Owners,players discussing almost 50/50 reveue split

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    Owners,players discussing almost 50/50 reveue split

    Source: Owners, players discussing almost 50/50 revenue split

    • By Associated Press
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    ROSEMONT, Ill. -- NFL owners and players are discussing a straight split of income in the next collective bargaining agreement that would net the players just under 50 percent of total revenues.

    The Top 100: Players of 2011
    "The Top 100: Players of 2011" countdown continues on www.nfl.com/nflnetwork">NFL Network on Sunday, June 19 at 8 p.m. ET. Stay tuned for a reaction show after players Nos. 21-30 are revealed.

    A person familiar with the negotiations told The Associated Press the players' share would approach the 50 percent the NFL Players Association has said it has received throughout the past decade. But the expense credits -- about $1 billion last year -- that the league takes off the top would disappear.

    The person spoke on condition of anonymity because the negotiations are supposed to be confidential. The owners are holding a special meeting Tuesday to discuss proposals made in recent negotiations with the players.

    The key topic in these negotiations is unquestionably how to split revenues in the
    future. The NFL is a $9.3 billion industry, with projections such revenues will increase substantially soon when broadcast contracts come up for renewal. For the 2010 season, the NFL set TV ratings records.

    Although no teams are claiming they aren't profitable, they say their profit margins are shrinking rapidly. Many franchises have heavy debts from stadium constructions, too. So the owners have sought an additional $1 billion of league income before sharing with the players; the league already gets more than $1 billion off the top.

    Those expense credits have been a major sticking point, though both sides recently have made some movement toward compromise. How much compromise is needed for labor peace is a key topic being discussed Tuesday.

    Copyright 2011 by The Associated Press

     
  2. You have chosen to ignore posts from JoeFoyFan. Show JoeFoyFan's posts

    Re: Owners,players discussing almost 50/50 reveue split

    I state again: almost only counts in horseshoes and handgrenades!
     
  3. You have chosen to ignore posts from tcal2-. Show tcal2-'s posts

    Re: Owners,players discussing almost 50/50 reveue split

    That would be a big win for the owners.  Isn't it currently 60/40 in the players favor?
     
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  5. You have chosen to ignore posts from prolate0spheroid. Show prolate0spheroid's posts

    Re: Owners,players discussing almost 50/50 reveue split

    Seems like a pretty good compromise to me.  The players proposed a 50-50 split of all revenues a while back.  It sounds like the owners are now on board with that idea.  The three major pluses of this arrangement, I think are:

    1. In the short term, the players get almost the same amount they would have gotten under the prior CBA

    2. In the longer term, it helps the owners if revenues grow faster than the expense credit they got under the old CBA.  

    3. It doesn't give the owners a windfall if revenues grow very fast (as might have happened if the growth in the salary cap were pegged to a fixed percentage).

    Overall, it seems like a good compromise that has some pluses and minuses for both sides. 

    And since I'm pretty much agreeing with Rusty (and we've been on opposite sides of this all along), I think it really must be a good deal!



     
  6. You have chosen to ignore posts from ma6dragon9. Show ma6dragon9's posts

    Re: Owners,players discussing almost 50/50 reveue split

    The owners will give up 48%, but still want expense credits, which makes it not a true 48%...

    48% of ALL REVENUE would be fair, taking 10-20% off the top, and then giving up 48% would be a huge win for the owners.

    Tcal - they were getting 60% after the credit. Which, if memory serves, of the 9 bil last year, 1 bil came off the top before the 60% was doled out, if that makes sense.
     
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    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]The owners will give up 48%, but still want expense credits, which makes it not a true 48%... 48% of ALL REVENUE would be fair, taking 10-20% off the top, and then giving up 48% would be a huge win for the owners. Tcal - they were getting 60% after the credit. Which, if memory serves, of the 9 bil last year, 1 bil came off the top before the 60% was doled out, if that makes sense.
    Posted by ma6dragon9[/QUOTE]

    It does, thanks dragon
     
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    Re: Owners,players discussing almost 50/50 reveue split

    The whole damned thing was about an increase in money off the top from the get go for the owners. So basically, we know nothing about this yet.
     
  9. You have chosen to ignore posts from zbellino. Show zbellino's posts

    Re: Owners,players discussing almost 50/50 reveue split

    The players made 60/40 net and about 49% gross, after the credits.

