Sweating it out - the QB deals

[MoLewisrocks]

Pretty sane and well reasoned article in the Globe - not sure who penned it since on line it bears no author...

My only quibbles would be that citing agent comments that all it takes is a big enough signing bonus assumes everyone has access to that much cash. Other players get signed, too, and here Wilfork has already been handed $18M, Bodden got whatever he got, and Mankins money - which should be in the $15M+ range) is likely being held in escrow like account in case he regains his senses. NE is probably looking at close to $40M in signing bonus money paid in 2010 absent a Brady deal. Can it be paid out over time as opposed to up front...yeah, but unless the tradeoff is paying a little more than you otherwise would the player would be losing money on that deal by virtue of simply not having access to that money and whatever it can earn over a couple or three seasons so... It is the inability to efficiently spread the bonus money amortization farther via split signing and option bonuses and the inability to guarantee the option with salary (or guarantee additional salary going forward as part of a package) that is making a Brady deal more difficult to construct to work well enough to accommodate both sides needs.

Also, while Manning's tag number may exceed Brady's by virtue of the 120% rule if both are in fact tagged in 2011, we can't know by how much since neither will wear the standard non exclusive franchise tag based on top 5 paid in 2010 but rather the exclusive tag based on top 5 in 2011. And you can't assume because Manning will cost more tagged he would have increased leverage going forward because he's always cost more and Brady less because of cap model. The Colts have already lived through multiple years of $20M+ Manning cap hits, while the Pats have yet to crack the $15M threshold with Brady.

http://www.boston.com/sports/football/patriots/articles/2010/07/25/sweating_it_out/?page=1

 

[patfanken]

Very interesting article. I wish we could find out who the author was.

As to the story itself, it seemed, at least to me, that its the Colts who are in the biggest bind. As it was laid out, they will be the ones who will have to lay out the largest amount of up front money, yet they are not nearly in as good a financial situation as the Pats. Relatively speaking THEY have the bigger problem in getting a deal done.

The other point I took from this story was the impact of the reality that the Cap IS NOT going to continue to rise. If the GB financial report is any indication of future revenues, it could even drop some. If that's the case, big money deals for QB like Manning and Brady, could go well over the 10-12% of the cap ratio you'd like to have. It would be a very big impact.

For that reason alone, I think those contract, when they are done, will be measured in inches rather than pages

 

[NE39]

Breer normally write the "On Football" column. I imagine it is him.

 

[Miguel]

What the article fails to mention is
1.) the number of sponsorship deals that the NFL have reached since the owners opted out of the CBA. I have counted at least six.
2.) the very real possibility that the Patriots, Colts, and Saints have not reached deals with the league's 3 best QBs is that reaching deals undercuts the owners' arguments that they (the owners) can not afford to operate under the current economic environment/CBA.
3.) that Roger Goodell has set a goal for the NFL of having $25 billion in revenue in the year 2027.

SBJ: Goodell sets revenue goal of $25 billion by 2027 for NFL - Daniel Kaplan, SportsBusiness Journal - NFL - Sporting News


If the owners expect to be able to triple their revenue in the 17 years, why can't they reach deals with 3 of the most important faces in the NFL?

 

[Miguel]

It is the inability to efficiently spread the bonus money amortization farther via split signing and option bonuses and the inability to guarantee the option with salary (or guarantee additional salary going forward as part of a package) that is making a Brady deal more difficult to construct to work well enough to accommodate both sides needs.

Why not simply instead use a supersede signing bonus rather than an option bonus? Like the 49ers did with Patrick Willis? Or a completion bonus?Like the Saints did with a couple of their players?

 

[upstater1]

If you look at the college football deals--even in this atmosphere--they have been huge. Look at what the ACC just signed. TV networks need content. The NFL's big money deals will continue to rise even if local revenues stay even or dip a bit.

The Krafts have the money, it really is time to pay up. Brady deserves everything he's asking for from the Patriots. If Wilfork is getting that much, Brady deserves 2.5x as much.

 

[PatsWickedPissah]

What the article fails to mention is
2.) the very real possibility that the Patriots, Colts, and Saints have not reached deals with the league's 3 best QBs is that reaching deals undercuts the owners' arguments that they (the owners) can not afford to operate under the current economic environment/CBA.
If the owners expect to be able to triple their revenue in the 17 years, why can't they reach deals with 3 of the most important faces in the NFL?

I think #2 is the basis for the impass. Don't see an easy way out for the owners crying fiscal constraint while the business plan is for major revenue growth. Of course, the road to ruin is littered with unfulfilled business plans.

Geting a deal THIS year for the QBs is huge. Up front bonus money will get hit much more by taxes next year vs 2010. Brady will pay 10% more tax dollars on his up front money and salary if his deal is next year vs this year.

