sounds a lot better for the players than nine.

On Wednesday, the league posted a evasive and overly simplistic response to the allegation that the league wants the players to take an 18 percent pay cut at NFLLabor.com: "Those numbers that Mr. Smith used at his Super Bowl press conference are inaccurate. No current player needs to take a pay-cut as a result of our proposal. Our goal is to generate a pool of resources in order to have continued investment and continued growth. This will lead to higher salaries and higher benefits for players."

Also on Wednesday, Patriots owner Robert Kraft provided a more meaningful reiteration of Pash's point.

"We're asking for cost recognition because we want to be able to go out and take risks and build the business," Kraft said, per Tom Curran of Comcast Sports Net New England. "That 60 percent, some people interpreted it going from 60 percent to 42. But it's 18 off 100 percent. I think there's a misunderstanding there."

Kraft is being kind; it's not a misunderstanding but a deliberate misrepresentation. No one is asking the players to cut their pay by 18 percent. In fact, there might ultimately be no reduction at all, if the pie continues to grow as it has over the past 15 years.

Kraft also recognizes that things are going well. "We have the greatest sport going in America," he said. "Both sides have to be smart enough to continue to build a partnership."

Actually, that's one of the best things we've heard in weeks.

Meanwhile, and in fairness to the union, the current system already provides for an off-the-top reduction. So the union isn't currently getting 59.6 cents on the dollar. As two union sources explained it to me recently, the $8 billion in total revenue is subject to an initial $1 billion reduction for cost credits. Once 59.6 percent is taken from the remaining $7 billion, the players' share is $4.2 billion -- roughly 52 percent of the total revenue. (As we understand it, the pre-2006 salary-cap formula based on designated gross revenues resulted in roughly 51.7 percent of all revenue being paid to the players. If that's accurate, the players are only getting 0.3 percent more under a CBA with which the owners claim they can't live.)

Under the league's current proposal, the $7 billion would be cut by 18 percent, or $1.26 billion, before application of the 59.6-cent formula. This would result in the players getting $3.42 billion, which equates to 42.7 percent of the total revenue.

So under the current proposal it would be a nine-percent drop, from 51.7 percent to 42.7 percent. But that's based on an 18-percent cut in the revenue pool, and it's widely believed that the 18-percent number is negotiable. If the league ultimately would agree to a 10 percent reduction of the revenue pool, the players' total take would be 46.9 percent of the total revenue.

Though that's roughly five percent lower than the amount the players currently get, the pie will continue to grow. Since 1994, the per-team salary maximum has expanded from $34.6 million to $123 million. So that 46.9 percent cut will continue to yield bigger and bigger numbers as the league uses the 18 percent credit against the revenue pool to help position the sport to generate more and more revenue in the future.

To summarize, the union's assertion that the league wants the players to take an 18 percent pay cut is blatantly false. Still, the league wants the players to take a smaller piece of the pie. The league glosses over that fact by pointing to the reality that the pie will continue to inflate.

Got it? The test will be on Tuesday.

[get louder at lambeau]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

[pbmax]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.
Good catch. Any responses yet?

[pbmax]

Well, he certainly didn't cover it in his "update".

While 9% describes the static figure the players percentage of revenue would drop by, it does not describe the actual amount of lost dollars, or "pay".

He's also getting hammered for his poor explanation that 9% is the key since revenues will continue to expand. I still like that the article tackled the issue head on and made the different explanations from each side plain, he clearly biffed the conclusion.

[retailguy]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

[get louder at lambeau]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

His premise is that Smith was lying by saying it would be an 18% reduction in their total slice of the pie, and he claimed it would be more like 9%. He is wrong. Totally. Completely. He fucked up the math and came to an incorrect conclusion.

Any expected rise in revenue is not material to the discussion at all. They are talking about percentages here, Retail. As in, a percentage of whatever the total revenue of any year may be, regardless of the total pie being larger or smaller in any given year.

Me myopic or you? :bs: Maybe you should know what you're talking about before you throw that term around.

[Smidgeon]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

His premise is that Smith was lying by saying it would be an 18% reduction in their total slice of the pie, and he claimed it would be more like 9%. He is wrong. Totally. Completely. He fucked up the math and came to an incorrect conclusion.

Any expected rise in revenue is not material to the discussion at all. They are talking about percentages here, Retail. As in, a percentage of whatever the total revenue of any year may be, regardless of the total pie being larger or smaller in any given year.

Me myopic or you? :bs: Maybe you should know what you're talking about before you throw that term around.

That's only 18.6% if you use the players wage as a starting point. If you look at it in terms of the overall amount (so instead of using 3.42 as the 100% mark--which you did by using it as the denominator in the equation--use the 8 billion that he referenced earlier as being 100%), it's a reduction of 9.75%: (4.2 / 8) - (3.42/8). What this means is that the players are getting 9.75% less of the overall pie. But the relative decrease is 18.6%. So while you're not wrong in that regard, you aren't right either in your overall point.

[retailguy]

Thanks Smideon for making the overall point in a much clearer concise manner. You are certainly not myopic. :wink:

[get louder at lambeau]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

His premise is that Smith was lying by saying it would be an 18% reduction in their total slice of the pie, and he claimed it would be more like 9%. He is wrong. Totally. Completely. He fucked up the math and came to an incorrect conclusion.

Any expected rise in revenue is not material to the discussion at all. They are talking about percentages here, Retail. As in, a percentage of whatever the total revenue of any year may be, regardless of the total pie being larger or smaller in any given year.

Me myopic or you? :bs: Maybe you should know what you're talking about before you throw that term around.

That's only 18.6% if you use the players wage as a starting point. If you look at it in terms of the overall amount (so instead of using 3.42 as the 100% mark--which you did by using it as the denominator in the equation--use the 8 billion that he referenced earlier as being 100%), it's a reduction of 9.75%: (4.2 / 8) - (3.42/8). What this means is that the players are getting 9.75% less of the overall pie. But the relative decrease is 18.6%. So while you're not wrong in that regard, you aren't right either in your overall point.

That 9.75% number is not relevant here. THat's the problem.

The thing Florio is questioning is Smith saying the players would be taking an 18% pay cut. Which they would. The 9.75% is just a misleading way to look at it, as it has no bearing on the actual numbers, and is incorrect to apply here. That's like if I said that I was going to decrease your slice of the pie from 10% to 5% you'd only be getting a 5% decrease, where in reality it would be a 50% decrease for you. I am 100% right. :wink:

[get louder at lambeau]

Oops. Double posted.

[sharpe1027]

Did I get this right?

- Under the proposal the owner/player's ratio of the total revenue shifts by 9%.
- The players currently get about half of the total revenue, so 9% shift of the total results in an 18% reduction relative to what the players would receive under the current agreement. That is because the player receive only half of the total revenue, a shift of 9% of the total revenue is actually 18% of what they get. Example: Assume the league has 100 billion in revenue. If the players were to receive 50%, they would get 50 billion. Shift the percentage 9% and the players only get 41 billion. Thus, while 9 billion is only 9% of 100 billion, it is 18% of 50 billion.
- Whether or not the players actually receive a paycut depends upon whether or not the total revenue goes up, down or remains the same. Regardless, they would receive about 18% less of whatever the total revenue actually was.

So, the players really do make 18% less, relative to whatever the revenue comes in at.

[get louder at lambeau]

Did I get this right?

- Under the proposal the owner/player's ratio of the total revenue shifts by 9%.
- The players currently get about half of the total revenue, so 9% shift of the total results in an 18% reduction relative to what the players would receive under the current agreement. That is because the player receive only half of the total revenue, a shift of 9% of the total revenue is actually 18% of what they get. Example: Assume the league has 100 billion in revenue. If the players were to receive 50%, they would get 50 billion. Shift the percentage 9% and the players only get 41 billion. Thus, while 9 billion is only 9% of 100 billion, it is 18% of 50 billion.
- Whether or not the players actually receive a paycut depends upon whether or not the total revenue goes up, down or remains the same. Regardless, they would receive about 18% of whatever the total revenue actually was.

So, the players really do make 18% less, relative to whatever the revenue comes in at.

That is exactly right.

[Smidgeon]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

His premise is that Smith was lying by saying it would be an 18% reduction in their total slice of the pie, and he claimed it would be more like 9%. He is wrong. Totally. Completely. He fucked up the math and came to an incorrect conclusion.

Any expected rise in revenue is not material to the discussion at all. They are talking about percentages here, Retail. As in, a percentage of whatever the total revenue of any year may be, regardless of the total pie being larger or smaller in any given year.

Me myopic or you? :bs: Maybe you should know what you're talking about before you throw that term around.

That's only 18.6% if you use the players wage as a starting point. If you look at it in terms of the overall amount (so instead of using 3.42 as the 100% mark--which you did by using it as the denominator in the equation--use the 8 billion that he referenced earlier as being 100%), it's a reduction of 9.75%: (4.2 / 8) - (3.42/8). What this means is that the players are getting 9.75% less of the overall pie. But the relative decrease is 18.6%. So while you're not wrong in that regard, you aren't right either in your overall point.

That 9.75% number is not relevant here. THat's the problem.

The thing Florio is questioning is Smith saying the players would be taking an 18% pay cut. Which they would. The 9.75% is just a misleading way to look at it, as it has no bearing on the actual numbers, and is incorrect to apply here. That's like if I said that I was going to decrease your slice of the pie from 10% to 5% you'd only be getting a 5% decrease, where in reality it would be a 50% decrease for you. I am 100% right. :wink:

I would agree with you on that last point if there wasn't a yearly increase to player salaries.

We could also put it another way to demonstrate why which denominator used is so important.

In 2009, the salary cap was $128 million per team. That means a max of (128x32=4096) $4.096 billion allocated to player salaries alone. In 1994, the salary cap was $34.6 million per team. With 28 teams in 1994, the total amount to the players was (34.6*28=968.8) $969 million. If we use that as the denominator, the players have had a (4096/969=4.227) 422.7% increase in player salaries during the free agency era.

So while someone can look at the relative decrease of 18.6% the owners are asking, I can also look at the relative increase of 422.7% that the players have gained in the last (2009-1994=15) 15 years.

That's an increase of [422.6%^(1/15)=1.496] 49.6% per year for player salaries. An investment that returns 49.6% per year consistently for 15 years is unheard of. Cost of living increases are only 4% per year on average. Which means that the player pool has grown 45.6% per year over inflation.

So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport. In this case, the oversimplification (because I really don't want to calculate the correlation of the percentages) is that 45.6%-18.6% is still an increase of 27%. Yearly. Also, if I understand the argument right, it isn't that the owners want their 9% for profit. They want more money freed up to develop the sport, to fund stadiums, to increase brand and sport awareness--all which makes the NFL as a whole more profitable and continues the increased salaries the players receive.

[sharpe1027]

I would agree with you on that last point if there wasn't a yearly increase to player salaries.

We could also put it another way to demonstrate why which denominator used is so important.

In 2009, the salary cap was $128 million per team. That means a max of (128x32=4096) $4.096 billion allocated to player salaries alone. In 1994, the salary cap was $34.6 million per team. With 28 teams in 1994, the total amount to the players was (34.6*28=968.8) $969 million. If we use that as the denominator, the players have had a (4096/969=4.227) 422.7% increase in player salaries during the free agency era.

So while someone can look at the relative decrease of 18.6% the owners are asking, I can also look at the relative increase of 422.7% that the players have gained in the last (2009-1994=15) 15 years.

That's an increase of [422.6%^(1/15)=1.496] 49.6% per year for player salaries. An investment that returns 49.6% per year consistently for 15 years is unheard of. Cost of living increases are only 4% per year on average. Which means that the player pool has grown 45.6% per year over inflation.

So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport. In this case, the oversimplification (because I really don't want to calculate the correlation of the percentages) is that 45.6%-18.6% is still an increase of 27%. Yearly. Also, if I understand the argument right, it isn't that the owners want their 9% for profit. They want more money freed up to develop the sport, to fund stadiums, to increase brand and sport awareness--all which makes the NFL as a whole more profitable and continues the increased salaries the players receive.

I think the point is that most people would not look at it that way. You could just as easily predict a decrease in revenue and say that they going to take a paycut that is much larger than 18%, but what is the point? The reality is if the proposal goes through, whatever the players would have otherwise made is reduced by 18%. If I go into a business deal with a partner, I sure has hell would not allow him to change my percentage of the profits just because the end result was that I got more than year before. Nobody would find that fair.

As for the 9% not being for profit, I feel that's a little misleading. Don't the the owners already pay for that stuff (and have every incentive to do so)? Basically, the owners are asking the players to pay for that stuff so they don't have to, meaning the owners can reduce their personal investments in that stuff and make more profit. Also, why wouldn't it just be 4.5% from both sides then? Personally, I think it is more of a political gimmick than anything else.

[Smidgeon]

I would agree with you on that last point if there wasn't a yearly increase to player salaries.

We could also put it another way to demonstrate why which denominator used is so important.

In 2009, the salary cap was $128 million per team. That means a max of (128x32=4096) $4.096 billion allocated to player salaries alone. In 1994, the salary cap was $34.6 million per team. With 28 teams in 1994, the total amount to the players was (34.6*28=968.8) $969 million. If we use that as the denominator, the players have had a (4096/969=4.227) 422.7% increase in player salaries during the free agency era.

So while someone can look at the relative decrease of 18.6% the owners are asking, I can also look at the relative increase of 422.7% that the players have gained in the last (2009-1994=15) 15 years.

That's an increase of [422.6%^(1/15)=1.496] 49.6% per year for player salaries. An investment that returns 49.6% per year consistently for 15 years is unheard of. Cost of living increases are only 4% per year on average. Which means that the player pool has grown 45.6% per year over inflation.