     

    One person told the AP that the players' share would approach the 50 percent the NFLPA has said it has received throughout the last decade. But the expense credits -- about $1 billion last year -- that the league takes off the top would disappear.

    Also, there would no longer be "designated revenues" from which the players would share, the person said. Instead, the players would share from the entire pie, which they project will grow significantly over the course of the new CBA, which is expected to run anywhere from six to 10 years. So if they are taking 48 percent or more of a much higher revenue stream -- without the initial NFL deduction for operating expenses -- the players still would receive far more money than they got under the previous agreement.

    There is no expense credit off the top this time around. The other article states that rather unequivocally. If it's 50/50 gross, then it is essentially the same except it seems like they talked about a 90% salary floor as well, which seems a bit high.

    The only advantage I see here for the owners is that they no longer have to worry about their expenses exceeding the expense budget which had to be audited and renogtiated as a separate value instead of a part of a larger percentage.
     
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    Re: Owners,players discussing almost 50/50 reveue split

    It sounds like the proposed agreement has a much more limited expense credit than the old agreement did. I think even in the old CBA there was some recognition that owners should be able to raise and invest money for stadium improvements that would increase overall revenue.  The players have an interest in letting the owners do this, since that increase in overall revenue benefits both players and owners.  I assume the new deal is going to continue to give the owners breaks to allow them to invest in better stadiums that can then generate additional revenue for both themselves and their players.  That kind of revenue-generating investment is a win for both sides, I think.

    Overall, this seems like a good deal that will ease future salary pressures on owners, but also leaves players without any significant loss in the short term and with some guarantees that they'll share evenly in future revenue growth.   
     
  11. You have chosen to ignore posts from BabeParilli. Show BabeParilli's posts

    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]The players made 60/40 net  and about 49% gross, after the credits.   One person told the AP that the players' share would approach the 50 percent the NFLPA has said it has received throughout the last decade. But the expense credits -- about $1 billion last year -- that the league takes off the top would disappear. Also, there would no longer be "designated revenues" from which the players would share, the person said. Instead, the players would share from the entire pie, which they project will grow significantly over the course of the new CBA, which is expected to run anywhere from six to 10 years. So if they are taking 48 percent or more of a much higher revenue stream -- without the initial NFL deduction for operating expenses -- the players still would receive far more money than they got under the previous agreement. There is no expense credit off the top this time around. The other article states that rather unequivocally. If it's 50/50 gross, then it is essentially the same except it seems like they talked about a 90% salary floor as well, which seems a bit high. The only advantage I see here for the owners is that they no longer have to worry about their expenses exceeding the expense budget which had to be audited and renogtiated as a separate value instead of a part of a larger percentage.
    Posted by zbellino[/QUOTE]

    The advantage for the owners is that instead of a portion of their part of the pie being fixed (1 bil) it is now a percentage.

    The way it was the players 50% of the total would have steadily risen as the pie got bigger with that fixed money off the top for the owners. So over time the owners will reap billions more than they would have otherwise.

    Example old way:

    $9 bil pie. - 1 bil for owners.

    8 bil pie @ 60% = 4.6 bil for players total.

    Owners 4.4 bil total.

    % of pie for players = 51%

    ***

    Old way if pie is bigger:

    16 bil pie. -1 bil for owners.

    15 bil pie @ 60% = 9 bil for players total.

    Owners 7 bil total.

    % of pie for players = 56%

    ***
    New way:

    The owners get 1 bil more of the pie at 16 bil and the players 1 bil less than the old way (with 50% fixed on all revenue, which is looking more like 48%).

    Plus there is talk about some "stadium credits" still being there.

    ***

    So this doesn't affect the current players much since careers are relatively short. But as I have said before, these players could care less about players of the future so they will gladly go along if they aren't being cut much since the court card didn't work, which was the only card they had.

    The owners are getting more than they originally wanted.
     
