Football Is A Thriving Business, But For How Long?

Several issues on the horizon will have owners and league commissioners concerned.
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As a former professional sports league commissioner, I once held the responsibility of assessing the state of a game. In my case it was basketball and while the setting was Australia where basketball was not among the top three most popular sports, the challenge of acknowledging and solving the problems of the present could never outweigh the obligation of shaping the future.

For football in North America, whether we are talking about the NFL or CFL or whether we include the Power Five conferences of the ACC, Big 10, SEC, Big 12 and Pac 12, we have to make projections about the forces shaping this particular game and where those currents are taking us. For now, I think most of the league commissioners are watching the following sectors and logically taking steps to address the issues suggested:

1) Supply Chain Management: The players are always the game and if fewer talented players select football as their primary sport, the business model will struggle. This is not wholly about concussions but also about the global growth of European football (soccer) and the salaries paid in European football plus esports avidity (video gaming) that is removing vital ‘ingredients’ from the supply mix.

2) Media Landscape Disruption: As millennials cut cables, reject the purchase of television sets and eliminate paid advertising from their various media platforms, rights fees for football broadcasts are threatened. Said another way, this discussion is not about Colin Kaepernick or the Florida State-Alabama game but rather about the way in which ‘fans’ will consume American football in the next decade. If the rights fees flatten, much of the incremental sizzle of promoting the game may diminish.

3) Asset Appreciation and the Next Greatest Fool: Ownership in pro leagues like the NFL is predicated on buying a team for $X and eventually selling it for more than $2X. This always attracts wealthy investors because they know that regardless of what premium they pay for a franchise, they will see their money doubled (and usually sooner than later). They can also generally count on someone else paying a larger premium than they did for that team. When those assets don’t double, there are fewer “fools” in the market and that means an owner has a harder time getting out. If assets don’t appreciate, commissioners get fired.

4) The scarcity of time: In an age when a minute is too long and 140 characters too many, game forms that exceed three hours may force changes to game operations, traditions and consumption. Traditionalists and fans who live for the protection of certain statistics aside, the game form offered in 2017 may require notable alterations to maintain audience engagement. European football enjoys a running clock (as does Australian Rules football and rugby union). Neither sport is built around logical advertising breaks as is found between innings in baseball and possessions in American football. One way or another, the game must change or lose relevance.

5) Labor Disruptions and Work Stoppages: the NFLPA is already signaling they intend for the game to stop at the next round of negotiations. This will be a fascinating showdown between really wealthy individuals and fabulously wealthy individuals. And the result could be the removal of the game from the ala carte menu that either already exists or is coming. If we imagine that the toymakers might refuse to sell their toys during the holiday season, we may finally see a fiery backlash truly threaten the future of American football (in an age of numerous other attractive options).

Bottom line... the state of the game is healthy today but clouds are massing on the horizon.

To quote the Doors... the commissioners are Riders on the Storm.