So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport. In this case, the oversimplification (because I really don't want to calculate the correlation of the percentages) is that 45.6%-18.6% is still an increase of 27%. Yearly. Also, if I understand the argument right, it isn't that the owners want their 9% for profit. They want more money freed up to develop the sport, to fund stadiums, to increase brand and sport awareness--all which makes the NFL as a whole more profitable and continues the increased salaries the players receive.

I think the point is that most people would not look at it that way. You could just as easily predict a decrease in revenue and say that they going to take a paycut that is much larger than 18%, but what is the point? The reality is if the proposal goes through, whatever the players would have otherwise made is reduced by 18%. If I go into a business deal with a partner, I sure has hell would not allow him to change my percentage of the profits just because the end result was that I got more than year before. Nobody would find that fair.

As for the 9% not being for profit, I feel that's a little misleading. Don't the the owners already pay for that stuff (and have every incentive to do so)? Basically, the owners are asking the players to pay for that stuff so they don't have to, meaning the owners can reduce their personal investments in that stuff and make more profit. Also, why wouldn't it just be 4.5% from both sides then? Personally, I think it is more of a political gimmick than anything else.

My point was simply to point out that there's mathematically far more to this than just 9% versus 18%. Anyone who says one or the other is oversimplifying. I don't care who gets what slice of the pie. I just want to be able to follow my team instead of being stuck watching NASCAR because there is no football on.

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side. As to the politics of it, I don't know. But to the purpose of costs, the argument is that cost allocations that used to be shouldered primarily by a third party (stadiums that were publicly funded) are now being shouldered primarily by the owners and investors.

So the argument for 18% being reallocated to the cost share is basically like a company reallocating more money to research and development because that company feels like there's a combination of a recent fading out of outside money coming into R&D and that an increase of funds contributed to R&D will grow the company much more dramatically than any other avenue.

[sharpe1027]

My point was simply to point out that there's mathematically far more to this than just 9% versus 18%. Anyone who says one or the other is oversimplifying. I don't care who gets what slice of the pie. I just want to be able to follow my team instead of being stuck watching NASCAR because there is no football on.


There is a basis point (total revenue) from which the current system operates. The proposal results in an 18% loss in what players would receive relative to the basis point. I disagree that it is much more complex "mathematically" just because the basis point changes once a year. Maybe we just have a different threshold of simple? :wink:

[sharpe1027]

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side.

I had not heard this. Their proposal would make more sense if their percentage was also reduced. Of course, it would still benefit the owners more than the players as these cost were traditionally payed for by owners. I would assume that this was understood by both sides when the current agreement was signed.

[get louder at lambeau]

I just commented on this story at PFT. Florio's confusing himself by overcomplicating the math. He says the players' take would go from $4.2 bil to $3.42 bil. Now divide the latter by the former- 81.4%- an 18.6% decrease. Ta da. His own numbers prove his whole premise is stupid.

I think you might be confusing yourself by undercomplicating the math. Your viewpoint seems a bit myopic, it assumes that revenues remain constant from year to year, which is highly unlikely.

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.

I didn't find Florio's premis stupid, in fact, I got a great deal from it.

His premise is that Smith was lying by saying it would be an 18% reduction in their total slice of the pie, and he claimed it would be more like 9%. He is wrong. Totally. Completely. He fucked up the math and came to an incorrect conclusion.

Any expected rise in revenue is not material to the discussion at all. They are talking about percentages here, Retail. As in, a percentage of whatever the total revenue of any year may be, regardless of the total pie being larger or smaller in any given year.

Me myopic or you? :bs: Maybe you should know what you're talking about before you throw that term around.

That's only 18.6% if you use the players wage as a starting point. If you look at it in terms of the overall amount (so instead of using 3.42 as the 100% mark--which you did by using it as the denominator in the equation--use the 8 billion that he referenced earlier as being 100%), it's a reduction of 9.75%: (4.2 / 8) - (3.42/8). What this means is that the players are getting 9.75% less of the overall pie. But the relative decrease is 18.6%. So while you're not wrong in that regard, you aren't right either in your overall point.

That 9.75% number is not relevant here. THat's the problem.

The thing Florio is questioning is Smith saying the players would be taking an 18% pay cut. Which they would. The 9.75% is just a misleading way to look at it, as it has no bearing on the actual numbers, and is incorrect to apply here. That's like if I said that I was going to decrease your slice of the pie from 10% to 5% you'd only be getting a 5% decrease, where in reality it would be a 50% decrease for you. I am 100% right. :wink:

I would agree with you on that last point if there wasn't a yearly increase to player salaries.

We could also put it another way to demonstrate why which denominator used is so important.

In 2009, the salary cap was $128 million per team. That means a max of (128x32=4096) $4.096 billion allocated to player salaries alone. In 1994, the salary cap was $34.6 million per team. With 28 teams in 1994, the total amount to the players was (34.6*28=968.8) $969 million. If we use that as the denominator, the players have had a (4096/969=4.227) 422.7% increase in player salaries during the free agency era.

So while someone can look at the relative decrease of 18.6% the owners are asking, I can also look at the relative increase of 422.7% that the players have gained in the last (2009-1994=15) 15 years.

That's an increase of [422.6%^(1/15)=1.496] 49.6% per year for player salaries. An investment that returns 49.6% per year consistently for 15 years is unheard of. Cost of living increases are only 4% per year on average. Which means that the player pool has grown 45.6% per year over inflation.

So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport. In this case, the oversimplification (because I really don't want to calculate the correlation of the percentages) is that 45.6%-18.6% is still an increase of 27%. Yearly. Also, if I understand the argument right, it isn't that the owners want their 9% for profit. They want more money freed up to develop the sport, to fund stadiums, to increase brand and sport awareness--all which makes the NFL as a whole more profitable and continues the increased salaries the players receive.

The 9.75% number is just as independent of year to year growth as the 18% number. You're confused.

Your 9.75% number was based on static numbers just like the 18% number- They just reflect different viewpoints. 18% is the change in the PLAYERS' SHARE of total share of revenue from the players perspective, which is the valid number here, as it was what Smith claimed and what Florio disputed. Your 9.75% number is change in players' share as expressed as a percentage of total revenue. Both are completely independent of year to year change in total revenue.


On that day, Executive Director De Smith harped on the allegation that the league wants the players to take an "18 percent pay cut."

That is based on the proposed reduction of the players' current piece of the pie, and it's accurate as stated, IMO. Their total pay per year is based on a percentage of total revenue, not based on a static number. If they were to play under the proposed CBA, as opposed to the previous CBA that would have been in place if the owners had not recalled it, the difference is an 18% pay cut, regardless of the total revenue for any given year. Not a year to year pay cut, but an old CBA to new CBA pay cut. I think that's where the misunderstanding is coming from. Year to year increases in total NFL revenue is not the issue here- how much of that total the players get is.

IF you buy the owners' line that it will be better for the players if they give up a larger share of total revenue, then you're just plain naiive. If it was, there would be no argument between teh NFL and NFLPA at all.

[Smidgeon]

My point was simply to point out that there's mathematically far more to this than just 9% versus 18%. Anyone who says one or the other is oversimplifying. I don't care who gets what slice of the pie. I just want to be able to follow my team instead of being stuck watching NASCAR because there is no football on.


There is a basis point (total revenue) from which the current system operates. The proposal results in an 18% loss in what players would receive relative to the basis point. I disagree that it is much more complex "mathematically" just because the basis point changes once a year. Maybe we just have a different threshold of simple? :wink:

See, that's the thing. If you use total revenue as the basis point, the players are only losing 9% under the proposal. If, however, you use the proportion the players are currently getting as the basis point, then they're losing 18%.

[sharpe1027]

See, that's the thing. If you use total revenue as the basis point, the players are only losing 9% under the proposal. If, however, you use the proportion the players are currently getting as the basis point, then they're losing 18%.

No. You are getting confused. Both numbers use total revenue as the basis point, the are just describing two different things. Since we are talking specifically about the players change in salary. Relative to the basis point and comparing one CBA to another, it is an 18% reduction and NOT a 9% reduction. Make sense?

[Smidgeon]

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side.

I had not heard this. Their proposal would make more sense if their percentage was also reduced. Of course, it would still benefit the owners more than the players as these cost were traditionally payed for by owners. I would assume that this was understood by both sides when the current agreement was signed.

Well, actually the argument is that these costs are not all things that were traditionally paid for by the owners. The example I posted about stadiums being more privately funded than previously is one example.

The other side of it is the argument that the costs have grown at a faster pace than the revenues. In which case though the costs have been traditionally shouldered by the owners, their revenues are taking a hit that the players' revenues aren't. So in effect it's a redistribution.

[Smidgeon]

See, that's the thing. If you use total revenue as the basis point, the players are only losing 9% under the proposal. If, however, you use the proportion the players are currently getting as the basis point, then they're losing 18%.

No.

Care to explain?

[sharpe1027]

If they were to play under the proposed CBA, as opposed to the previous CBA that would have been in place if the owners had not recalled it, the difference is an 18% pay cut, regardless of the total revenue for any given year. Not a year to year pay cut, but an old CBA to new CBA pay cut. I think that's where the misunderstanding is coming from. Year to year increases in total NFL revenue is not the issue here- how much of that total the players get is.


This.

[Smidgeon]

That is based on the proposed reduction of the players' current piece of the pie, and it's accurate as stated, IMO. Their total pay per year is based on a percentage of total revenue, not based on a static number. If they were to play under the proposed CBA, as opposed to the previous CBA that would have been in place if the owners had not recalled it, the difference is an 18% pay cut, regardless of the total revenue for any given year. Not a year to year pay cut, but an old CBA to new CBA pay cut. I think that's where the misunderstanding is coming from. Year to year increases in total NFL revenue is not the issue here- how much of that total the players get is.

IF you buy the owners' line that it will be better for the players if they give up a larger share of total revenue, then you're just plain naiive. If it was, there would be no argument between teh NFL and NFLPA at all.

I agree that the numbers exist in relativity.

As for your second to last paragraph, no it isn't that simple. Even if that's what the owners really mean (and I'm not convinced that's what they do, just playing devil's advocate), an argument would still exist between the two sides. Business negotiations are complicated things that make even the most insignificant detail a heated disagreement. And since "it will be better for the players" is such a vague argument that can't be proven since it depends on unrealized future growth, even a pure motive will be questioned and prodded.

[Smidgeon]

If they were to play under the proposed CBA, as opposed to the previous CBA that would have been in place if the owners had not recalled it, the difference is an 18% pay cut, regardless of the total revenue for any given year. Not a year to year pay cut, but an old CBA to new CBA pay cut. I think that's where the misunderstanding is coming from. Year to year increases in total NFL revenue is not the issue here- how much of that total the players get is.


This.

9% relative to total revenue
18% relative to the revenue the players are currently receiving under prior CBA

Don't get total revenue confused with allocated share.

[sharpe1027]

Is it correct that the players would receive 18% less under the new CBA than under the existing CBA?

Answer: Yes.

[Smidgeon]

Is it correct that the players would receive 18% less under the new CBA than under the existing CBA?

Answer: Yes.

But not on the basis of total revenue like you declared earlier.

Percentages and proportions are all relative. Every single time. That's why the owners can claim 9% and the players claim 18% and both be right. They're both using different starting points.

[sharpe1027]

Is it correct that the players would receive 18% less under the new CBA than under the existing CBA?

Answer: Yes.

But not on the basis of total revenue like you declared earlier. Percentages and proportions are all relative. Every single time.

Actually either both the numbers are "on the basis of total revenue," or neither is, depending on how you look at it.

I am guessing that by this point you are trying to prove me wrong rather than trying to decide whether Florio was correct or not. I refuse to take the bait, what I said is correct.

Player salary change = ((Total revenue) X (New CBA%))/((Total revenue) X (New CBA%))

Total revenue drops out of the equation completely (XY/XZ) = Y/Z

(Old CBA%)/(New CBA%) = (41%)/(50%) = 82% of original .... or 18%.

So, what the total revenue actually is or is not (unless it is zero) makes no difference to the statement at issue.

Is it correct that the players would receive 18% less under the new CBA than under the existing CBA, irrespective of what the total revenue might be?

Answer: Yes.

[Smidgeon]

I am guessing that by this point you are trying to prove me wrong rather than trying to decide whether Florio was correct or not. I refuse to take the bait, what I said is correct.

First, keep your opinions on my motives to yourself. Your opinions are unfounded seeing as you've never met me and have no idea how I process through ideas.

What I said was correct as well. Just because you don't agree doesn't mean my math was wrong.

As to whether Florio was correct or not, he was only half right, but he wasn't all wrong. Relative to total revenue, the portion shouldered is 9%. Relative to existing salary, the pay cut would be 18%. Both are true statements.

[get louder at lambeau]

What I said was correct as well.

Not this part-

That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

Sorry to be an ass, but it's not.

[Smidgeon]

What I said was correct as well.

Not this part-

That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

Sorry to be an ass, but it's not.

If 18% of the total revenue (9% from owners and 9% from players) is reallocated to costs that include and are for the benefit of the growth of the sport (new stadiums, advertising, developing international awareness), then yes, that statement is correct.

If you're talking just the 18% cut from the basis of the player salaries, it's irrelevant. If you start with the total revenue, it's relevant.

[get louder at lambeau]

What I said was correct as well.

Not this part-

That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

Sorry to be an ass, but it's not.

If 18% of the total revenue (9% from owners and 9% from players) is reallocated to costs that include and are for the benefit of the growth of the sport (new stadiums, advertising, developing international awareness), then yes, that statement is correct.

