Return To Football & Media Companies Protection Of Live Sports Content

The NFL preseason is already three weeks old, and college football will begin traditionally on Labor Day weekend; football is back and for many Americans that means that they have something to watch on TV again. The excitement for the start of both a new college football season as well as a new NFL football season is tempered by the continued movement of media companies to protect live sports content.

The trend towards eliminating cable television service, or “cord-cutting”, is gaining momentum each year as Americans look to trim the monthly expenses in order to pay for rising costs for other services, such as healthcare. The “cord-cutting” trend has been aided by the prevalence of streaming television products and platforms available to the consumer.

However, the consumer that is looking to still utilize “live TV” can do so through a few different pathways: HD antenna, streaming devices, and hybrid streaming services. The HD antenna is very simple: it attaches next to your TV and provides the broadcast channels within the mileage range on the box. The antenna would provide CBS, NBC, FOX, ABC, CW, and PBS as well as a few more local stations.

The antenna would provide you access to live sports broadcast on the national networks, and would not include any games broadcast on cable television. This option would work very well for NFL football, and some college football games. It would be of little use to obtain access to any other major sports, other than an occasional game.

The local baseball, basketball, and hockey games are almost exclusively aired on cable regional sports networks or on national cable sports networks such as ESPN or NBC Sports Network. This leads us to option two: streaming devices.

The streaming device route or Smart TV route can provide access to a huge amount of live sports content, but most of that content is not free of charge. The NBA, NHL, and MLB all have streaming “apps” but they require a subscription to access. The streaming device route can also support “live streaming” of certain networks but most of that would require either a cable subscription or another type of payment arrangement to access that content.

The hybrid streaming device route would be a DirecTV now, Sling box, or a few other smaller services that allow for the content available on a very large package of channels to be viewed in other rooms in your home. This would require a subscription and at least one box connected from either a cable or satellite provider. This route may also require the purchase of additional equipment.

However, this setup would enable access to a significant amount of live sports content. The other service is through Hulu which will feature a package of channels for $40.00 per month which would allow for live streaming of network and cable television, including live sports.

The networks pay such a high premium for the live sporting events that it is, in some ways, understandable that they have put in place certain measures to make it more difficult to stream the content without a cable or satellite subscription. The challenge will be in adapting their content providing platforms to attract other audience/fan base demographics.

The younger generation is conditioned toward streaming versus watching any regular television programming. The advertising around some of the streaming services and apps can be a bit misleading. Some of the sports related streaming apps will give you access to certain content for free and require a fee or cable subscription for access to the most important content: the live game or archived game broadcasts.

The NFL has partnered with e-commerce giant, Amazon, to stream 10 games this year as part of the Thursday Night Football package. This exclusive opportunity with the NFL and their coveted live game content cost Amazon $50 million. The broadcasts are free for all those with an Amazon Prime membership which runs at $99.00 per year.

This agreement with Amazon is different than the agreement they had last year with Twitter for the Thursday night games because Twitter streamed them live for free to everyone with an account, Amazon requires a Prime membership for access. It will remain to be seen if that will have an impact on live stream viewership, either positively or negatively.

The future of sports content on TV, and other content on TV is trending more toward a structure where the consumer will pay to have all sorts of content streamed on a customized basis. The consumer access to a broad range of content will require membership to a wide range of services, similar to the premium channel cable TV subscriptions currently (HBO, Showtime, Starz, Encore). It is important to note that whatever service or method you use it is like the old adage: “there is no free lunch”.

A good example of this trend is the decision by Disney recently to end their partnership with Netflix to start their own streaming service. This translates into a scenario where in order to gain access to Disney content you will have to purchase their streaming service. I think that many other major media companies are going to follow suit.

The return to football means some exciting weekends relaxing with family and friends. It conjures up memories of past football weekends with the big college games on Saturday nights, and the CBS games at 4 o’clock on the East Coast with the aroma of a home cooked dinner in the background.

It is time for many of us to watch TV again, and I hope that this piece informed you on the best options that you have to access this content. I wish you all a happy and safe football season.

Football Talk

I write about both sports and television ratings often on Frank’s Forum, and with the Super Bowl just concluded, I was reflecting back on the past few months. The Super Bowl is usually the most watched event on television of the entire year, and some editions of the sporting event have set all-time U.S. television ratings records.

The thrilling comeback and overtime win for the New England Patriots as they defeated the Atlanta Falcons had overnight numbers that are lower than previous Super Bowls. However, the event still posted a 48 overnight rating and about 110 million viewers which is a huge number in terms of the way rating numbers have changed in recent years.

The start of the NFL season coincides with the start of the new season of TV programs. The major networks have had the same strategy for years regarding viewership. The networks tend to pair successful returning series with new series concepts and then determine over a period of time if those lineups are successful.

Many new television concepts for network series usually are not successful. It is very difficult terrain especially with the new technologies available to viewers to successfully navigate the waters of the new media world we live in. The streaming services such as Netflix, Amazon, and Hulu have only increased the competition for new television programs to gain interest and stay viable.

One new series that has become one of the highest rated new shows on network television is from NBC and titled, “This Is Us”. It is a favorite show for my wife and I which we enjoy watching together. In our busy lives we never watch it live on the night it airs, we always watch it via On Demand from our provider, which serves to validate my earlier point on the changes to viewership patterns.

