Report: NFL proposed a potential 35% pay cut for players to offset losses from coronavirus pandemic. CGM Already Responds (1 Viewer)

[livefromDC]

Not that simple at all. The workers at Kroger/Rouses do not take home a percentage of all revenues that Kroger/Rouses earns. The players negotiated that they do so in order to ensure their salaries increase as the revenues increase. However, they never anticipated a situation where revenues would significantly decrease. They did not simply want to work for a salary (like those at Kroger/Rouses), they wanted to share in the revenues like a partner with the owners.

Not that simple either. Each player negotiated a separate contract which outlined their pay, and yes, a salary. When the team feels that a player is underperforming or not worth the contract, they can tear the contract up. When a player thinks they are over performing the contract they can hold out (and get fined) or play unhappily.

There's no sliding scale on a contract that's been negotiated. The owners didn't anticipate this. Oh well. Players never anticipate outplaying their contracts or having it torn up. But when it happens the players have to adjust. They have contracts with the players. It works BOTH ways. Labor for pay. You dont get to say, well we just dont want to pay you what's in your contract this year. Tear up all the contracts or pay them what you owe them.

Fans siding with owners every. Single. Time instead of the players is like some weird form of Stockholm Syndrome.

They have contracts. They're taking the risk. Pay them or don't play at all.

 

[livefromDC]

I am definitely not smarter than you and I have no feelings on either side, other than feeling really bad for the really good players on rookie deals (like Kamara) who are going to get hosed either way. If stadium revenue is between $100M and $150M per team per season, it is something every owner is considering. They are all business people and they are all thinking about losses and legalities of options. I don't know the ratio of TV and stadium revenue, but I am assuming stadium revenue is a huge chunk and possibly big enough to cause many teams to lose money if a season is played without stadium revenue. I think it is coming down to which is a bigger loss, a season without stadium revenue or no season at all and the legalities of that and everything in between. If a season is played and there is a net loss in revenue, it will be dealt with in the salary cap for future seasons. Just a big mess from every angle.

"Although ticket sales constitute an important revenue stream for individual NFL teams, they are nonetheless relatively small compared to quickly growing revenue from TV deals (you’re probably noticing a pattern here). On average, NFL stadiums seat about 70,000 people, and games usually sell out. This doesn’t leave much opportunity for growth. The average ticket price has increased about 7% annually since the turn of the century. Tickets cost about $30 in 2000 to about $102 in 2017, but the added revenue from these increases are negligible when compared to revenue growth from TV."

How the NFL Makes Money

The NFL makes money in many ways, but its TV deals are by far its most lucrative revenue stream and will likely continue to be.

www.investopedia.com

Ticket sales are negligible. This data is from 2017. It's likely even less of the revenue stream now. Teams can 100% afford to pay players what's stated in their contracts. They just want the players to shoulder the hit while they see the same profits and are comfortably away from any harm to their own health. Meanwhile, people are arguing for players to take a pay cut AND risk their health to the virus???

 

[sfidc3]

Some of y’all see the dynamic as you vs the players (esp regarding salaries)
the players see it as them vs owners (you know, like a job)
Your entertainment is derived from the players - you root for the, obsess over them, idolize them in a way

and yet some of y’all back owners every.single.time
the same owners that will try to exploit you as much as they do the players
the same owners you hate when it’s a Roger goodell question

someone smarter than me will have to explain why y’all get “won’t somebody think of the poor owners” in times like this

Agreed. It's economics, supply and demand, it is the fans and the networks willing to pay ungodly sums to the NFL and owners to watch, attend and buy NFL gear....which is why the players make so much money (and rightfully so in this economic environment)...

I'm almost always going to take the side of the player in these types of negotiations, they should have the leverage because without them there is no NFL....but there seems to be no shortage of billionaires wanting to own sports teams.....

 

[guidomerkinsrules]

I am definitely not smarter than you and I have no feelings on either side, other than feeling really bad for the really good players on rookie deals (like Kamara) who are going to get hosed either way. If stadium revenue is between $100M and $150M per team per season, it is something every owner is considering. They are all business people and they are all thinking about losses and legalities of options. I don't know the ratio of TV and stadium revenue, but I am assuming stadium revenue is a huge chunk and possibly big enough to cause many teams to lose money if a season is played without stadium revenue. I think it is coming down to which is a bigger loss, a season without stadium revenue or no season at all and the legalities of that and everything in between. If a season is played and there is a net loss in revenue, it will be dealt with in the salary cap for future seasons. Just a big mess from every angle.

