The collective bargaining agreement discussions are moving kind of quickly, which is odd for the NFL. Remember, the NFLPA told players to start putting away money into a rainy day fund. Owners weren’t as pessimistic, but they had a lot of …
The collective bargaining agreement discussions are moving kind of quickly, which is odd for the NFL. Remember, the NFLPA told players to start putting away money into a rainy day fund. Owners weren’t as pessimistic, but they had a lot of negotiating power. There was no reason to think otherwise. Last time we had a CBA negotiation there was a 132-day lockout. In 2018, Richard Sherman basically said a lockout or work stoppage was going to happen in 2021. So, it’s about time to ask what changed. It’s simple. Market forces changed, specifically the NFL and its need to get into television deals.
Look, plain and simple this is insanely smart by the NFL. They are coming off an extremely exciting season and moving into a year with a free agent bonanza. There are exciting young quarterbacks. Ratings and viewership did extremely well. Meanwhile, the NBA has struggled with ratings. The NFL is essentially crushing one of its biggest competitors. The league is going to expand the regular season the playoffs. There’s content galore.
Timing also plays a part here. The NFL should be striking while the iron is hot. Young people are actually interested in the NFL, but other sports could be catching up. It’s still king.
The added games also matter.
The NFL is rushing for a reason though and that reason may be timing. The longer the NFL and NFLPA wait, the more television distribution partners may be able to cry that they can’t afford the asking price. See, as we all know, cable subscriptions and traditional television distribution methods are changing. Comcast is losing money because it’s losing cable subscriptions. Comcast also happens to be the parent company of NBC. NBC will be bidding on television rights. The more customers Comcast loses, the less it will want to pay for the NFL. The same goes for DirecTV and the Sunday Ticket package.
Antennas aren’t making up the difference of people cutting the cord and antennas don’t pay retransmission fees. Essentially, the NFL’s biggest buyers are losing customers, losing the dual-income stream from cable providers because those providers are losing cable subscriptions. The moral of the story is that these traditional television partners are losing money. Wait a year to agree to a CBA and that delays television negotiations. That delay could result in a loss of money. That means the sooner the better for the players and the owners. It’s the way to get the most money possible out of deals — and is also the main reason for a 17-game season and an extra playoff team/game.
There’s an obvious answer here though — or so it seems — and that answer is slicing and dicing the distribution deals to allow streaming partners. Amazon, Apple, Alphabet, Yahoo!, Twitter, and even DAZN or ESPN+ have been mentioned when streaming comes into play. The problem is that the streaming market may be the future, but it’s not the now and it won’t be it thing in a year either. It’s going to take time for that market to truly develop. The NFL and NFL can’t afford to wait a year because traditional distribution partners will still be losing customers, but streaming partners won’t have enough market penetration to make it worth the investment. The league doesn’t want a short term deal here. It wants a long-term deal and streaming partners may not be fully-interested in that.
So, the short and simple answer is right now is the best time. It’s why the NFL is pushing the CBA earlier. It’s why players may want to agree to the deal now. It’s the biggest pie they can eat. Otherwise, there are risks. That’s why there seems to be a rush. The smart people who know how to make money are trying to make the most money possible
