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Forbes Mag article on the CBA


yungmack

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What I'd like to know is how much do companies pay their work force as a percentage of total revenue? Is it on the order of what the NFL pays players?

 

In the entertainment business, absolutely yes. Movie stars and musical performers get a large percentage of the generated revenue. That scenario doesn't bother most people. High profile speakers on the lecture circuit get a large payment for their services, and that doesn't bother most people.

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You are right that the owners might have nothing to be gained by opening them up their books to scrutiny because it might undercut their bogus claims. They are making the claim that under the current CBA structure their businesses are in financial peril. What if that isn't the case?

 

If the labor conflict between the players' union and the owners were sent to an arbitrator how would the arbitrator react if the owners told the arbitrator that we can't give you all the relevant information because you won't understand it or we are not going to hand over the material because it is not in our best interest?

 

so what is the best case scenario for you the fan if the books are opened? i truly believe that this will only hurt the league in the long run. you can say private third party but tell me that the nflpa would not be in front of the tv saying "look - every team made a profit!"

 

we already have the posters on here clamoring how an organization making a profit should not be allowed to decrease salary. little do they consider that for some of these owners, that profit might be a lower percentage then you make on a savings account. do any of them take into consideration that maybe public funding for stadiums is drying up and there might be some billion dollar investments coming up? thats a huge shift of expenses, and somehow the only stream of money thats not allowed to be touched is player salary? pass it on the the fan in ticket prices, concessions, merchandise, just dont reduce spending on players.

 

on the flip side, if the owners are lying and getting rich -- does it help the sport in ANY way to give the players more money?

 

or maybe things are worse then we think -- suddenly the players know they can hold out cause some owners do need the money. suddenly a fan thinks why should i buy that jersey, the teams probably leaving for LA next year anyway.

 

 

and last, the owners deserve to clean house. many have poured billions into a company, and have grown a league much the same way bill gates, steve jobs, etc... have grown their own companies. i dont see any owners getting sam walton rich off of their team, and i think its incredibly unfair for fans to think this is solely an act of passion and the owners dont deserve those returns because they should do it for the love of the game.

Edited by NoSaint
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so what is the best case scenario for you the fan if the books are opened? i truly believe that this will only hurt the league in the long run. you can say private third party but tell me that the nflpa would not be in front of the tv saying "look - every team made a profit!"

 

I don't understand your reasoning. The owners insisted on a clause in the last CBA agreement that would allow them the option to re-open the CBA. They bargained for that clause just in case there was a change in the economic environment which could put them in a perilous financial position.

 

The owners have now exercised their prerogative to re-open the CBA. You don't think that it is reasonable for the union to ask the owners to demonstrate to them why there is a need to re-open the CBA? What if the owners are getting greedy and are over-reaching for more of a profit margin at the expense of a labor agreement that is currently beneficial to both sides?

 

we already have the posters on here clamoring how an organization making a profit should not be allowed to decrease salary.

 

Let's get serious. The owners have little regard for what the silly posters of a football blog think. As you should already know most posters support the owners and not the players. I am of a very miniscule minority.

 

on the flip side, if the owners are lying and getting rich -- does it help the sport in ANY way to give the players more money?

 

There is no flip side. The players are not asking for more money. What they want is for the current CBA to be abided by. They are simply saying if you want to re-open the negotiated CBA then demonstrate to us why there is a need to. The union has made the case that if the owners want some "give backs" then demonstrate the need for it. What is wrong with their position?

 

or maybe things are worse then we think -- suddenly the players know they can hold out cause some owners do need the money. suddenly a fan thinks why should i buy that jersey, the teams probably leaving for LA next year anyway.

 

If the Bills leave for LA it won't be because of the fans. It will be because of a self-centered, selfish 92 yr old owner who made the arrangements for the team to leave.

 

 

and last, the owners deserve to clean house. many have poured billions into a company, and have grown a league much the same way bill gates, steve jobs, etc... have grown their own companies. i dont see any owners getting sam walton rich off of their team, and i think its incredibly unfair for fans to think this is solely an act of passion and the owners dont deserve those returns because they should do it for the love of the game.

 

I don't understand the above comment. The owners ARE making a lot of money. They are not under financial duress. All the owners, some to a greater degree than others, have been supported by public subsidies that have made their "companies" exponentially increase in value with a steady stream of profit.

Edited by JohnC
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In the entertainment business, absolutely yes. Movie stars and musical performers get a large percentage of the generated revenue. That scenario doesn't bother most people. High profile speakers on the lecture circuit get a large payment for their services, and that doesn't bother most people.

I'd be surprised if movie casts and musicians even made 40% of the revenue from a film or album that the movie or record company takes in. Lecturers I don't know.

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Poor millionaire players. How EVER will they survive when they have to...you know...get REAL jobs.

What does this have to do with the price of cheese? They're entertainers, which is a business type in and of itself. As for the owners, I have to laugh at the claims of risk that they face. Owning and running an NFL team is about the most risk-free investment that one could make (granted, it's hard to be allowed into the club). But I digress -- the BS about "real jobs" discounts the fact that they're the entertainment for the most profitable media property (and the most predictably profitable media property) in the US.

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I hope the owners break the players union for the sake of small-market teams. Any Bills fan that's FOR the players is against the team's future in Buffalo. Unions destroyed industry in WNY, See: Steel, Bethlehem. Let's not let a union destroy the only joy in that godforsaken place.

