A Couple nights ago, I was with a buddy at a sports bar and the current NFL CBA (collective bargaining agreement) dispute came up. I thought it would be interesting to cover the highlights as it will affect sports betting one way or another, as well as probably affect the CBA issues coming up in the NBA and MLB.
Current situation. As we are not privy to the closed door negotiations, I would like to preface everything in this article with what our perception of the current situation is and what the situation REALLY is are probably two different things altogether, but I think we can agree on the following:
The NFL is a $9 billion a year industry. Last year, the owners took $1 billion from the $9 billion to use for stadium maintenance etc. The remaining $8 billion was split 50/50 between the owners and the players.
The Players Position. The players basically want to maintain the CBA as is.
The Owners Position. The owners first of all are facing the need to rebuild, remodel or build new stadiums and are looking to take an extra $1 billion in order to do that which would mean that either they do that out of the $4 billion that is their share of the revenue or take it off the top which would mean that the players would help fund the stadiums. In recognizing that the players would be taking a pay cut to do this, they have offered to renew the CBA with a fixed dollar amount of revenue sharing instead of the percentage the CBA calls for now. In other words, instead of sharing revenue 50/50, they are offering to pay the players a fixed amount every year, with an annual increase every year, but that the revenue sharing as a percentage goes away.
My perception of the general public’s perception of this situation is that the players just don’t want to take a pay cut, they will allow the owners to grow the business and the owners can keep the extra growth they have, just don’t make the players take a pay cut. And the owners are being greedy...
My perception of the situation is that the owners just want to be able to grow the business and keep any additional revenue they generate, but the players are demanding that the revenue sharing as a percentage be maintained, in other words if the owners are able to double the size of the business, the players want half of that increase, and they are will to turn down a fixed agreement with no salary cuts to do it.
One issue is the way it is portrayed in the media, which is why I brought this up in the first place. The media seems to think the players are simply fighting to keep their pay the same, while it seems obvious to me that what they are fighting for is the opportunity to benefit from the owners growing the business. The owners haven’t helped themselves out a lot, but part of that is good strategy. While players can come out and say things like “the NFL is economic slavery” with relative impunity, the owners have been pretty silent. Which is smart on the owner’s part; they realize in the end, once this is over, they will have to go out and work with and market these players.
So who is wrong here? Part of it can be perception, if you think owners are greedy capitalist pigs, then you will side with the "poor, abused and mistreated" players. If you think that the business owner has a right to grow his business as he sees fit and keep the rewards from his efforts then you probably side with the "noble and generous" owners. Personally I don't think either side is wrong, both sides are businessmen and are negotiating to make the best deal possible.
Anyway, that’s what I think I know…
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