Revenue Sharing.

[wolfeskins]

everyone on here is making some very good points. the only thing i can say is "if it aint broke, don't fix it".
things should stay as they are as long as the league can remain strong and successfull. if the league begins to weaken then they should explore this idea.

[Schneed10]

Originally Posted by Defensewins

I agree with your concern with this system, there is no incentive for the poor teams to be more lucrative and perform on the field.

The NFL's complicated economics works like this:

The NFL is making about $5.2 billion in revenue per year. Every owner starts out with nearly $100 million a year each from national television and radio contracts and national sponsorships. In addition they get one-third of ticket revenue from each game played, which is pooled and redistributed equally among all teams. The clubs also receive equal portions from a 12 percent royalty on every NFL-branded piece of merchandise. In all, about $3 billion of the $5.2 billion pot is shared equally.
Under the current collective bargaining agreement, which expires at the end of the 2007 season, an annual ceiling is placed on player payrolls of about 65 percent of defined league revenues. So even if Snyder makes more money, he cannot spend it on players salaries. After the $100 million distribution from the league, teams are largely on their own.
Because Snyder is a smart at generating additional revenue, the Redskins' annual revenue has increased from more than $100 million a year when Snyder took over the team in 1999 to around $245 million. So this proves there is no correlation between high-revenue teams and winning percentage. And no correlation between salaries paid and winning percentage.

My major problem with this system is seeing cheap teams like the Cardinals perform so poorly on the field and the owner is a cheap lazy SOB. But yet he is pocketing millions and under spending by $10m on players salaries. Then he complains when his stadium is empty. He is creating the problem. He has not incentive to improve, because the leagus is subsidizing his team. Hard working owners like Snyder are paying his salary and bills.

Great analysis, you're dead-on.

Dan Snyder and Jerry Jones (the highest revenue generators) contend that less revenue should be shared because of owners like that of the Cards. They contend that there isn't enough incentive for them to market themselves because they can grab a big chunk of shared revenues to make up for their laziness. I agree, to a point. The worst thing that could happen to the league is moving back to the un-capped era. The point was made earlier, Rozelle's theory, that league parity is what leads to compelling drama and interest across the entire country. Without a salary cap, big market teams like our Redskins will outspend the smaller market teams and gain a big advantage in player acquisition. This leads to the PERCEPTION amongst the public that the smaller market teams don't have a chance to compete, and hence interest drops. (It doesn't matter whether wins and losses are actually tied to payroll size or not, what matters is that people PERCEIVE that is the case, and consequently the non-die-hard fans lose interest once they realize their team can't afford to sign the household name players) And when some fans begin losing interest, demand for tickets decreases, as well as the number of people who will watch the games on TV. That leads to declining TV ratings, and that means fewer TV revenues for the NFL. That's the key, those TV revenues are the biggest chunk of the shared pot, if TV revenues start declining, ALL NFL teams will be worse off, including Dan Snyder and Jerry Jones.

Not to mention the quality of the league declines as the big market teams (like the Yanks and the Red Sox) just spend their way into the postseason.

I'm OK with wanting to adjust the amount of shared revenues, but not if it destroys the salary cap system.

[BigSKINBauer]

Originally Posted by Schneed10

Great analysis, you're dead-on.

Dan Snyder and Jerry Jones (the highest revenue generators) contend that less revenue should be shared because of owners like that of the Cards. They contend that there isn't enough incentive for them to market themselves because they can grab a big chunk of shared revenues to make up for their laziness. I agree, to a point. The worst thing that could happen to the league is moving back to the un-capped era. The point was made earlier, Rozelle's theory, that league parity is what leads to compelling drama and interest across the entire country. Without a salary cap, big market teams like our Redskins will outspend the smaller market teams and gain a big advantage in player acquisition. This leads to the PERCEPTION amongst the public that the smaller market teams don't have a chance to compete, and hence interest drops. (It doesn't matter whether wins and losses are actually tied to payroll size or not, what matters is that people PERCEIVE that is the case, and consequently the non-die-hard fans lose interest once they realize their team can't afford to sign the household name players) And when some fans begin losing interest, demand for tickets decreases, as well as the number of people who will watch the games on TV. That leads to declining TV ratings, and that means fewer TV revenues for the NFL. That's the key, those TV revenues are the biggest chunk of the shared pot, if TV revenues start declining, ALL NFL teams will be worse off, including Dan Snyder and Jerry Jones.

Not to mention the quality of the league declines as the big market teams (like the Yanks and the Red Sox) just spend their way into the postseason.

I'm OK with wanting to adjust the amount of shared revenues, but not if it destroys the salary cap system.

