With new television deals officially beginning to kick in from all four major networks that broadcast the NFL, as well as DirecTV, we’re beginning to get a feel for how valuable said contracts are at a franchise level.
Daniel Kaplan of Sports Business Journal reported on Monday that each NFL club will gain an extra $27 million in revenue from contracts with NBC, CBS, FOX and ESPN, all of which commence next month when the 2014 preseason schedule gets underway.
That, according to Kaplan, is a 20 percent increase from the $131 million each franchise received in 2013 — the last year of much less lucrative deals for all four networks and the penultimate season of DirecTV’s exclusive contract for NFL Sunday Ticket.
What’s scary is that DirecTV is now working on a new deal with the NFL, one which is almost certain to be worth in excess of the flat $1 billion the satellite provider currently shells out. Once that deal commences in 2015, things could really get out of hand.
In fact, Kaplan predicts that teams could be pulling in at least $200 million merely from broadcast contracts by 2016. That number will at the very least be $181 million, which helps explain why Forbes estimates that even the league’s least valuable club is worth more than $800 million. And in a recent list of the 50 richest sports franchises in the world, 30 NFL teams made the cut.
Revenue sharing is a beautiful thing, especially if you’re the Buffalo Bills, Jacksonville Jaguars or Oakland Raiders, none of whom are driving much of these immense profits. Hell, there was a report recently that suggested the Bills are going to fetch $1.1 billion on the open market, which is astounding when you consider how quickly these clubs have become filthy rich.
Pessimists like myself wonder if this will eventually be looked back on as the heyday for NFL football in terms of business and broadcasting (which are obviously intertwined). Mark Cuban’s prediction that the league is fat hot on the verge of slaughter wasn’t crazy. Eventually, technology could alter the supply and demand that currently favors the NFL in a big way.
But for now, the league and its 32 teams are certainly enjoying a nice ride.