Those of you who have not seen the show yet, but plan to watch it from the beginning or at least check out the pilot episode (which I recommend) I do not want to provide any spoilers. I will summarize one scene which serves as the point of this whole piece on football.

In one scene in an early episode of the show one of the female characters is observing the guy she is romantically involved with while he is watching a Pittsburgh Steelers football game on TV. The scene then shifts to a flashback of her childhood where she is sitting on the floor observing her father as he intently watches the Steelers play on TV.

Then, she explains to the guy she is with, that she cannot relive her childhood and sit there while he watches football. She asks him to teach her about the game, which he gladly obliges, and in the time advanced sequences, she emerges as a huge fan of the sport.

It evoked a memory of a similar situation for my wife and I, except my father-in-law was not a sports fan. She wanted to spend time with me, and anyone who knows me understands that I enjoy sports very much. I enjoy watching games and talking about sports of all types. I especially love and enjoy NFL football.

My wife asked me in the same type of way to teach her the game of football, so that she could understand what was going on, and that we could talk about it. Her brothers are both avid New York Giants fans, so it helped that she knew some of the history of that team for me to use as my baseline for her.

I taught my wife, just as the character “Jack” taught “Rebecca” about football, using props for the lineman and the other positions on the field. We watched NFL Network together, and during the course of watching the games I would answer questions about the rules of the game, which was also a lot of fun for me.

It seems like before I knew it, my wife, like the character “Rebecca”, was a passionate football fan, yelling at the TV (totally out of character for my wife) and watching the Giants on her smart phone while cleaning or doing other household tasks, or while out running errands.

We watch several out of market games together too, we discuss the issues facing other teams in the league, and the strategy of the NFL Draft and that process. In the years that followed, we would have gatherings for Sunday football games, and started our own traditions for the Super Bowl.

In the past couple of years, with my working the weekends, we have lunch together on Sunday before I go in to work, and we will watch the Giants or whoever is on at 1PM. We talk about that game, and then she will put the Sunday primetime game on for when I get home. We will very often watch that together.

In reflecting on the past several weeks, the whole situation really came to a head when I had to work all of the Divisional Playoff weekend a few weeks ago. I would come home late and my wife provided all the background on the games. I listened as she talked about three-man or four-man rush defensive calls, on challenged referee decisions that went to the replay booth, and on the Cowboys play calling to get back into that toe-to-toe battle with the Packers.

She told me all about the Falcons and their vaunted offense, her opinion on why the Seahawks could not get going, and how Aaron Rodgers is the best quarterback at extending plays. It is a nice and healthy distraction away from all the things that can clutter up life and serves as a point of interest for us to have together and share.

Now, football season is over, and football talk for my wife and I will shift to the offseason topics of teams improving rosters, draft prospects, and new head coaches trying to turn around teams that have underperformed.

After that wild Super Bowl game was concluded I told my wife how I will miss football. It always seems so long to wait for it to return again in September, but she reassured me and told me that I say the same thing every season. It will be back before we know it, and she told me that I will shift my focus to hockey primarily, a sport she does not know as well (but will watch with me).

I will miss the games on Sunday afternoons and the Monday nights, but I will miss our football talks. The process of writing this essay helped me understand how much I value the memories of those talks as well as to gain further insight as to how much my wife loves me. She loves me enough to learn about football because she wanted to spend more time with me.

I am lucky, fortunate, and blessed. It is my hope that you find that same type of common interest with the special someone that you share your life with and that time can be fulfilling and fun. In the meantime, I will wait until next season for our football talks to return.

Raiders Relocation: From Oakland to Vegas – Two Cities Two Different Approaches

The Raiders filed paperwork with the NFL on Thursday to relocate to Las Vegas which means that the final step is the formal approval of 24 of 32 owners to clear the path to the desert for this wayward franchise. The team has called Oakland home at two different points in their history from 1960 to 1982 and then again from 1995 to the present.

The Raiders have been seeking a new stadium facility to replace the aging Coliseum, which is basically falling apart at this point. The discussions with Oakland officials have been going nowhere for years regarding a new facility, largely because Oakland is still paying off loans for the expansion of the Coliseum which was done in the mid-1990s.

The Raiders attempted to join the Chargers in a joint bid for a new stadium in the suburbs of Los Angeles, but the final proposal was voted down by the league owners in favor of the Rams proposal for the Inglewood stadium development project.

The Las Vegas option for the Raiders came about shortly after the team saw the Los Angeles pathway dry up. The resort city voted aggressively to approve $750 million in public funds (raised through an increase in the hotel tax) towards the development of a 65,000 seat domed stadium. This measure represents the largest amount of public financing approved for a sports stadium in American history.

The Raiders owner, Mark Davis, has been committed to moving the franchise to Las Vegas once the project was given the green light by the Governor of Nevada. The potential for a new stadium with new revenue streams to help grow the Raiders brand just was too enticing for Davis to pass up.

The way this relocation (if it is made official in the March league meetings) has gone is a tale of two cities with two different approaches to the situation. Oakland has been reluctant to use any public money for a stadium, while Las Vegas allocated the most public financing ever.

Oakland has other issues though with the school system in need of upgrades, public safety spending needed, and other necessary infrastructure projects. The city attempted to “save” the Raiders by entering into an agreement to have former Raiders Ronnie Lott and Rodney Peete develop concepts for a new stadium on the Coliseum site.

