A look back at the NFL/NFLPA 10 year Collective Bargaining Agreement

Going back to 2011, the NFL had locked out the players. So the long negotiation sessions with the NFLPA began. After the NFL draft, fans of football had nothing to look forward to for the 2011 football season, as there would be none. As a football fan I can assure you it was a dark time for fans. I wanted to discuss a few things regarding the CBA and other sports it impacted. The rookie wage scale was part of the new CBA. We previously discussedwhether the rookie wage scale is working or not. So lets touch on othersubjects.

First, the length of this CBA vs. the last CBA. The last CBA was an eight-year CBA with a two-year opt out for the league to use in year six, which they did. The new CBA is for 10 years with no opt out for either theplayers or the league. They are stuck together for ten years. This is unprecedented! Most Unions will never bow on such a term. You can never really know the true impact of a CBA until a few years after. The players and league either both felt it was a win-win situation, or that they got the better end of the stick.

Money is flowing into the NFL like a river of gold. This comes from the media contracts that the NFL secured with numerous different networks as well as the fans buying merchandise and season tickets. In the new CBA the owners and the players changed the way the money was split. In the oldCBA the money was split majority to the players, around 56% with the ownerstaking home about 44%. The new CBA will split the pot a little different.  The owners will get 53% of all revenue over 10 years, and the players will get 47%. The reason the union capitulated to losing so much of the pot is because the owners guaranteed that they would use the extra money they are making to grow the pie. A good visual is to think of the State of Rhode Island as the old CBA. The new CBA is the size of the state of Ohio. 47% of Ohio is more than 56% of Rhode Island.

The real question to be asked was why was this CBA so significant in the sports business world? Base ball maybe “Americas favorite past time,” but Football is “Americas Sport.” More money is generated in the NFL than the other three major sports (Baseball, Basketball, Hockey) could dream to get too. This means, more money is tied up in contracts with the NFL than any other sports. Lets list a few: TV, merchandise, royalties, and apparel. You may think that is very little, but lets go further in depth. ABC is the only Major network that does not have a contract with the NFL. Fox, CBS, NBC, and ESPN all have games. (Yes ESPN and ABC are joint company technically, but we are talking about basic channels)

In the end of the day, Football being guaranteed to be played for the next ten years, gives players, owners, fans, and businesses that rely on the NFL for commerce long term security.

After the NFL agreed to the new CBA, the NBA and NHL had lockouts over consecutive summers. Their lockouts did not do so well. The NFL was the only industry to get their deal done before the lockout went into the season. They took no loss in money. The NHL and NBA both had to have shorter seasons and lost games because of their lockouts. The NFL CBA also set an industry standard in terms of length. The NHL’s new CBA followed the NFL’sexample and got a 10-year agreement, although both players and owners can optout at year eight. The NBA also followed and made it a 10-year length.

There is a reason the NFL is Americas Sport. There is a reason the Super Bowl is the number 1 televised show in America, second in the world to the World Cup. The reason is the NFL is a product that is amazing. It is a business that is run competently despite many claims otherwise. There is a reason most politicians won’t go near it with bills or rules.

One last fun tidbit, during the NFL lockout reporters asked President Obama if he would get involved to help get things between the NFLPA and NFL moving. He firmly replied “No.” There are many sensitive political issues in this country, but Football is where it doesn’t matter if you are Republican or Democrats. Where the gridiron is concerned Americans are united. Just like we all want lower taxes!