  12. You have chosen to ignore posts from zbellino. Show zbellino's posts

    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]In Response to Re: Owners,players discussing almost 50/50 reveue split : The advantage for the owners is that instead of a portion of their part of the pie being fixed (1 bil) it is now a percentage. The way it was the players 50% of the total would have steadily risen as the pie got bigger with that fixed money off the top for the owners. So over time the owners will reap billions more than they would have otherwise. Example old way: $9 bil pie. - 1 bil for owners. 8 bil pie @ 60% = 4.6 bil for players total. Owners 4.4 bil total. % of pie for players = 51% *** Old way if pie is bigger: 16 bil pie. -1 bil for owners. 15 bil pie @ 60% = 9 bil for players total. Owners 7 bil total. % of pie for players = 56% *** New way: The owners get 1 bil more of the pie at 16 bil and the players 1 bil less than the old way (with 50% fixed on all revenue, which is looking more like 48%). Plus there is talk about some "stadium credits" still being there. *** So this doesn't affect the current players much since careers are relatively short. But as I have said before, these players could care less about players of the future so they will gladly go along if they aren't being cut much since the court card didn't work, which was the only card they had. The owners are getting more than they originally wanted.
    Posted by BabeParilli[/QUOTE]

    You're math is so crucially wrong Babe. There is no "16 bil", and I know where you got the figure from ... but it's bad math.

    The owners' expense credits were never, ever, ever a fixed $1 billion, but a floating figure that was always somewhere around 10% of "all" revenue. It is just a mythic construct because those expense credits were aroud $1 billion in 2009 and 2010. In 2005, for instance, the owners expense credits were a hair under $700,000,000. It was never fixed and grew every season faster that any other portion of the revenue pie.

    To give perspective, the owners were shooting for a 38%/62% split of "all" revenue, but doing under the auspices of taking another percentage of "all" revenue in credits, and somehow that became equated to "another billion before the split" and a neat and tidy notion that the NFL signed a deal that gave them $1 billion off the top in 2006, when they did not.  

    This deal, the one we are looking at in the settlement now, is essentially the same deal the owners walked away from and declared a lockout over on Feb 11th. It is the same deal DeMaurice Smith sent them on March 2nd when they rejected settlement. And the settlement (and this is a settlement despite all the ballyhooed, "the lawyers are left home" comments) is presided over by a judge they fought tooth and nail to avoid (magistrate Aurthur Boylan) in a jurisdiction (federal courts as opposed to NLRB) they wanted to run screaming from since the outset. 

    You won't hear it on this weblog, where most "fact" is just fiction ... but the owners lost this in the lower courts once it was deemed that the anti-trust lawsuit was "not" an NLRB issue once and for all, and that the owners would not be able to force the players into collective bargaining outside of the court.  

    The NFL just settled a lawsuit they could not win. Period. In the end? They were looking for something close to $1.25 billion and two extra weeks of work for that pay, and they got (if 48 percent is the figure and not 50/50) something close to $100-150 million and no 18 game schedule. Meanwhile, they are contributing double to veteran's health benefits, will have a salary floor close to 90% (ouch), and ultimately could end up losing the franchise tag as well.

    But that is what happens when you settle a lawsuit you cannot win.  
     
  13. You have chosen to ignore posts from zbellino. Show zbellino's posts

    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]It sounds like the proposed agreement has a much more limited expense credit than the old agreement did. I think even in the old CBA there was some recognition that owners should be able to raise and invest money for stadium improvements that would increase overall revenue.  The players have an interest in letting the owners do this, since that increase in overall revenue benefits both players and owners.  I assume the new deal is going to continue to give the owners breaks to allow them to invest in better stadiums that can then generate additional revenue for both themselves and their players.  That kind of revenue-generating investment is a win for both sides, I think. Overall, this seems like a good deal that will ease future salary pressures on owners, but also leaves players without any significant loss in the short term and with some guarantees that they'll share evenly in future revenue growth.   
    Posted by prolate0spheroid[/QUOTE]

    That is what happens in settlement talks when you are reporting to a judge.

    The NFL and the NFLPA both had their pie in the sky legal dreams. The NFL hoping they could force the NFLPA to stay certified, arguing in front of the NLRB without the pressure of anti--trust legislation, and the NFLPA shot for the moon hoping they could have their cake and eat it too, by forcing an injunction on the lockout. Neither was going to happen. But the NFL's loss was much greater as the courts are an unwinable battefield for them.

    Even if they had continued the lockout, even if they had brought in scabs ... the NFL could not continue their business model (salary caps, drafts) without prior approval of a certified players union, and would be open to more damage filings under U.S. anti-trust law if they wanted to continue that model.   

