Caponomics

[arrellbee]

Perhaps some numbers can give a perspective on what the owners are offering versus what the players want.

For history, the players pie per team was:
2001 67.4M
2002 71.1M
2003 75.0M
2004 80.6M
2005 85.5M

2006 94.5M under pretty much the same percentage cut to the players under the current CBA.

So this year, they get a 10.5% raise.
For the 5 years from 2001 to 2006 they got a 40.2% raise. Each of us will have to decide for ourselves if that is a fair raise or not. I'm sure most all of us got at least that amount.

So what, if the figures being mentioned in the media are somewhat correct, are the owners offering for the new CBA ? The number that Felger mentions is 105M.

So what that means is that the owners offer of 56.2 percent of the redefined revenue pie is offering the players 12% MORE of the pie than they are getting under the current CBA. Apparently that's not considered to be a very respectful offer on top of the 10.5% the players are already getting this year. Obviously very disrespectful.

In perspective, if the players accepted the new CBA at 56.2% they would be getting a 22.8% raise this year. And from 2001 numbers it would be a total of 55.8% raise. I know most of you do a lot better than that, but that is what the penny pinching owners are offering.

So what is Upshaw saying is the minimum these presently underpaid guys deserve ? His MINIMUM 60% number would give a salary cap of, I guess, 112M. So that would be a raise this year of 31% or a total raise since 2001 of 66.2%. Now that is much more fair to the players, don't you think ? And probably gives them the same sort of raises that you have been getting.

Well, just thought that might give you a better perspective on just what the players are dealing with in trying to reach a new agreement that is fair to them.

 

[mgteich]

Please list the increases in TV revenue for the same years and the percentages increase over the next six years in order to get a start to understanding the revenue involved and the relationship to salary cap.

You are simply saying that the player should be happy with a 40% raise. After all they make a fiortune. I trust that you don't negotiate for a living. I trust that you do understand that the negotiations are the structure for next six or seven years.

Perhaps some numbers can give a perspective on what the owners are offering versus what the players want.

For history, the players pie per team was:
2001 67.4M
2002 71.1M
2003 75.0M
2004 80.6M
2005 85.5M

2006 94.5M under pretty much the same percentage cut to the players under the current CBA.

So this year, they get a 10.5% raise.
For the 5 years from 2001 to 2006 they got a 40.2% raise. Each of us will have to decide for ourselves if that is a fair raise or not. I'm sure most all of us got at least that amount.

So what, if the figures being mentioned in the media are somewhat correct, are the owners offering for the new CBA ? The number that Felger mentions is 105M.

So what that means is that the owners offer of 56.2 percent of the redefined revenue pie is offering the players 12% MORE of the pie than they are getting under the current CBA. Apparently that's not considered to be a very respectful offer on top of the 10.5% the players are already getting this year. Obviously very disrespectful.

In perspective, if the players accepted the new CBA at 56.2% they would be getting a 22.8% raise this year. And from 2001 numbers it would be a total of 55.8% raise. I know most of you do a lot better than that, but that is what the penny pinching owners are offering.

So what is Upshaw saying is the minimum these presently underpaid guys deserve ? His MINIMUM 60% number would give a salary cap of, I guess, 112M. So that would be a raise this year of 31% or a total raise since 2001 of 66.2%. Now that is much more fair to the players, don't you think ? And probably gives them the same sort of raises that you have been getting.

Well, just thought that might give you a better perspective on just what the players are dealing with in trying to reach a new agreement that is fair to them.

 

[pats-blue]

Please list the increases in TV revenue for the same years and the percentages increase over the next six years in order to get a start to understanding the revenue involved and the relationship to salary cap.

You are simply saying that the player should be happy with a 40% raise. After all they make a fiortune. I trust that you don't negotiate for a living. I trust that you do understand that the negotiations are the structure for next six or seven years.

I think his point is that the players are EMPLOYEES. Granted I am sure the owners got a healthy increase on thier gross income. Some owners like Kraft have to payoff a 300+ million debt and provide better workout facilities for thier EMPLOYEES with that increase. What do the players have to pay for out of thier "raises"?? Well Duce Staley has to pay for a new $120,000 "grill" that he lost in a bar "altercation" ,but as far as the afore mentioned raises in thier income over the last few years. I myself rarely even get a COLA every year and in fact even when I do it is always less than inflation that year. These EMPLOYEES are doing pretty good....Upshaw is run by the AGENTS and as an EMPLOYEE of them he isn't doing the best job to maximize THIER money.

 

[shirtsleeve]

I think his point is that the players are EMPLOYEES. Granted I am sure the owners got a healthy increase on thier gross income. Some owners like Kraft have to payoff a 300+ million debt and provide better workout facilities for thier EMPLOYEES with that increase. What do the players have to pay for out of thier "raises"?? Well Duce Staley has to pay for a new $120,000 "grill" that he lost in a bar "altercation" ,but as far as the afore mentioned raises in thier income over the last few years. I myself rarely even get a COLA every year and in fact even when I do it is always less than inflation that year. These EMPLOYEES are doing pretty good....Upshaw is run by the AGENTS and as an EMPLOYEE of them he isn't doing the best job to maximize THIER money.

