These are crazy times, folks…. Crazy times. A social networking idea is now worth $50 billion, gas prices could hit $5 a gallon by 2012, and MLB is the poster child for labor peace.
That’s right, the folks that brought you the 1994-95 work stoppage – the one that very nearly killed baseball – is now what other leagues should aspire to. Next thing you know, Sarah Palin and Ralph Nader will be running together on the next presidential ticket.
Here’s what we’ve come to: The National Football League, who pulled in revenues of $9.3 billion last year, and just saw Super Bowl XLV become the most watched television event in U.S. history with a staggering audience of 162.9 million viewers is about the lockout the players on March 4 the day after their current CBA expires. Their contention? Players got a better deal than they should have when the late Gene Upshaw was at the helm of the players and Paul Taglibue was headed out the door as commissioner of the NFL. Now, owners like Jerry Jones of the Cowboys, Robert Kraft of the Patriots, and Jerry Richardson of the Panthers want concessions from the players – $1 billion’s worth, due to what they are saying is “cash flow problems”. The NFLPA has asked for the league to open their books, to which the league has said, ”That’s none of your business.”
And, the NFL isn’t the only league on the verge of a lockout. The NBA’s current CBA expires on June 30, and like the NFL, the possibility of a work stoppage is real. The difference between the NFL and the NBA is the NBA is citing losses, and have released audited financial information to the NBPA in which they are showing the league in aggregate is losing money. Forbes has reported that 17 of the league’s 30 clubs ran at an operating loss last year.
The NBA’s situation is bleak, but at least the sides (owners and players) have been at this before. David Stern and Billy Hunter have been through labor battles, and have a cadence of sorts.
For the NFL, it’s all too reminiscent of Major League Baseball’s ugly past.
“I think a majority of owners, including me, would probably like to have even stronger cost-containment than we’re talking about right now.”
The quote above wasn’t from Jerry Richardson, NFL Commissioner Roger Goodell, or Jerry Jones. It was former Texas Rangers owner Tom Hicks in 2002 shortly before Major League Baseball and the MLB Players Association reached a 4-year labor agreement – the first time MLB had reached a CBA without a work stoppage since the union for the players had gained power through former Exec. Director Marvin Miller in the 1960s.
You see, Hicks said this statement in a press conference he called in San Diego… on his yacht. It was also after Hicks had given Alex Rodriguez a record $252 million, 10-year contract.
The point is, rhetoric doesn’t reach labor deals. MLB and the MLBPA figured this out nearly a decade ago. The NFL and NFLPA need to adhere to what Spanish American philosopher George Santayana said in 1905: “Those who cannot remember the past are condemned to repeat it.”
In several interviews that I’ve done with Rob Manfred, the longtime labor exec for MLB, and most recently Michael Wiener the Exec. Dir. of the MLBPA who took over for Donald Fehr in late 2009, one theme has surfaced: partnership. Talk to the NFLPA and ask them if they feel they’re partners with the NFL, and they nearly spit in disgust, “Hell, no!”
Yes, MLB and the MLBPA don’t see eye-to-eye on everything. “Any deal has to make sense,” both sides have said. But, the players and the owners saw in 2002 what the NFL, and to a lesser extent the NBA, have not grasped: in these crazy times, people’s patience when it comes to players making millions and owners worth billions, only goes so far. Baseball figured out you don’t kill the golden goose. You know, as an owner, that the topic of a salary cap is a non-starter. Likewise, you don’t talk about adding 2 extra Wild Card teams and extending the playoffs without having the players sign on the line – collectively bargain it. Roger Goodell and the NFL’s owners don’t get this.
For the NBA, I’m willing to cut them some slack. There’s evidence they’re losing money. The cost of doing business has gone up. Revenues have grown, but only marginally – about 1% each year for the past 3 years. For the NFL, they saw revenues grown 9% last year alone. It’s hard to buy what they’re selling.
For those that are watching, it comes back to that crazy world… “Wait a minute. The league that has no salary cap is in better shape than the two that have them? What?” As one top executive from a league other than MLB told me this week, “The complexities of a capped systems can lend themselves to such conflicts as we are seeing. There’s more moving parts.”
For those that are wondering whether baseball will be the beneficiary of labor strife, the answer is, only for a while and even then, it won’t be much. Ask yourself, as you look at the massive attendance growth in MLB since the 1994-95 lockout if every fan that swore he wouldn’t come back to baseball ever, kept that promise.
For those that are wondering how MLB stacks up to the NFL and NBA in terms of revenues, here’s numbers from league sources that paint the picture:
- 2009-10 – $4.4 billion
- 2008-09 – $4.3 billion
- 2007-08 – $4.2 billion
- 2010 – $7 billion
- 2009 – $6.6 billion
- 2008 – $6.3 billion
- 2009-$9.3 billion
- 2008 – $8.5 billion
- 2007 – $8 billion
- Numbers Show NFL’s ‘Economic Realities’ for Lockout Unwarranted (Forbes)
- Rain on NFL Parade? (Variety)
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Maury Brown is the Founder and President of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football, The Biz of Basketball and The Biz of Hockey, as well as a contributor to FanGraphs and Forbes SportsMoney. He is available for freelance and looks forward to your comments.