     
  14. You have chosen to ignore posts from prolate0spheroid. Show prolate0spheroid's posts

    Re: Owners,players discussing almost 50/50 reveue split

    Babe's argument is partially right, partially wrong.  His characterization that the players have been "routed" however seems a bit more like Babe's wishful thinking than the truth.  After all, as Z points out above, a 50-50 split of all revenue was the players' original counter offer to the owner's original proposal.  So if anything, the final deal is looking like it will closely resemble what the players offered back in February.  
    • There's no doubt that a 50-50 split will be better for the owners than the old CBA if revenue growth is strong (and if the deal is a long one).  This is because the expense credit (about $1 billion last year) is not likely to grow as fast as revenue and therefore, under the old deal, the players actual take might have grown from the recent 50% to something closer to 60%.
    • It's doubtful, however, that the 50-50 split is worse for the players than the owners' original proposal.  As I understand it, the owners originally wanted to take a larger (and possibly faster growing) expense credit off the top, plus reduce the split of remaining revenue from 60-40 to something more like 50-50.  DeMaurice Smith said that the owners original proposal would have dropped the salary cap to about 40%-42% of all revenue from the recent 50%.  That's where the widely quoted 18% pay cut comes from. (A 9 percentage point drop from about 50% to about 41% would equate to an 18% reduction.)  
    • The owners' second proposal (the last minute one before the union decertified) was not much better for the players, since it took most of future revenue growth out of the equation.  Players would have gotten about 50% of revenue initially, but their portion would likely have shrunk significantly over time.   
    • What's good for the players in the current 50-50 split is it ensures their proportion of the revenues over the entire life of the deal stays about equal to what it has been over the past few years.  Compared with the old CBA, the future growth potential for the players isn't as high, but the new agreement does "keep players whole" at the current percentage.   
    Overall, I see this as a good deal for both sides.  It stabilizes the players' share of revenues at the current 50% of revenue, protecting the players from future reductions in that percentage and the owners from future increases.  

    This was the unions first counter proposal . . .  and so the owners coming around to it bodes well for an eventual deal since this is something the players seemed ready to accept back in February. 






     
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    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]Babe's argument is partially right, partially wrong.  His characterization that the players have been "routed" however seems a bit more like Babe's wishful thinking than the truth.  After all, as Z points out above, a 50-50 split of all revenue was the players' original counter offer to the owner's original proposal.  So if anything, the final deal is looking like it will closely resemble what the players offered back in February.   There's no doubt that a 50-50 split will be better for the owners than the old CBA if revenue growth is strong (and if the deal is a long one).  This is because the expense credit (about $1 billion last year) is not likely to grow as fast as revenue and therefore, under the old deal, the players actual take might have grown from the recent 50% to something closer to 60%. It's doubtful, however, that the 50-50 split is worse for the players than the owners' original proposal.  As I understand it, the owners originally wanted to take a larger (and possibly faster growing) expense credit off the top, plus reduce the split of remaining revenue from 60-40 to something more like 50-50.  DeMaurice Smith said that the owners original proposal would have dropped the salary cap to about 40%-42% of all revenue from the recent 50%.  That's where the widely quoted 18% pay cut comes from. (A 9 percentage point drop from about 50% to about 41% would equate to an 18% reduction.)   The owners' second proposal (the last minute one before the union decertified) was not much better for the players, since it took most of future revenue growth out of the equation.  Players would have gotten about 50% of revenue initially, but their portion would likely have shrunk significantly over time.    What's good for the players in the current 50-50 split is it ensures their proportion of the revenues over the entire life of the deal stays about equal to what it has been over the past few years.  Compared with the old CBA, the future growth potential for the players isn't as high, but the new agreement does "keep players whole" at the current percentage.    Overall, I see this as a good deal for both sides.  It stabilizes the players' share of revenues at the current 50% of revenue, protecting the players from future reductions in that percentage and the owners from future increases.   This was the unions first counter proposal . . .  and so the owners coming around to it bodes well for an eventual deal since this is something the players seemed ready to accept back in February. 
    Posted by prolate0spheroid[/QUOTE]

    PS,

    The settlement is almost 100% identical. The players actually offered a 49/51% split as their opening offer in early February (11th) ... with the exact same language and the exact same demands. It is also identical to the settlement offer that was rejected March 22nd and again on March 28th IIRC. The only thing that has occured that is meaningful in that span of time is that the owners have a.) had their war chest locked up, and b.) had it decidely firmly that the anti-trust portion of the battle will not be headed to the NLRB.

    The owners' opening demand was 38%, which sweetened to 40-42%, and then that silly trick language deal where the players got 50%, but were essentially excluded from any real growth over the length of the deal with an outrageously low and artificial growth projection that defied what Moody's and Forbes projected for the NFL, which would have been worse than 40% in the long run.  

