NFL appears headed for a costly lockout

Friday, February 11 2011

As NFL commissioner Roger Goodell and NFL Players Association director DeMaurice Smith go deeper into the negotiating dance of a new collective bargaining agreement, they want to be careful not to become known as the executives who killed the $9 billion golden goose. This article was written by D. Orlando Ledbetter and appeared in the Atlanta Journal Constitution.

The NFL has surpassed baseball as the nation's favorite sport, and Super Bowl XLV was the most watched event in television history with an estimated 111 million viewers, according to Nielsen Co.

The players and owners have benefited financially from a system that has made the players rich and the owners, even richer.

But that financial stability is in a state of flux as the negotiations took an ugly turn Thursday when the owners, according to ESPN, walked out of a negotiating session in Washington and cancelled an owners' meeting that was scheduled for Tuesday.

Some of the key issues include:

Revenue sharing
Drug testing
Rookie wage scale
Expanded schedule
Retired player benefits
Financial transparency
Salary cap
International play
In May 2008, the owners opted out of the CBA, which is set to expire March 3. They are seeking $1 billion in concessions per year from the players over a seven-year period, according to Smith.

Some of the teams have used public funds to help build stadiums, in a public-private partnership. Public funding is not as viable an option in hard economic times, and the NFL needs its own funds to build the new mega-stadiums that would allow franchises, such as the Falcons, to generate their own revenue.

The NFL also would use the money to expand rosters, establish more of a European presence, expand benefits and expand health-and-safety programs.

"We would be able to have stadiums in Los Angeles," said Jeff Pash, the NFL's executive vice president, during Super Bowl week in Arlington, Texas. "We could have a new stadium in the San Francisco Bay area. We could have a new stadium in Atlanta. We could have a new stadium in Minnesota."

The fight has been getting a little snippy as the deadline approaches.

"There is a lot out there, things that small-minded lawyers can't even dream of, but we need to have a system that fuels it," Pash said in a not-so-veiled shot at Smith.

The union wants to continue playing under the current system that guarantees the players 50 percent of the revenue, according to Smith. Before giving back any money to the owners, the union wants to see the owners' financial records.

"You're now asking the players to give back a billion dollars a year for the next seven years, and our simple question is before anyone would want to write a $7 billion check, what financial information would you think is relevant?" Smith said.

With the owners walking out Thursday and no future meetings scheduled, a lockout appears imminent. On the NFLPA's website, nflplayers.com, there's a large graphic that reads "Lockout Countdown."

Some fans certainly will be alienated by the fight between the millionaire players and the billionaire owners.

The players' average salaries by position all were over $1.3 million for the 2010 season. Quarterbacks average $4.1 million while running backs average $1.39 million, just ahead of the kickers at $1.32 million.

"If we can't get an agreement done. ... we will have failed to fulfill our obligation to our fans," Pash said.

Green Bay Packers president Mark Murphy has been on both sides of this fight. As a player in the 1980s, he served as the Washington Redskins' player representative and went through the strike of 1982. The league also had a strike in 1987.

"I remember the first game after we came back from the strike," Murphy said. "Fans were yelling at us. Yelling at me. ... That was a tough time for players and for the league."

Murphy understands why the players like the current system.

"[The earlier strikes] helped set the stage for the system that the players have now," Murphy said. "It's been good for the players."

Now, that the games are over, the players have prepared for the fact that they don't know where their next six-figure paycheck will come from.

"A lot of people don't understand, come March 4, we don't have insurance," Pittsburgh wide receiver Hines Ward said. "They are stripping away our insurance. ... This is a serious matter."

Jay Feely, a former Falcon, is the union representative for the Arizona Cardinals. He believes the players will support the union.

"I think we've done a great job of educating our players, and the players understand what the past players have done to get to this point," Feely said. "They know you have to make a little sacrifice to get to the greater good."

The players are fine with the lockout if all they miss are mini-camps and organized team activities. If it lingers into the preseason and the regular season, they likely will start to get antsy.

"It's the favorite sport played," Ward said. "It makes millions. To sit there and have a lockout would be crazy."

The financial losses could be staggering.

"If you lost the entire preseason, it would be upwards of $1 billion," Pash said. "I don't know how much you would salvage if you had a deal done by July 1."