Say, how did that labor standoff work out for NFL players, anyway?

posted at 11:36 am on April 9, 2012 by Ed Morrissey

Remember how football fans worried that the 2011 NFL season could be lost, thanks to the decision of the NFLPA to reject the league’s offer for a new collective bargaining agreement?  The players argued that the offer on the table was insufficient, and that they needed to guarantee more revenue for players as their executive director DeMaurice Smith led them into a work action and a threat of antitrust lawsuits that resulted in a lockout before a new agreement was reached.  The NFLPA declared victory, but as the Boston Globe reports, it turned out to be a victory that may have cost players over a half-billion dollars:

But the question that continues to loom – and likely will for some time – is, did the game even need the lockout, which was triggered when the NFL Players Association walked out of federal mediation March 11, 2011?

Because the way things are going, the players look like they didn’t gain anything. In fact, it appears they’re losing money – some $652 million over the next three seasons.

What happened?  Smith and the NFLPA wanted a fixed percentage of revenues from the NFL, and rejected the salary cap cuts for 2011 in the original league offer.  They got both — but as the saying goes, be careful what you wish for.  The new collective bargaining agreement raised the cap back up on 2011 to nearly $121 million, which means the players potentially gained over $204 million across all 32 teams last season.

So far, so good, right?  However, the caps are now fixed at $121 million over the life of the CBA unless the league can increase revenue substantially.  In the original league proposal without the fixed revenue share, the league escalated team caps in the following four seasons up to $134 million.  That will result in a net loss of income opportunity for players of about $652 million during the life of the new CBA that Smith negotiated.

This could change, of course, if the NFL can find new ways to substantially increase its revenue — but interest in the game is about as high as it will probably get, relative to other sports.  The league tried explaining that to the NFLPA and showed them their projections, which turned out to be much closer to eventual outcomes than those from the NFLPA.  Unless the league escalates ticket prices at a much higher rate than we’ve already seen and demands higher TV revenues, the revenues won’t move much outside of normal inflation over the next few years.  And new TV revenues would have to be dependent on drawing a lot more viewers to the games.

Looks like the players tried a gimmick play and lost a lot of yardage on that scrimmage, not to mention the damage done to the league from the threats of a lost season.  They may want to look for a new playcaller in the next round of CBA bargaining.

Update: Twitter follower MarioC points out that the new CBA did indirectly result in an increase in TV revenues from the NFL’s partners in December, which the Globe may have missed:

Rights fees for all three networks will increase by about 6 percent or 7 percent a year, according to three people with knowledge of the talks who were granted anonymity because they weren’t authorized to disclose the terms. The NFL currently receives about $4 billion a year in television rights fees from companies including Walt Disney Co. (DIS)’s ESPN and DirecTV. (DTV)

NFL Commissioner Roger Goodell – who along with the three broadcast networks declined to reveal financial terms — said the 32-team league’s new decade-long labor agreement signed after a four-month offseason lockout helped it to negotiate the longest television deals in league history.

“That kind of stability gave us the ability to get these contract extensions,” Goodell told reporters yesterday. “The players deserve great credit.”

Under the terms of the new collective bargaining agreement, the players’ share of broadcast revenue climbs to about 55 percent from around 50-51 percent under the prior deal, Ganis said. The NFL has annual revenue in excess of $9 billion.

Well, that means that the players will get 4-5% more of the 6-7% annual increase than they otherwise would have received, presumably in incremental cap increases.  That doesn’t appear to make up for the amount the players passed up, although I haven’t crunched the numbers entirely to determine that.


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Players will play, they will be paid. No big shift in anything here.

Freelancer on April 9, 2012 at 11:39 AM

Looks like the players tried a gimmick play and lost a lot of yardage on that scrimmage, not to mention the damage done to the league from the threats of a lost season.

I’m also interested in your thoughts on the bounty hunting escapades that have surfaced in the last 2 weeks.

ted c on April 9, 2012 at 11:40 AM

NFLPA takes the snap, rolls to the left…..looking, looking…THROWS DEEP!……CAUGHT AT THE 15, the 10, the 5… TOUCHDOWN!….wait..there’s a flag….behind the line of scrimmage…looks like this one is coming back….minus 10 more for the holding.