If you're talking just the 18% cut from the basis of the player salaries, it's irrelevant. If you start with the total revenue, it's relevant.

Those costs are currently all on the owners. As they should be. As they always have been. Labor unions don't pay owners' expenses. I think that's just the owners' way of trying to make their side look better.

It's like the Government trying to tell you that you aren't really paying more taxes, you're investing in America! :D

[Smidgeon]

What I said was correct as well.

Not this part-

That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

Sorry to be an ass, but it's not.

If 18% of the total revenue (9% from owners and 9% from players) is reallocated to costs that include and are for the benefit of the growth of the sport (new stadiums, advertising, developing international awareness), then yes, that statement is correct.

If you're talking just the 18% cut from the basis of the player salaries, it's irrelevant. If you start with the total revenue, it's relevant.

Those costs are currently all on the owners. As they should be. As they always have been. Labor unions don't pay owners' expenses. I think that's just the owners' way of trying to make their side look better.

It's like the Government trying to tell you that you aren't really paying more taxes, you're investing in America! :D

It isn't quite true to say that it's always been on the owners. While the lions' share has been, it was easier to get public funding for stadiums in the past. So the argument is that it's a new(ish) cost to both sides.

The other side of the equation (and this part is all speculation but kind of makes sense to me---maybe) is that the costs are expanding disproportionally. While under the old CBA $1 billion costs pre-pie cutting between owners and players was deemed fair, maybe more is necessary now. That part I don't know and I don't think anyone will know unless and until the owners open up their books for review.

[sharpe1027]

First, keep your opinions on my motives to yourself. Your opinions are unfounded seeing as you've never met me and have no idea how I process through ideas.

Boo Hoo. Coming from the guy who said "Anyone who says one or the other is oversimplifying" as if yours is the only opinion.



What I said was correct as well. Just because you don't agree doesn't mean my math was wrong.

What you said was:



"there's mathematically far more to this than just 9% versus 18%"

I showed you the math above, it's not very difficult.



So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

18% also takes into account the growth of the sport, for the exact same reasons. For example, if there is a 50% increase in revenue, than the 9.75% decrease is less than 9.75%, just the use the same math you applied to the 18% in your example. Before you go there, you were not wrong that the 18% could be looked at in absolute terms, but what you said was that the 9.75% was suddenly relevant because of that. Not true, it is subject to the same effect.



If you use total revenue as the basis point, the players are only losing 9% under the proposal. If, however, you use the proportion the players are currently getting as the basis point, then they're losing 18%.

The problem with your analysis is that both 9% and 18% originate from the total revenue. Go ahead and try to calculate how much money each represents, the only way to do it is to start from the total revenue for a particular year. Your arguments are all mixed up.



But not on the basis of total revenue like you declared earlier.

Really? How do you propose determining the actual amounts without knowledge of total revenue? You can't. Each of them are based upon and change with the total revenue. What I said is correct.



As to whether Florio was correct or not, he was only half right, but he wasn't all wrong. Relative to total revenue, the portion shouldered is 9%. Relative to existing salary, the pay cut would be 18%. Both are true statements.

Florio said that 18% was a misrepresentation. It is not. Florio was wrong to say that.

[Smidgeon]

First, keep your opinions on my motives to yourself. Your opinions are unfounded seeing as you've never met me and have no idea how I process through ideas.

Boo Hoo. Coming from the guy who said "Anyone who says one or the other is oversimplifying" as if yours is the only opinion.

At any point, did I conjecture why you disagreed with me? My statement and your statement are apples and oranges.




What I said was correct as well. Just because you don't agree doesn't mean my math was wrong.

What you said was:



"there's mathematically far more to this than just 9% versus 18%"

I showed you the math above, it's not very difficult.

I also showed you my math above. Was my math incorrect?




So while 10%-5% is a 50% decrease, if there's a 50% raise that happens before that, 15%-10% is only a 33% decrease. That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

18% also takes into account the growth of the sport, for the exact same reasons. For example, if there is a 50% increase in revenue, than the 9.75% decrease is less than 9.75%, just the use the same math you applied to the 18% in your example. Before you go there, you were not wrong that the 18% could be looked at in absolute terms, but what you said was that the 9.75% was suddenly relevant because of that. Not true, it is subject to the same effect.

I'm getting all confused on this one with so many numbers floating around in my head, so I'll concede this point for the sake of peace.




If you use total revenue as the basis point, the players are only losing 9% under the proposal. If, however, you use the proportion the players are currently getting as the basis point, then they're losing 18%.

The problem with your analysis is that both 9% and 18% originate from the total revenue. Go ahead and try to calculate how much money each represents, the only way to do it is to start from the total revenue for a particular year. Your arguments are all mixed up.

I don't believe my arguments are mixed up. Using the quote above, I'm saying that both perspectives can be stated accurately.




But not on the basis of total revenue like you declared earlier.

Really? How do you propose determining the actual amounts without knowledge of total revenue? You can't. Each of them are based upon and change with the total revenue. What I said is correct.

Okay, in my head, "on the basis of" means "the denominator of the equation".




As to whether Florio was correct or not, he was only half right, but he wasn't all wrong. Relative to total revenue, the portion shouldered is 9%. Relative to existing salary, the pay cut would be 18%. Both are true statements.

Florio said that 18% was a misrepresentation. It is not. Florio was wrong to say that.

I agree that saying "18% is wrong" isn't the complete story and because of that is an incorrect statement. But my overall point is that 9.75% = 18% depending on what you're looking at.

That's been my only point the entire way through.

[Administrator]

sharpe, if you can't argue your point without insults, then stop.

I would recommend that you spend some time looking at the math from Smidgeons perspective, he has a point that you're missing.

Smideon - well done. You gave a great explanation, backed with facts and explanation. We need more of that around here.

[get louder at lambeau]

What I said was correct as well.

Not this part-

That's why the 9.75% is relevant. It's because it takes into account the growth of the sport.

Sorry to be an ass, but it's not.

If 18% of the total revenue (9% from owners and 9% from players) is reallocated to costs that include and are for the benefit of the growth of the sport (new stadiums, advertising, developing international awareness), then yes, that statement is correct.

If you're talking just the 18% cut from the basis of the player salaries, it's irrelevant. If you start with the total revenue, it's relevant.

Those costs are currently all on the owners. As they should be. As they always have been. Labor unions don't pay owners' expenses. I think that's just the owners' way of trying to make their side look better.

It's like the Government trying to tell you that you aren't really paying more taxes, you're investing in America! :D

It isn't quite true to say that it's always been on the owners. While the lions' share has been, it was easier to get public funding for stadiums in the past. So the argument is that it's a new(ish) cost to both sides.

The other side of the equation (and this part is all speculation but kind of makes sense to me---maybe) is that the costs are expanding disproportionally. While under the old CBA $1 billion costs pre-pie cutting between owners and players was deemed fair, maybe more is necessary now. That part I don't know and I don't think anyone will know unless and until the owners open up their books for review.

New costs are not new to both sides, because this is not a 50-50 partnership. This is labor v management. All costs are on the owners no matter what, unless they are going to give the NFLPA stock in the teams. Whether or not they get public stadium financing has no bearing on it. The intention of this CBA recall and renegotiation is and always has been to decrease labor costs for NFL franchises. Owners argue a hardship in remaining profitable, but refuse to show the proof of their claim. If I was the NFLPA, I wouldn't have much sympathy for that point of view.

The owners are not losing money here; they are just not making as much as they think they can, and they think they can cut labor costs by leveraging their ability to survive a lockout against the players' ability to withstand one. If this was about growing the league, the owners wouldn't be threatening a lockout. Lockouts are pretty bad for growth.

[sharpe1027]

At any point, did I conjecture why you disagreed with me? My statement and your statement are apples and oranges.

Your oranges are no better than my apples.




I also showed you my math above. Was my math incorrect?

Nope, never said your math was wrong. Your statements and conclusions stemming from the math had some problems (see you concession below).



I'm getting all confused on this one with so many numbers floating around in my head, so I'll concede this point for the sake of peace.

How gracious of you.



I don't believe my arguments are mixed up. Using the quote above, I'm saying that both perspectives can be stated accurately.

The problem with your analysis is that both 9% and 18% originate from the total revenue.



Okay, in my head, "on the basis of" means "the denominator of the equation".

The 18% is calculated from the total revenue in just as 9% is calculated from total revenue. I admit I have no idea what is in your head.



Florio said that 18% was a misrepresentation. It is not. Florio was wrong to say that.

I agree that saying "18% is wrong" isn't the complete story and because of that is an incorrect statement. But my overall point is that 9.75% = 18% depending on what you're looking at.

That's been my only point the entire way through.[/quote]

Your point has also been that myself and others were wrong. Which is rather annoying since you based your argument upon what you admit is "in your head," rather than what I said.

[sharpe1027]

I have to laugh at the title of this thread given the heated debate. The original point of the thread was whether Florio was wrong that the statement was blatantly false.

The answer is pretty conclusive that it is not a false statement. Can you come up with different numbers? Sure. But 18% is a valid number. Florio's explanation shows a lack of basic math skills.

Mr. Admin, I hope can understand my frustration with a certain poster's continual attempts to argue. Either this poster is incorrect (even he admits that 18% is at least one way to look at it)...or the point this poster is arguing about has little to do with the original point of the discussion. To me it feels like the common thread of his arguments were a disagreement with particular points from my posts, rather than the main issue.

This is rather frustrating to deal with and did cause me to guess as to his true intentions. To the extent that my guess is wrong and is perceived as an "insult," I would apologize. Seriously though, that has to be one of the lamest insults ever. :roll:

[sharpe1027]

sharpe, if you can't argue your point without insults, then stop.

I would recommend that you spend some time looking at the math from Smidgeons perspective, he has a point that you're missing.

Smideon - well done. You gave a great explanation, backed with facts and explanation. We need more of that around here.

Since you removed my previous post. I truly would like to know what you consider an insult. If you can not explain yourself, how can you expect us to avoid repeating?

[pbmax]

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.
Where did you hear that revenues are expected to decrease?

Even owners aren't making that claim. They are claiming costs (related to financing and new stadium costs) have risen faster than they projected. I have seen nothing about a revenue decline, even if you account for inflation.

[pbmax]

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side.
In the strict terms of this CBA proposal, that figure is incorrect. The players would (using 2009 dollars) take an 18% cut. That money flows back to top line revenue. That is, the money not paid to players under the new proposal compared to the old goes to a pool of revenue that is excluded from player revenue calculations.

All that money is available to owners. Now some amount of that money may be used to pay increased non-player costs, but we have no figures available to know what those costs are.

[Administrator]

sharpe, if you can't argue your point without insults, then stop.

I would recommend that you spend some time looking at the math from Smidgeons perspective, he has a point that you're missing.

Smideon - well done. You gave a great explanation, backed with facts and explanation. We need more of that around here.

Since you removed my previous post. I truly would like to know what you consider an insult. If you can not explain yourself, how can you expect us to avoid repeating?

I haven't deleted ANY posts. I have no idea what you're talking about.

The ONLY one here who is arguing is you. Smidgeon hasn't gone "after you" once. Referring to another post you made, I do mind you standing up for your point. Your tone "stinks". If you can't argue without getting personal and insulting, then stop. This was a very good spirited debate until you started that crap.

Thank you.

[Administrator]

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side.
In the strict terms of this CBA proposal, that figure is incorrect. The players would (using 2009 dollars) take an 18% cut. That money flows back to top line revenue. That is, the money not paid to players under the new proposal compared to the old goes to a pool of revenue that is excluded from player revenue calculations.

All that money is available to owners. Now some amount of that money may be used to pay increased non-player costs, but we have no figures available to know what those costs are.

I think you brought up a good point in this discussion. However, you can't use 2009 dollars to compare 2010 revenues and percentage splits. Right now, you can't calculate what the change will actually be, because you do not have 2010 revenues. Nor do we have all the provisions of the CBA to figure the exceptions to the agreed split.

If the union says "18%" you know it'll be less than that. If the NFL says "9%" you know it'll be higher than that. But, today, you can't fully calculate it.

[sharpe1027]

I haven't deleted ANY posts. I have no idea what you're talking about.

The ONLY one here who is arguing is you. Smidgeon hasn't gone "after you" once. Referring to another post you made, I do mind you standing up for your point. Your tone "stinks". If you can't argue without getting personal and insulting, then stop. This was a very good spirited debate until you started that crap.

Thank you.

Fair enough. I'll chalk it up to operator error on my part.

You accuse me of getting personal, insulting and starting crap. What insults? What is so personal? What is starting crap? Please take a minute and look through the thread. To state that I am the only one that is arguing is quite frankly BS.

The main point of the discussion is whether or not Florio was wrong. Smidgeon likes to poke holes and try to prove others wrong, which is fine. But if I still believe I am correct and point by point explain my position, is that starting crap?

You talk about "tone." Perhaps you are inferring things about the intent behind my posts? The vast majority of my posts are fact/logic based arguments. Perhaps by pointing out the inconsistencies of Smidgeon's posts my "tone" is perceived by you to be a bit rough. Still, I did not use a single name, wasn't calling him stupid or anything else to personally insult him (other than disagreeing and pointing out flaws).

If you are going to take sides and make suggestions, perhaps you should be a little more judicious in how you do so.

[pbmax]

As for the 4.5% versus 9%, the owners are asking for 18% being reallocated to costs and 9% being shouldered by each side.
In the strict terms of this CBA proposal, that figure is incorrect. The players would (using 2009 dollars) take an 18% cut. That money flows back to top line revenue. That is, the money not paid to players under the new proposal compared to the old goes to a pool of revenue that is excluded from player revenue calculations.

