The league is close to renewing its television broadcast deals with its TV partners that will result in a significant increase in rights fees, representing more than a 60 percent increase across the board, according to a report in Sports Business Daily.
The NFL and NFLPA resolving the lockout without missing any games has resulted in the NFL maintaining its position at the top of the sports pyramid in terms of fan popularity and TV ratings, enabling the league to leverage that popularity to benefit the teams and the players.
According to the report, each broadcast network will pay an annual average of at least $1 billion for the rights, and with three networks involved (CBS, Fox and NBC), this would be greater than $24 BILLION over the next eight years.
When combined with the money from their ESPN rights for Monday Night Football ($1.8 billion per year) along with DirectTV’s NFL Sunday Ticket, the new Thursday night package, Sirius satellite radio, etc., the new national media revenue could be worth $7 billion annually, an increase from the $4.28 billion under current contracts, equaling a 64 percent increase.
The additional $2.72 billion per year would count towards all revenue, shared according to the collective bargaining agreement. Using the overall average of 47.5 percent of all revenue going to the players, 47.5 percent of the $2.72 billion will go to increasing the salary cap, accounting for an increase of $1.31 billion in player’s salaries, or about $40 million per team.
The teams will share the other 52.5 percent of the increase, amounting to about $44 million per team in increased revenue.
Congratulations to new Jaguars owner Shahid Khan, who timed his purchase perfectly. It’s like buying a fixer-upper and finding oil in the back yard the day you close.
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