Roger Goodell is good at parts of his job, and Yahoo! game proves that
If you wonder why Roger Goodell has kept his job as commissioner, the answer will be in your hands on Sunday morning. That’s when Yahoo! will stream the Bills-Jaguars game from London. And the good news is: You don’t have to watch that game to appreciate its impact.
The game will be broadcast online only except in the Buffalo and Jacksonville markets. It’s a trial balloon. If there are problems, well, it’s only the Bills and Jaguars—two struggling franchises in small markets. That won’t ruin too many weekends. The NFL can improve the product for the next time around. And simply having a game on Yahoo! gives Goodell more options in the future. It could be the start of another billion-dollar revenue stream.
You won’t hear much about this, of course. It goes against the popular narrative that Goodell is awful at his job.
But the reality is that Goodell is awful at parts of his job. His record on player discipline is terrible—not because he is too harsh or soft, but because he is haphazard. A penalty today does not match up with a penalty from last year. This was a fundamental reason why his suspension of Tom Brady was overturned. It did not line up with any previous infractions for manipulating equipment. The league tried to equate Brady’s actions with steroid use, and U.S. District Court Judge Richard Berman didn’t buy it.
That is a common theme for Goodell: He does whatever sounds good at the time. His flip-flop on Ray Rice was just public posturing when a video came out.
And it makes you wonder: Why does Goodell insist on controlling player discipline? It’s been one nightmare after another for him. What is he getting out of this? If you try juggling torches for years, and you keep burning yourself, it’s probably time to hire a professional juggler and move on with the rest of your life.
And let’s be clear: Goodell is really good at the primary goal of his job, which is increasing revenue for owners.
It’s easy to say that the NFL would make money no matter who is in charge, and that is true. But how much money? Billionaires did not become billionaires because they were happy being millionaires. Goodell and his advisers have smartly leveraged their one advantage over every other sports league: Video viewership of their games.
Major League Baseball teams draw far more fans to stadiums, because they have more games. The NBA has more stars with crossover appeal. But the public cannot resist watching NFL games.
Goodell has steadily exploited the value of this, without overreaching. He expanded Thursday Night Football from something that was a late-season affair, after college football’s regular season, to a full-season slate. The players hate this. I’ve written that before. Thursday games are hell on their bodies, and they make every other NFL player-safety campaign seem fraudulent. But Goodell has used Thursday Night Football masterfully, and not just because each Thursday game brings in more money.
Goodell realizes that when a product is in demand, there are advantages to making sure it remains in demand. In 2011, he locked most of the NFL’s broadcast partners (Fox, CBS, NBC, DirecTV, ESPN) into deals that last through 2022 and bring in roughly $7 billion a year, according to most reports. That’s an incredible windfall. But Goodell did not lock up the rights to every game. He has kept those Thursday night games on short contracts—the current deal with CBS is for two years and expires in a few months.
This accomplishes two objectives:
1. It keeps every network eating out of Goodell’s hand, because they all want Thursday Night Football. For a commissioner who is constantly under siege— sometimes of his own doing, and sometimes because of larger issues—this is a huge boon.
2. It allows the NFL to find a new broadcast partner at any time—which includes partners that nobody really envisioned when the league signed its other deals in 2011.
How smart is this? Well, think of a typical athlete negotiating a contract. He can negotiate the longest, biggest contract he wants, or he can negotiate a shorter deal that allows him to sign an even bigger contract in the future. In effect, Goodell has done both. The NFL gets the guaranteed cash flow and a chance to position itself for the future.
This Yahoo! game is just the beginning. In the next few years, you could see games on Netflix. Or NFL.com. Or some other service that we haven’t even heard of yet.
The NFL always has to finesse its way around antitrust concerns, but Goodell will have a lot of options. And once he finds the combination that works, the league’s current TV deals will be nearing their 2022 expiration. He will have a good idea of how to maximize revenue for his league for its next video deals. And he will have risked nothing.
This would be considered a wild, innovative success for any other commissioner. Goodell is setting his league up for the next 20 years. If you owned an NFL team, you would be very happy with how Goodell has navigated his TV negotiations.
If you’re a fan, though, you don’t see it. You just see a commissioner bumbling his way through one suspension and court battle after another. It would be good for the NFL if Goodell gave up some authority on player discipline. And it would be great for Roger Goodell, too.