All that money is available to owners. Now some amount of that money may be used to pay increased non-player costs, but we have no figures available to know what those costs are.

I think you brought up a good point in this discussion. However, you can't use 2009 dollars to compare 2010 revenues and percentage splits. Right now, you can't calculate what the change will actually be, because you do not have 2010 revenues. Nor do we have all the provisions of the CBA to figure the exceptions to the agreed split.

If the union says "18%" you know it'll be less than that. If the NFL says "9%" you know it'll be higher than that. But, today, you can't fully calculate it.
But 2009 dollars are the closest set of numbers we have. The owners are not going to disclose revenue numbers expected in 2010. They are even reluctant to share cost data.

So its either deal with the last set of known figures or speculate on 2010. And if I was constructing the argument for the players, I would avoid speculating on unknown numbers. Look at the confusion sown by simply looking at the same, known numbers from two different perspectives.

[get louder at lambeau]

Well, pb, your thread is ruined. Lots of arguing, intervention from the Admin, strange disappearing posts. "World's Most Boring Thread" it is not. :satan:

[pbmax]

Ruined?! Hah!

We haven't even begin to argue. Wait 'til Patler gets here and shows us how we went wrong. :lol:

This article (and thread) is why I do not mind opinion pieces of any stripe in journalism. Its far better to lay out all the cards for people to view and argue about openly than to debate the aesthetics of the kabuki theatre that usually marks public debate.

Of course, its easier in this case as everyone agrees at the very least on what the numbers are. If not what they mean, or which are more important.

[Guiness]

I think you brought up a good point in this discussion. However, you can't use 2009 dollars to compare 2010 revenues and percentage splits. Right now, you can't calculate what the change will actually be, because you do not have 2010 revenues. Nor do we have all the provisions of the CBA to figure the exceptions to the agreed split.

If the union says "18%" you know it'll be less than that. If the NFL says "9%" you know it'll be higher than that. But, today, you can't fully calculate it.
But 2009 dollars are the closest set of numbers we have. The owners are not going to disclose revenue numbers expected in 2010. They are even reluctant to share cost data.

So its either deal with the last set of known figures or speculate on 2010. And if I was constructing the argument for the players, I would avoid speculating on unknown numbers. Look at the confusion sown by simply looking at the same, known numbers from two different perspectives.

I'm with pb on this part of the argument - the union has no better figures to use than 2009, and that's on the owners. If the owners really wanted open negotiations, they'd disclose more.

Having said that, the owners have no obligation to do so, and if I side with their decision to tell the players to go piss up a rope when they ask.

[Guiness]

Here some writers write something on a subject there is nothing to write about right now.


NDIANAPOLIS -- NFL commissioner Roger Goodell and NFL Players Association executive director DeMaurice Smith spent about 1 hour, 40 minutes working on a new collective bargaining agreement Thursday, then left without saying a word.


Goodell eventually returned to the hotel lobby hours later, after participating in the league's competition committee meeting and reiterated the league's position of finishing a new deal before the CBA expires in March 2011.

"It doesn't pay to characterize everything," Goodell said. "They [the players] know our desire to get a deal done and we've got to keep working to do that."

The two sides held their latest round of negotiations in an Indianapolis hotel ballroom as the league's annual scouting combine began. Goodell said the two sides discussed "setting up" another meeting, but did not establish a date.

Thursday's topics included the appeals process for disciplinary actions and player safety issues, things Goodell expressed interest in implementing before a deal is completed.

Goodell declined to discuss other topics on the agenda, but said he remains hopeful the two sides will negotiate a deal before the CBA expires.

"I think it's natural that deadlines produce results, so I think deadlines help," he said. "I think there is a general desire on both sides to get a deal. But I don't think you can create artificial deadlines."

The first official deadline is March 5. If players and owners do not reach an agreement by then, the league will have its first non-salary cap season since 1993.

Goodell ruled out any chance of the owners agreeing to a temporary one-year salary cap to avoid an uncapped season, saying that's the reason owners opted out of the previous deal in the spring of 2008.

And it's increasingly likely no deal will be finished by then.

"I guess till you get to March 5, there's always a chance," Goodell said.

But players are looking to a more ominous deadline next March.

They believe no deal will lead to a lockout before the start of the 2011 season. The union has instructed players to plan appropriately so their families can have a similar lifestyle if there is a lockout. Player reps and union officials declined questions Thursday morning and Thursday afternoon.

Smith was joined at the negotiating table by several player representatives including Jeff Saturday of Indianapolis and Mike Vrabel of Kansas City. About 15 player reps also attended the competition committee meeting.

Goodell brought a group of league executives to the bargaining session, including executive vice president and general counsel Jeff Pash.

The meeting was supposed to last about one hour but went longer than expected.

Goodell appeared to be in good spirits when he entered the room. He smiled and hugged one player before negotiations began. When the session broke up, both sides came out expressionless.

The NFLPA also sent out a memo Tuesday saying it does not expect a new deal to be in place by March 5 when free agents can start signing with new teams.

Smith has said the sides have met more than 30 times in the past six months.

[sharpe1027]

I think you brought up a good point in this discussion. However, you can't use 2009 dollars to compare 2010 revenues and percentage splits. Right now, you can't calculate what the change will actually be, because you do not have 2010 revenues. Nor do we have all the provisions of the CBA to figure the exceptions to the agreed split.

If the union says "18%" you know it'll be less than that. If the NFL says "9%" you know it'll be higher than that. But, today, you can't fully calculate it.

It is true that they will each happily cook the books to win the PR war. However, if the NFL owners are saying 9%, they are essentially agreeing with the 18% since the two numbers are linked (18% is just 2 X 9%). For instance, if the NFL had said 4% change in shared revenue, then the players would be losing 8% from one CBA to the next. Make sense?

[Administrator]

I think you brought up a good point in this discussion. However, you can't use 2009 dollars to compare 2010 revenues and percentage splits. Right now, you can't calculate what the change will actually be, because you do not have 2010 revenues. Nor do we have all the provisions of the CBA to figure the exceptions to the agreed split.

If the union says "18%" you know it'll be less than that. If the NFL says "9%" you know it'll be higher than that. But, today, you can't fully calculate it.

It is true that they will each happily cook the books to win the PR war. However, if the NFL owners are saying 9%, they are essentially agreeing with the 18% since the two numbers are linked (18% is just 2 X 9%). For instance, if the NFL had said 4% change in shared revenue, then the players would be losing 8% from one CBA to the next. Make sense?

No it doesn't make sense. You are so wrapped up in your point you can't see the big picture. I know you think you can, but you cannot.

Until you understand ALL the ways to calculate this, you have blinders on.

The 18% could be and is most likely political BS. We won't know until the 2010 revenue figures are released and we figure the percentages exactly as Smidgeon showed.

The ONLY way that 18% is accurate is if 2010 revenue is EXACTLY the same as 2009 revenue. Otherwise, it's a wrong number. You take the odds on that. I know what I betting on. 18% is wrong.

[ThunderDan]

Why don't we look at actual numbers?

2009 Revenue $8,000,000,000.

1 billion comes off the top for the owners so that leaves 7 billion.

59.6% of 7 billion (as a CPA it sure is hard to write the b word when you are use to dealing with multi-million dollar entites) is $4,172,000,000 for the players.

Under the new system we take the 7 billion and take 18% (off the top) away and that leaves $5,740,000,000. Multiply that by 59.6% and the players get $3,421,040,000.

That is an 18% reduction in the compensation paid to the players.

As a % of the total 8 billion dollars in the first scenario the players get 52.15% and only 42.76% in the second. A 9.39% reduction of total revenue.

I have never ever heard an owner of a business that I work with say well my compensation only went down 9% of total revenue when his take home pay is cut 18%.

[ThunderDan]

Now lets look at another scenario.

Revenues increase by 10% for the league in 2010 to $8.8 billion.

1 billion dollars comes off the top right away (how many new reasonable stadiums will $1,000,000,000 build a year owners?).

With the old system $7.8 b x 59.6% is $4,648,800,000 for the players.

With the new system the we take off an additional 18% leaving $6,396,000,000 in the pool before multiplying by 59.6%. The players get $3,812,016,000. That is an 18% reduction from the old system.

Compared to 2009 player compensation would go from $4,172,000,000 to $3,812,016,000. An actual decrease of 8.7% from 2009.

The owners from $3,828,000,000 to $4,987,984,000 an increase of 30.3%

So to sum up, in this scenario the NFL grows 10% and the players get 8.7% less and the owners get 30.3% more.

[ThunderDan]

Lets look if the NFL vrevenues shrunk 10% next year.

Total revenues go down to $7,200,000,000.

$1 billion comes off the top leaving $6,200,000,000.

Under the old system the players would get $3,695,200,000.

Under the new system they would get $3,030,064,000. An 18% decrease from the old way.

Compared to 2009 they go from $4,172,000,000 to $3,030,064,000. A decrease of 27.4%.

The owners go from $3,828,000,000 to $4,169,936,000. An increase of 8.9%

So to sum this scenario up, a 10% decrease in revenues would lead to the players getting 27.4% less and the owners get 8.9% more than 2009.

[sharpe1027]

No it doesn't make sense. You are so wrapped up in your point you can't see the big picture. I know you think you can, but you cannot.

Until you understand ALL the ways to calculate this, you have blinders on.

The 18% could be and is most likely political BS. We won't know until the 2010 revenue figures are released and we figure the percentages exactly as Smidgeon showed.

The ONLY way that 18% is accurate is if 2010 revenue is EXACTLY the same as 2009 revenue. Otherwise, it's a wrong number. You take the odds on that. I know what I betting on. 18% is wrong.

You are being an ass for no good reason.

If the owners said that it shifts by 9%, then the math requires that the players lose 18%. It is irrefutable.

Total Revenue = R
Player Percentage Under CBA1 = P1
Player Percentage Under CBA2 = P2
Actual Player Money Under CBA1 = R X P1
Actual Player Money Under CBA2 = R X P2

P1 is near 50%. If the Owners agree that the amount of revenue shared shifts by 9%, then P2 = 41%.

Percentage of Player change:

(R X P2) / (R X P1) = P2/P1 = 41/50 = 18% change. So, again, if the owner's agree that the shift is 9%, then the actual player change between CBA agreements MUST be 18%. Other numbers do not matter.

Now, if the 9% is not assumed (e.g., the revenue changes from 2009 to 2010), then you are correct that we don't know where the real numbers will come out (see Thunderdan's post). However, what I said is correct: if it is a 9% shift, then it must be a 18% reduction. Please calm down. :(

[get louder at lambeau]

The ONLY way that 18% is accurate is if 2010 revenue is EXACTLY the same as 2009 revenue. Otherwise, it's a wrong number. You take the odds on that. I know what I betting on. 18% is wrong.

Looks like you would lose that bet, based on calculations by our resident CPA, ThunderDan, with both increased and decreased revenue scenarios represented in the math. I know you're the Admin and all, but in this case I think Dan outranks you, kinda like how Favre outranks Childress. :wink:

[Guiness]

Thanks for writing that up TD - I quickly scribbled it down and came to the same conclusion, but didn't get around to posting it.

[Guiness]

I will point out one problem with your numbers though TD, and it's that they're a bit of a straw man argument (not entirely - they are relevant)

The issue at hand is the claim that EXPENSES have risen faster than expected. The owners are saying that they can not make a reasonable profit with that portion of the revenue. That claim, of course, is unverifiable, and should be given little or no credence, since owners will not divulge what their expenses are...! :shock:

[get louder at lambeau]

I will point out one problem with your numbers though TD, and it's that they're a bit of a straw man argument (not entirely - they are relevant)

The issue at hand is the claim that EXPENSES have risen faster than expected. The owners are saying that they can not make a reasonable profit with that portion of the revenue. That claim, of course, is unverifiable, and should be given little or no credence, since owners will not divulge what their expenses are...! :shock:

Huh? The debate in this thread so far is about whether the NLFPA's claim of an 18% pay cut is accurate, not whether owners have a legitimate claim about expenses rising or not.

[ThunderDan]

I will point out one problem with your numbers though TD, and it's that they're a bit of a straw man argument (not entirely - they are relevant)

The issue at hand is the claim that EXPENSES have risen faster than expected. The owners are saying that they can not make a reasonable profit with that portion of the revenue. That claim, of course, is unverifiable, and should be given little or no credence, since owners will not divulge what their expenses are...! :shock:

The way I see it is, that is only relevant if the owners and players were co-owners. If you want to have collaborative talks the owners have to show all streams of income and expenses that they are responsible for. Without that it will be an adversarial process and things may not get done.

[sharpe1027]

I have never ever heard an owner of a business that I work with say well my compensation only went down 9% of total revenue when his take home pay is cut 18%.

I think this hits the nail on the head.

The owners argue that the amount that the player's percentage would go down is to be offset by growth in revenue, but they offer no such adjustment of the player's percentage upward were the revenue to go down.

The owners benefit from a flexible salary structure that adjusts with the revenue. This reduces their risk/exposure considerably because if revenue is flat or decreasing, then the player's cut automatically goes down. The players sacrifice salary security to share in the growth of total revenue. At least that's how I would view it.

This is why I feel that the owner's argument is intellectually dishonest.

[ThunderDan]

The issue at hand is the claim that EXPENSES have risen faster than expected. The owners are saying that they can not make a reasonable profit with that portion of the revenue. That claim, of course, is unverifiable, and should be given little or no credence, since owners will not divulge what their expenses are...! :shock:

I have been thinking about this a little more and had to respond.