BobMbx on April 9, 2012 at 11:42 AM

Unless the league escalates ticket prices at a much higher rate than we’ve already seen, demands higher TV revenues, and finds more states full of morons willing to tax themselves for a direct payment to the 1%, the revenues won’t move much outside of normal inflation over the next few years.

Fixed, for the reality of the modern NFL. So how was that Madonna performance?

MNHawk on April 9, 2012 at 11:44 AM

Oh my God, the Quarterback is TOAST!

search4truth on April 9, 2012 at 11:44 AM

Oh my God, the Quarterback is TOAST!

search4truth on April 9, 2012 at 11:44 AM

Die Hard ref FTW!

Ed Morrissey on April 9, 2012 at 11:46 AM

Unions at their collective best.

Bitter Clinger on April 9, 2012 at 11:47 AM

Oh my God, the Quarterback is TOAST!

search4truth on April 9, 2012 at 11:44 AM

Come out to the coast, we’ll get together, have a few laughs…

pecan pie on April 9, 2012 at 11:49 AM

Unions for multi-millionaires! Liberal economic theory strikes again! Gotta love it.

questionmark on April 9, 2012 at 11:50 AM

Die Hard ref FTW!

Ed Morrissey on April 9, 2012 at 11:46 AM

All Die Hard fans know that one, Ed.
As for the NFL catfight…I’m always riveted whenever millionaires squabble with billionaires. Let me get my Spam sandwich Kroger faux cola and I’ll be right back.

swinia sutki on April 9, 2012 at 11:52 AM

Oh my God, the Quarterback is TOAST!

search4truth on April 9, 2012 at 11:44 AM

Die Hard ref FTW!

Ed Morrissey on April 9, 2012 at 11:46 AM

or, in this case with the NFLPA, “ut oh, looks like we’re going to need some more FBI guys”

Rovin on April 9, 2012 at 11:53 AM

sandwich Kroger = sandwich and Kroger. Engage the brain.

swinia sutki on April 9, 2012 at 11:53 AM

I’m not commenting until I hear Adrian Peterson and Rashard Mendenhall weigh in…

reaganaut on April 9, 2012 at 11:55 AM

Roger Goodell is ruining the NFL.

rubberneck on April 9, 2012 at 11:56 AM

Revenue will be declining as the league puts in more protective measures. Good for the players but there’s a reason no one watches flag football. The measures put in last season dumbed down the game and made for astronomical passing yards.

aniptofar on April 9, 2012 at 11:58 AM

Yeah but county and city sporting authorities all over the country will build massive ultra luxurious stadiums at over a $ billion each, and lease them to owners for $1 per year and some free seats.

Houston owes $330 million on the 47 yr old astrodome and it hasn’t been used for anything in 6 yrs. It only cost $35 million to build.

Seattle rolled it’s $280 million bond on the kingdom into it’s new facilities, that will never be paid for.

You should see how much Tom Benson has bled Louisiana for the Superdome and the Saints.

Pro sports is a great racket if you can get into it.

elowe on April 9, 2012 at 11:59 AM

The federal government should field a team of federal inmates.
That would generate some interest among the 99%.

redguy on April 9, 2012 at 12:00 PM

….unless the league can increase revenue substantially.

In real or nominal terms? If inflation goes up to 1973 levels, the costs of everything will double roughly every 5 years….and if league revenues keep pace, this may be turn out to have been a brilliant move.

cthulhu on April 9, 2012 at 12:02 PM

What gets me is how the NFLPA preached about unity and solidarity during the lockout, then we find out that some NFLPA members (the Saints) were actively involved in a bounty system to knock out other NFLPA members.

Bitter Clinger on April 9, 2012 at 12:02 PM

In real or nominal terms? If inflation goes up to 1973 levels, the costs of everything will double roughly every 5 years….and if league revenues keep pace, this may be turn out to have been a brilliant move.

cthulhu on April 9, 2012 at 12:02 PM

But what happens if inflation becomes so great that no one can afford to buy tickets to the games? NFL and NFLPA are both screwed then.

Bitter Clinger on April 9, 2012 at 12:04 PM

The Steelers. Pffffffffft!! Go Giants!!!

joejm65 on April 9, 2012 at 12:04 PM

Does the union care
About employee safety?!?
What a strange union!

Haiku Guy on April 9, 2012 at 12:05 PM

There is something deliciously ironic about this outcome. Greedy union makes poor business decision, financially harming members.
O/T but sure is good to have Ed back! Interesting topics and crisp, witty writing. Ed, you were missed!

indyvet on April 9, 2012 at 12:05 PM

aniptofar on April 9, 2012 at 11:58 AM

Nope.