Right on the nose. Upshaw does not represent his union well. He is representing the agents and the top 10% of the players at the expense of the rank and file. The players oughtta can the clown asap. And yes the players are EMPLOYEES of a company, in this case, its a football team. Can you imagine payroll and benefits packages of any other industry costing 56% of gross revenues? And thats just to the unionized employees. That doesn't even count the management and clerical ones. Can anyone here even imagine getting a 55.8% raise over the last half dozen years? I know mine hasn't kept up with inflation, even without fuel costs.

Over half the players in the league are minimum type guys, or maybe just over, for their status. They would be THRILLED with management's offer. THEY win, at the expense of the top few players and all of the agents. Bring the offer to the players and they will accept it hands down.

 

[arrellbee]

Please list the increases in TV revenue for the same years and the percentages increase over the next six years in order to get a start to understanding the revenue involved and the relationship to salary cap.

You are simply saying that the player should be happy with a 40% raise. After all they make a fiortune. I trust that you don't negotiate for a living. I trust that you do understand that the negotiations are the structure for next six or seven years.

Well, there are a couple points.

One is simply that the players are making out like bandits by getting a huge increase. But that is relatively immaterial, I guess. If you think they haven't gotten enough for some reason, you are certainly welcome to that notion.

You already know what the increase in TV revenue and stadium income are. It is 40.2%. So the players got their exact cut of the increase in income. Did the owners get a bigger payoff ? Of course not - their part of the pie went up the same percent as the players the way the CBA is constructed. The players get their same percentage of the pie no matter how big it gets and the owners get their same percentage of the pie.

So now you ask if the players should get a bigger percentage of the pie. What would happen if the players got 100% of the revenue ?? I think everyone could agree that the clubs couldn't operate. So what is the percentage that the players get that will kill the clubs ? It's somewhere between the current percentage and 100%.

If I understand the tone of your post, you think that the owners could take less of the cut and still stay in business. I don't have any idea why you might think that, but everyone gets to have their own opinion on the matter.

We'll actually be able to tell when the players demands reach that critical percentage - the clubs will refuse to agree and ultimately will use players who will agree to play without such a large cut. Unlike the NHL, it is my guess that the clubs will not stop playing a full schedule and the players are basically helpless to prevent that. You get a free market for players. Some clubs will dominate and some will not have a chance ever to be competitive. If the NHL is any example, some owners will be stupid and franchises will go out of business which will mean fewer players. You can make your own guess as to whether the players as a whole will get more money or not in that kind of a scenario. My personal guess is that you end of with a mess and the players actually get less - but that's just my opinion.

By the way, if you want to ponder on how little the owners can get by on, just remember that many of the owners have borrowed money to buy their team and out of their part of the revenue they have to repay those loans with interest. If owners like Kraft use their own money or borrowed money to build a new stadium, which increases the players amount of pie, they have to repay those dollars also - out of their share of the pie. The owners have to pay all of the operating expenses and non-players salaries, etc etc.

The players ? They just get to keep all of their share. None of it goes back into the business to increase future revenues or keep the clubs in business.

 

[mgteich]

arrellbee,

I have supported Kraft and everything he's done with patriots since before he bought the team. I also support other owners who run their business as a business. They all should continue to make more and more, and become billionaires.

I agree that the players could continue to get the same percentage of the same types and revenues, and do very well. However, the pie of football revenue has gotten bigger when one includes football revenue previously excluded, for example luxury boxes. The players should have no claim on non-football revenue.

If there were only the successful owners and the players, the deal would have been signed weeks ago. It is a matter of increase the kinds of revenue or increase the percentage a bit or both. This deal is not hard for anyone to negotiate. There is so much in the pot that all would gain.
----------------------------
The real problem is that there are owners who are crying for charity and special deals from the revenue pot. They want the other teams and the players to build their sta0diums and finance their teams and their team expenses. They want the successful owners to share their revenues of all kinds. Some of these teams are making good money (Cinci) and are simply scamming. Other owners are incompetent or refuse to even try to raise money through normal marketing; after all they will be bailed out. And there are some in small markets that may never make it. One small market team seems to have done fine in the suburbs of Providence.

So several of the teams seeking a handout have gathered together to blackmail everyone else. My answer is to figure a way to buy off a few through changes that benefit them, pass the CBA and screw the rest. Teams must be allowed to fail. Incompetance shouldn't be rewarded by giving failing teams more and more money.

The suggestion made by a media writer, cited earlier today, is a good one. Set up a system to review the books and situations of all teams begging for handouts, and give only to those in need who demonstrate a willingness to undertake steps to improve their profitability. I would added penalties if they fail to act, just like any other handout or loan.