The issue with that process though has been two-fold: the financing for the construction of the stadium has been unclear, and the Raiders have been left out of the discussions about the potential development of a facility that they are supposed to operate within. It goes without saying that the situation is pretty messy and might have been engineered by officials in Oakland as an effort to play to the public that they at least attempted to keep the team.

Furthermore, there are residents in Oakland that feel strongly that the new stadium should be financed privately and that Davis and his wealthy partners should have moved forward a plan to build a facility on their own. Those same residents feel that the public funds available should be used on other necessary services and improvements to schools and other areas.

There are still others who will blame either Davis for being greedy or the Oakland civic leaders for being too shortsighted if the Raiders end up leaving the city. That is what fascinates me about these situations, the viewpoints are usually so varied about the same fundamental issue.

The Vegas deal looks like a win-win scenario for both the city and the team. The NFL league office is not thrilled about losing a team in a top TV market like the Oakland/Bay Area for a team in Las Vegas which is a much smaller metro area and media market. The factor to offset that is the only other major league team in Las Vegas right now is the NHL’s Vegas Golden Knights who begin play as an expansion team next season. The other factor is the national appeal and following that the Raiders have which will follow the franchise wherever it calls home.

The officials in Las Vegas along with the casino hotel owners were very committed to making this proposal work because they saw a unique opportunity to get a franchise through relocation to their city. I have written previously that this proposal was a hit with those same groups because the NFL season runs in the autumn months which are traditionally the slowest point of the tourism cycle for Las Vegas. The relocation of the Raiders would fill hotel rooms when the demand is usually low and create opportunities for fans to travel for long weekends to see their team play the Raiders in Las Vegas.

The relocation papers have been filed and it is difficult to see a scenario where Oakland retains the Raiders at this point. The NFL owners would be setting a potentially bad precedent for their own self-interest if they voted down the proposal for a stadium with the most public financing ever allocated, in a time where many cities are not willing to put forth public funds for stadiums at all.

I always feel badly for the fans in Oakland who will lose the Raiders in this situation, and some of them may remember losing them in the early 1980s when they first relocated to Los Angeles. It could have all been avoided if Oakland had been more flexible in their approach and if greed did not dominate the motivations of the people involved on both sides.
In the end we will never know if a privately funded stadium would have worked in Oakland or not. The Raiders will most likely be playing in a new domed palatial facility off the Vegas Strip in a couple of years, while Oakland will be paying for an empty Coliseum with mountains of unfilled seats and memories of a team that was once their own.

Monday Night Football Ratings Take A Nosedive

The ratings were released today for ESPN’s Monday Night Football and they were the second lowest ratings for a season and would have been the lowest if not for the huge rating turned in by the Dallas Cowboys-Detroit Lions contest this past week.

The problem facing the ratings for MNF is part of a broader trend facing all NFL broadcasts this season, as a ratings decline was felt across all their broadcast packages. The ratings slump was seen by some as being connected to the presidential election, but even after that was decided in early November, the ratings have not rebounded to expected levels.

This past week, with the long Christmas/Chanukah holiday weekend the NFL lead the ratings for their main telecasts: Thursday Night Football (Eagles vs. Giants), Sunday Night Football, and Monday Night Football.

The ESPN Monday night package had been down in recent years because the matchups were generally not as compelling as the games featured in other NFL packages. The other theory being that with the addition of more Thursday night NFL games on network channels with CBS and NBC splitting those telecasts, that the average as well as the hard core NFL fan was becoming disinterested by the time Monday night rolled around.

The broadcast of NFL games, prior to this season, held the sentiment within the media and advertising industries as the “final frontier” for programming which remained immune to drops in ratings or viewership. This season though dispelled that theory as each segment of the NFL broadcasting tiered structure, from the regionalized coverage on Sunday afternoons to the primetime broadcasts, all experienced a downturn in ratings.
The before-mentioned Presidential election had some effect on the NFL ratings because the cable and network news programs on Sunday nights saw a marked increase in ratings. The NFL numbers rebounded somewhat after the election, but still were softer overall than in recent years.

I have written previously about a potential oversaturation point for the NFL with televised games and I think the 2016 season is evidence that the threshold has been reached. The final weeks of the season were also fairly devoid of drama surrounding the field of playoff teams, with the AFC side decided except for seeding a couple of teams, and the NFC side basically set except for the NFC North.

The matchup to decide the NFC North title between the Detroit Lions and the Green Bay Packers served as the season finale to Sunday Night Football on NBC and it finished with a 13.7 rating. That served as an increase from the Christmas night game on NBC between Kansas City and Denver which finished with an 11.2 rating.

The NFL, for its part in this situation, has repeatedly stated that they are looking into the ratings downturn and evaluating strategies to increase viewers moving forward. They also remain committed to Thursday and Monday night games despite the decline in ratings this season for both of those programming entities.

The players, notably Richard Sherman of the Seattle Seahawks among others, have been vocal in their disdain for Thursday night games which create short weeks for both teams, especially the visiting team that must also travel to the game site. The discussion is now shifting toward improved scheduling of Thursday night games such as positioning it following a bye week for the teams involved, or scheduling more divisional matchups with shorter travel distances for the visiting team.

I had also written previously about the National Anthem protests by NFL players and whether that had an impact on the ratings slump for the NFL. The issue undoubtedly drew people away from watching certain primetime games (especially those featuring the San Francisco 49ers which were at the center of the issue) and I know people personally who refused to watch certain NFL games because of those protests.

