While Progress Stalls, NFL Risks Losing $1 BILLION with 2011 Lockout

Roger Goodell and Carolina Panthers owner Jerry Richardson at an owners meeting in suburban Chicago August 8, 2006. Goodell was selected=

Who says owners won’t feel the pain should a lockout of the NFL Players Union and players take place in 2011? According to an article published by the Wall Street Journal, owners stand to lose upwards of $400 million in the loss of season ticket sales alone, when patrons are asked to renew come March.

$1 billion. That’s the estimated value of a number of NFL franchises. $400 million is enough financial backing for the NFL to take you seriously as a prospective owner to an NFL team. The amounts are mind-boggling. However in the end, the final amount could in fact push $2 billion.

This is a predicament of the NFL’s choosing. They took a juggernaut business in a challenged economy and then sent a message of a voluntary shutdown. NFL players proposed a ‘lock-in’ last year to get this done and they said no.The owners pocketed over $300 million in cash savings in the uncapped year alone. –Union Lawyer, James Quinn

Among the ongoing discussions are that owners want to hold more international games and institute a new wage scale for rookies, in addition to expanding the NFL regular season, while wanting all players to take an 18% pay-cut starting next year, so owners can take part in the aforementioned activities, which include stadium improvements.

Proposed Losses the League and Teams Might Incur

  • $125 million from existing corporate partners demanding discounted sponsorship deals, while others might pull out of late-season sponsorships such as the Pro Bowl, entirely.
  • $400 million in the loss of season ticket revenues from season ticket holders not renewing their contracts.
  • $500 million from the months of April through August ($15.625 million per team) for missed preseason games.
  • $8 million per team for every canceled home game.
  • $750 million if the entire 2011 season becomes a lockout for breach of contract with Verizon Wireless, which paid the NFL for rights to broadcast games on Verizon’s V-Cast, and also for the rights to use NFL players in the company’s telecommunications commercials.*

The final amount adds up to a hefty price of $1.78 billion! However, the deal with Verizon might not be a breach of contract if the league and Players’ Union agree to terms by the NFL’s regular season.

In the meantime, the NFL will continue to receive $4 billion in television rights fees during a potential lockout, which would help cover contract costs, stadium upkeep, and such. However, the sum would eventually have to be repaid to the networks.

Information obtained from WSJ.com

Follow Cat Crave on Twitter @THECatCrave.

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Tags: James Quinn NFL NFL Lockout NFL Players Union Verizon Wireless Wall Street Journal

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