 

[flutie2phelan]

One small market team seems to have done fine in the suburbs of Providence.


Wunderbar!

For the entire post ... not just this delicious snippet.

 

[hwc]

With the caveat that the numbers do not reflect increasing value of franchises:

The least profitable teams in the NFL have been generating pre-tax operating revenues of about $15 million with the current salary cap structure. So, figure that they would continue to do so with this year's $94.5 million cap.

Increase that cap by $10 million and you start to cut pretty close to the bone for some of the franchises. Now, obviously, none of them are headed for the poor house. But, it's not like the players are exactly suffering with a $95 million cap, either. The reason Upshaw and his NFL Agents Association are screaming about revenue sharing is that they know their demand for 60% has crossed the line for a number of franchises.

 

[arrellbee]

mgteich - a really excellent description of many issues !! !!

I hope I can contribute something else. Let's see if I can make sense.

I think, just me thinking, that you can pretty much separate the hang-up currently in reaching an agreement and the issue among owners of revenue sharing. I say that because the owners have ALREADY agreed to give the players a cut of the bigger pot. So at 56.2 percent of this bigger pot, the players DO end up with an extra share of more money - which gives them an extra 7.5M or so per team I guess. So the owners, apparently by enough votes, already HAVE agreed to increasing the players share of the total pie compared to the existing agreement. If the end result of the owners proposal is somewhere at 102M or more, that is at least 8 percent increase in the money the players get. And they can have this agreement WITHOUT ANY resolution of any sharing issues amongst the owners.

The numbers work out that what Upshaw is asking for is an increase of 15.23 percent or double what the owners have offered. There seems to be an indication that he thinks there is some magic that if he can 'force' some new revenue sharing formula, he can get that increase. Frankly, I don't think any kind of revenue sharing helps him to get agreement for that bigger increase. Suppose there were to be an agreement on more revenue sharing. What that means is that the bigger market owners would take a triple hit - more money out of their pocket to the have-not teams, the increased cost associated with generating some of that revenue, AND more money to the players !! And if the amount of revenue shared doesn't add up for the small market teams to the extra salary money being asked for by Upshaw, they would have a further hit beyond what they have presently agreed to.

It would be ironic if the small market teams had signed off on the present proposal to the players union figuring that they would get some more revenue sharing. And now that they are finding out that they might NOT get more sharing, they might take the proposal off of the table that's there now !!

I think Upshaw's only chance, probably highly unlikely, is that the owners would just agree to his higher demand without any changes in the sharing formula. And if that doesn't work, I think the players are going to find out whether or not they do better in a free market situation.

 

[Patsfanin Philly]

I can envision one quirky side effect if there is no new CBA come draft time. Picture a team in cap limbo with multiple huge contracts so bad that they'll be forced to make major cuts and then have to pay draft picks.
For those teams (like Washington...) wouldn't it make sense to trade out of the first round in hopes of getting an additional first round next year in the uncapped year and reducing their rookie pool this year leaving some breathing room under the cap??? The end result would be lots of trades and some teams with multiple picks this year(those not in cap trouble like Cleveland) and some with multiple picks next year when they can spend ehat they want ...and the players can demand the moon.......
If you're the team dealing with those cap strapped teams, you're dealing from a position of strength knowing their problems......and can get a better deal.
Just my $0.02,

 

[arrellbee]

I can envision one quirky side effect if there is no new CBA come draft time. Picture a team in cap limbo with multiple huge contracts so bad that they'll be forced to make major cuts and then have to pay draft picks.
For those teams (like Washington...) wouldn't it make sense to trade out of the first round in hopes of getting an additional first round next year in the uncapped year and reducing their rookie pool this year leaving some breathing room under the cap??? The end result would be lots of trades and some teams with multiple picks this year(those not in cap trouble like Cleveland) and some with multiple picks next year when they can spend ehat they want ...and the players can demand the moon.......
If you're the team dealing with those cap strapped teams, you're dealing from a position of strength knowing their problems......and can get a better deal.
Just my $0.02,

I think that thought is worth more than $0.02 !!

 

[mgteich]

Sure! Back to the old days when Washington also traded away all its first day dsraft choices.

I can envision one quirky side effect if there is no new CBA come draft time. Picture a team in cap limbo with multiple huge contracts so bad that they'll be forced to make major cuts and then have to pay draft picks.
For those teams (like Washington...) wouldn't it make sense to trade out of the first round in hopes of getting an additional first round next year in the uncapped year and reducing their rookie pool this year leaving some breathing room under the cap??? The end result would be lots of trades and some teams with multiple picks this year(those not in cap trouble like Cleveland) and some with multiple picks next year when they can spend ehat they want ...and the players can demand the moon.......
If you're the team dealing with those cap strapped teams, you're dealing from a position of strength knowing their problems......and can get a better deal.
Just my $0.02,