The largest expense to the owners is players salaries. The players are a part (the largest part to me the fan) of the product. The owners have effectively capped their expense as a % of income.

The reality is the owners get 100% of the revenue. The can argue they have to pay 59.6% to the players but if they didn't pay them who are they going to put on the field.

At our firm we don't say the owners only gets 65% of the revenue because the other 35% has to pay the employees that generate the work product.

[get louder at lambeau]

League rejects union offer to keep cap in place
Posted by Mike Florio on February 26, 2010 4:58 PM ET
Once upon a time, the NFLPA couldn't wait for the salary cap to go away. Since then, however, the union apparently has become acquainted with some of the niceties of the labor deal regarding the consequences of the evaporation of the per-team spending limit.

For starters, no cap means no floor. Then there's the increase in years of service for unrestricted free agency from four to six, and that pesky "Final Eight Plan," which makes it very hard for the last eight teams standing to participate in the market -- and damn near impossible for the final four to sign unrestricted free agents.

So now the union is desperate to keep the cap. Albert Breer of the Boston Globe reports that the union made one last pitch to extend the rules that have applied from 2006 through 2009 into 2010. Per Breer, the league rejected the proposal on Thursday.

As a result, the first uncapped year since 1993 will begin next Friday at midnight.

It's not known what the union offered in exchange for the continuation of the salary cap. But it means that there's still a chance -- slim as it might be -- that the two sides will get a deal done before the clock strikes twelve on March 5, since the union could decide to take the best deal that's on the table in order to keep a cap -- and a floor -- in place.

http://profootballtalk.nbcsports.com/2010/02/26/league-rejects-union-offer-to-keep-cap-in-place/

[retailguy]

Revenues next year are projected to decrease, if that happens to be the case the players net "take" would be less (and could be far less) than the 18% they are claiming.
Where did you hear that revenues are expected to decrease?

Even owners aren't making that claim. They are claiming costs (related to financing and new stadium costs) have risen faster than they projected. I have seen nothing about a revenue decline, even if you account for inflation.

It was in an interview with Goodell, I think. Super Bowl weekend, perhaps? He was all over the place. I've gone back and looked for it, but I cannot find it.

I can find a lot of references that the NFL is being impacted by this economy, but none that reference lower revenues. So maybe I heard it wrong? Not sure, I thought it was pretty clear... but maybe not?

[retailguy]

At our firm we don't say the owners only gets 65% of the revenue because the other 35% has to pay the employees that generate the work product.

Dan, when I read this I had to respond. I know what you meant by this, and don't disagree with the point you were trying to make, but don't think you saw the point you weren't trying to make....

Inadvertently, perhaps (if your numbers were correct), you told us that your firm has lower percentage payroll costs than the NFL, so holding everything else constant, your CPA firm is much more profitable than the average NFL team (when looking at percentages).

This debate is largely predisposed by which argument you agree with. If you side with the players and the NFLPA, you are screaming about an "18%" reduction. If you are predisposed to agree with the NFL and the owners, you are talking about "9%".

I don't know about you, Dan, but what I observed in my firm was that few businesses were successful with a payroll percentage as high as the NFL. Most business struggled heavily if they got above 45% in total loaded payroll. Most that were over 50% lost money and eventually either fixed it, or went out of business. Of course there were limited exceptions, but those were few and far between.

Our industry is being outsourced to India, and Kuala Lumpur. Why? Because labor is cheaper. Because firms like yours can lower payroll costs and benefits and make more money. I wonder, some days, if there will be any work left for a US based CPA.

I was approached about 7 years ago now, two years before I sold my half of the firm, to outsource to India. I could have made almost as much money, outsourcing all my returns to India, as I did then by only hiring 4 part time tax people. My partner and I did the vast majority of the 2,200 returns ourselves and hired temporary help during the tax season. We did all the returns outside of tax season. I would have only reduced the profitability of the firm by about 3% and done zero returns, or very close to it...

That won't work with the NFL. I don't think the Indians and the Malaysians can put out a quality NFL product. So from that sense the Union has a bit more power than the average union. The owners need the players for a good quality product that people will watch.

That being said, I think the NFLPA made many mistakes that they'll now pay for. The biggest was the refusal to do anything about the rookie salary inflation. I don't think we'd be here today if they had agreed to address this problem.

At the end of the day, US business judges profitability in percentages. The CPA's working for the NFL and the teams probably see that the owners could make more money owning a chain of Starbucks or McDonalds than they do running NFL teams. I recognize that when you look at $'s, the profit is obscene, however, on a percentage basis, other industries (including your firm Dan) are much more profitable.

An adjustment to the CBA is inevitable. It's going to happen. The NFLPA is likely to have a few pounds of flesh taken out of it's backside, but it remains to be seen how far the owners will actually push. Reality says that the players are overpaid, and the percentages have to be reduced.

We'll see what happens, I guess.

[pbmax]

RG, the business model for NFL teams does not look like small service industry businesses. Yours or the ones Dan is looking at. I would bet that compared to industries of similar size and revenue, football teams are marked by high labor costs and low capital costs. The second one is a sheer guess. There are franchises that own their own stadium, but even now that is the exception.

The year before Unrestricted Free Agency and the cap were negotiated into the CBA, the NFL spent just under 70% of revenues on player costs. I have never been able to identify this, but I believe that would be 70% of designated revenue (designated for the cap), not the total league revenue. So in essence, the league traded free agency and a salary floor for a lower and more fixed labor cost structure.

Only nine votes would have killed the current CBA in 2006, but it passed with only two objections. Publicly, I think it was categorized as unanimous, but I have read that Buffalo and Oakland initially voted against it.

Owners have cited two reasons for opting out. Changing cost structure (in several cases related to stadiums) and the economy, specifically the cost of financing. I have also seen loss of investment value listed as well. Each are legitimate, none has been documented fully except for the Packers.

I don't think you need to take sides for owners or players to think the next logical question is how much have the costs gone up, and how much of that is structural and not temporary. Those are questions I need answered before I take a side.

[pbmax]

To just finish the thought, I think there are two forces at work here and neither is malicious, but both probably mean that the league will not be able to operate like it has been. And the dynamic is not whether you side with management or labor.

First, lower revenue clubs did not like the new percentage of revenue in the 2006 CBA and only agreed to it if revenue sharing was supplemented by the sharing of certain local revenue. High income clubs disliked the new sharing idea entirely. And there is logic in their self-interest.

Clubs like Dallas, Washington and New England bought their teams with a significant amount of debt. They also have spent their own money (and borrowed even more) to improve or replace their stadiums. To finance that debt, they have had to turn their franchises into cash cows. In order to realize the maximum return on their efforts, they have concentrated on increasing local revenues that they do not need to share with other clubs. Better ROI.

Just as the Packers did not want to spend the bulk of the improvement money on seating at Lambeau (because each ticket sold would send 40% of the money to another team), highly leveraged franchises wanted to find new revenue streams that would return the maximum amount of revenue to the team itself. That meant stadium naming rights, scoreboard advertisements, admission fees to training camp, and the official beverage of the Dallas Cowboys.

The two groups never settled their differences on supplemental revenue sharing. So they went in the other direction, instead of finding a way to fund the new costs, find a way to reduce it. My belief is that the current economy and the cost of financing are real costs and effects, but their effect is temporary and were not a consideration when the league failed to find a suitable solution to local revenue sharing.

The real conflict is how will future franchises be sold and purchased. If only the marquee teams will be bought in a highly leveraged manner, then the league probably faces no great challenge longer term. But if more and more franchises are purchased with high debt loads (contrasted to Pittsburgh, Cincinnati, and Buffalo that are owned within a family or Green Bay - all franchises with a low debt load) then the conflict will grow.

Essentially, it will change the character of the ownership of NFL teams. Fewer families, more groups, more debt and more debt service. That will mean a search for new revenue closer to the Redskins than the Bengals or Bills. Some league owners are said to be apoplectic that Mike Brown did not sell naming rights to his stadium when he had the chance. But he is collecting supplemental revenue checks for the right to honor his father.

For the players, long term the hunt for new revenue will help them. But in the short term, the leveraged owners are asking the players to subsidize the smaller clubs in place of supplemental revenue sharing.

[pbmax]

At the end of the day, US business judges profitability in percentages. The CPA's working for the NFL and the teams probably see that the owners could make more money owning a chain of Starbucks or McDonalds than they do running NFL teams. I recognize that when you look at $'s, the profit is obscene, however, on a percentage basis, other industries (including your firm Dan) are much more profitable.
How can you make this judgement when you have none of the figures except the Packers? Does the Forbes estimation even cover the profit?

[sharpe1027]

This debate is largely predisposed by which argument you agree with. If you side with the players and the NFLPA, you are screaming about an "18%" reduction. If you are predisposed to agree with the NFL and the owners, you are talking about "9%".


RG, I think the point that keeps getting missed is that the 18% and 9% are one in the same. You can't have one without the other. That's what Florio didn't seem to understand. As other's have pointed out, just about everyone of us would use the 18% if we were talking about or own salary. I mean, that's how much change it means to us individually. Another way to look at it is that the 9% is just a number used in the formula that determines the salaries, it doesn't accurately represent the change in salaries. So for Florio to suggest that 9% is the correct number to use when discussing the change in player's salary strikes me as pretty misplaced.

As I mentioned above, I also don't agree with the argument that a possible increase in revenue justifies shifting more of the money to the owners. Why should the owners benefit more from revenue increases than the players?

As to your other point, I don't think there has been much discussion about what the proper percentage should be up until now. we were mostly trying to get a handle on what the proposal was or was not. I would think that you are correct that the NFL percentage of pay to their employees is a pretty high percentage compared to many other business models. That being said, the players are the entire reason there is even anything for the owners to "own."

It is an interesting question. I don't know what the right number is, but I don't have a problem with more of it going to the players than would in a typical business model.

[sharpe1027]

The real conflict is how will future franchises be sold and purchased. If only the marquee teams will be bought in a highly leveraged manner, then the league probably faces no great challenge longer term. But if more and more franchises are purchased with high debt loads (contrasted to Pittsburgh, Cincinnati, and Buffalo that are owned within a family or Green Bay - all franchises with a low debt load) then the conflict will grow.


Maybe, but the revenue associated with marquee teams may just mean that investors will speculate more and leverage beyond what even the best teams can afford. If you want an example of this phenomenon, you can look to the 'other' sport called football. Manchester United is one of the highest grossing teams in any sport for the premier league in English soccer. Yet, they team is lost money in 2008 because a group of investors borrowed so much to purchase the team that they cannot afford the interest payments. Despite being (arguably) the most successful team, they are only just getting into the black.

http://www.guardian.co.uk/football/2010/jan/20/manchester-united-glazers-debt-ronaldo

[retailguy]

RG, I think the point that keeps getting missed is that the 18% and 9% are one in the same. You can't have one without the other. That's what Florio didn't seem to understand. As other's have pointed out, just about everyone of us would use the 18% if we were talking about or own salary. I mean, that's how much change it means to us individually. Another way to look at it is that the 9% is just a number used in the formula that determines the salaries, it doesn't accurately represent the change in salaries. So for Florio to suggest that 9% is the correct number to use when discussing the change in player's salary strikes me as pretty misplaced.

Sharpe, others have told you that you don't "grasp" the full argument and I don't want to get into that discussion, but your point above seems to indicate that you think individual salaries are going to decrease. I don't read that anywhere.

What is going to change, and slow, is ever increasing salaries, and probably the salary floor. I don't see anyone talking about changing current contracts. Will there be less money for raises? Sure. Show me an industry where that is not the case. Again, it's the way the world works.

9% and 18% are really not the same thing. Looking at them globally, you can make that argument, but individual paychecks? Not a chance. A smaller salary cap pool doesn't mean smaller salaries, as much as it means smaller raises. Who can realistically argue with smaller raises? Who is not currently experiencing smaller raises, regardless of how much money the employer is making?



As I mentioned above, I also don't agree with the argument that a possible increase in revenue justifies shifting more of the money to the owners. Why should the owners benefit more from revenue increases than the players?

Risk. This is the way business works. If you don't like it, then open a business. Or don't. But don't bitch about "fairness". Players have much less investment, and much less risk than the owners do. At the end of the day, if there are profits, the owners should get to keep them, and the players should be compensated for performing their job. Players don't own the team.



As to your other point, I don't think there has been much discussion about what the proper percentage should be up until now. we were mostly trying to get a handle on what the proposal was or was not. I would think that you are correct that the NFL percentage of pay to their employees is a pretty high percentage compared to many other business models. That being said, the players are the entire reason there is even anything for the owners to "own."

Quite honestly, it isn't anyones business what the proper percentage is. And we can't get a "handle" on the proposal because we're getting "bullshit" from both sides.

This discussion is largely about who can argue the best. I largely stopped participating when I knew you and others weren't "listening". And I promise you, when this post is finished I'm done again. The question I'll leave you with is "Where is Smidgeon?" Why did he stop posting? I think it was because we weren't getting a "handle" on anything, but merely arguing right/wrong. Smidgeon was not wrong, and he grasped and explained the concepts better than most here, including me, did.



It is an interesting question. I don't know what the right number is, but I don't have a problem with more of it going to the players than would in a typical business model.

And I do have a problem with that. Because I know how hard it is to run a successful business. I also know how different the "perceptions" of my employees were to what was real.

The owners should be able to pay whatever they want. And if the product suffers because of their bad decisions then they should (and will) bear the brunt of that. This is why, ultimately, I did not outsource to India when I had the chance. It was the right call for me, but, the other way would have worked too. My business, my choice. My choice, my responsibility. If it's good, I get rich. If it's bad, I go bankrupt. My employees shared in that, but, they didn't have the risk, so they didn't get the reward.