In gross terms it’s about 70 (tv) / 30 (stadia)
And if tv is the onl y game, those #s will explode

 

[V Chip]

The players negotiated that they do so in order to ensure their salaries increase as the revenues increase. However, they never anticipated a situation where revenues would significantly decrease. They did not simply want to work for a salary (like those at Kroger/Rouses), they wanted to share in the revenues like a partner with the owners.

If I am not mistaken, the partial league revenue share (despite how it is framed here, the players don’t share in ALL league/team revenue) is based on the league revenue for the next year — ie, the salary cap increases the next year based on revenue from the current year. If that is the case, the implications of the loss of income this year should be reflected in the salary cap the next year. Thus the owners/league shouldn’t be withholding income for the players this year in case of loss of income. It should be reflected in the salary cap next year.

If games aren’t played, then players who get paid basically per game shouldn’t get that income for the cancelled game, but the owners shouldn’t just withhold salary “in case” of loss of income.

 

[Infoman]

CGM already tweeted his feelings



And more MT

 

[SAINTSFAN]

Not that simple either. Each player negotiated a separate contract which outlined their pay, and yes, a salary. When the team feels that a player is underperforming or not worth the contract, they can tear the contract up. When a player thinks they are over performing the contract they can hold out (and get fined) or play unhappily.

There's no sliding scale on a contract that's been negotiated. The owners didn't anticipate this. Oh well. Players never anticipate outplaying their contracts or having it torn up. But when it happens the players have to adjust. They have contracts with the players. It works BOTH ways. Labor for pay. You dont get to say, well we just dont want to pay you what's in your contract this year. Tear up all the contracts or pay them what you owe them.

Fans siding with owners every. Single. Time instead of the players is like some weird form of Stockholm Syndrome.

They have contracts. They're taking the risk. Pay them or don't play at all.

It is not "siding" with anyone. It is finance and contracts. Either all the players take some cut to reflect the losses or the cap could be significantly reduced next season as a result. In that situation, those under guaranteed contracts would be fine in the short-term, but those without guarantees would be stuck getting released or their salaries cut in order to fit the players under the cap. I am sure the union wants to avoid that. It is not as simple as saying the owners should just pay everyone. That is why there is a union and a CBA to abide by.

 

[jasonsw]

I think in the end cooler heads will prevail. NBA and MLB had to do contract negotiations. All of this is a starting point

 

[Swimmer]

I am definitely not smarter than you and I have no feelings on either side, other than feeling really bad for the really good players on rookie deals (like Kamara) who are going to get hosed either way. If stadium revenue is between $100M and $150M per team per season, it is something every owner is considering. They are all business people and they are all thinking about losses and legalities of options. I don't know the ratio of TV and stadium revenue, but I am assuming stadium revenue is a huge chunk and possibly big enough to cause many teams to lose money if a season is played without stadium revenue. I think it is coming down to which is a bigger loss, a season without stadium revenue or no season at all and the legalities of that and everything in between. If a season is played and there is a net loss in revenue, it will be dealt with in the salary cap for future seasons. Just a big mess from every angle.

You make some really good points - thx.

In no way do I personally trust the owners to escrow and then possibly distribute the remaining funds.

But there is the reality of the business of NFL teams. There are 2 points that I had to understand to get a better understanding of this issue. I think the last I saw was that:

1) The average NFL franchise would be worth $2.2 billion if sold. but....
2) That does not mean the individual teams are making a lot of money running their annual operations. This is why we have seen some small-market franchises not pay players near the cap or manipulate the cap where it appears they are paying the players higher but actual payroll is far less

So, if the teams actually lose $100 mil to $150 mil in fan revenue, franchises could actually lose money operating this year. That's what the teams and any business want to avoid. "If I sell my business, I could make $2 billion but I can't make payroll this year because I am losing money." And they will support their profit position by touting all the jobs they are creating for others outside their players and coaches. True but lame bs. They will use this line to try to support fans in stands at games, Oh they have such big hearts - "Excuse me. I am coughing up serious bs!" - lol

