SBJ Football is on an offseason bi-weekly schedule, and I’ll be on vacation during the next regularly scheduled edition. Mark your calendars for my return on June 13.
As the NFL continues to develop a policy on private equity investment in teams, the balance of power among the owners is held by a group you might call reluctant supporters. These are owners who don’t ever foresee selling equity to a fund themselves and would prefer the league not do it at all, but they’re willing to go along for the sake of their colleagues who insist this is necessary.
The existence of this group explains how Roger Goodell can say owners collectively “agree with the direction we’re going” and promise a policy by the end of the year, while there’s still enough resistance to prevent formal action now. Cowboys owner Jerry Jones gave voice to this perspective when he said, “You’ve got to look around the corners, see what the consequences might be. We’re pretty proud of the way we govern the NFL at this particular time.”
Owners with this viewpoint see risk/reward differently than owners who want to do a P.E. deal as soon as they’re allowed. At least five teams have been trying to sell significant minority stakes in recent months — the Dolphins, Chargers, Bills, Raiders and Eagles — and nearly the half the league is facing major facility expenditures that could conceivably use equity financing. However, it appears those most eager to bring P.E. into the fold will have to appease those who are most worried about the downside and are less interested in it.
Among other things, the critics worry about conflicts of interest. What if a fund owns part of a player agency or a sportsbook? What if a fund’s own limited partners include players or broadcasters or gambling investors? Those cross-ownership issues are common to many sophisticated businesses, but new to NFL owners, who are accustomed to personally knowing their co-investors. They also say the rules can always be liberalized after the fact; they say it would be virtually impossible to pull back if something goes awry.
In short, the policy isn’t getting done without appeasing these reluctant supporters, so the smart money should be the final policy landing on the more conservative side of the spectrum.
Barring a last-minute settlement, the NFL’s biggest litigation in years will kick off with jury selection in 13 days — June 5 — in U.S. District Court in California. Plaintiffs claim the NFL’s tactic of bundling all the rights to out-of-market games together and selling them to a single entity, DirecTV (under the “Sunday Ticket” brand), violated antitrust laws. Damages could exceed $6 billion, and a trial would mean senior execs and owners testifying in open court.
Teams were briefed by league lawyers on the case in Nashville this week, and lawyers have spent the last two days proposing language for jury instructions to Judge Philip Gutierrez. One source says a settlement appears unlikely, with the plaintiffs and the league “too far apart” on a deal.
Some of the NFL’s strategy is to look ahead to appeals, and the hope that it could get to the U.S. Supreme Court. There’s an authentic public policy question inside the case — to what extent does the NFL’s antitrust exemption apply to media packages other than over-the-air broadcasts? The 1960 Sports Broadcasting Act simply didn’t envision satellite TV, and certainly not broadband internet.
The case does not apply to the current “Sunday Ticket” deal with YouTube TV; just older deals with DirecTV.
When it comes to the cost-cutting at NFL Network, there may be less than meets the eye. This offseason, big changes to “Good Morning Football,” the end of stalwart “NFL Total Access” and talent cuts have all been filtered through the lens of a possible equity swap deal with Disney — the idea being that the NFL is sprucing up the balance sheets before a transaction.
But NFL Net is cutting costs because it has to, whether or not that deal comes together, sources say. League execs are growing more aware of how little studio shows and on-air talent really drive the business, and are making brutally practical decisions, sources said. “It’s as basic as the costs are really high and the revenues are not,” said one insider.
The value of NFL Network, largely retransmission fees, stems almost entirely from the handful of live regular-season games, preseason simulcasts and game replays. The network’s studio programming and personalities are well regarded among core fans, but sources say the financial return of all other programming does not justify high production costs.
Also, NFL media strategists increasingly believe their best means of producing world-class entertainment content comes through one-offs produced in the joint venture with Skydance Media rather than a 24/7 cable channel. Just recently, the NFL gave games on Saturday, Dec. 21 to NBC and Fox — windows traditionally taken by NFL Net.
FYI on the Disney deal: It’s moving slowly at the moment, and the NFL has not given up talks with possible partners other than Disney, one source said. It’s been nearly three years since the league first hired Goldman Sachs to evaluate NFL Network options.
With a GDP higher than Canada’s and a nearly 60-year history of sending their countrymen to the NFL, Australia is probably the NFL’s most appealing foreign market to not yet host a regular-season game. The main reason for that is a big one: The distance.
To make it work, the participating teams would need major concessions in their schedule, based on how other leagues have handled Australia-U.S. travel. “The stadiums and the infrastructure are all here, it’s just getting the scheduling right,” said Tristan Hay, managing director for Sydney-based THM Sport.
I connected with Hay on my way home from the Nashville meetings, because Hay helped MLB execute a two-game series in Sydney in 2014 and was involved in the National Rugby League’s matches in Las Vegas earlier this year.
