THE BUSINESS AND POLITICS OF SPORTS
Sports lockouts should come with a frequently asked questions guide for the sports media and sports fans. You see whether it is the National Football League lockout or the National Basketball Association lockout they is a small impact on virtually every American taxpayer and those who a cable TV basic expanded tier subscribers.
There are some questions that need to be answered for everyone. For instance, why are cable TV subscribers underwriting sports owners lockout? The Walt Disney Company plans to pay the National Football League a rights fee whether the NFL plans a full schedule or misses some games. Will cable TV subscribers get any refunds or rebates from ESPN? The answer is no.
National and regional cable TV sports networks have a long history of not refunding subscribers for missed sports programming including the 1998-1999 National Basketball Association lockout. Don't expect any refunds from ESPN, Cablevision's Madison Square Garden Network for missed Knicks games or Comcast for missed Philadelphia 76ers games. Cablevision owns the Knicks and Comcast owns the 76ers.There are numerous sports owners who either own regional cable TV networks outright like Comcast or pieces of cable TV regional sports networks. In Chicago, Comcast is partners with Jerry Reinsdorf's Chicago Bulls, Reinsdorf's White Sox, the Chicago Cubs ownership and Rocky Wirtz's Chicago Blackhawks in the city's regional sports network.
What kind of economic impact will the lockouts have?
Not as much as people think. A National Football League team has 10 home dates (Buffalo has eight or nine with one regular season game in Toronto depending on the season) while an NBA team might host on average about six games a month between the beginning of November and mid-April to complete a 41 game home schedule. There may be a couple of pre-season games and playoff games. But the overall economic impact is minimal.
Visiting teams don't bring a lot of fans with them to attend NBA games and a typical NBA team sends players, coaches, equipment guys and trainers along with broadcasters on the road. It is not a big traveling party and that means not many hotel rooms are needed and restaurants aren't making a living off of having NBA teams come through.
In 1998-99, Golden State Warriors owner Charles Cohan didn't want to pay rent at the Oakland Arena for missed games during the NBA lockout. The municipally owned arena operators took Cohan to arbitration where he lost. How many owners in both the NFL and NBA will attempt to withhold rent payments?
That should be a FAQ.
Some municipalities will lose some sales tax monies from ticket sales and concessions but municipalities have decided not to collect property taxes on arenas throughout the country. In New York, Philadelphia and in California, municipalities will be denied of the "Michael Jordan tax" and collect taxes from players who are in for a day playing.
Some businesses around arenas and stadiums will lose money and that has caught the attention of the Attorney General of the State of New York. Eric T. Schneiderman claims he is taking action acting on behalf of a handful of businesses and workers whose incomes are threatened if there are no Bills games in Orchard Park.
The Florham Park, N.J.-based New York Jets franchise, which plays games in East Rutherford, will not be holding training camp at Cortland State in central New York.
Schneiderman's office sent NFL Commissioner Roger Goodell a letter informing him that the state plans to investigate the NFL to see if the league, the 31 owners and Green Bay, has violated New York antitrust laws.
The letter overstates the real impact the NFL lockout has on businesses but Schneiderman is the first politician seeking to involve himself in the lockout. Schneider is looking out for hotels, retailers, the New York transportation system of buses and trains and cars and the per diem workers who could lose between nine and 12 days worth of work in Orchard Park and the couple of weeks of pre-season workouts a New York State universities in Cortland, Albany and Fredonia training facilities.
To quote Donald Trump, the economic impact is small potatoes. A few people will get hurt but the jobs Schneiderman is protecting are part time minimum wage positions at the stadiums and training camps.
Sports teams’ economic impact on a given area is always overstated. Also people are going to spend money on entertainment, they will just shift that football or basketball dollars elsewhere.
"The expected blow to the state's economy will be tremendous," wrote Assistant Attorney general Richard L. Schwartz. "Many New York public and private institutions depend heavily on the NFL training camp and regular season games to generate revenue."
A note to the assistant attorney general, Cortland State, doesn’t depend on whether the New York Jets training camp takes place at the campus’ main stadium. Mr. Schwartz might want to check the books of the college to see just how profitable or unprofitable having an NFL team on the premises is for the school. It might startle him and others in the Attorney General’s office to see the books at Cortland.
Ralph Wilson's Buffalo Bills gets about $7 million in subsidies for stadium maintenance and day of game operations.
The entity formally known as the National Football League Players Association put out a paper that contended that if there was no 2011 NFL season, that $160 million in local spending in each league city and 3,000 jobs would be wiped out. The NFLPA stance seems absolutely ludicrous given the fact that the league plays just 10 home games except in East Rutherford where the stadium houses two teams and stadium jobs are dead end per diem positions which would supplement someone's income.
The real money losers are the players and cable TV subscribers underwriting labor actions and not even knowing it.
If Schneiderman really wanted to conduct a thorough investigation, he would start with the television networks, Sumner Redstone's CBS, General Electric's NBC (now majority owned by Comcast), Rupert Murdoch's News Corp (FOX), the Walt Disney Company (ESPN) and DirecTV and ask why those entities are underwriting the owners costs in the lockout. Schneider can also check in with the NBA and see if Time Warner's Turner Sports and the Walt Disney Company's ESPN are underwriting the NBA lockout and investigate the Dolan family's Cablevision and ask if any fees that are being collected are going to the Knicks from the Madison Square Garden Network. He can also ask Goldman-Sachs and the New York Yankees owned YES Network about fees going to the New Jersey Nets.
That would just be a New York investigation. Similar inquiries could take place around the country.
Those are just a few FAQs that should be asked and answered. In the toy store of media, the sports department-writers, TV talking heads and radio talk show hosts are infuriated that their world has collided with the real world sort of - after all they want to be entertained with games and want no part of how sports really operates. If Schneiderman was truly serious about probing sports, there is a lot out there but his inquiry will be forgotten once the two sides in the NFL battle call a truce and reach an agreement.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition" is available at bickley.com, Barnes and Noble or amazonkindle.