I completely agree, i just don't understand 1 thing,.... i heard that 2007 will be an uncapped year, is this true or will this be resolved. Does that mean we could sign players for 7 years and pay the full amount during that single year. we could cut all the players and not worry bout penalties and sign the probowl team. (I don't want this to happen) Is this a possiblility or will the situation be resolved..... or has it been resolved?

[CRT3]

It has not been resolved, and I have claimed all along the Redskins are playing for that one uncapped year in 2007. A deal to avert this will happen if the owners can agree on revenue sharing which will not happen

[MTK]

Hey CRT3, now that Morton's avatar is gone how about changing your sig?

[Schneed10]

Originally Posted by CRT3

It has not been resolved, and I have claimed all along the Redskins are playing for that one uncapped year in 2007. A deal to avert this will happen if the owners can agree on revenue sharing which will not happen

Actually, the movement to continue the salary cap system gained serious steam when two of the owners previously taking up positions in support of Snyder and Jerry Jones backed off and acknowledged that the NFL needs the salary cap. Both Bob McNair of Houston and Robert Kraft of New England have taken up positions in favor of reducing the amount of shared revenues; but they acknowledged this week that a salary cap is necessary.

Then you have Jerry Jones saying things like "we'll find a solution, because we have to. It's just nobody knows what it is yet."

I think he's right. The owners are going to realize a strike year is the last thing they can have happen. Also, director of the NFLPA Gene Upshaw has said that he'd be on firm legal ground by invalidating the existing contract of every NFL player if a new CBA is not reached. I'm not sure if he's right in legal terms, who knows, but if he is that would mean EVERY player in the NFL would become a free agent. It would be a free-for-all.

The owners will ultimately realize that when push comes to shove they need to remain open for business or they won't be able to line their pockets with any revenues, shared or not. They don't want a strike year, so if it means Dan Snyder and Jerry Jones end up sharing an extra 5% more of revenues than they wanted to, then they'll make that sacrifice.

These are the kinds of situations where people play waiting games until the eve of current CBA's expiration. Then leverage begins to play a role in negoatiations, bluffs get called, and deals get worked out. I personally can't see the owners failing to agree on a revenue sharing plan, and from the way Upshaw talks, he's not asking for an unreasonable chunk of cash for the players. He pretty much likes the status quo. I don't see an uncapped year happening.

http://sports.espn.go.com/nfl/column...len&id=2069744

[skinsguy]

Wow....reading all of your posts about the revenue sharing has made me alot more familiar with the sticky details! This was an excellent question, Daseal! Before this, I was all for having an uncapped year and to do away with the salary cap, but this might force me to change my thinking on it.

Ah well.....at least if there is a strike year, the Redskins always seems to be at the top of their game! ;-)

[wolfeskins]

yea , you guys have taught me a thing or two in this thread. thanks.

[Schneed10]

Originally Posted by skinsguy

Wow....reading all of your posts about the revenue sharing has made me alot more familiar with the sticky details! This was an excellent question, Daseal! Before this, I was all for having an uncapped year and to do away with the salary cap, but this might force me to change my thinking on it.

Ah well.....at least if there is a strike year, the Redskins always seems to be at the top of their game! ;-)

I think an uncapped year would be kinda cool in some ways, because the Redskins would be able to sign whoever they wanted, because they have the most financial ammo. But I don't like baseball's system and I don't want to become the NY Yankees, so for the long haul I'd rather see the salary cap in place.

Plus, I think all the owners as well as Gene Upshaw know that it would be nearly impossible to go back to a salary cap once we had one uncapped year. Once the players got a taste of uncapped salaries they'd never agree to a cap, restricting the payday that the Washington Redskins or Dallas Cowboys would deal out to them. It'd be like the baseball negotiations or NHL negotiations, it'd be like pulling teeth to get back to a salary cap.

[CrazyCanuck]

Great posts guys. Here are my random thoughts:

- Revenue sharing in sports is not only desired but vital. The fact is certain markets will always generate more revenue than others. Without any revenue sharing this discrepency between big markets and small markets would continue to grow exponentially until the quality and competitiveness of the league hits rock bottom (ie MLB).

- Individual people are greedy for the most part. The NFL is lucky because they came up with revenue sharing decades ago when the league had no revenue. If they tried to instate this rule now I don't think it would ever get passed, or the sharing would be much much less.

- The heart of the revenue sharing problem (IMO) is the TV money. That's where the big bucks are and therefore these are the most important revenues to share. Baseball has big problems because every team has their own tv deal and they are far from equal. The Yankees for example have their own tv network, while my beloved Expos actually spent a year with no tv deal AND no radio deal. The only solution I see for baseball involves gathering all the TV rights into one big package so it can be spilt appropriately by the league. But this is almost impossible due to the splintered nature of the market - ESPN, TBS, YES, WGN, NESN, etc.