[retailguy]

At the end of the day, US business judges profitability in percentages. The CPA's working for the NFL and the teams probably see that the owners could make more money owning a chain of Starbucks or McDonalds than they do running NFL teams. I recognize that when you look at $'s, the profit is obscene, however, on a percentage basis, other industries (including your firm Dan) are much more profitable.
How can you make this judgement when you have none of the figures except the Packers? Does the Forbes estimation even cover the profit?

tens of thousands of tax returns over a 15 year period. When you look in totality, business is not that "different". There is only so much money for things and the percentages are remarkably similar across industry, and not that different, small or large.

If a business is approximating 60% salaries, or even 50% salaries, then other areas have to be cut back. Marketing would be an easy one. I bet it is a struggle to increase marketing and awareness. No rule says that the owner should have to forgo profit to invest. It would be perfectly reasonable to lay people off or reduce salaries to grow. It's done all the time. And will continue to be done all the time.

Owners shouldn't have to open their books, but if they did, you might be surprised. Look closely at the Packers annual returns. Figure out the percentage of operating expenses. Look at another service business. Will things be different? Sure. But more will be the same than will be different. The numbers are larger, but math is math.

[sharpe1027]

Sharpe, others have told you that you don't "grasp" the full argument and I don't want to get into that discussion, but your point above seems to indicate that you think individual salaries are going to decrease. I don't read that anywhere.

Not at all. I am saying that relative to the current CBA, the total salary available for players would go down. No more, no less. I agree completely that it would be stupid to try to predict individual salaries and while others have tried to make that argument, I've worked hard to stay away from that particular argument. I feel, as I think you do, that the relevant question is how much change there would be relative to the current CBA.



What is going to change, and slow, is ever increasing salaries, and probably the salary floor. I don't see anyone talking about changing current contracts. Will there be less money for raises? Sure. Show me an industry where that is not the case. Again, it's the way the world works.

Well, the thing here isn't whether or not there will be less money for raises, it is about who gets the money that is available. Assuming that the revenue goes up, down or sideways, the players would argue that it should be shared along lines of the current CBA and not redistributed more towards the owners.



9% and 18% are really not the same thing. Looking at them globally, you can make that argument, but individual paychecks? Not a chance. A smaller salary cap pool doesn't mean smaller salaries, as much as it means smaller raises. Who can realistically argue with smaller raises? Who is not currently experiencing smaller raises, regardless of how much money the employer is making?

Why are you talking about individual paychecks? I might be missing something, but that strikes me as a straw man argument. I can't honestly say what anyone's particular pay check would be. What I can say is where the overall money is going to end up in a global sense. So, they are pretty much the same thing in the manner that I meant them (didn't mean to imply otherwise).



Risk. This is the way business works. If you don't like it, then open a business. Or don't. But don't bitch about "fairness". Players have much less investment, and much less risk than the owners do. At the end of the day, if there are profits, the owners should get to keep them, and the players should be compensated for performing their job. Players don't own the team.

Well, they agreed to the one percentage before and now they are trying to change it. Clearly the owners want to make more money. They own the team, but that doesn't necessarily justify anything. Nobody is saying the owner's don't get profits. The question is just whether or not the amount they want to pay the players is fair. There has to be a line somewhere. You can't just use blanket statements. Clearly there are differing opinions about where the line should be. I admit that I don't know the answer, but you talk like you think you do. Maybe you know something I don't?


Quite honestly, it isn't anyones business what the proper percentage is. And we can't get a "handle" on the proposal because we're getting "bullshit" from both sides.

When both sides start throwing numbers out into media, I feel like they invite analysis by the public. It is not like we are prying into personal records of a private business. We are commenting on both sides attempts at a PR battle. If you won't want to discuss it, then don't.


This discussion is largely about who can argue the best. I largely stopped participating when I knew you and others weren't "listening". And I promise you, when this post is finished I'm done again. The question I'll leave you with is "Where is Smidgeon?" Why did he stop posting? I think it was because we weren't getting a "handle" on anything, but merely arguing right/wrong. Smidgeon was not wrong, and he grasped and explained the concepts better than most here, including me, did.


Might be true. IDK. I re-read my posts, and frankly I don't see them as all that offensive. The worst thing I said had to do with my perception of Smidgeon's reason for posting was more about the argument than the main point. I admit I was a little skeptical of his arguments since the argument kept shifting away from whether or not Florio was wrong. To me his arguments kept bringing up semantics that didn't have anything to do with the main point. I don't think I was the only one to notice this. Still, maybe I am just a big asshole. I guess it is what it is.


And I do have a problem with that. Because I know how hard it is to run a successful business. I also know how different the "perceptions" of my employees were to what was real.

All I said was that the NFL might be a different model than a CPA firm and that I would be OK with that. I think you are reading too much into what I said.


The owners should be able to pay whatever they want. And if the product suffers because of their bad decisions then they should (and will) bear the brunt of that. This is why, ultimately, I did not outsource to India when I had the chance. It was the right call for me, but, the other way would have worked too. My business, my choice. My choice, my responsibility. If it's good, I get rich. If it's bad, I go bankrupt. My employees shared in that, but, they didn't have the risk, so they didn't get the reward.

True, but also remember that the NFL is a monopoly that has a legal exception that few other business have. It is not like the players have any other option. If it was a true free market the then there would be competition for the player's services and the owners and players could both be sure that they are getting fair market value.

I didn't mean to get you all up in arms RG. I was agreeing in part and trying to point out a few observations. I don't mind that you don't agree 100%, but I don't think there is a need to get all bent out of shape...but, again, I may just post like an asshole and not fully appreciate it. If so, you can keep calling me out on it.

[pbmax]

At the end of the day, US business judges profitability in percentages. The CPA's working for the NFL and the teams probably see that the owners could make more money owning a chain of Starbucks or McDonalds than they do running NFL teams. I recognize that when you look at $'s, the profit is obscene, however, on a percentage basis, other industries (including your firm Dan) are much more profitable.
How can you make this judgement when you have none of the figures except the Packers? Does the Forbes estimation even cover the profit?

tens of thousands of tax returns over a 15 year period. When you look in totality, business is not that "different". There is only so much money for things and the percentages are remarkably similar across industry, and not that different, small or large.

If a business is approximating 60% salaries, or even 50% salaries, then other areas have to be cut back. Marketing would be an easy one. I bet it is a struggle to increase marketing and awareness. No rule says that the owner should have to forgo profit to invest. It would be perfectly reasonable to lay people off or reduce salaries to grow. It's done all the time. And will continue to be done all the time.

Owners shouldn't have to open their books, but if they did, you might be surprised. Look closely at the Packers annual returns. Figure out the percentage of operating expenses. Look at another service business. Will things be different? Sure. But more will be the same than will be different. The numbers are larger, but math is math.
I agree that numbers are numbers and the Packers profit number from the 09 books was low compared to previous years and as a return percent.

But it took a record dive of investment instruments for that number to plummet that low and they were still profitable.

As a percentage of total revenue (the entire ball of wax, not for cap purposes) the NFL spends between 50 and 52% on players. I can only guess at the number after other employees are figured in, but I would imagine its under 60%.

For an entity in the entertainment industry, that doesn't seem far out of line. And we haven't even spoken about the appreciation of the value of the franchise. Its been a long time since business classes, but that payroll figure does not portend the end of a business model to me. It has been higher and the league has thrived. In fact there is some evidence that baseball might be at its most profitable and its payroll number is in the same ballpark. No one talks about this because baseball is supposed to be three days away from disappearing forever, but oh well.

What would change it would be the need for franchises to spend on stadiums. The need for local revenue and the need for both revenue growth and cash means that some teams will need to keep finding new ways to separate money from its customers. That change of the business model may affect the player's take, not the percentage as it stands now.

[retailguy]

PB - I'm talking more about ROI or ROACE instead of pure profit. I might be making 10% on my money, but if I can make 15% somewhere else with relatively the same level of risk, which is the better investment?

That's the discussion that I think is going on with the Dan Snyders of the world. Owning a team is "fun". Earning 6% isn't "fun". These guys think differently than the rest of us. It's all about "more more more". It becomes a game after a while, and they're in it to win. I understand the owners, but I don't always agree with them. The biggest mistake they made was agreeing to the last CBA. It was a ridiculous decision that will haunt them for generations.

Sharpe, I'm not "pissed" but probably a little frustrated. Too many folks on the internet who have never done a damn thing in their lives. Yet they are an expert at whatever they do. Some of those folks are here (not saying you specifically so don't take it that way), and it gets old arguing with them all the time. It's better since Tyrone left, for example, but still.

There are times when I know I'm right, because I've lived it, so I just wander away, and don't say any more because it isn't worth the battle. Then the person I've stopped arguing with, thinks they are right, and it emboldens them for the next time. Eventually, you can't even talk to them, and they always have to be right. That gets damn old.

Then, there are philosophical debates. Example, Dan and I are similarly educated, probably from the same institution, but probably couldn't agree about the best thing for breakfast, much less anything in our own industry. We'd probably fight about the color of the sun. That gets old after while too. So, eventually, in my case at least, we just post less. Thank God this place isn't my problem anymore. It was impossible to please anybody, most of the time.

Take care.

[pbmax]

I am sure that its always about money and more, more and more. But there are far more profitable investments than a pro franchise of any sport. So while they are chasing more, if they invested this money to maximize the investment only, they would have chosen to do something else. That has always been true, even when the only money that they counted was gate receipts. The exception might be Snyder. He made his fortune on turning around under marketed businesses and given his success in DC, he made have had a slightly different motivation. But even Jones was a crazy fan before he owned the team.

If the last CBA was such a predictable catastrophe, then they wouldn't have signed on. I think it was more likely that Jones/Snyder/Kraft thought they would be able to stiff the lower revenue clubs and Tags and Goodell pushed through a number more than they were comfortable with. That coupled with the fact that low revenue clubs were not forced to make any business or marketing concessions made it unpalatable.

I think its as much an internal struggle among the peer group as it is against player cost. The irony is that faint-hearted and emotional fans are already wringing their hands over franchises moving to better markets. But if Buffalo, Jacksonville, Cincinnati and Minnesota did find more profitable venues, then the supplemental sharing wouldn't be such an issue and the costs wouldn't be prohibitive for the revenue impaired.

I have no doubt you are sincere RG and tired of bickering with emotional posters. But in comparing the current situation to other businesses and owners you have worked with, I think you may be drawing too direct a parallel. No doubt the primary motivations are similar, but the barriers in each case are probably a little different.

[ThunderDan]

I can't believe where this thread is going.

It is plain and simple, the players salaries are going to go down. The owners feel they are overpaying but they won't open their books to the NFLPA.

To Retail's point, he says payroll over 50% is too high or some such number. For a lot of businesses that might be true. The NFL is a completely different animal. The players are the product. A product were your ability to earn money is potential over on every play that you are in. The owners damn well should play their players a "premium" for playing. The average NFL player loses like 20 years in expected life span and a vast majority are crippled or servely hinder later in life.

I became friends with Elroy Hirsch later in his life. He could tell you about every game he play with the Rams but he couldn't tell you how many strokes it took him to get to the green. He had absolutely no short-term memory. He couldn't drive, he couldn't find his keys, he couldn't remember what he ate for lunch. He would ask you the same question honestly (not pulling your leg) 7 times in 18 holes and be interested in the answer everytime because he had no idea he had asked you 6 times before.

[Patler]

No, the players are not the product any more than the fancy leather seats in your car are the product, or the luxurious extras in the mansion are the product. The team and the league are the product, the players are simply parts assembled into different models. When the player leaves or retires, another takes his place. Many Packer fans are just now experiencing for the first time that a player is not the product, the team is. Favre left, and guess what? The product isn't gone! The Packers are still quite entertaining, even if it is a new model.

Looking at just the player costs is a waste of time. Many fans talk as if everything other than player salaries is profit to the owners. The Packers report having about 250 employees. At any one time, about 60-65 of those are players. Sure, some of the others don't make a lot of money, but you have a head coach, GM and President each making multiple millions, perhaps another $10 million tied up in the coaching staff. The cost to transport a team, training it, etc. are huge.

I haven't verified the numbers, but my recollection is the Packers reported about $250 million in gross revenue, and about $20 million in profit. If I were the owner of the Packers, I would be looking at ways to increase that number ($20 million), not just from an increase in gross sales, but also increasing the profit percentage by getting cost percentage more under control.

In a sense the owners and players (not individual players, but the NFLPA) are partners, because the players salaries are tied to some part of gross incomes. Its not like a typical CBA where salaries are fixed. Since they are partners, there has to be a certain level of trust in the running of the business, mostly by the players trusting the owners. Basically, the owners are telling the players that there is not enough profit in operations right now to fund expansion. With more cash to work with in the short term, long term revenues can be increased to the betterment of both the owners and the NFLPA.

As to the question that started this thread, which percentage is the most accurate? The answer is: either, both, neither; depending on how you want to look at it. However, the owners argument for the decrease is an old one.The old "50% of $200 is less than 40% of $300" argument. So if someone asks you if you want 40% or 50% without specifying "of what", how can you answer?????

[3irty1]

No, the players are not the product any more than the fancy leather seats in your car are the product, or the luxurious extras in the mansion are the product. The team and the league are the product, the players are simply parts assembled into different models. When the player leaves or retires, another takes his place. Many Packer fans are just now experiencing for the first time that a player is not the product, the team is. Favre left, and guess what? The product isn't gone! The Packers are still quite entertaining, even if it is a new model.