 

[patfanken]

If the owners expect to be able to triple their revenue in the 17 years, why can't they reach deals with 3 of the most important faces in the NFL?

I think the bigger question is HOW the owners expect to triple revenue. The fact that the Krafts have gotten sponsorships for the port-a-potties tells me they are reaching the limits of potential revenue sources. Where is that new money supposed to come from, especially in these economic times?

 

[Gwedd]

I think the bigger question is HOW the owners expect to triple revenue. The fact that the Krafts have gotten sponsorships for the port-a-potties tells me they are reaching the limits of potential revenue sources. Where is that new money supposed to come from, especially in these economic times?

Canada, with at least one team, the Bills relocating there, and games 17 & 18 being played there for many, if not all, of the teams.

 

[PatsWickedPissah]

Canada, with at least one team, the Bills relocating there, and games 17 & 18 being played there for many, if not all, of the teams.

Paltry relative to TRIPLING total revenue. I say the plan is wishful fantasy from the man in the empty suit.

 

[Deus Irae]

What the article fails to mention is
1.) the number of sponsorship deals that the NFL have reached since the owners opted out of the CBA. I have counted at least six.
2.) the very real possibility that the Patriots, Colts, and Saints have not reached deals with the league's 3 best QBs is that reaching deals undercuts the owners' arguments that they (the owners) can not afford to operate under the current economic environment/CBA.
3.) that Roger Goodell has set a goal for the NFL of having $25 billion in revenue in the year 2027.

SBJ: Goodell sets revenue goal of $25 billion by 2027 for NFL - Daniel Kaplan, SportsBusiness Journal - NFL - Sporting News


If the owners expect to be able to triple their revenue in the 17 years, why can't they reach deals with 3 of the most important faces in the NFL?

The moment Bradford signs a mega-deal, the owners' position regarding Manning/Brady will be exposed. Teams have already made big deals with players at other positions. It's only the QB spot that has any claim right now. Bradford's deal will kill that.

 

[alamo]

The Krafts have the money, it really is time to pay up.

Overly simplistic analysis. It's not whether "The Krafts" have the money, it's whether the business known as the Patriots has the money. Businesses have to worry about cash flow and long term profitability. Economic and CBA uncertainty just adds to it. Which makes a megadeal more complicated to work out.

People point at Ferguson Willis Dumervil etc. and say "deals can easily get done" but ignore the fact that Manning/Brady are probably TWICE the size of those deals and that ratchets up the complexity considerably.

Brady deserves everything he's asking for from the Patriots. If Wilfork is getting that much, Brady deserves 2.5x as much.

But contracts are not about what you deserve based on what you've done... they are about leverage and future (not past) production.

 

[bigfandan]

Players union will likely argue the revenue stream is going to pick up as economy starts to recover. The trend in last 3 years can not be representative of long term growth of the league.

Given that, the possibility of a Lower Cap is very slim.

The other point I took from this story was the impact of the reality that the Cap IS NOT going to continue to rise. If the GB financial report is any indication of future revenues, it could even drop some. If that's the case, big money deals for QB like Manning and Brady, could go well over the 10-12% of the cap ratio you'd like to have. It would be a very big impact.

 

[MoLewisrocks]

The moment Bradford signs a mega-deal, the owners' position regarding Manning/Brady will be exposed. Teams have already made big deals with players at other positions. It's only the QB spot that has any claim right now. Bradford's deal will kill that.

Initially that will be the agent spin. When the dust settles we will find out what he's truly guaranteed and even what hoops he will have to jump through in order to achieve his purported guarantees. Brady and Manning will expect and ultimately receive their money or suitable guarantee of it up front. Which is why you can't compare the rookie QB deals to the veteran HOF QB deals. Bradford's deal may set the latest level of overall basic franchise QB AAV parameter, that is all. Both the QB's and players have a pretty good idea what the parameters of their deals will entail without Tom Condon poking his rookie stick into the mix. And why you can't do the deals for the big boys as cavalierly or construct them as easily since they are extensions and subject to additional rules.

I think alternatively the Bradford deal will also just further underscore why there has to be a rookie contract cap. So few of them ever live up to the hype that has driven these deals in the last decade, even if they play relatively well and hang around as starters for more than 5-6 years...

 

[MoLewisrocks]

What the article fails to mention is
1.) the number of sponsorship deals that the NFL have reached since the owners opted out of the CBA. I have counted at least six.
2.) the very real possibility that the Patriots, Colts, and Saints have not reached deals with the league's 3 best QBs is that reaching deals undercuts the owners' arguments that they (the owners) can not afford to operate under the current economic environment/CBA.
3.) that Roger Goodell has set a goal for the NFL of having $25 billion in revenue in the year 2027.