Hay is quick to note he’s a sport promoter, not a high-performance sports scientist. But, he notes, both MLB and NRL worked on the assumption that athletes need a week or more on both sides of the trip. “You’d need 10 days to acclimatize,” he said. The Dodgers and D-backs played their games a week before the rest of the league started their regular season, and then next played seven days after their last game in Australia. The four NRL sides spent two weeks in the U.S. before their season-opening matches in Vegas, then didn’t play again for 12 days after.
The NFL has made major inroads in Australia in his lifetime, said Hay, 43, who predicts an NFL game would be a massive hit (the NFL played one preseason game in Sydney in 1999). The Super Bowl is a big cultural event and “everybody I know that has an interest in sport has an interest in one of the major sports from the U.S.,” he said. “NBA is massive. NFL is huge. Wagering’s been a big part of that.”
Here’s some specifics on the distance: Even taking the shortest possible NFL trip to Australia — if both L.A. teams played each other in Brisbane — it would be 7,128 miles, 32% longer than any other team has ever traveled for a game (the Packers will travel 5,423 miles to play in São Paulo, Brazil in September). Those L.A. teams would go 17 time zones away (the current time zone record is when the Seahawks went nine time zones away to Munich in 2022).
And the numbers get even bigger when you talk about Sydney or Melbourne, or the majority of NFL teams who play in the eastern half of the U.S.
The Chargers have landed well-executed NFL schedule release videos over the last few years, finding success with anime in particular. But this year’s “Sims”-themed effort raised the bar even higher.
Within 24 hours of its release, the Chargers’ effort was the most-viral schedule video among NFL teams on X, according to data from Zoomph. The team saw 78,500 engagements and over 23 million views, well ahead of the Titans, who were second with 25,300 engagements and 3.6 million views. The Chargers noted that across all social platforms — excluding YouTube — the video was viewed 41 million times in the first 24 hours, which was 4x higher than the second-best team with 10.2 million.
Jason Lavine, Chargers VP/content and production, said the team has seen a “meteoric rise in attention” since hiring Jim Harbaugh as coach, and the metrics from last week’s release is just a microcosm of the attention that Harbaugh has placed on the organization.
Calling the audible
So why shift from the popular anime theme? “How many movies do a trilogy?” Lavine posed. “Typically, the third time doesn’t go well.”
Following 20 brainstorming sessions by the Chargers’ social media and video teams, they landed on the “Sims,” and it was a yes “without hesitation.”
Lavine points to a few main reasons why the release has resonated beyond the Chargers’ fanbase, ranging from nostalgia to a large community who relate to the “Sims” to social creators who understand the content. “You’re trying to tap into an audience that you wouldn’t typically get to,” Lavine said. “But if you’re going to do an idea of something that’s going to attract that audience, you better do it right.”
Lavine noted two Chargers staffers — Allie Raymond, director of organic social media, and Hannah Johnson, seasonal assistant of organic social media — understood how to mesh both the world of “Sims” and an NFL schedule release. “They knew what to do and to hit on key things that would matter to a ‘Sims’ audience,” Lavine said.
Easter eggs
Over the three-minute and thirty-second video, the team was able to sneak in multiple Easter eggs that connected back to the schedule. That included a scene of Ravens coach John Harbaugh fighting with his brother, as well as Bengals QB Joe Burrow arriving in his Super Bowl suit and a 7-Eleven manned by Ja’Marr Chase (referencing a chain worn by the Bengals wideout).
There was a well-timed jab at Harrison Butker’s recent remarks. The video portrayed a fan wearing a Chiefs No. 7 jersey — Butker’s number — and working in a kitchen. The bit took social media by storm. Lavine did said that viral reception compares what the team did a few seasons back with an anime version of then-Jaguars coach Urban Meyer. “We care deeply about growing not just the next generation of fan, but the female fan,” noted Lavine. “So certainly, this was a tremendous opportunity to do that across the board.”
- The NFL had a noticeable presence among the winners during Wednesday night’s Sports Business Awards. Falcons owner Arthur Blank was honored with our Lifetime Achievement Award. The Rams’ SoFi Stadium was named Sports Facility of the Year, while the Atlanta Falcons Birds Eye View Series took home Best in Sports Social Media, ESPN won Best in Sports Media (they experimented with the Toy Story Funday Football game telecast), and Excel Sports won Best in Talent Representation (they acquired Rep 1 Football).
- Should the Jaguars’ proposed EverBank Stadium renovation financing deal with the city of Jacksonville be approved, the team would assume considerably more control of the city-owned venue, keeping in line with recent NFL lease negotiations that have moved that direction, writes SBJ’s Bret McCormick.
- For the Rams’ schedule release this year, the marketing team knew it wanted to build on what it’s done the past two years but also tie into the theme it’d set for all its messaging in 2024: music, notes SBJ’s Jason Wilson.