Thursday, March 02, 2006

Grumpy Old Men


The NFL owners are grumpy and the players are grumpy. Players are getting cut, general managers have no idea what to do about their salary cap, and owners can't believe what the players are demanding. They're all grumpier than a guy woken up by a drunken friend's Wednesday night 1 AM phone call.

I try to avoid labor situations, so here's my misinformed understanding of what this is about:
  • The owners and players are fighting over a few percentage points for revenue sharing. What's the difference between a few percentage points? Apparently tens of millions of dollars.
  • The players want owners to change the way they share revenue with each other. Teams like the Patriots, Cowboys, and Redskins make more money than teams like the Cardinals and Bills because of local radio rights and other sources of local income. The players want more of that local revenue shared so more teams have money to throw at free agents.
The first issue is a traditional sports labor dispute. Hopefully, the owners and players are smart enough to realize that if they take too long to agree on a number, there will be less revenue to share.

As for the second issue, the players should just forget it. Yes, teams that play in bigger markets get an income advantage (although the Patriots didn't take advantage of this in the 80's). However, most of the extra local income comes from owners investing in building a quality team and promoting it. These good owners should not have the fruits of their labors given away to owners who refuse to invest in their teams.

1 comment:

Patriotsy2k said...

"most of the extra local income comes from owners investing in building a quality team".
This is very true, with Daniel Snyder and the Redskins as my prime example. He has the highest local revenue - or "unshared revenue", which the lower owners call it. His figure is around 267 million a year, while the Arizone cardinals receive a little less than half of that. Yet he also has loans tied to this plush new stadium, which were financed with the idea that he would receive large income from the luxury box suites and other local revenue streams. If there was "local revenue sharing", financial problems would ensue. And who is to say what the owners in buffalo, Jacksonville, and Phoenix would do with the extra money?
As of now, it would take more than a 75% majority to get this sharing idea enforced (at least 24 teams). From what I have read, the teams with the highest local revenue will block this, and have created a little clique. These teams are Washington, Philadelphia, Dallas, NY Giants, NY Jets, NE PAtriots, Denver Broncos, and quite surprisingly, the Houston Texans. All they would need is 1 more team to vote against this, and could come easily with KC or Oakland.
Of course, this could all change with this new labor agreement. So let's see who folds first.