Reynolds Rap

NFL Labor: Peace, Preseason and TV Revenue In Our Time

7/25/2011 3:50 PM

After four months of posturing and negotiating, the NFL lockout is finally over.

With the NFL Players Association executive board and 32 team reps voted unanimously Monday the league is looking at 10 years of labor peace, with the players opting out of a late push for an opt-out clause after the seventh season.

The only real casualty from most NFL fans’ perspective — aside from those who worship at the altars of organized training activities and getting their fantasy teams together early — is the Hall of Fame Game in Canton, Ohio. The Aug. 7 meeting the Chicago Bears and St. Louis Rams was sacked when final negotiations lagged.

However, NBC’s coverage of the Green Bay Packers-New Orleans Saints season opener on Thursday Sept. 8 and all of the networks’ exciting exhibition game action that precedes it will remain on your remote.

Actually, preseason 2013 could be noteworthy, as the owners likely will be whistled for illegal procedure. Beginning in 2013, the NFL can shift to a 16-game regular season-and-two-exhibition-game format without the input or approval of the recertified NFL Players Association, according to ProFootballTalk.com. As such, the players would lose their 48% share of the revenue tied to the missing contests. The owners, which entered the just-completed negotiations with an eye on instituting an 18-game regular-season schedule that would have left only a pair of the relatively meaningless preseason contests, figure to revisit their quest to expand the current 16-game regular-season schedules.

NFL officials didn’t return phone calls by press time.

The league’s TV contracts with CBS, Fox, ESPN and NBC all end after the 2013 season, while DirecTV’s Sunday Ticket package expires upon the conclusion of the following campaign. [It should be noted that ESPN has already reportedly signed a long-term extension with the league, the announcement of which has been forestalled by the labor dispute].

Although the players have been steadfast in their opposition to the extra contests for health reasons — and some view the games as dilutive from inventory and interest perspectives — any additional real contests would up the ante in new rights deals.

Going to 18 games could also set the table for the NFL to offer another Thursday Night Football package, a move that was being discussed for the 2012 season. That gambit ultimately was tackled during the negotiations, leaving NFL Network in that position — at least for the next couple of seasons.

Expanded and more lucrative TV and media packages would certainly benefit the fiscal interests of the players, who stand to take home 55% of the monies from such deals under the new collective bargaining agreement.

All told, the players will receive at minimum 47% of all league revenue under the new contract. That ratio is down from the 50%-50% split with the owners under the deal that expired with the 2010-11 season. However, management took $1 billion off the top of the league’s $9 billion in revenue last season before that ratio was applied.

Under the new collective bargaining agreement, the players have agreed to take less, but their cut will be determined from an “all revenue” pie. Fueled in part by higher media deals – ESPN’s reported new Monday Night Football and highlights pact will jump to $1.9 billion per season from $1.1 billion now — that total will grow substantially over the life of the deal.

Some reports estimate the total at some $12 billion to 15 billion per season, with projections reaching the $20 billion mark toward the latter part of the contract.

October