 

Joe, you couldn't be more off base. The "new breed" of NFL OWNERS are the greatest threat to the Bills existence here. Not the Players Union. I know it will offend your capitalist business sense, but the NFL thrived from "collective" business policies among the teams. Things like equally dividing revenue. Ralph Wilson knew this and was against this current CBA, as many of the provisos in it were the baby of the "new breed" such as Jerry Jones and Dan Snyder. You can't blame the players for taking a deal that gave them 60% of revenue, can you? All but maybe 2 of these owners thought it was a good deal. RW was the only one to vote NO. There is no CBA right now. The players are right. They ARE the game, the reason we watch, and the owners know it. They may be shrewd businessmen. But you can't outsource the QB job to some third world nation. People want to see Manning, not Abu. Remember what the scab games looked like? The owners are clearly at fault here. They're kicking themselves for giving the players 60%, but their bluster is all phony. There is just too much money to be made (and lost) by locking out the players. A new CBA will be reached. But don't blame the players for the precarious position the Bills franchise is in. It has more to do with other owners wanting to "keep" more of their revenue stream away from the "shared" revenue streams. They don't understand that there is NO OTHER business like a sports league. If you always "crush" your competition (on the field AND on the balance sheet) you may have your home market cornered. But nobody anywhere else will care enough to watch. The owners will kill the golden goose, not the players.

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The owners get a big chunk of change from the networks and DirectTV regardless if the games are played or not, and don't pay player salaries or benefits , along with reduced expenses in many cases (if there's no deal). They play hardball and the NFLPA, or whatever new union succeeds them, need to compromise, in order to maintain their lifestyles, provide for their families, etc.

 

How do the owners take it on the chin, outside of the court of public opinion?

 

I agree that might be a huge PR problem for the league, but the owners will get most of what they want. Simply because they can outlast the other much more comfortably, while of course, making less money then they would have if there wasn't a lockout.

First its simply a guess as the owners are refusing to tell the truth about finances. No one can know for sure what the real situation is as the NFL has decided not to let folks know what is real and what is not.

 

However, I do not think that it is an unreasonable guess that the owners are not releasing the real #s because there is something in there that does not help their case. No one knows for sure what it is (it could be they undercut the case they are in trouble and need a fix from the players or I think it may be that the numbers would reveal which teams are in the worst shape and thus most vulnerable to being pushed around- anyway whatever it is cannot be good for the owners or they likely would release the #s.

 

My guess is that a few of the teams are heavily leveraged and if so they will put peer pressure on the other well0to do owners to make a deal so that their loans do not default,

 

I doubt the owners are monilithic and likely will find it hard to be stronger than a few weak links,

 

In addition, the player leadership has long seen this coming and I would suspect a talented tenth of players who understand this situation have likely come up with some left field strategies like the NFLPA threat to decertify which won the last couple of CBA fights.

 

The sad fact is that the owners took advantage of the taxpayers and the system to get college ball to absorb a huge training cost for them. I think the owners will probably take it on the chin as their forcing the players not to sign with them until they were adults is likely gonna come back and bite them.

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The other potential problem the owners have btw is the threat by elected officials to take away the partial exemption which the NFL has in regard to anti-trust laws. It is this partial exemption under which NFL teams to some extent conspire with each other to block other competitors from entering the market.

 

The threat to this exemption is one of the reasons why political leaders in Cleveland who are about as stupid as the NYS political leaders were able to beat up the NFL and force the league into letting them keep the Browns and get the expansion of the league back into Cleveland.

 

Who knows for sure how the publicity war between the millionaire players and the billionaire owners will play out, but the owners would be playing a game where even if it is unlikely a new bill will pass to strip them of the partial antitrust exemption, merely the threat of this is going to create problems for the teams which are heavily leveraged.

 

One of the mistakes some folks make in analyzing this situation is to assume that all NFL teams have the same needs and views on this issue. The likelihood is that some are more heavily leveraged as they have gotten loans to buy their teams. These teams will be putting a lot of pressure on the rich owners like Snyder and Jones to get a deal done,

 

I think folks are fooling themselves if they choose to believe all the teams are monolithic. The teams may well only be as strong as their weakest links.

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I'd be surprised if movie casts and musicians even made 40% of the revenue from a film or album that the movie or record company takes in. Lecturers I don't know.

 

How much does Tom Cruise make per movie, including percentages of the gross revenue? Do you think that Russell Crowe works for chump change? Rush Limbaugh, Bill Clinton, Gen Colin Powell can get more than $250,000 per speech. Ronald Reagan once made a few million $$$$ by flying to Japan, giving a 15 minute generic speech off of his cue cards and then immediately flying back home. Sara Palin, not the brightest light bulb in a room, can make over $100,000 per appearance and have her travel mode (corporate jet) and permiere hotel accommodations paid for by the sponsoring group. How much can a rapper make off of a successful CD? I'm confident that even you would be impressed.

Edited by JohnC
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How much can a rapper make off of a successful CD? I'm confident that even you would be impressed.

 

Not much. Artists don't make very much money off albums. Even acts that would be considered wildly successful can often not repay the label. The labels often take advantage of the artist because the artist makes money from live performances and other areas.

 

Perhaps, the owners should start taking endorsements into question and players with high endorsements should share 50% of them with everyone else.

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Perhaps, the owners should start taking endorsements into question and players with high endorsements should share 50% of them with everyone else.

 

Why? Do baseball stars share their endoresment money with the owners? Do NBA stars share their endorsement money with the owners? Do some of the few NHL hockey stars share their endorsement money with the owners? When Jerry Jones has a non-pro football event in his stadium does he share it with the players? When Dan Snyder has a college football game at his stadium does he share his proceeds with the players?

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