However, the Denver Post conducted a survey about the NFL ratings slump and only 25% of the respondents felt that the National Anthem protests were the core issue as to why they were changing the channel from the NFL production. It should be noted that this survey was unscientific but it had some revealing results which demonstrated that the number of penalties, overall quality of play, and the off-field issues for players (domestic violence, drugs, guns etc.) were the top reasons for the decline in viewers.

First, the number of penalties in these games is bordering on being out of hand. The league office has to get together with the officiating crews during the offseason and discuss some ways to cut down on penalties, especially during primetime games. There were points in this season where my schedule allowed me to watch more Monday night games than anything else, and the number of penalties and stoppages for challenged rulings on catches or some other issue made the games very difficult to watch at points. I am a huge fan of the NFL and watch more out of market games for that sport than any other, so if I am frustrated with that, it has to effect the average viewer.

Second, the overall quality of play is a huge issue here with ratings and they are connected very closely to the decline this season. Many of the Thursday and some of the NBC games on Sunday in primetime as well as the Monday night edition on ESPN had scores that were so lopsided that the viewers bailed well before the end of the game. The retirement of Peyton Manning and some less attractive matchups in some of the primetime packages drove this rationale further in the impact on ratings.
Next, the off-field issues for the players is a definite concern for the league, to which there is no easy way to mitigate because of the way information is transmitted today via social media and the internet. The media coverage of a variety of off-field matters from domestic violence charges, weapons charges, and other infractions such as drug or PED use is a definite setback to the image of the league. The league has talked about transparency, so it is not like they can keep these matters out of the public domain, so it will remain an issue for the NFL moving forward.

Finally, the topic of oversaturation was discussed in multiple media reports ( produced a great piece about the ratings slump) and the before-mentioned Denver Post survey noted that only 29% of viewers watched all three days of NFL football (Thursday, Sunday, and Monday). That translates into a situation where you have oversaturation of product in the airwaves.

The combination of factors driving the decline also translates into a situation where the solution is not easily obtained. It should be interesting to see how the NFL responds to the ratings data from this season and whether they can reverse this trend, stay tuned.

The NFL seems bullish on not eliminating any of these package tiers so they are going to have to work around this reality that, until they address some of these other issues, the ratings are going to remain hovering around the levels they were this season. The NFL is getting a dose of the fact that reality is sometimes a very difficult concept to accept.

Gone Fishing: L.A. Rams Fire Jeff Fisher

The Los Angeles Rams vaulted to the top spot in the sports news stream this afternoon when they announced they had made a head coaching change by dismissing Jeff Fisher after a 4-9 start to the 2016 season. The Rams lost their fourth straight game on Sunday and they had lost eight of their last nine games.

The reason why this move came as a bit of a surprise is that the team and Fisher had just recently confirmed that Fisher and General Manager Les Snead had both signed contract extensions (Fisher was given an extension through the 2018 season). The Rams owner, Stan Kroenke, spoke today about the firing of Coach Fisher and explained that the thought process at the time of the extension (which actually was signed before this season began) was to reward Fisher for making the transition of the franchise from St. Louis to their relocation this season to Los Angeles. The Rams are set to move into a huge new stadium facility in a few years and they thought Fisher could lead them into that stage in their progression in Southern California.

This season, however, was a spectacular failure for Fisher who has been dogged by on-field and off-field issues all season. The first issue was the decision to play Case Keenum at quarterback and bench the Rams top draft pick, Jared Goff, which then led to the media pressing Fisher about playing Goff. The team had traded future draft selections to move up to the top overall spot in the draft to select Goff and Fisher kept him on the bench.

When the media pressured Fisher about this situation, it was essentially discovered that he was against the decision to trade all of those future assets to move up to select Goff. The selection of Jared Goff was supposed to represent the future of the franchise in their new Los Angeles chapter, and that player was not in the plans for the head coach of the team, that was the first sign of trouble for Fisher.

Next, the play of the team after a surprising start, began to spiral downward. The players looked unfocused, and the play turned sloppy and undisciplined in all three phases: offense, defense, and special teams. The new fan base in L.A. grew weary quickly and called for Goff to get a shot at quarterback.

Coach Fisher, under what I would assume was intense pressure from the front office and the owner, relented and started Jared Goff. The situation went from bad to worse as the turnover ratio for the team ballooned and the Rams dropped their next four games. It was unfair to Goff too, since he had not seen the field at all, and then he is dropped into the middle of an already rocky season, and he is told to essentially learn the offense “on the go”.

The offensive woes continued with the Rams getting blown out by the Atlanta Falcons yesterday in front of a dwindling home crowd. The comments by running back Todd Gurley after the game are summed up by him calling the Rams “a middle school offense”, and in my opinion Gurley should not be saying anything to the media to criticize anything because his play has been well below the expectations, his performance has been terrible this season.

The offense is most probably a main reason why the decision to fire Jeff Fisher was made at this point because if the front office was lukewarm about keeping Fisher as their coach, the sooner they transition the new offensive scheme for Jared Goff to learn, the better off they will be in the long term. I have seen this with other teams and their young quarterbacks, the management wants to avoid having them learn multiple systems, and stability is needed for success.

Furthermore, Fisher had the whole ordeal with Eric Dickerson which unraveled off the field which became a huge distraction for the team. Dickerson is a Hall of Fame running back who was a staple of the L.A. Rams in their original run in Southern California before the team relocated to St. Louis in the mid-1990s.

