The idea behind today's entry is to give a sense of the numbers we're talking about with respect to the CBA. It is likely that you've heard that the players are being asked to take an 18% pay cut, or that league revenues are $8 billion but profits are getting squeezed as much as 40%.
Here's what I can say definitively: it's really hard to prove or disprove most of the claims. This is because - with the exception of the Green Bay Packers - none of the accounting information is truly public. And while we could take the Packers' situation and extrapolate to the other 31 teams, the truth is that they are not necessarily an "average" team.
So after the jump is what I believe to be the truth - or close enough to the truth for us.
I planned to show both sides of the equation (revenue and expenses), but frankly just the revenue side was complex enough to stand alone.
Annual Revenue (in $ millions) |
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Shared evenly: |
Total |
Avg Per Team |
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|
Broadcast TV (CBS, Fox, NBC, ESPN) contracts: |
$ 3,085 |
$ 96.4 |
|
DirecTV contract: |
700 |
21.9 |
|
Other media contracts (Sprint, EA, Sirius, Verizon): |
283 |
8.8 |
|
Product licenses (hats, t-shirts, bobbleheads, etc.): |
? |
? |
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|
|
Shared unevenly or not shared: |
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|
|
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Tickets & concessions (~60/40 split home/away): |
1,888 |
59.0 |
|
Stadium naming rights, luxury boxes (not shared): |
? |
? |
|
|
|
|
|
TOTAL: |
~$ 8,000 |
~$ 250 |
Let me explain a few things:
- The $8 billion figure has been used multiple times in the articles I reviewed. The lower end of that estimate is $7.6 billion, and the NFLPA site now indicates a figure as high as $8.5 billion, with the addition of a new media contract with Verizon.
- Though there are question marks in the row, I did find information that product licenses account for ~$4 billion in league revenue. However, if I added that to the other figures, the total revenue would be listed as $10 billion, without counting the revenue from naming rights and luxury boxes. I believe some of the $4 billion is counted in the $1.9 billion tickets & concessions revenue.
- There is a comprehensive document listing the naming rights of all sports venues, but they have cleverly locked down the .pdf file. To go through it and pluck this information out manually requires more time (and patience) than I currently have so here is a link for those who are interested in the details.
Sources:
- Jason LaCanfora, Nothing Out of the Norm Happening with CBA Negotiations
- Tim Graham, Harsh Reality: Labor Pains Ahead
- Kurt Badenhausen, Michael K. Ozanian and Christina Settimi, Recession Tackles NFL Team Values
- Wikipedia, NFL on Television
- Sports Business Daily, NFL Media Rights Deals for the '07 Season
- Adam Brennar, Welcome to the Club
- Business & Economics Research Advisor, The Business of Professional Football
- Rodney Fort, National Football League Incomes and Expenses
- Economy in History of the NFL
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