SBJ: Goodell sets revenue goal of $25 billion by 2027 for NFL - Daniel Kaplan, SportsBusiness Journal - NFL - Sporting News


If the owners expect to be able to triple their revenue in the 17 years, why can't they reach deals with 3 of the most important faces in the NFL?

Maybe because those faces will be gone in six or seven years...and expectations aren't always met?

Why not simply instead use a supersede signing bonus rather than an option bonus? Like the 49ers did with Patrick Willis? Or a completion bonus?Like the Saints did with a couple of their players?

I don't know. I would assume they have looked at all the potential options and decided they all come up short for one side or the other. Maybe in this case it's because neither option can't be guaranteed for skill and injury...and stranger things have happened. Or maybe it's because the teams would prefer to allow the cap to pay a larger portion of these deals via guaranteed salary than bonus structure, and that simply can't happen at this juncture.

 

[Deus Irae]

Initially that will be the agent spin. When the dust settles we will find out what he's truly guaranteed and even what hoops he will have to jump through in order to achieve his purported guarantees. Brady and Manning will expect and ultimately receive their money or suitable guarantee of it up front. Which is why you can't compare the rookie QB deals to the veteran HOF QB deals. Bradford's deal may set the latest level of overall basic franchise QB AAV parameter, that is all. Both the QB's and players have a pretty good idea what the parameters of their deals will entail without Tom Condon poking his rookie stick into the mix. And why you can't do the deals for the big boys as cavalierly or construct them as easily since they are extensions and subject to additional rules.

I think alternatively the Bradford deal will also just further underscore why there has to be a rookie contract cap. So few of them ever live up to the hype that has driven these deals in the last decade, even if they play relatively well and hang around as starters for more than 5-6 years...

The point of a Bradford deal will not be the specifics about what Bradford gets. The point will be that a QB can still get an 'absurd' deal even under current CBA conditions. Even if Bradford's deal were to be nothing but Stafford's deal, to the letter, it would still show that QB deals can be done.

 

[Snake Eyes]

The moment Bradford signs a mega-deal, the owners' position regarding Manning/Brady will be exposed. Teams have already made big deals with players at other positions. It's only the QB spot that has any claim right now. Bradford's deal will kill that.

The Rams might give Bradford a monster deal but that doesn't mean it's a smart thing to do, Kraft wants to put a competitive team on the field every year and having a ton of money in 1 player makes that very difficult to do.

 

[MassPats38]

Bradford needs a contract now to play, not a contract of legal effect next year. Brady and Manning fall under the basic contract consideration of whether a team should wait until a player is about to become a free agent to act and hope that doesn't prompt a hard line approach from the player in the next deal.

As I suspect any salary cap under a future CBA would remain the same or increase, the question mark under major deals would be how much the team can afford to spend on the deals and not cripple prospects in others deals, not whether owners have the operating capital. As the franchise with the 3rd highest value in sports, and a value that hinges on the quality of the product put on the field every Sunday, I do not expect the ability to pay Brady is the problem.

I don't doubt the uncertainty of the CBA is an issue as the failure to anticipate CBA requirements certainly has led to the downfall of teams in the past (for example, the Niners), and as a practical fact nothing is set in stone at this time as far I know as the salary cap number that could be established under a new CBA. I hope Kraft is savvy enough to know if a player forfeits a year of pay when not under contract that player would likely not thank him for that calculated move with a one-sided benefit to Kraft. Right now, the owners who would appear to benefit most from a lock-out under the television deals would appear to be the low revenue teams, not the high revenue teams. I would love to know what the Patriots make a year in gross profit in comparison to what these contracts would provide as I have to believe it is not a step up for the Pats, Cowboys, etc.

 

[Deus Irae]

The Rams might give Bradford a monster deal but that doesn't mean it's a smart thing to do, Kraft wants to put a competitive team on the field every year and having a ton of money in 1 player makes that very difficult to do.

I'd say that the Colts have proven it can be done.

 

[Snake Eyes]

I'd say that the Colts have proven it can be done.

As Chris Rock said "you might be able to drive a car with your feet but it doesn't mean it's a smart thing to do".

As for building a team, BB has said that you build from the line out and the middle up, top down teams like the Jets usually collapse on themselves, I want a team that has the depth to sustain injuries and go deep in the playoffs. We won our Suberbowls because of a balanced team, we even had a team that would have been dangerous in the playoffs with Matt Cassel.

Also, the Colts might very well have won that Suberbowl they lost of they were more balanced instead of focusing so much on Manning. I could also make the argument that the Giants would have been a better playoff team in 08 if they hadn't thrown so much money at Manning and made more of an effort to keep Derrick Brooks and or hired another WR so that they wouldn't have been as exposed if Burress was injured (or shot himself).

Individual players don't win Superbowls, teams win Suberbowls.