Looking at just the player costs is a waste of time. Many fans talk as if everything other than player salaries is profit to the owners. The Packers report having about 250 employees. At any one time, about 60-65 of those are players. Sure, some of the others don't make a lot of money, but you have a head coach, GM and President each making multiple millions, perhaps another $10 million tied up in the coaching staff. The cost to transport a team, training it, etc. are huge.

I haven't verified the numbers, but my recollection is the Packers reported about $250 million in gross revenue, and about $20 million in profit. If I were the owner of the Packers, I would be looking at ways to increase that number ($20 million), not just from an increase in gross sales, but also increasing the profit percentage by getting cost percentage more under control.

In a sense the owners and players (not individual players, but the NFLPA) are partners, because the players salaries are tied to some part of gross incomes. Its not like a typical CBA where salaries are fixed. Since they are partners, there has to be a certain level of trust in the running of the business, mostly by the players trusting the owners. Basically, the owners are telling the players that there is not enough profit in operations right now to fund expansion. With more cash to work with in the short term, long term revenues can be increased to the betterment of both the owners and the NFLPA.

As to the question that started this thread, which percentage is the most accurate? The answer is: either, both, neither; depending on how you want to look at it. However, the owners argument for the decrease is an old one.The old "50% of $200 is less than 40% of $300" argument. So if someone asks you if you want 40% or 50% without specifying "of what", how can you answer?????

Nice post Patler. Especially when you see that other teams struggle much harder than the Packers to turn profits.

[pbmax]

Players may not BE the product, but they are not leather seats. Corintian leather, maybe. :lol:

I do not remember the detail of the AFL's financial operations or the effect on the NFL, but I think that the move of Joe Namath to the AFL had to affect the income of the NFL far more than leather seat choices. I know the immediate effect of the AFL was a signing war between the two for stars and high profile draft picks.

Patler, if you're contention were believed by the NFL teams at that time, they would not have cared about who they signed, just that they got a decent, functional player. From a marketing standpoint alone, they are not the same as a replaceable part. If the name Joe Namath was worth more, then the players are far more like sweet 19" spinning rims.

And Favre leaving has hurt the Packers financially, even in Jersey sales alone. Car manufacturers do not compete for parts suppliers by bidding them higher like teams do for players. Players are replaceable, but they aren't simple parts either. There is a financial impact to them. Otherwise Ziggy would not have brought 4 West. And the Packers were lucky to have a quality replacement. Past history has shown that does not happen often. And I think we can agree that a run of mediocrity will impact the income of a franchise.

Going back to the AFL for a moment, there is also value in having all the best in one place.

[pbmax]

Oddly enough, I think I have constructed the outline of an argument that Ted Thompson sees the players as Body by Fisher parts and Dan Snyder thinks the players are Tom Cruise.

That might be the first time RG agreed with TT on a philosophical basis. :shock:

[Patler]

Leather is more expensive than vinyl, each can be used to make a car.
Brady is more expensive than Orton, each can be used to field a football team.

Specific players might make the product "better", and improved teams overall might increase income, but the teams are the product. I won't go and watch Favre or Rodgers throwing a football on a field by himself to no one. I will and did watch the Packers when the team was bad, when Tagge was throwing to Staggers.

To grow to what it is, the NFL needed and still needs very rich, very ambitious owners who can afford to and will take financial risks in the hope of mega returns. The Packers can keep up, but I doubt they would ever have led the way for the growth of the NFL. Their story in the '60s certainly helped, but they weren't the visionaries.

Sure, quality players improve the product. But without the right types of owners, the ones who could and did sustain losses in its infancy, the NFL might have ended up being pro soccer or the NHL in fan interest.

Players come and go. The NFL (the product) has continued to grow, replacing parts as necessary, just like other new products get a foothold, get better and eventually become something society thinks it can't do without.

[retailguy]

I think I would maintain that the entertainment is the product, not even the NFL per se. The better the players the better the fans entertainment. That's why there are bidding wars for components (players), not dissimilar to "unique" options on cars, they make the product more desirable.

Peyton Manning makes the product more desirable (sells more tix, merchandise, etc) than Kyle Orton, though Kyle produces a fine product.

When that works, you get rich, ala Robert Kraft. When that doesn't work, you struggle to sell tickets and avoid blackouts like Al Davis & Wayne Weaver.

PB, I think you're right that at a certain level the NFL is unique, but in most ways, they are just a really big business with the same nagging problems most of us "little normal" people face.

[pbmax]

Leather can be obtained from numerous suppliers in nearly unlimited quantities.

Quarterbacks who can increase the value of an NFL product (as Favre certainly did in Green Bay, Brady does in New England and Manning does in Indianapolis) are in far shorter supply.

They are not simple components.

Orton, or any street free agent QB can play the position and allow the game to continue and tickets to be offered for sale. Diehards may watch, but Replacement Level Players will not elevate your franchise's value or revenue. So you will be dependent on other teams and players to continue to grow the pie so your investment can continue to appreciate. But this is not maximizing your return on investment.

The league cannot survive as is, with the growth they wish to have with replacement level players. This is exactly the point. The NFL reaches its maximum potential revenue when it has the best players.

[Patler]

So long as the NFL pays significantly better than the player's alternative, they will have most of the best players. If every starting QB's salary was decreased by $2 million, would they all quit? I doubt it. More importantly if the salaries had escalated more slowly, so that each was 20% less right now, would all the best players have left? I doubt it. If the salary cap had stayed at about $90 million instead of raising to $120 million the last few years, would the league be devoid of talented players? Again, I doubt it. Most players don't have options for comparable work.

QB's are not in short supply. If 20 of them left right now, 20 others would replace them. Performance might change, maybe running would again predominate, but that's just the point. The owners, the league, the coaches put on an entertaining product featuring what they have. For some in the not too distant past it was defense.

[Patler]

Leather can be obtained from numerous suppliers in nearly unlimited quantities.

Not if P.E.T.A. has their way! :lol:

[MJZiggy]

Otherwise Ziggy would not have brought 4 West. And the Packers were lucky to have a quality replacement. Past history has shown that does not happen often. And I think we can agree that a run of mediocrity will impact the income of a franchise.



Watch who you're blaming, there, buddy!! :x

[pbmax]

QB's are not in short supply. If 20 of them left right now, 20 others would replace them. Performance might change, maybe running would again predominate, but that's just the point. The owners, the league, the coaches put on an entertaining product featuring what they have. For some in the not too distant past it was defense.
So your contention is that performance at QB will not change the revenue of the franchise?

If you dropped the salary and lost the top 20 QBs, of course the game would readjust and compensate. But it would not be the same game. Those QBs might choose to play elsewhere or an entirely different sport.

Just as college basketball has been hurt in the TV ratings by not showcasing the best young stars, football would be affected. It would be slower and less easily noticed, but affected none the less. And like the NCAA now is considering increasing the postseason field to 96 teams, the league would eventually have to make changes to the game in order to keep increasing revenues with an inferior product with fewer marketable players.

And I am not sure it would go unnoticed for long. In a passing dominated league, a sudden drop in quality at QB is going to be noticed. And while diehards might love a defensive struggle, casual fans (the ones that truly make the difference in revenue as they often choose to spend their money on other alternatives) will watch or do other things.

[pbmax]

Otherwise Ziggy would not have brought 4 West. And the Packers were lucky to have a quality replacement. Past history has shown that does not happen often. And I think we can agree that a run of mediocrity will impact the income of a franchise.



Watch who you're blaming, there, buddy!! :x
I can't help it is your screen name and Triple Word Score Wilf are nearly the same. :lol:

[Patler]

It's all relative. The NCAA plays exciting football with QBs that never make the NFL. If QB play declined in the NFL and scoring suffered more than the league could bear, they would do as they have done in the past, change the rules to accommodate it.

Abrupt change is always difficult, but it buffers over time.

My second point is they don't have to pay $10-20 million per year for the best QBs to play. I bet most, if not all would play for a lot less. Decreasing or freezing salaries isn't going to change the game.

[pbmax]

...My second point is they don't have to pay $10-20 million per year for the best QBs to play. I bet most, if not all would play for a lot less. Decreasing or freezing salaries isn't going to change the game.
Perhaps not immediately. But there are alternatives for younger players, other sports. And lowering or freezing salaries will increase the likelihood of labor strife if revenues continue to climb. That will hurt the game.

And the farther the needle goes down on player costs, the more likely you will see competition.

The NFL would of course to exist if the alternate QBs were used, they might even then have room for Tebow. But it would affect the popularity and marketability of the league in a way that it does not in college. College fans and alumni will truly go to watch their team. There are fewer such diehards in pro football.

[sharpe1027]

To grow to what it is, the NFL needed and still needs very rich, very ambitious owners who can afford to and will take financial risks in the hope of mega returns. The Packers can keep up, but I doubt they would ever have led the way for the growth of the NFL. Their story in the '60s certainly helped, but they weren't the visionaries.

Sure, quality players improve the product. But without the right types of owners, the ones who could and did sustain losses in its infancy, the NFL might have ended up being pro soccer or the NHL in fan interest.

Players come and go. The NFL (the product) has continued to grow, replacing parts as necessary, just like other new products get a foothold, get better and eventually become something society thinks it can't do without.

Patler, I think your points are valid, however, what would you say to the following parallel?

Players will continue to play and produce a quality product even if they get a smaller percentage. Player's come and go. Locking out/squabbling with the owners will hurt the players in the short term.

Owner's will continue to try to grow their business and make more money even if they get a smaller percentage. Owner's come and go. Striking/squabbling with the players will hurt the owners in the short term.

IMHO, it all comes down to the precise numbers and where the line should be drawn. There are incentives to reward each side, and perhaps more incentive on the owner side then the player side. However, do any of us know enough to even pretend to know where the line/percentage should come out?

[Patler]

The NFL rose to prominence on the running backs and linebackers who epitomized the violence of the sport, which the fans became addicted to. The QBs and pretty boy wide receivers simply became the rock stars. In my opinion, the league will not suffer without a few of them.

College football is a huge feeder system. The NFL will be fine even if a few more top athletes take up golf.

[Patler]

Patler, I think your points are valid, however, what would you say to the following parallel?

Players will continue to play and produce a quality product even if they get a smaller percentage. Player's come and go. Locking out/squabbling with the owners will hurt the players in the short term.

Owner's will continue to try to grow their business and make more money even if they get a smaller percentage. Owner's come and go. Striking/squabbling with the players will hurt the owners in the short term.

IMHO, it all comes down to the precise numbers and where the line should be drawn. There are incentives to reward each side, and perhaps more incentive on the owner side then the player side. However, do any of us know enough to even pretend to know where the line/percentage should come out?

The big conflict arises because current players only have a short term interest. The owners might be hurt short term, but their outlook is much more long term. Owners don't come and go all that frequently. Players drink from the trough only a short time. The owners will accept a short term hit for long term gains.

[MJZiggy]

Otherwise Ziggy would not have brought 4 West. And the Packers were lucky to have a quality replacement. Past history has shown that does not happen often. And I think we can agree that a run of mediocrity will impact the income of a franchise.



Watch who you're blaming, there, buddy!! :x
I can't help it is your screen name and Triple Word Score Wilf are nearly the same. :lol: :taunt:

[pbmax]

The NFL rose to prominence on the running backs and linebackers who epitomized the violence of the sport, which the fans became addicted to. The QBs and pretty boy wide receivers simply became the rock stars. In my opinion, the league will not suffer without a few of them.

College football is a huge feeder system. The NFL will be fine even if a few more top athletes take up golf.
There is a difference between rose to prominence and revenue generating. The TV contracts that drove pro football to the stratosphere happened after the AFL and the Super Bowl. Shortly after Monday Night Football and immediately during the change to the passing friendly rules. As I said, it would survive, but probably not at its present ratings nor at the same rights fees.

[Patler]

The NFL rose to prominence on the running backs and linebackers who epitomized the violence of the sport, which the fans became addicted to. The QBs and pretty boy wide receivers simply became the rock stars. In my opinion, the league will not suffer without a few of them.

College football is a huge feeder system. The NFL will be fine even if a few more top athletes take up golf.
There is a difference between rose to prominence and revenue generating. The TV contracts that drove pro football to the stratosphere happened after the AFL and the Super Bowl. Shortly after Monday Night Football and immediately during the change to the passing friendly rules. As I said, it would survive, but probably not at its present ratings nor at the same rights fees.

I disagree. Monday night football grew when teams ran consistently, when linebackers made huge hits, when mayhem was part of the game.

We disagree about the impact from the rock stars of the NFL. I can leave it at that! :)

[sharpe1027]

The big conflict arises because current players only have a short term interest. The owners might be hurt short term, but their outlook is much more long term. Owners don't come and go all that frequently. Players drink from the trough only a short time. The owners will accept a short term hit for long term gains.

Couldn't the same be said for most businesses? The average time for an employee to stay at one job in the US is only 4 years.

Are you suggesting that the owner's need a bigger cut so they more incentive to grow their business? Under the current system, how many teams run into problems with the salary floor? It seems that unless that is the norm, the owners see more value in spending money on their players than trying to grow the league through other means. Maybe with more profit they would seek to reinvest, but I bet plenty of them would just keep the money and spend it elsewhere.

[Patler]

Couldn't the same be said for most businesses? The average time for an employee to stay at one job in the US is only 4 years.

Are you suggesting that the owner's need a bigger cut so they more incentive to grow their business? Under the current system, how many teams run into problems with the salary floor? It seems that unless that is the norm, the owners see more value in spending money on their players than trying to grow the league through other means. Maybe with more profit they would seek to reinvest, but I bet plenty of them would just keep the money and spend it elsewhere.