    At the time, the owners, if you recall, dubbed this 50/50 offer unreasonable and ended negotiations. In fact, the one quote they grabbed indicated that the only reason the owners showed for that couple of hours is because they mistakenly assumed that the 50/50 figure was 50% of "total" revenue, which would have been close to giving them 3/4 a billion right then, and that they quickly left once they realized it was a proposed 50/50 of "all" revenue, with a new grammer that didn't include the differentiation between "total" and "all." 


    Most of the posters here calling this a "victory" for the owners considered this very same offer "unreasonable" themselves months ago. People were talking about how the union wouldn't budge and were driving football off a cliff. How the union would rather kill football with offers like this, and that they wouldn't give "an inch" until the NFL was finished financially and they had too.

    Now it's a route.

    The 8th or Judge Nelson could have sent this back to the NLRB under Norris-LaGuardia, but they will not. As Marsha Coyle wrote, a while back, on the Law Journal:  Experts and other observers, however, agree the dispute will settle. "The main issue is whether it settles at a collective-bargaining table or at a table in the courthouse," LeRoy said. "If at the bargaining table, the NFL gets a good deal; if it settles in a courthouse, the players get a good deal. That's the issue."

    That is the beginning and the end of this. It was decided in court, and the players have all but gotten the deal they wanted from the outset. The owners got nothing close to what they wanted at the outset, and the longer it goes on the weaker their argument that decertification was a "sham."

    It may be a rational deal, as you say, but the fact that the owners are lightyears off their intial 38% bargaining posture shows how irrational that was from its inception. 
     
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    Re: Owners,players discussing almost 50/50 reveue split

    So, if the current negotiation is based on what the players had already offered, why is there a negotiation? It would seem that just accepting their offer would suffice.

    How terms are being stated here with such assurance is puzzling when reports say even the owners aren't being given the full details.

    As far as the owners being afraid of the anti-trust suit, that would take much more time to resolve than these players have. And it is not 100% certain the players would like the result.

    The NLRB was never going to be a factor in this.

    The nonsense of the Doty court will be swept away with any agreement, so it is moot.

    The real court impact is that the lockout remains in place. If the players held the superior position they would be on strike instead of locked out.

    We will see when the dust settles what the numbers are.

    But the owners have steadfastly said they wanted to negotiate. It is the players who walked away. And once the injunction was stomped, suddenly they are willing to talk again.

    That doesn't add up to the players getting the same deal. It adds up to them being willing to bend as gameday checks become jeopardized and no court has forced the issue on their behalf.
     
  17. You have chosen to ignore posts from prolate0spheroid. Show prolate0spheroid's posts

    Re: Owners,players discussing almost 50/50 reveue split

    Babe's got his story and he's stickin' to it! Wink


    It looks like a compromise to me, not a "rout" for either side . . . 

    And Babe is right that none of us knows the details of this offer yet . . . or really of any of the other, earlier offers.  And the devil really is in the details.  Still, we can make reasonable guesses on what was being offered at different times. 

    I don't think it was just the players who got scared of losing money.  I think a lot of owners were looking at lost revenues and big loans they need to pay back and didn't want to risk turning their deep pockets into much shallower pockets. 
     
  18. You have chosen to ignore posts from zbellino. Show zbellino's posts

    Re: Owners,players discussing almost 50/50 reveue split

    In Response to Re: Owners,players discussing almost 50/50 reveue split:
    [QUOTE]Babe's got his story and he's stickin' to it! It looks like a compromise to me, not a "rout" for either side . . .  And Babe is right that none of us knows the details of this offer yet . . . or really of any of the other, earlier offers.  And the devil really is in the details.  Still, we can make reasonable guesses on what was being offered at different times.  I don't think it was just the players who got scared of losing money.  I think a lot of owners were looking at lost revenues and big loans they need to pay back and didn't want to risk turning their deep pockets into much shallower pockets. 
    Posted by prolate0spheroid[/QUOTE]

    Babe's just inventing things because he likes the noise they make. There are a trail of links of the NFL, as far back as March, turning down the players settlement offers -- including doing so after the 8th circuit issued the stay. The players offered this settlement the moment that they issued suit, and the NFL wouldn't deal with them unless they reformed as a union. Again, these are facts. 

    The players' position in February already was a compromise ... and one that was balked at by the owners. 

    Now it's good enough .... some people can look at a blue sky and tell you it's pink with green dots ... it's best to just ignore them.
     
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