This is not meant to be a political or economical study, since I am not qualified to make an assessment in such a manner. However, I am both analytical and extremely passionate in nature.
I love to study every detail of the NFL, especially from a statistical standpoint, which is why I created a stat-based site (www.queuestats.com) so I could learn more. I am also such a huge fan that I have to take out almost all emotion from watching our Broncos play because I would be too depressed as a kid to focus on school or anything else during the week after a Denver loss.
Some people want games to be close - I do not. I hope Denver dominates every opponent from start to finish. I want Denver to be head-and-shoulders above every team. This doesn't mean I am not satisfied over a win - our opening game against Pittsburgh was awesome and I thoroughly enjoyed it. However, every study I do with stats and every emotion I might feel towards Denver and the NFL is pointed towards one thing - I want Denver (or the NFL) to perform to its maximum potential and I want to be able to quantify it.
So what does this have to do with my view of the NFL as a business in the "Entertainment Industry"? It is okay for fans to use critical thinking when discussing the state of the Broncos (or NFL) just as during the game, there is nothing wrong with letting emotions run high. They are both good, but they should be used properly.
The State of the NFL
The NFL is entering a critical season and off-season because of everyone in the NFL community - NFL staff, team staff, players, fans and media.
Last season, the players were locked out because of fundamental disagreements. Regardless of how much the players "deserve" to be paid, one thing that I read bothered me more than anything. I kept hearing that the NFL was being greedy, that the players are the reason the NFL is popular and this was going to be a tough battle between billionaires and millionaires.
First, Roger Goodell is not a billionaire. He is the CEO of 7-8 billion dollar business, and he brings in 10-15 million dollars per season. Team owners are not billionaires because of their team - again, they make money with other businesses and have NFL salaries similar to Roger Goodell. The point here is these owners do not make nearly as much money as the media would have us believe.
Second, without the NFL staff and team owners capable of striking deals with the networks and building these awesome stadiums, these players would have no job. No employee is more important than his employer. This is Business 101 and this is where the battle begins.
The NFL is not just a regular business that has 9-5 hours where a company can just plug in another employee to fill the spot. These player's have unique talents (athleticism and football IQ) that aren't as easily replaced as other jobs, giving them more value. They are, however, an unknown commodity coming into the NFL, where a programmer or engineer with a BS degree is much more likely to be capable of doing his job his first year.
The NFL is an open industry - we get to see executive decisions every day with regards to players and the CEO of this company. How many businesses have you been actively following and are aware of major decisions on a daily basis with regards to its employees and their finances?
These players also have fan support. Most fans have shirts or jerseys of their favorite players. How many jerseys have you seen with Shanahan, Fox, Bowlen or Goodell on them (No, Elway the player does not count for Elway the executive)?
There is a natural connection with these players and we want them to succeed. So naturally, if the players are upset, the fans are upset. If the players feel they have been wronged, we feel we have been wronged. There is an emotional tie to the players that will inherently never exist with the executives of the NFL, including the staff for our favorite teams.
The biggest questions regarding the lockout last season that has come up again with the lockout of the refs are how much value do the players (or refs) have in relation to NFL executives and how much should their pay increase (or decrease) based on the total revenue of the NFL.
I have two questions here for you before I answer the two above.
How much did the players make in the '70s, '80s and '90s?
How talented were these players?
Which is more likely?
The huge increase in revenue is a result of expansion by owners and the league CEO who are obviously trying to make as much money as possible.
The huge increase in revenue is a result of more talented football players which makes the game more exciting to watch.
Everyone is focusing on Goodell and they fail to see a host of NFL employees like Steve Sabol who come up with great ideas to market the NFL and ultimately make it more profitable. In any business, finances are extremely important. Executives are forced to count the dollars and search for the best way to maintain their current profit and eventually increase it.
My dad just started another family business and anyone who has started one of their own understands, it is a lot of hard work. Saying Roger Goodell doesn't deserve the money that the previous commissioners worked so hard for him to receive is like saying I don't deserve the money I might make off my dad's business when he retires and I take over.
At the crux of this issue is that players (and refs) are being overvalued because of our infatuation with their performance (entertainment) on television. These players are most definitely an important piece of the billion dollar engine that is the NFL. So are the refs. So are the fans. So are the media. The idea that players and the executives are equals is a fallacy, at least according to every model portrayed in colleges across the country that is based off of capitalism and a free-market system.
Does a programmer of a 100M dollar corporation getting payed 80k per year deserve an increase proportional to the CEO of that same company? Whether Apple is worth 60B or 80B next year, their programmers will continue to make the same because their job hasn't changed and they are not in a position of leadership. The only time a programmer's salary increases is if the market for their skill-set increases or the company they work for believes they have a great value.
This is why unions are inherently dangerous - they fight capitalism with socialism instead of getting at the heart of the problem. Instead of allowing CEOs (team owners) to set the value of players, the union is setting the value for them. Team owners are no longer in charge the way they should be because the CBA has stripped them of a huge portion of their authority. Now, players rebel. Refs rebel. Now, they have leverage over the NFL and their bosses.
Because if these players and the refs have leverage over the NFL with regards to pay, when do their demands end? When is 15 million dollars per year for a pro-bowl QB not enough? Whenever that player feels he is worth more. Why not raise it to 20M per year because he feels that is just, right? In 10 years, will it be 30M per year? At what point does a player receive the amount of money equal to his worth, and who gets to decide that? In this case, the union.
This is why Goodell is in an impossible situation. From a purely business perspective, the regular refs are asking for full-time salaries and benefits while working part-time. They are important to the NFL in the same way that programmer making 80k is to Apple, but they are not in charge. At least, until the media and fans say otherwise.
Because if the fans and media disapprove of the NFL, another business principle kicks in. Do not lose money. Since most of us make under 100k per year, millions of dollars seem like no big deal to a billion dollar company because it has "so much money". I can assure you, no business wants to take a loss. There is no benefit in that.
So now the NFL will be watching to see if it loses money because of the replacement refs. The NFL will be watching to see if fans and all the sponsors stop supporting it. If so, they are then forced to meet the demands of the regular refs. If so, this creates a terrible precedent for business with the NFL.
Demand more money from your boss, wait for the backlash when you don't receive it, then receive it later.
If you haven't noticed, I can't stand unions one bit. I also believe being in any position of leadership is incredibly important and paramount to success, whether in the family, business, or government.
I have no problem with someone using facts to show that the NFL simply wants all the money and don't want to pay anything to the players or refs, despite what the market for their services might dictate. However, there is plenty of information to suggest that the players and refs are no less guilty of being greedy.
The difference here is owners in any business have the right to keep however much money they want. If they don't pay employee's enough, they go somewhere else. There are plenty of owners who are willing to spend the money to acquire the best players in the NFL if other teams are unwilling. The owners don't need a union to agree upon a salary cap. It appears the NFL is losing all credibility and all of its authority to the unions because they have angered the fans.
The fans want to see their favorite players on the field and best officials possible, even if it means the NFL takes a loss. Even if it means the NFL must comprome business principles. Even if it means caving every time to the demands of the unions. To fans, all that matters is the emotion of a football game at the highest level.
At some point, these players and refs need to be held accountable. They are waging a financial war and are in full control because they have the emotions of the fans and media who are not running the NFL and making important decisions.
The NFL is fighting on principle and is losing this battle. That is unfortunate.