Member of Chargers Tests Positive for COVID-19

[Formula 21]

Isnt the revenue split just on TV contracts and maybe jersey sells? Owners get all stadium & individual team branding generated $ - I.e. Jerrah’s success

Players get a percentage of revenue. I don't know what is included in revenue, but I'd suspect ticket sales are part of it.

Players should get more money as hazard pay, but the revenues coming in are going to be less with no ticket sales so owners will want to pay them less. I think its a tricky issue.

The owners will do whatever costs them the least money. It is a business. And I don't think the players will want to lose a year of their earning power.

[like54ninjas]

Players get a percentage of revenue. I don't know what is included in revenue, but I'd suspect ticket sales are part of it.

Players should get more money as hazard pay, but the revenues coming in are going to be less with no ticket sales so owners will want to pay them less. I think its a tricky issue.

The owners will do whatever costs them the least money. It is a business. And I don't think the players will want to lose a year of their earning power.

Decent breakdown.......

How The NFL Makes Money TV is the NFL's golden goose, but gambling and streaming show potential.

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By JAKOB ECKSTEIN
Updated Sep 24, 2019
By any measure, the NFL is the most successful American sports league in history. For all the talk of North America’s “Big Three” sports (or for hockey fans, Big Four), the reality is that there’s pro football, and then there’s everything else.


In 2015, in response to mounting criticism for its quickly growing revenue, the NFL gave up the tax-exempt status it had held since 1947. The league now exists as a trade association made up of and financed by its 32 member teams. 31 of these teams are owned individually, only the Green Bay Packers retains its non-profit status. The NFL earns the lion’s share of its money with TV deals. According to Statista, more than 50% of the league’s revenue came from TV deals in 2015, a year when the league made about $12 billion. Other revenue streams include ticket sales, merchandising, and licensing rights and corporate sponsorships.


Despite steadily declining viewership since 2015 and recent controversies about concussions and the national anthem, the NFL is making more money than ever. Although, due to its private status, it is impossible to know exactly how much the NFL makes; Bloomberg estimates it earned around $15 billion during the 2018 season. This is up from estimates of $14.2 billion in 2017 and $13.3 billion in 2016. And the league is showing no intentions of slowing down. Commissioner Roger Goodell has targeted $25 billion in revenue by 2027, or 6% annual growth.


The Business Model

The NFL groups its revenue streams into two categories: “national revenue” and “local revenue.”

National revenue consists of TV deals along with merchandising and licensing deals, which are negotiated at the national level by the NFL itself. This money is then divided evenly between the 32 teams regardless of individual performance. According to the Green Bay Packers’ 2018 annual report, the NFL earned over $8.1 billion in national revenue last year, meaning each team received about $255 million in national revenue from the league.

Local revenue, which consists of ticket sales, concessions, and corporate sponsors, is earned by the teams themselves. In 2018, the Packers earned $196 million in local revenue, 43% of their total revenue that year, which was $455 million.

However, the costs of running a professional football team are high. In 2018, the Packers spent $420 million on expenses. $213 million went to players, while $208 million went to stadium upkeep, marketing, and team and administrative costs. This leaves the team an operating income of $38.5 million. According to Forbes, the Dallas Cowboys are the NFL’s richest team, with $864 million in revenue and an operating income of $365 million in 2018.

This is the basic structure of the NFL’s business. Here’s how it breaks down.

• The NFL gave up its tax-exempt status in 2015.
• Commissioner Roger Goodell has targeted $25 billion in revenue by 2027.
• TV deals make up over half of the NFL’s revenue.
• The Green Bay Packers are the only NFL team run as a non-profit corporation.

Massive TV deals

Football is, hands down, the most-viewed sport in the U.S. Nineteen of the 20 most-viewed TV broadcasts in U.S. history are Superbowls of various years. In season, NFL games are broadcast live in the USA on Mondays, Thursdays, and Sundays. These games are consistently the highest rated shows on TV, so media companies have shelled out big bucks for the rights to broadcast them.

The NFL currently has TV deals with CBS, NBC (owned by Comcast), Fox, and ESPN (owned by Disney/Hearst). In contracts that were finalized in 2011, CBS, NBC, and Fox committed to pay the NFL a total of $39.6 billion between the 2014 and 2022 seasons. The three broadcasters share rights to "Sunday Night Football,” as well as annually rotating rights to the Super Bowl. Fees payed by these networks are set to rise about 7% annually, meaning they will each be paying the NFL about $3.1 billion per year by 2022.

In the same year, ESPN signed a deal to pay the NFL $15.2 billion through 2021 for the rights to “Monday Night Football.”

In 2018, Fox signed an additional deal for $3.3 billion for exclusive rights to “Thursday Night Football,” outbidding NBC and CBS. Merchandising and Licensing Deals

Although the majority of its national revenue comes from its monster TV deals, the NFL also makes money by selling companies the rights to sell items that represent the NFL. For instance, the NFL, in partnership with Nike, signed a 10-year licensing deal with online sports-retailer Fanatics in 2018. This deal makes Fanatics the exclusive manufacturer of all adult-sized, Nike-branded merchandise sold through the NFL’s online store.

The value of this deal went undisclosed, but in all likelihood, it’s pennies compared to the NFL’s TV deals. According to Navigate Research, a Chicago-based firm that specializes in the evaluation of sports and entertainment marketing investments, only about 10% of the NFL’s yearly revenue comes from these deals. Ticket Sales and Concessions

Although ticket sales constitute an important revenue stream for individual NFL teams, they are nonetheless relatively small compared to quickly growing revenue from TV deals (you’re probably noticing a pattern here). On average, NFL stadiums seat about 70,000 people, and games usually sell out. This doesn’t leave much opportunity for growth. The average ticket price has increased about 7% annually since the turn of the century. Tickets cost about $30 in 2000 to about $102 in 2017, but the added revenue from these increases are negligible when compared to revenue growth from TV.