And the players are thinking that they will still have to play the games and they will take all the risks of contracting viruses for them and their family and friends, but not the owners in their luxurious and I guarantee you before the season newly air filtrated suite boxes. As a pure business event, this is a tough one. Personally, I think the teams should bite the bullet while some teams lose money this year just like so many other business industries are doing in this pandemic era

 

[Swimmer]

I think in the end cooler heads will prevail. NBA and MLB had to do contract negotiations. All of this is a starting point

^ 100% spot-on. The saber-rattling has just begun between both sides. To me, this stuff just sounds like normal business negotiations and there is too much money at stake for either side to blow it all

 

[BELOWSEALEVEL]

NFL annoys me.
Players should get paid less
Tickets should be less.
Everything should be less across the board

 

[Swimmer]

Question for those with knowledge of this virus which is not me....

I read this morning a report sponsored by 230 plus, many being extremely well respected leading scientists in this field that

1) The virus is also spread airborne, not just through contact and can infect people up to 30 feet away as the air floats for up to 3-minutes
2) The virus can be caught through the eyes

Combine the 2 and to a street medical idiot like me, and it sounds that if this is legit, one player in a locker room with the virus could infect nearly all the team

For you all in the know, is this is possibly legit and if so, what would it mean to team sports like the NFL?

Thx

 

[livefromDC]

It is not "siding" with anyone. It is finance and contracts. Either all the players take some cut to reflect the losses or the cap could be significantly reduced next season as a result. In that situation, those under guaranteed contracts would be fine in the short-term, but those without guarantees would be stuck getting released or their salaries cut in order to fit the players under the cap. I am sure the union wants to avoid that. It is not as simple as saying the owners should just pay everyone. That is why there is a union and a CBA to abide by.

It is that simple right now. The idea being floated by league is an attempt to paint the players as what's standing between fans and the season. The only thing you got right was that there's a union and CBA.

 

[No2DC]

You make some really good points - thx.

In no way do I personally trust the owners to escrow and then possibly distribute the remaining funds.

But there is the reality of the business of NFL teams. There are 2 points that I had to understand to get a better understanding of this issue. I think the last I saw was that:

1) The average NFL franchise would be worth $2.2 billion if sold. but....
2) That does not mean the individual teams are making a lot of money running their annual operations. This is why we have seen some small-market franchises not pay players near the cap or manipulate the cap where it appears they are paying the players higher but actual payroll is far less

So, if the teams actually lose $100 mil to $150 mil in fan revenue, franchises could actually lose money operating this year. That's what the teams and any business want to avoid. "If I sell my business, I could make $2 billion but I can't make payroll this year because I am losing money." And they will support their profit position by touting all the jobs they are creating for others outside their players and coaches. True but lame bs. They will use this line to try to support fans in stands at games, Oh they have such big hearts - "Excuse me. I am coughing up serious bs!" - lol

And the players are thinking that they will still have to play the games and they will take all the risks of contracting viruses for them and their family and friends, but not the owners in their luxurious and I guarantee you before the season newly air filtrated suite boxes. As a pure business event, this is a tough one. Personally, I think the teams should bite the bullet while some teams lose money this year just like so many other business industries are doing in this pandemic era

This situation is somewhat different because just about everyone (employers and employees) are facing serious financial challenges. Far too often, large entities use a crisis situation to make cuts. Job loss and furloughs may be a reality to a lot of people soon. The players may get some bad PR if they emphasize inflexibility on salaries. I'm pro-player but they don't want to be viewed as insensitive to the financial troubles the virus is causing.

 

[NMS]

Yeah, it makes great fiscal sense for the owners who are already losing billions..

Not every owner has the cash on hand to get through a shortened season/season with no fans and be able to make it.

Look at Fertita in the NBA who's lost a huge chunk of his fortune being it was tied up in casinos and restaurants

WHAT?

You always hear about the players having to manage their money if they hold out during collective bargaining an now you are saying not having a season or having a shortened one they they will somehow not make it? You do realize that that to get an NFL team you have to have to have considerable assets just to be considered? You don't get to be an NFL owner and be house poor.