The NFL: Running the Numbers in the Football Business

Why does America — and I include myself — invest so much psychic energy, not to mention hard dollars, in professional football, a sport that on many levels combines the worst aspects of roller derby and professional wrestling?

Sometimes when I am watching Dan, Boomer, Phil, Chris, Rod, Coach Cowher, Prime, Jamie, Mike, Shannon, and the rest, wearing those pink ties and crisp suits and seated on the high alters of cable television, I feel as if I am watching the Supreme Court deliberate on taunting, end-zone celebrations, the Raider Nation, clock management, Ochocinco, booth reviews, Cover Two, the wildcat, and Brett Favre’s shoulder, if not the ‘junk’ in his text messages.

Sadly, most Americans are clearer on what happens in the red zone than they are about the decisions of the Supreme Court. The business of America is football, much more than it is Main Street stores, the national budget, or the small print of the Patriot Act.

Maybe when the Decatur Staleys were playing the Chicago Cardinals, or when teams like the Massillon Tigers, the Shelby Blues, and the Ironton Tanks were on the field, football was a sport. It was played in local stadiums by players who worked in nearby steel mills and earned $25 a game.

The forward pass, national television, and the deification of Vince Lombardi turned the sport into an $8 billion bonanza that, to cover expenses, relies upon subsidized stadiums, sky boxes full of corporate bonus babies, enough violence on the field to render many ex-players vegetables, and a relationship with television that has reduced the airing of the games to violent You Tube clips spliced around ads that blur the attractions of Cialis and McDonald’s (“I’m lovin’ it!”)

What is the reality of football “franchises,” the right to own a team in a select market? Because football is absurdly given an antitrust exemption (as if the play of the Cincinnati Bengals is in the interest of national security), franchises are best understood as local protection rackets.

Except for the Green Bay Packers, which is owned by its fans, most NFL teams are owned by corporate hierarchs who have paid millions to buy a team. Fair enough; free enterprise is in the playbook of capitalism.

But instead of a sporting club that enjoys competition and fair play, what owners buy is a cooperative share of the national football monopoly. Its purpose is to browbeat cities and states for subsidized stadiums. Players are expected to perform under barbaric working conditions, and advertisers and television networks join a never-ending race for the rights to broadcast the spectacles on the Circus Maximus.

If you are doubtful of football’s influence–peddling in smoke-free political rooms, consider this: President Obama appointed Pittsburgh Steelers owner Dan Rooney to be the U.S. Ambassador to Ireland, no doubt for his go-routes to the Democratic Party. Or that the insolvent state of New Jersey encouraged the Jets and the Giants to build a new $1.6 billion stadium in the Meadowlands, even though the state still owes $110 million on the stadium it replaced, which has since been torn down.

Keep in mind that most NFL sweetheart deals are hidden as carefully as Jimmy Hoffa would have been spiked into the end zone at Giants Stadium. Revenue-sharing, sales tax increases, municipal bonds to buy stadium land, and parking-lot concessions are among the many ways local political establishments pay obeisance to team owners, who did not get their, on average, $1 billion in net worth by reaching into their own pockets.

New Jersey loves to boast that the Jets and Giants paid privately for New Meadowlands Stadium. Actually, the fans paid, via PSLs (that's personal seat licenses), and by paying $200 a pop for many seats. But the NFL owners chipped in $300 million, and the state has poured some $2 billion into the nearby Xanadu project (shops, offices, malls, etc.) that has little to show for the spent money except upgraded swampland, and a train line to the new stadium.

To pay for their subprime stadium debts, NFL owners are now threatening to “lockout” the players from the 2011 season, unless the players’ union agrees to lower the league’s salary cap, which sets how much each team can spend on its players.

The fans are told that the salary cap (59% of league revenue) is in place so that teams can compete as equals, and that “on any given Sunday,” every team has a chance of winning. Actually, the cap is just another example of the extent to which the NFL is a closed shop and exists to limit owners’ expenses.

To be sure, football players are not like you and me, and are paid hundreds of thousands of dollars for relatively short careers. (Running backs last less than four years in the league.) But for all the stars that you read about getting $7 million in signing bonuses, most players earn the league minimum (about $400,000) and are cut, usually after suffering a career-ending injury.

More life–threatening is the extent to which a career in football renders players prone to dementia: 6.2% of NFL players are affected, as opposed to 1.2% in the general population. In dealing with this issue, what most interests the owners isn’t player safety, but rather juking class-action liability, were it to be proven in court that NFL play causes dementia.

The bling for NFL owners, along with those subsidized stadiums, is its $20 billion in television contracts from the various networks, including CBS, NBC, Fox, and ESPN. The owners divide this swag, and the networks parse the schedule: there are games on Sunday afternoon, Sunday night, Monday night, and often on Thursdays — roughly the slots of Gregorian rituals in the middle ages.

Football’s thirty-two teams are a closed shop that enjoys antitrust exemption (hence, no competition), and the games are not "news", and thus available to anyone to broadcast. Football is studio entertainment, played before a “live stadium audience.”

Why do we need billion-dollar stadiums in each market, when a handful at Universal Studios would suffice? And they could be “themed” to simulate snow bowls, mud games, or even the Black Hole, Oakland’s biker digs.

Ratings of televised football games continue to go up and up, dominating national life not just on Sundays, but increasingly on holidays, too. Strangers could easily get the impression that Mayflower pilgrims got together with local Indians to watch the Lions get stuffed yet again on Thanksgiving. Can an indebted nation really give up so many hours to the Bills and the Buccaneers?

The biggest risk to football as we now know it is if new technology (will today's mainstream networks really survive?) diminishes advertising from the NFL games and waters down the $20 billion in television contracts. And, although I have no proof or evidence, I wonder if another risk to the sport could be a gambling scandal.

Developments that range from the NFL’s Red Zone broadcast to Fantasy Football have the feel of gimmicks that appeal to gamblers, who, like derivative traders, seek ways to bet on the fractional aspects of the games. One revelation of the Tiger Woods humiliations was the amount of time pro athletes spend in Vegas, rubbing shoulders with high rollers, if not cocktail waitresses. Didn’t the golfer Phil Mickelson once bet $20,000 on the 28-1 Ravens to win the Super Bowl?

For the fans, the game is about their teams winning and getting to the Super Bowl. For the owners, it’s about maintaining membership in the football oligopoly (worth about $250 million a year for each team, including the woeful Cleveland Browns). For the hot money, the games are a variation on off-track betting.

As a fan of the New York Jets, now in the forty-first year of their rebuilding program, I might take a bleak view of the NFL, as part of my denial over Mark Sanchez’s wobbly arm and his “happy feet.” Maybe I am remorseful for all the time I spend listening to Mike Mayock explain zone blocking schemes or the A gap.

At the same time, I share the views of former French president Georges Clemenceau, about an earlier League, that “of Nations.” At the Peace of Paris in 1919, he said: “I like the League. I just don’t believe in it.”

Photo of NY Jets v Eagles game by Ed Yourdon

Matthew Stevenson is the author of Remembering the Twentieth Century Limited, a collection of historical essays. He is also editor of Rules of the Game: The Best Sports Writing from Harper's Magazine. He lives in Switzerland.