- Fox sports is baseball's best hope IMO (believe it or not). They already have a bunch of individual tv deals set up. Plus they are big enough that they can split their broadcasts by region (ie Fox east, Fox West, etc.) This way they get the one big tv deal, and still have the capability to broadcast regionally (which is needed for baseball). Once all the TV money is being split evenly then the league might finally start to see some competitiveness and balance between markets.

- Back to football. Like you guys mentioned, teams like the Skins are pissed because they spend effort and energy to increase revenues in creative ways, then have to ship out a bulk of these to other teams who don't lift a finger. This is why the MINIMUM salary cap is just as important as the MAXIMUM. It prevents cheap teams from fielding a crap product and raking in the profits. The minimum cap is also what the players are concerned about, as this is the only amount of money that the union is guarnateed to see. The difference between the min cap and max cap is like $20M, so even today some teams are raking in an extra $20M just by playing cheap and short-changing their fans. This is why I think we should be grateful to have Snyder as owner.

- It's a tough debate as to what is fair regarding the side revenues that currently are not shared (ie luxury boxes, etc.). I'll let you guys debate it. My view is that any inherent advantage (ie larger markets) should be removed through revenue sharing, while anything that is already on a level playing field should not. This way hard work and creativity are rewarded while greed and frugality are not.

Sorry for the long rant.

[CrazyCanuck]

...and as for the uncapped year - no, nyet, nunga.

[Schneed10]

Originally Posted by CrazyCanuck

Great posts guys. Here are my random thoughts:

- Revenue sharing in sports is not only desired but vital. The fact is certain markets will always generate more revenue than others. Without any revenue sharing this discrepency between big markets and small markets would continue to grow exponentially until the quality and competitiveness of the league hits rock bottom (ie MLB).

- Individual people are greedy for the most part. The NFL is lucky because they came up with revenue sharing decades ago when the league had no revenue. If they tried to instate this rule now I don't think it would ever get passed, or the sharing would be much much less.

- The heart of the revenue sharing problem (IMO) is the TV money. That's where the big bucks are and therefore these are the most important revenues to share. Baseball has big problems because every team has their own tv deal and they are far from equal. The Yankees for example have their own tv network, while my beloved Expos actually spent a year with no tv deal AND no radio deal. The only solution I see for baseball involves gathering all the TV rights into one big package so it can be spilt appropriately by the league. But this is almost impossible due to the splintered nature of the market - ESPN, TBS, YES, WGN, NESN, etc.

- Fox sports is baseball's best hope IMO (believe it or not). They already have a bunch of individual tv deals set up. Plus they are big enough that they can split their broadcasts by region (ie Fox east, Fox West, etc.) This way they get the one big tv deal, and still have the capability to broadcast regionally (which is needed for baseball). Once all the TV money is being split evenly then the league might finally start to see some competitiveness and balance between markets.

- Back to football. Like you guys mentioned, teams like the Skins are pissed because they spend effort and energy to increase revenues in creative ways, then have to ship out a bulk of these to other teams who don't lift a finger. This is why the MINIMUM salary cap is just as important as the MAXIMUM. It prevents cheap teams from fielding a crap product and raking in the profits. The minimum cap is also what the players are concerned about, as this is the only amount of money that the union is guarnateed to see. The difference between the min cap and max cap is like $20M, so even today some teams are raking in an extra $20M just by playing cheap and short-changing their fans. This is why I think we should be grateful to have Snyder as owner.

- It's a tough debate as to what is fair regarding the side revenues that currently are not shared (ie luxury boxes, etc.). I'll let you guys debate it. My view is that any inherent advantage (ie larger markets) should be removed through revenue sharing, while anything that is already on a level playing field should not. This way hard work and creativity are rewarded while greed and frugality are not.

Sorry for the long rant.

Great perspective. I love your posts, they come too few and far between!

[CrazyCanuck]

Originally Posted by Schneed10

Great perspective. I love your posts, they come too few and far between!

Well guys like you always seem to hit the nail on the head, leaving me with nothing to add! I think it's great that there are so many knowledgebale fans on this site.

PS - New cap sheets are on the way soon. Sorry for the delay but not much happening this time of year.

[CRT3]

Originally Posted by Mattyk72

Hey CRT3, now that Morton's avatar is gone how about changing your sig?

Is Morton gone?

[monk81]

Originally Posted by skinsguy

Wow....reading all of your posts about the revenue sharing has made me alot more familiar with the sticky details! This was an excellent question, Daseal! Before this, I was all for having an uncapped year and to do away with the salary cap, but this might force me to change my thinking on it.

Ah well.....at least if there is a strike year, the Redskins always seems to be at the top of their game! ;-)

And Joe Gibbs did a fantastic job with the replacement players too!