Dickerson was seeking some on-field passes for himself and his friends, Fisher reportedly denied the request, and a rather vocal (at least Dickerson was) and public feud between the two men ensued. Fisher was never going to win a fight with a Rams former player that carries as much clout as Dickerson, so I knew this was going to be yet another “black mark” against Fisher.

The Rams were blown out yesterday by Atlanta, as I mentioned earlier, and with that loss Coach Fisher tied Dan Reeves for the most losses in an NFL coaching career in the history of the league. It was a matter of time before the hammer was going to drop on Fisher, I thought it was going to be after the season on that Monday where characteristically coaching changes are made.

In the interim, John Fassel, the son of former New York Giants head coach, Jim Fassel, will step in and guide the team. The Rams have a game on the road in Seattle on Thursday night, which also surprised many with the timing of this decision today, it is a short week for the team to prepare. This change being made at this point translates into a situation where reading between the lines it had to have been very rough behind the scenes over the past few days.

The aftermath beyond these last three games of the 2016 debacle of a season for the L.A. Rams is that the team with a multi-billion dollar new stadium being constructed along with a huge retail and entertainment district surrounding it, which is dubbed “NFL Disneyland” needs to make a big splash again. The Rams front office needs to hire a big name to replace Fisher. They need a big time offensive minded head coach to install a system that complements Jared Goff, who they have committed significantly toward being their franchise quarterback.
Those names are Mike Shanahan, Jon Gruden, and Jim Harbaugh. The plan, according to reports from ESPN, NFL Network, and others if Shanahan was hired his son, Kyle, would join him in L.A. and would take the reins as head coach in a few years.

The most intriguing name, whether you like him or not, is Harbaugh. In my own opinion, I do not think that Gruden has interest in leaving his very lucrative ESPN commentary job to coach again, or else he would have done so already. I would also have some concerns if I were the Rams about whether Gruden still had the fire to coach after being away from the sideline for so long.

The Rams roster is not very good and needs a lot of work to build toward a playoff contender, let alone a championship contender. I would think Gruden would be interested in a team that was closer to winning than one that will take a bit of rebuild before it can turn that corner.

Harbaugh, though, is a name that is going to gain traction because he has lived and coached on the West Coast with Stanford and the San Francisco 49ers, and he had great success at both stops. In his current situation at the University of Michigan there have been some significant bumps in the road in that situation because Harbaugh wants to do things his way, and Michigan has resisted completely handing him the keys to do so.

The Rams, if they were very aggressive, could pry Harbaugh away from his alma mater, especially if they put enough money on the table. The fact that Stan Kroenke is a billionaire and has a significant amount of resources dedicated to making the Rams a part of the fabric of L.A. again is leverage for the next coach to utilize as well.

In a related note, now that Fisher is dismissed, Eric Dickerson has stated that he will attend Rams games again, and for whatever it is worth, he just started following Jim Harbaugh on Twitter.

The Rams ownership and management made a bold push to the NFL to gain relocation into the coveted L.A. market before any other team, and their first season there has been a flop. They need to make another bold move by naming the right man to coach the team moving forward and transition this team into one that will capture the consciousness of the fan base in Los Angeles. They need to right this ship before it sinks completely.

NFL – Los Angeles Update – The Fate of 3 Franchises

The NFL returned to Los Angeles with a preseason game last week between the newly relocated L.A. Rams hosting the Dallas Cowboys in front of almost 90,000 fans at the L.A. Coliseum. The Rams, who had called Southern California home for decades before moving to St. Louis in the mid ‘90s, only to return again to Los Angeles in a landmark decision by the NFL owners committee in February.

The Rams once played at the Coliseum, so the game had a retro feel, almost like a “back to the future” kind of vibe to it, and the team showed that they have some growing to do in order to get themselves back into a contender in the NFC. The top overall pick in the 2016 NFL Draft, Rams quarterback Jared Goff, looked shaky and inconsistent at points. The offense features a future star in the league at running back, Todd Gurley, and the defense is young but talented.

The on-field issues for the Rams are only one piece of the equation, the bigger picture is the importance of Los Angeles to the future of three franchises: the San Diego Chargers, the Oakland Raiders, and the before mentioned Rams. The vote that landed the Rams back in L.A. and approved the plan by Rams ownership to build a gigantic stadium and other development in Inglewood has some important caveats to it.

The Chargers have the right of first refusal, essentially as part of the NFL vote, they have two separate one year options on relocation to L.A. if they cannot come to an agreement with the authorities involved in San Diego to remain in that market. The Chargers exercised their first of the two options by choosing to remain in San Diego for the 2016 football season.

The stadium proposal for the Chargers, which I covered in previous articles, centers on a waterfront facility that will adjoin an expanded convention center space for the city. The voters in San Diego will ultimately decide the fate of the team with a referendum ballot initiative on Election Day in November. The measure will decide if the public funding portion of the project, which will be obtained through tax increases on tourism and hotels, will be approved by the citizens. In the event that the measure fails, I think the Chargers will move to Los Angeles and join the Rams in the Inglewood stadium.

Conversely, an approved vote by the required majority in San Diego would make for an interesting scenario because the Chargers would remain in San Diego. This would open the door for the Raiders to potentially move to Los Angeles under the terms of the agreement in the NFL owners vote regarding the return of the league to that market.

Raiding LA?