The difference, of course, is that a great many "regular" employees who leave jobs after only a short time do so as their own decision (until the last year or two at least). Many could stay at their jobs if they wanted to, if they saw long term reasons to do so. Many leave for similar jobs, but for different employers, often because of the future prospects with the new employer. NFL jobs are short duration because the players get fired. They couldn't stay no matter how much they wanted to, no matter how good the future looked. A little different mindset.

The recent stadium expansions, surrounding lands developments and plans for both by other teams would suggest that owners will and see the need to reinvest in their operations by making their facilities revenue generating 12 months/year and increasing their take on destination spending by the fans. Just look at what the Packers have done and have plans to do, just to keep up. They aren't buying up land around the stadium just for the heck of it.

[sharpe1027]

The difference, of course, is that a great many "regular" employees who leave jobs after only a short time do so as their own decision (until the last year or two at least). Many could stay at their jobs if they wanted to, if they saw long term reasons to do so. Many leave for similar jobs, but for different employers, often because of the future prospects with the new employer. NFL jobs are short duration because the players get fired. They couldn't stay no matter how much they wanted to, no matter how good the future looked. A little different mindset.

The recent stadium expansions, surrounding lands developments and plans for both by other teams would suggest that owners will and see the need to reinvest in their operations by making their facilities revenue generating 12 months/year and increasing their take on destination spending by the fans. Just look at what the Packers have done and have plans to do, just to keep up. They aren't buying up land around the stadium just for the heck of it.

Yeah, there are differences, but the dynamic still has similarities between owners and employees. The owner wants what is best long-term for the company (or at least until they want to sell) and the employee wants to get paid the most. Some employees can be maintained by the allure of future potential of the company, but that's often in the form of them being made part owners through stock incentives.

The question that remains, for me at least, is whether or not those investments you mentioned would in fact be encouraged by shifting the revenue percentages. I think that the incentive for the investments you mentioned are driven more by the revenue sharing models between teams. Destination spending type investments offer a way for a team to get an advantage over other teams in terms of revenue because they are not shared (I think that's how the revenue sharing works). For instance, most of the stadium expansions include a lot of new luxury boxes. Why? Probably because income from them is not shared.

[get louder at lambeau]

Wow. This thread is all over the place. It went from arguing over the correct application of percentages to what the NFL is as a business, to college football being exciting (Which it isn't. :wink: ), to I don't even know what you guys are arguing about now. :lol: Not sure if some of you do either.

One thing I think is important, that someone (pb?) brought up, is that the NFL is NOT a typical business. Not by any stretch of the imagination. It is a strange and complex conglomeration of individual large, high profile businesses that in some ways acts as a legal monopoly, in other ways like a non-profit industry trade group. There is nothing clear cut about this. This is not the same as a mom and pop shop and how they interact with labor, the NFLPA clearly more than just plain labor, and Peyton Manning has more in common with Hannah Montana than he does Joe the Plumber.

[pbmax]

Here is a hint of what non-salary cap football may look like, and one probable reason for the current CBA unrest. Its obviously early and not all teams have their full roster set. I also think that in the offseason, the teams count the most expensive fifty players under contract for cap purposes. So the final numbers for 2010 are obviously not in. With that said:


PFT (http://profootballtalk.nbcsports.com/2010/03/14/plenty-of-teams-would-be-well-below-the-salary-floor/)[/b]]We've obtained the salary cap numbers that would apply if the cap were still in place. Based on the numbers, the following franchises are, to date, taking full advantage of the lack of a salary floor: the Chiefs ($79 million), the Buccaneers ($79 million), the Jaguars ($81 million), the Bengals ($85 million), the Cardinals ($91 million), the Rams ($92 million), the Bills ($98 million).

The salary floor in 2009 was $107 million.

The Cap Numbers so far (http://profootballtalk.nbcsports.com/2010/03/14/salary-cap-report-if-there-were-a-salary-cap/)

[get louder at lambeau]

The Cap Numbers so far (http://profootballtalk.nbcsports.com/2010/03/14/salary-cap-report-if-there-were-a-salary-cap/)

Interestingly, 3 of the 7 highest "salary cap" teams are in the NFC North. :shock:

[Guiness]

I wonder where those numbers come from?

Vikings are matched up with Skins is interesting. Flat out funny is Oakland being tied for fifth.

:shock: at Dallas's number. Think Jones and Steinbrener ever talk?

[pbmax]

I wonder where those numbers come from?

Vikings are matched up with Skins is interesting. Flat out funny is Oakland being tied for fifth.

:shock: at Dallas's number. Think Jones and Steinbrener ever talk?
The talk at PFT is that they planned this, with language in the contracts that allowed them to convert money from this year to something pro-rated if the CBA was extended and the cap stayed in place.

[pbmax]

Traditional Revenue Sharing Not What It Used To Be

Revenue sharing remains a key source of potential controversy
Posted by Mike Florio on March 21, 2010 7:45 PM ET (http://profootballtalk.nbcsports.com/2010/03/21/revenue-sharing-remains-a-key-source-of-potential-controversy/)

Revenue sharing remains a key source of potential controversy
Posted by Mike Florio on March 21, 2010 7:45 PM ET
We've heard from multiple league insiders who agree with our assessment that the current unity among NFL owners is fleeting, and largely confined to one issue: Squeezing the players into taking less money.

As to the issue of owners sharing the money that their teams generate, the potential for discord remains. Indeed, four years ago we believed that, absent a comprehensive solution, the NFL possibly could split into two leagues -- one made up of teams willing to share every dollar and another composed of teams with an "every man for himself" mentality.

Supplemental revenue sharing, the redistribution of wealth from teams making the most to teams making the least, has turned out to be a Band-Aid at best. Meanwhile, the traditional notions of sharing have been challenged over the past decade.

A league source tells us that, for example, the traditional 60-40 split of ticket money between home team and road team doesn't apply universally. Per the source, the Cowboys have finagled an exception for club seat revenue, apparently to help defray the costs of the North Texas Football Cathedral. Other teams have worked out similar deals, many of which transactions have received little or no publicity.

Bottom line? If the NFL plans to maintain competitive balance via a salary cap and a salary floor based on total football revenues, any new agreement must account for the fact that a formula based on total revenues will increase the labor costs for low-revenue teams. Absent a long-term answer to this specific problem, the situation will continue to create controversy every time a labor deal is due to be renewed, and it will only get worse as the gap in the revenues continues to grow.

In the interim, the challenge for the NFL will be to keep that percolating problem tightly under wraps. For the NFLPA, the mission is clear -- find a way to force this core issue to the surface sooner rather than later.

http://profootballtalk.nbcsports.com/2010/03/21/revenue-sharing-remains-a-key-source-of-potential-controversy/

[pbmax]

Its understandable and reasonable to want to devote a slightly higher share of ticket revenue to retire or at least service the debt carried by a new stadium. But the impact could be unintentionally tilting the field even more towards higher revenue clubs and away from other teams who do not get the discount eventually.

The new stadium team is getting a chunk of revenue not available to every team. This money comes from other teams. That money is used in part to finance (or pay for) new or refurbished stadium construction. Part of the reason new stadiums are built is to maximize revenue OTHER than ticket revenue. Like Bob Harlan explained, a team can choose to spend its capital budget on adding seats, but that money leaves the team the traditional 60-40 split. That hurts your return on investment.

Amenities that might attract fans year round (Hall of Fame, Atrium, Restaurants, Pro Shop, NFL Experience kids area, etc.) are the new must have items in stadiums. Having other teams subsidize the building of these revenue generators not only deprives them of the money lost from the traditional 60-40 split, it increases the revenue generating disparity between those teams.

My hunch is that teams with lower revenues, those that will depend on the public to finance a large part of new stadiums, are the teams who will not get the sweetheart deal on club seat revenue sharing.

[pbmax]

Have been heavy on the owner stuff lately, here is some news about the Players Union.

PFT has had several articles about Domonique Foxworth challenging incumbent NFLPA president Kevin Mawae's reelection bid last week. Mawae won, but the challenge was notable as Foxworth is reportedly Executive Director DeMaruice Smith's protege.

Possible motives for the challenge range from Foxworth acting without the blessing of his mentor to a possible rift between Smith and holdovers from Gene Upshaw's tenure.

The latest news are unnamed player sources claiming that Smith had nothing to do with the challenge and that Mawae and Foxworth are of one mind about the Union's direction. Florio makes a convincing case that with no explanation given for Foxworth's challenge, that none of these latest tidbits explain anything other than the Union trying to preserve the image of unity.

The original article for SBJ is behind a paywall, so all there is to link to is the PFT mention:

http://profootballtalk.nbcsports.com/2010/03/22/report-smith-didnt-ask-foxworth-to-run-against-mawae/

[pbmax]

Owners win a round in the lawsuit over supplemental revenue sharing. Players won and stopped the owners from shuttering the program in the previous challenge. The owners won this round, in which the NFLPA claimed the NFL shorted teams by adding qualifying factors to the formula for payments.

http://profootballtalk.nbcsports.com/2010/04/17/league-wins-latest-supplemental-revenue-sharing-ruling/

[Guiness]

Reviving this thread, saw some statements from Smith that took me by surprise.

http://www.cbssports.com/nfl/story/13414011/nfl-union-chief-reaches-to-explayers-for-cba-fight


CHARLOTTE, N.C. -- DeMaurice Smith has a difficult fight ahead with owners on a new labor deal, and the NFL Players Association chief wants to stack his side with as many supporters as he can find.

Retired players, especially.

Hoping to win them over before the NFL owners can, the union's executive director spent much of his speech at the Charlotte Touchdown Club luncheon on Wednesday wooing the handful of ex-players sprinkled in the crowd of mostly business executives.

Smith asked them to stand and be acknowledged. He promised past troubles are over, and vowed to work for increased retiree benefits in the next collective bargaining agreement, floating the idea that each team should put $1 million aside every year to boost pensions.

"Our issues, or some of our issues, are going to stretch not only from players today, but they're going to reach back to players before us and they're certainly going to push forward to players ahead of us," Smith said.

Smith made eliminating the bad feelings between retired players and the union one of his top priorities when he took over last year for the late Gene Upshaw, who angered many when he once said he worked for only current players.

Now facing a potential work stoppage after the 2010 season -- Smith reiterated he believes a lockout is probable -- Smith wants a unified front.

"It was on the logo -- 'Past, Present and Future' -- but I always felt bad that the former players really weren't a part of things," said Steve Beuerlein, a former NFL quarterback and union representative who attended Wednesday's luncheon. "I think DeMaurice has really attacked that issue. I think that's what guys are really looking for."

Smith quickly settled a legal dispute over marketing rights for former players after he took the job. He got two former players to sit on the executive committee. He's combined meetings between current and former players. He's set up small gatherings -- including one Tuesday in Charlotte -- with retirees.

He indicated if each team gave $1 million a year, players who retired before 1993 would see their pensions increase by $1,000 a month. Smith also wants to the league to boost health benefits for retirees.

"Every one of these stadiums in the country has that ring of fame that celebrates all of those great players who used to play that game. I know for a fact that each and every team in the National Football League sells legacy," Smith said. "My problem is, that as we look on those names up there on that ring of fame, not one player gets a dime from that team."

NFL commissioner Roger Goodell has been public with his intentions of boosting retiree benefits in the new CBA. Smith insists current players shouldn't suffer with their own wages and benefits in such a deal.

Smith suggested players would only accept a pay cut in the new deal if owners agreed to give up equity in their teams to the players.

"I do not believe and I reject that there has to be some sort of world in which players have to choose between current players and former players," Smith said.

Smith also touched on a handful of other subjects:

• He said the union doesn't know the names of the two men listed in a criminal complaint filed in U.S. District Court in Buffalo on Tuesday. Dr. Anthony Galea was charged with injecting at least one current NFL player with an unapproved drug and giving human growth hormone to a retired player.

• When asked about speeding up the appeal process for drug issues -- Houston Texans linebacker Brian Cushing tested positive in September and was suspended this month -- Smith said the union would like a number of testing procedures changed. He then harped on a judge chastising the NFL for its policies in the case involving Kevin Williams and Pat Williams of the Minnesota Vikings.

"I consider those to be serious issues that we need to address about the process," he said.

• Smith didn't back down from critical comments he made about Cushing, when he said players who break the rules "cheat the game, cheat the fans and cheat themselves."

"The players know that my background was 10 years as a prosecutor, four years in the homicide section," Smith said. "I'm probably not the guy that you want to cry to about misconduct. I'm probably not going to be a sympathetic ear."

Smith then tied in personal conduct with how players will be treated following their playing careers.

"I demand that you be good men in your community. I demand that you be good husbands, good fathers, good sons," Smith said. "I demand it because I know if you are you will not only be a good football player on the field that our fans will love, you will be a great former player in your community that our fans will always love."

Beuerlein met Smith for the first time after the luncheon. Walking around these days now with an artificial hip, Beuerlein sounded optimistic that a unified front would increase the chances that current and former players are served in the new labor deal.

"You always hear, 'There's strength in numbers.' Well, there's strength in unity," Beuerlein said. "As long as we can be a united force I think we can be stronger for sure."
Copyright 2010 by STATS LLC and The Associated Press. Any commercial use or distribution without the express written consent of STATS LLC and The Associated Press is strictly prohibited.

Of great note to me is that he wants the owners to give up equity in the teams to the players???? Talk about a non-starter, can you seem Pacman Jones being a co-owner with Jerry Jones? :lol:

[ThunderDan]

Bump!

Fun to look at an old post now that the agreement is hopefully close to done.