The one thing teams can do is choose to renovate their stadiums to add more seats and concession stands. Such renovations are costly and disruptive, but usually pay off. Since 2010, the Packers spent more than $370 million gradually updating its stadium, Lambeau Field, including adding more seats. Since then, their yearly ticket revenue has jumped from $48 million to $71 million.

NFL teams can also use their stadiums to host non-football events, like concerts, but opportunities for revenue growth from these events have the same limitations.

An NFL team earned about $7 million, on average, in ticket sales from a single stadium event in 2016. About 55% of that revenue is used to pay athletes or musicians. 10% goes to general stadium administration, 5% goes to the team’s coaching staff, 5% is paid in taxes, and the remaining 8% are profit.

Like ticket sales, concessions are peanuts compared to TV deals. Concessions contribute only about $3-5 million to the average NFL team’s revenue, but the margins on selling food at games are extremely high. Beer and soda sold at stadiums have margins of over 90%. Only 8%

The average NFL team's profit margin of ticket sales. Corporate Sponsors

Corporate sponsors pay NFL teams to display their logos on players’ uniforms, TV transitions, merchandise, etc. In 2018, the NFL pulled in over $1.3 billion in sponsorships. The most coveted sponsorships are naming rights to NFL stadiums. According to the New York Times, the naming rights to Met Life Stadium in New York and the AT&T Stadium in Dallas are both worth $19 million a year.

Future Plans

TV Growth

Contrary to some claims, TV isn’t dying, at least not when it comes to football. The value of the NFL’s TV deals has skyrocketed in the last few decades; by all accounts, it will likely continue to do so. As a result, the NFL’s biggest focus for reaching its aspirational $25 billion in revenue by 2025 is continuing to secure bigger and bigger TV deals. Streaming

Although TV is still king when it comes to watching football, streaming is on the rise. In 2017, Verizon signed a new $2.5 billion deal with the NFL for five years of streaming rights. This is twice the size of the deal Verizon had with the NFL before. In April of 2018, Amazon signed a comparatively small deal of $130 million for two years of streaming rights. If the growth of TV deals in the last few decades are any indication, these deals will also continue to grow rapidly over the coming decades. Gambling

Although the NFL has always officially been against sports gambling, that is likely to change soon. In May, the Supreme Court decided to let states determine whether or not to legalize sports gambling. As of July, eight states have already fully legalized the practice, while seven more have passed bills to do so. A legislative wave has begun. To capitalize on this, the NFL could set up betting parlors in stadiums, partner with established casinos, set up online sports gambling portals, etc. The possibilities are vast and there is no way the growth-obsessed NFL won’t explore as many as it can. $150 Billion Annually

Estimated value of American sports gambling.

Key Challenges

Reliance on Star Power

The NFL relies on its star athletes to keep fans coming back, and when their biggest stars begin to fade, so do TV ratings. This was the case in 2016, 2017, and 2018, when ratings fell slightly for three consecutive years. In 2017, for instance, many of the league’s most popular players were injured—J.J. Watt, Aaron Rodgers, Andrew Luck, Rob Gronkowski—stuck with bad teams—Russell Wilson, Von Miller, Eli Manning—or both, like Odell Beckham Jr.

This same logic also applies to popular teams. When few popular teams make the playoffs, fewer fans watch. According to the research firm MoffetNathanson, only half of the 10 most popular teams made it to the postseason in 2017. This could be connected to the 20% drop in viewership that year. Political Controversy

As most Americans probably already know, President Trump has had some problems with the NFL in recent years and he’s made his distaste very clear. He repeatedly admonished the NFL in 2017 and 2018 about not cracking down hard enough on players for kneeling during the national anthem to protest police brutality. Many of his supporters boycotted the league as a result. However, it remains to be seen whether this political entanglement will last.

[Xenos]

Hence the rigid testing...you test negative, or you test positive for antibodies, and you travel with team, stay with team, and take the field on gameday. You test positive for virus, your medically suspended for 3 games, away from team. It's not complicated. The only difficulty is test availability...if they are being mass produced all spring and summer, there will hopefully be a abundance. The players want it, the owners want it, the networks want it...and America needs it. If we are still losing 2000 a day come July, then I would be doubtful. But I do think concerts or any mass gatherings are suspect regardless, til 2021. But empty arena sports? They are already drawing up guidelines.

You're not only testing the players though. You're testing everyone involved in the operation. Do we have the resources to test not only everyone in the NFL but for more the everyday people that have their own nonessential businesses to run? And I disagree about needing it. It's a want. I want to Chargers to win a Super Bowl before I die. I don't need it though.

[Bolt-O]

Slightly off topic...

[Boltdiehard]

We'll see. If anything I think it will be the NFL who don't want to deal with the political fallout of spreading the virus.

The same NFL that is steamrolling ahead on construction of two NFL stadiums with thousands of “essential” workers where it’s almost impossible to practice social distancing? It’s the NV governor taking the heat not the NFL. In CA nobody cares or notices.

The politics is for us the money is for them.

[rikardo]

Slightly off topic...

Very bad news, Im a big fan of Von Miller (I still hate the Broncos)

[like54ninjas]

Very bad news, Im a big fan of Von Miller (I still hate the Broncos)

Likewise!

FUCK the donkies!

[Boltdiehard]

Slightly off topic...

No comment.