The report I saw from Mike Florio on NBC Sports was very interesting regarding the future of the NFL in L.A. in that the sources he consulted stated that the Rams would be very reluctant to have the Raiders join them in that market. The prevailing theory being that the Raiders (who also once called L.A. their home) would quickly become more popular than the Rams in Los Angeles.

The survey data seems to indicate that the L.A. market would have a more lukewarm reception for the Chargers in that market, and the Rams would be the more popular team in that scenario. The Raiders were enormously popular in L.A. when they played there, particularly in the ‘90s when the Silver & Black represented a greater societal symbolism with the movement towards the hip hop cultural revolution at that time which fostered an ESPN films production.

The Raiders have been working on several different fronts to find a new long term stadium solution to improve their revenue streams in order to stay competitive in the modern NFL landscape. The team has been working with Oakland on a new stadium for years, it has considered a relocation to San Antonio (that could be leverage for Oakland to make a deal), and the most recent scenario involves a potential deal with Las Vegas to relocate to the desert.

The other potential option for the future of the Raiders could be a move to L.A., but that would be put on the table as an option only after the Chargers exhaust their two optional years, which would mean 2018 at the earliest for a relocation to their former home in Southern California. That could still potentially happen if they do not reach an agreement with Oakland on a stadium deal in the interim.

In my view, as I have covered this topic and the NFL and their race to return to L.A. for years now, the Raiders situation is a mess and it will remain complicated for a while until it gains eventual resolution. The team ownership, notably principal owner Mark Davis, spins the line that the Raiders have many options as far as where they will eventually call home.

Back to Reality

However, in reality, he still has to get that relocation approved by the NFL and the full body of owners. Some pundits who like to “stir the pot” will say that Davis does not need NFL approval to move the team, that if he has a break in the lease in Oakland, he can move the team anywhere. While this may be true in theory, the fact is that if Davis wants to tap into the money that the NFL would provide toward the construction of a new stadium in a different market (usually in the area of $100 million) then he would need the approval of the NFL to relocate the franchise.

Some fans may recall that when the NFL announced that the Rams were going to be moving into Los Angeles, the league provided an incentive, which amounts to a consolation prize to the Raiders and Chargers. That incentive is to provide an additional $100 million (for a total of $200 million) to both teams if they could get a new stadium deal done in their current home markets of Oakland and San Diego respectively.

It is this incentive where I feel that both teams will eventually make something work in their home markets. In the San Diego scenario, the waterfront proposal has to pass in the November referendum. In the case of the Raiders and Oakland, I do not believe that they are going to Las Vegas especially now that the powers that be in that scenario have already changed the agreement.

The original Las Vegas proposal was for a 65,000 seat domed stadium to be built near The Strip to be shared between the NFL team (in this case the Raiders) and the UNLV football team. The proposed site development plan totaled $1 billion for the stadium and the city was willing to pay close to half of that amount. Mark Davis and the Raiders were going to get $100 million from the NFL to offset his end of the financing.

In the months that followed, Las Vegas got awarded an expansion NHL hockey franchise. Some feel that this recognition of finally getting a seat at the table at one of The Big Four sports leagues led the politicians there to change their tune about the NFL stadium proposal. The public financing end of that proposal went down sharply from the initial $500 million they were willing to absorb. The site that was identified has some other issues with it (which I will not detail further) and so now the proposal has expanded to nine different sites for a potential football stadium. These developments, on balance, make it seem that Las Vegas is less serious about spending public money to get the NFL to come to them, and that was the entire reason why Mark Davis was even entertaining the notion in the first place.

Gambling on the Desert

I thought that the Vegas option was waning but today I read two different reports: one that has the Raiders applying for trademarks around the name “Las Vegas Raiders”, and another that stated that NFL Commissioner Roger Goodell is looking to block the Raiders progress in Vegas because he prefers the team to remain in Oakland. This could get very sticky, very quickly. It is no secret that Goodell prefers that most teams stay in their current markets and the Bay Area is an important strategic region for the league. The issue of Las Vegas and gambling brings a whole other level of concern I think that the NFL is not willing to publicly recognize, but it is palpable internally within the league office at this point.

The San Antonio option for the Raiders, in my view and it is shared by others with knowledge of this situation, is that it is a ploy for leverage for Davis to get a stadium done in Oakland. I understand that Davis owns quite a bit of land there but the other issue to consider is the Dallas Cowboys and the Houston Texans would vote against that relocation. The owners of those two teams, Jerry Jones and Bob McNair, are both very powerful NFL owners that would get their other friends on the ownership panel to reject this potential move. Those two teams would be reluctant to have another competitor move into their region. The San Antonio option seems unlikely as well.

That leaves the Raiders probably staying in Oakland because they have the most incentive to do so ($200 million from the NFL towards stadium development) and the history of the franchise is tied to that market. The NFL would like to keep two teams in the Bay Area if possible, so I think every effort will be exhausted toward getting a stadium deal done. The issues with Oakland are that the public appetite toward funding a stadium with tax dollars is very unpopular.

The secondary issue is the land for a stadium is limited as far as the number of suitable sites that could be developed in a reasonable amount of time. Mark Davis has floated a proposal in the past for a very intimate new stadium around 50,000 seats but he prefers the current site where the team plays at Oakland Coliseum.

The problem with the Coliseum site development is that the A’s play baseball there from April through October, so it leaves very little time to do construction at the site without conflicting with the A’s and their 82 games played on that site each season. The A’s, for their part, have signed a lease extension to stay in Oakland, but have been trying to move to San Jose for years. The San Francisco Giants have the territorial rights to San Jose and have blocked the A’s from moving there.

