You’re not living the High Life if you can’t figure out how to share $9 billion
Posted by Anthony Stalter (03/17/2011 @ 8:00 am)
The NFL logo is seen on a trailer parked near the New Meadowlands Stadium where the New York Jets and New York Giants NFL football teams play home games in East Rutherford, New Jersey, March 14, 2011. The NFL has officially announced a lockout of players by team owners following the move by the players’ union to dissolve themselves and pursue court action against the league. REUTERS/Mike Segar (UNITED STATES – Tags: SPORT FOOTBALL BUSINESS)
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If your league grew 7.5% last year and now you can’t figure out a way to best divvy up $9 billion so that fans can enjoy a season next fall, then you automatically aren’t living the High Life.
As expected, the NFL labor situation has gone from bad to worse as the players have decertified and the owners have locked them out. While there are many factors at play, the root of the bickering is revenue – as in, how to share it. The owners want the players to take a paycut, while the players want to know why when the league’s profits and popularity keep growing.
Meanwhile, the fans continue to suffer this offseason. This is supposed to be a time for free agent news, draft rumors and a renewed sense of hope that your team will compete next year (even though it won’t…sorry, Buffalo fan). Instead, the draft is the only thing fans have to look forward to and the players and owners are doing their best to ruin that now, too. (The NFLPA has instructed top prospects not to attend Radio City Music Hall, so things could get real awkward when Roger Goodell starts announcing names on stage in New York next month.)
The worst part about the situation (besides the fact that there may not be a season next year) is that neither side is getting anywhere. Judge David Doty (who has ruled more in favor of the players than the owners when it comes to previous NFL cases) ruled that the owners couldn’t use the $4 billion from renegotiated TV contracts to fund their lockout, so the players seemingly had the upper hand in talks. Thinking they had friendly Judge Doty in their back pocket if they went to court, the players decided to reject a last-second offer by the owners last Friday and decertify. The only problem is that they didn’t have Judge Doty because a different judge has been assigned to their case. Now it appears the playing field has been leveled again.
The NFL has grown in leaps and bounds because of its fans. Now the league is a victim of its own success because fans are getting more impatient by the day. With no resolution in sight, everyone may have to wait until September to get back to living the High Life.
Mr. Smith goes to the negotiating table
Posted by Thomas Conroy (06/04/2009 @ 4:00 pm)
In March, the NFL Players Association (NFLPA) made an historic move by electing Washington D.C. power attorney DeMaurice Smith as their new executive director, and skeptics wondered if this was the right time for the union to bring an outsider into a leadership role. All eyes will be watching as he begins negotiation with the NFL on a new labor contract this week in New York.
Smith wowed the NFLPA’s board with an hour-long presentation detailing his plan for their upcoming collective bargaining sessions, as he promised to use his Congressional friends to challenge the league’s long-standing anti-trust exemption in order to obtain a better deal.
The owners have believed for a long time that the players’ cut of the revenue pie has been too big for too long, and opted out of the current agreement last year, which almost guarantees that there will be no salary cap for the 2010 season. With concerns of a slowing economy, the owners feel that escalating salaries within the league could impact the revenue stream for several clubs.
Smith recognizes the economic challenges facing the league, and has requested the NFL to open each team’s financial books. The league’s negotiating team has rejected his request and claims the union has enough information to secure a fair deal.
Many NFL insiders feel the league is at a disadvantage in this upcoming labor negotiation due to the fact that Smith is an unknown entity. He speaks like a politician (insisting on calling the players “businessmen”) and promises the union will maintain a hard line stance in the upcoming labor negotiations.
Everyone involved expects to play football in 2010, albeit without a salary cap, but Smith warns the owners that no new agreement will include a salary cap if the 2010 season is played without one. There is a good possibility that some form of a work stoppage will take place in 2011, either in the form of a players’ strike or an owners’ lockout prior to the start of training camp. Smith pointed out that a lockout would hurt not only the players, but the people and businesses that rely heavily on the NFL to make a living.
If the NFLPA had hired an insider that had a better understanding of the league’s politics and the current state of the labor/management relationship, many believe both parties would find common ground for a new agreement and the NFL would continue to flourish. But this isn’t the feeling anymore, as Smith encourages the players to prepare for war inside the board room.
It should be an interesting negotiation.