What might have been a light week in Charlotte was spoiled by bad news, namely the Brady appeal and a Congressional report criticizing the league in regards to concussion research
When NFL owners gathered this week for their one-day “May meeting,” an annual staple on the calendar before owners disperse for the summer, they must have sought solace among each other after a week of negative news. The stories surrounding the league going into the meetings presented anything but a good look. Owners and league officials cocooned in Charlotte to escape and talk about happy things like giving out Super Bowls (Atlanta, South Florida and Los Angeles were Golden Ticket winners).
The news that opened the week was the expected NFLPA and Tom Brady appeal challenging the most recent adjudication (I know, there have been many), a 2-1 decision by the Second Circuit Court of Appeals in favor of the NFL. This appeal is for a rehearing by the full slate of Second Circuit judges, rather than the three-judge panel from March. The odds of a rehearing are long and although all-star litigator Ted Olsen filed on behalf of Brady, it is highly doubtful that we will get to see him in action on this case.
Despite the long odds, the appeal was a no-brainer for Brady. There is no downside—additional legal fees are handled by the union (all players), not Brady—and it gave Olsen and NFLPA head DeMaurice Smith a national and public forum to further criticize Roger Goodell and the league. And the name-calling has now been ratcheted up again; Olsen and Smith both strategically injected the phrase “bully” into the conversation. Perhaps they know what an uphill battle this is in the court of law and decided to ramp up the rhetoric in the court of public opinion.
Another short-term benefit of the appeal is that it, at least temporarily, stays (puts on hold) Brady’s suspension for what I project as a 4-6 week time frame while the Court decides whether to take the case. If they reject it—the likely outcome—Brady and the NFLPA must decide whether to appeal to the United States Supreme Court, a true moon shot, or to accept the suspension. In the improbable event that the Second Circuit accepts the case for rehearing, well, buckle in. With briefs and hearings to schedule involving all 14 judges from the Second Circuit, a rehearing would certainly last through the 2016 season, meaning we will have gone through two NFL seasons with Tom Brady’s suspension being overturned and delayed. The wheels of justice do not move at NFL speed.
Soon after the Brady appeal, the NFL was facing another crisis moment (there seem to be many): an Outside the Lines report (Report) detailing a congressional inquiry that exposed the league as, at best, asking pointed questions about its NIH funding for concussion research and, at worst, attempting to influence this “unrestricted” funding. The NFL’s active new public relations leadership group previously fought back strenuously on reporting of the league’s concussion research efforts, taking an aggressive approach in March to New York Times reporting about the concussion-related ties to Big Tobacco. Here, however, while Dr. Ellenbogen—on the league’s committee and a subject of the congressional inquiry—has struck back in the media with complaints about never being consulted about the Report, the league has not responded with similar gusto as Ellenbogen or as they did with the Times. And predictably, Goodell’s comments—“We continue to focus on things that our advisers believe are important to study. Ultimately, it’s the NIH’s decision”—were bland and unrevealing, even mentioning that he had not read the Report.
The Report, on the heels of an arbitrator demanding the league include over $100 million in revenue that they had excluded from Cap calculations, raises the important element of public trust. Stories such as these, following recent depictions of the league in League of Denial and Concussion—chip away at that trust. They raise questions—whether perceived or real—about that all-important word “integrity,” a league mantra so often used in justifying discipline such as the Brady suspension. NFL leadership presents as not used to hearing the word “no” and steamrolling towards their target no matter what is left in their wake. As some owners even acknowledged, the messaging and transparency in this important space has to improve.
To be fair, the NFL has been on a positive trajectory in the concussion and head trauma space since being chastised in congressional hearings in 2009, and its contact limitations and concussion protocol guidelines are more stringent than all other levels of football, including NCAA and high school. Perhaps this congressional report, as congressional hearings seven years ago, spurs even more positive change.
• THE NFL’S GRANT MONEY, AND THE BIG BUSINESS OF CONCUSSION RESEARCH: Congress has hammered the NFL for interfering with grant money awarded for concussion research. A closer look reveals a deeper complexity behind the league’s actions. And as funding stalls, everyone involved has something to lose.
As mentioned above, there were some happy moments from this week’s league meeting, namely the awarding of Super Bowls from 2019-2021. The first of those went to Atlanta, edging out New Orleans, to host it in their new building scheduled to open in 2017. Speaking of that new building, the Falcons became a first mover this week in sacrificing some ancillary revenue from it.
One of the NFL’s true challenges to continue its unrivaled prosperity is to enhance the game-day stadium experience. With home viewing options becoming more sophisticated every year, the league has made it an ongoing initiative and priority to be vigilant in improving the stadium experience.
Fan complaints about the game day experience have included WiFi access (now addressed in most NFL stadia); loud, unruly and vulgar fans; parking and traffic and exorbitant cost of concession items. While virtually impossible to address all of these grievances, one team has taken a step in addressing one.
The Falcons made a bold move in the concession-pricing space. Upon the opening of their new stadium, they will cut prices on their food and beverage offerings, removing the usual exorbitant mark-ups that have traditionally been a staple of concession pricing (concession gouging). Hot dogs ($2), soft drinks ($2 for 12 ounces) and beer ($5 for 12 ounces) will cost dramatically less than NFL fans have become accustomed to. In slashing such prices, the Falcons have provided their peer NFL franchises a road map to one solution to a common criticism about the stadium experience.
The Falcons’ actions deserve praise yet also deserve some context to the relative impact of concession revenues on team revenues. While the Falcons’ financial records—as all teams beyond the Packers—are private, we know some basics about NFL team revenues. The largest revenue source, by a good margin, is broadcast revenue—from ESPN, NBC, CBS and Fox—shared equally among the 32 clubs. Beyond that primary revenue source is a line item for game-day revenues for the ten home games (eight regular season, two preseason), one of which is concessionary income. While specifics are not known, suffice it to say that NFL teams are not dependent on concessionary markups for beer, hot dogs, and soft drinks to accomplish their revenue goals.
With this in mind, we still applaud the Falcons in taking a piece, albeit a small fragment, out of their bottom line to improve the fan experience. More importantly, their actions serve as a call to their peers at other NFL teams to do the same or take similar steps to enhance the stadium experience, perhaps at the expense of maximizing revenues. The mark down of concessions seems an easy “give” to patrons, partially countering the home viewing experience from the comfort of their couches.
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