The Raiders were hopeful that the A’s would move across the Bay to San Jose because it would clear the path for them to build a stadium on land adjacent to the Coliseum on a faster timetable. The presence of the A’s on that site provides another hurdle to the project, but in the end, I think the Raiders will get a deal done to stay in Oakland.

Rams Reboot

The fate of the Rams is also tied to these other two teams, even though the Rams got the coveted first shot at the NFL reboot in Los Angeles. The Rams will have the inside track on all of the top corporate sponsorships and marketing opportunities. However, if they have to eventually share the market with another team that will impact them over the long term. The difference comes with which team they could potentially have to share the market with in Los Angeles.

The infamous “polls” that Rams owner Stan Kroenke cited from Twitter that allegedly displayed that the residents in the L.A. area favored the Rams over the Chargers in terms of popularity were part of the pitch that landed his team in Los Angeles. The Chargers would not be nearly as popular, according to other industry studies, as the Raiders would be in L.A. which was part of NBC Sports and Mike Florio’s excellent reporting on this situation.

A relocation of the Raiders to Los Angeles in the future would have a significant impact on the Rams and their presence in the market from a marketing and fan base development perspective. The obvious best case scenario for the Rams would be if the Raiders and Chargers both stayed out of the L.A. market for the long term. In the interim they will look to reap the benefits of being the first entry for the NFL into that huge untapped area which is the second largest media market in the US. They will also open their new stadium in Inglewood in a few years which will provide the NFL with a glitzy destination for the NFL Draft Combine, the Super Bowl, and other large scale league wide meetings.

The Olympic fever that just gripped the whole country will also benefit the future bid for the 2024 Summer Olympics where the US Olympic Committee is looking for the Rams Inglewood stadium to be the landmark centerpiece to a bid to get the Olympic Games back on US soil.

In the end, the Rams may be just beginning their new quest to rebrand themselves as “the team” in Los Angeles, but the team and the NFL still has unsettled business with the Chargers and Raiders. The fate of all three of these franchises are tied to L.A. and it remains to be seen how the political and financial forces at play will decide the chain of events regarding the future of the sport that America loves in San Diego and Oakland respectively. The next few months will provide some clarity, but for now, it is still anyone’s guess how it will be decided, and the fans of the three teams hang in the balance.

Bolting Ahead: The Chargers Downtown Stadium Update

The San Diego Chargers path to a playing in a new downtown stadium just took a detour with a decision by the judicial system in California regarding the voting mechanism for the November ballot referendum. The Supreme Court of California recently handed down a ruling which would require a two-thirds majority for the stadium initiative to pass on the ballot this fall rather than a simple majority.

The Chargers and the city officials in San Diego quickly countered that news with an announcement that they had anticipated that hurdle and were approaching this measure prepared to gain a two-thirds majority for success. The Chargers have a petition with over 100,000 signatures awaiting verification from the proper legal authorities regarding the stadium measure needed to keep the NFL franchise in that city.

In the event that the referendum measure fails to gain approval from the voting majority, that would put the future of the team in San Diego in jeopardy. The team has an option on the table from the NFL and the Los Angeles Rams to play at the new Rams stadium being constructed in Inglewood outside of downtown LA.

The Chargers decision at the end of the 2015 season to put all their efforts into moving to Los Angeles left the people of San Diego very upset. The Chargers may not have enough votes to pass this stadium ballot initiative which is structured in a way that it would bypass the rigorous steps of environmental studies on the downtown site proposed for the stadium adjacent to the convention center. This method would expedite the completion date of the stadium.

The “Convadium” concept as it is known in San Diego is the project to build a new stadium for the Chargers and connect it to an expanded convention center for the city. This proposal has been rife with problems from the beginning and is basically still a mess at this point. The main issue of course is involving the financing of the project: nobody seems to be clear on who is paying for what portion and how the public financing component of the project will be structured.

The other sticking point is over who has the final approval of the design of the space, and whether the Chargers will include the playing surface as part of the convention space. The thought process being that they could potentially gain revenues for convention use of the stadium side of the expanded convention center, which some residents have taken issue with that portion of the potential plan for the site.

Mission Impossible

In my previous work on this topic I have compared the Mission Valley proposal to the downtown convention center proposal. This scenario came up again recently and Dean Spanos sent a letter to the city officials involved basically stating that the team will not consider the Mission Valley site under any circumstances. The letter basically spells out that it is either the downtown site or nothing at all.

The news that the team management will not consider Mission Valley as an alternative site has fueled speculation that the Chargers could eventually move to Los Angeles and relocate the franchise. I must admit that I was of the opinion that once the Chargers opted to remain in San Diego for the 2016 season that they would get a deal done with the city and remain there; now I am not so sure given the events of the past six weeks. The situation could get very negative between the team and the city and the residents hold the cards; and they are upset with the Chargers or skeptical of the value of the new stadium project. That is a bad combination.

There are rumors that certain city officials believe that if the initiative on the ballot for the downtown “Convadium” fails that they can move ahead with a plan to build a new stadium on the Mission Valley site and lure another NFL team to play there, assuming the Chargers bolt for LA. The most frequent team mentioned is the Jacksonville Jaguars in that relocation scenario, which is understandable because the Jags play in the smallest market in the league and have an uncertain future in Northern Florida – moving that team anywhere would be an upgrade over the market they are in from a metrics perspective – but I am not an advocate for relocating existing teams and alienating their respective fan base.