I’m not sure where people come by these theories, perhaps from listening to ex-jocks on sports radio who try to rekindle some of that former glory by talking tough.

It is just completely baseless. The game has constantly been evolving from the “no hitting receievers five yards off the ball”, to the Bill Polian “illegal contact” farce to the “not taking the head off of a defenseless receiver” rule (which wasn’t last year).

The average, non-diehard fan wants to watch the Packers beat the Saints 42-34, not see the Browns top the Seahawks 6-3.

reaganaut on April 9, 2012 at 12:08 PM

Life’s tough, tougher when you’re stupid.

NoDonkey on April 9, 2012 at 12:11 PM

Good analysis for a political junkie!

KOOLAID2 on April 9, 2012 at 12:15 PM

reaganaut on April 9, 2012 at 12:08 PM

One of my all-time favorite games was watching Purdue beat Michigan 5-2 on a frozen field in the mid-90′s.

Mike Alstott ran the ball up the middle fifty times.

At least we’ll always have the Big 10.

NoDonkey on April 9, 2012 at 12:19 PM

Oh my God, the Quarterback is TOAST!

search4truth on April 9, 2012 at 11:44 AM

Come out to the coast, we’ll get together, have a few laughs…

pecan pie on April 9, 2012 at 11:49 AM

Do I sound like I’m ordering a pizza?!?!

Steve Eggleston on April 9, 2012 at 12:26 PM

As for the lost future revenue, you do realize that NFL stands for Not For Long, and the average career is somewhere under 4 years in length, right? What do Tom Brady and company care if the money isn’t there 5 years from now, especially since they’re getting theirs now?

Steve Eggleston on April 9, 2012 at 12:29 PM

Thats because the the unions are RAAAAACISTS!!

Liberal4life

Your so predictable.

Garym on April 9, 2012 at 12:31 PM

Do I sound like I’m ordering a pizza?!?!

Steve Eggleston on April 9, 2012 at 12:26 PM

“Welcome to the party, Powell”.

Garym on April 9, 2012 at 12:33 PM

If only we could go back to the QB calling plays in the huddle by drawing in the dirt with his finger.
NM, this is Professional Football we’re talking about.

OkieDoc on April 9, 2012 at 12:52 PM

Wait, DeMaurice Smith, Obama’s boy from back in the day, got in over his head and spit the bit on the lockout and the subsequent CBA deal?
No, say it ain’t so.
Maybe it would be better for everyone if Smith and Obama quietly retired and left the hard work to the adults in the room.

smfic on April 9, 2012 at 1:09 PM

Revenue will be declining as the league puts in more protective measures. Good for the players but there’s a reason no one watches flag football. The measures put in last season dumbed down the game and made for astronomical passing yards.

aniptofar on April 9, 2012 at 11:58 AM

Not much interest in paying to watch Pro Bowl type action.

a capella on April 9, 2012 at 1:14 PM

DeMaurice Smith? You are negotiating with some of America’s wealthiest business men (and their lawyers), and he’s YOUR GUY? And it might not of worked out for you?

Un-possible!

Next time, see if Ricky Williams’ first agent is free, that will be a step up for you.

FineasFinn on April 9, 2012 at 1:18 PM

I really must admit I have a difficult time drumming up sympathy for athletes making six/seven/eight figures a year. Combine that with the statistic of how many of them manage to go bankrupt for being irresponsible children with money…

I know, not really on topic, I digress.

Blacksoda on April 9, 2012 at 1:26 PM

Hey babe, I negotiate million dollar deals for breakfast. I think I can handle (these owners)…

Haiku Guy on April 9, 2012 at 1:40 PM

OT but NFL related…all of the suspensions for the Saints folks have been upheld. Paging Bill “Tuna Po Boy” Parcells…

Del Dolemonte on April 9, 2012 at 2:51 PM

I LOVE the picture of Urlacher standing over Favre lying face down on the turf. – Don’t you?

Almost as good at the Saints/Vikes NFCCG interception.

Favre is a Pevrert.

Green_Bay_Packers on April 9, 2012 at 2:56 PM

I don’t understand why people waste their life watching football. Why not do something instead?

thuja on April 9, 2012 at 3:13 PM