The Chargers management and some of the local political forces are fixated on the downtown site especially considering that would make San Diego a Super Bowl destination again which equates to big dollars in tax revenue and revenue for small businesses there as well. I understand having been to San Diego myself and being at both sites, Mission Valley and the Convention Center downtown, the differences in those areas are distinct. I also understand the trend for the NFL and other sports is moving to downtown stadiums attached to some other type of retail or commercial development property.

Opposition View

Furthermore I understand the opposition viewpoint regarding traffic on game days downtown and the environmental impact of a stadium in the convention center site. The situation is a total mess with no clear indication of how it will be resolved. The plans for the convention center and adjoining stadium development are controversial and have some definite down sides to it. The plan to raise hotel taxes to pay for the public funding portion of the stadium may or may not “play” well with the residents of San Diego in November.

In the end, the voters control the destiny of this project and hold the fate of the Chargers in their hands. It is a refreshing alternative to another stadium deal I have covered recently with the Atlanta Braves and Cobb County where the residents had little to no input and the decisions were made behind closed doors. The Tampa Bay Rays stadium quest is being closed to the public as well.

The Chargers and the city have to spend some time and resources on providing the residents with the facts and being transparent in the process for them to have success in November. The team will either be preparing to play in a new stadium downtown in a few years, or I believe if the vote goes against them they will relocate to Los Angeles. The decision has big implications for San Diego as well as for future stadium proposals that may go the way of public referendum voting and it is anybody’s guess how it will turn out.

San Diego Chargers Downtown Stadium Proposal News

In a follow up to earlier news stories on this topic, the San Diego Chargers of the NFL have advanced their proposed stadium plan for the downtown waterfront site in details that were leaked to the media on Tuesday. Several local news sources in San Diego have reported on this development, and the full proposal is expected to be formally released at some point this week.

The new stadium for the team is being sent through a process called citizens initiative which in the State of California is similar to a referendum voting mechanism. In this process if a certain amount of votes is gained on the proposed issue at hand then the measure will gain approval. The Chargers and the City of San Diego municipal officials are utilizing this mechanism because if the stadium proposal passes via citizens’ initiative, then the exhaustive environmental review of the land being used for these developments will be bypassed.

In California, the environmental review process could add extensive time to the completion of the project. In the event that the initiative is approved by the majority of the general public then the stadium development will take a huge step forward. It should be noted that the Chargers new stadium, under the details of this plan, would be attached to a new convention center for the city. Therefore, the vote will be for approval for both projects.

In an ironic twist, this initiative is the same procedural mechanism that the Chargers used to accelerate their stadium proposal in the LA suburb of Carson in order to “fast track” the land there in the race to LA with the Rams. Carson approved the measure, but the Chargers/Raiders joint proposal was voted down by the full league ownership panel in February.

I will outline the terms of the proposal, the “high points” and then to differentiate the other reporting on this topic, I will focus in on the potential issues with the proposal and the perspective of the parties involved in how this situation got to this point. A comparison will be made to the new stadium deal for the Chargers and what the agreement would look like if the team used the option to move to Los Angeles as a tenant in the Rams new stadium there.

Leaked Proposal

The proposal calls for the following in terms of the financing for the new stadium and convention center:

1. The San Diego Chargers will contribute $650 million to the development of the stadium (important note: the NFL contributes $100 million to any new stadium project and the Chargers will get an additional $100 million from the league as part of an incentive stay in San Diego that was granted to them when the NFL voted against their proposed move to Los Angeles)
2. The government will contribute $350 million to the development of the new stadium and will set up a Joint Public trust essentially to establish municipal ownership of the stadium. Translation: the city will own the stadium. The municipal government will also raise the $800 million for the new convention center.
3. The San Diego Chargers will get all stadium revenues for the 10 – 13 game days that they operate within the facility (includes preseason and playoffs).
4. The City will get all revenues from the rest of the events held at the stadium throughout the remainder of the year.
5. The Chargers will be responsible for all construction cost overruns that may occur.
6. The City of San Diego will finance their portion of the project through bonds and the increase of the hotel tourism tax which will increase from 12.5% to 16.5% this will be for the stadium and the convention center.
7. The increase in hotel tax will “sunset” after a period of 33 years. Then it will decrease to 13.5%
8. The stadium will have 65,000 seats and expected completion date is 2022

Some of that division of asset allocation is pretty standard in the stadium development deals. The construction overruns are usually covered by the team involved in these projects. In the current state of affairs in California where residents feel squeezed by high property taxes and increasing costs of living against flat wage increases, makes the public appetite for a tax increase to build a stadium a complete nonstarter. Therefore, the hotel tourism tax increase was the obvious pathway for both sides in this situation, the team and the politicians, to ensure the best chance for approval of the initiative.

Definite Issues

There are some definite issues with the proposal though which may be more readily discussed in the next few months. The most critical of all is the fact that the neither the Chargers nor the city own the land that the proposed stadium is supposed to occupy. In recent years similar arena or stadium proposals have faced that critical issue as well. In Seattle there is a struggle over land to build a new arena to attract an NBA or NHL team. In Sacramento, the Kings faced some of that push back in their quest for a new downtown facility. The most public dispute was in Brooklyn back when the Nets proposed the Barclays Center in the Atlantic Yards area and the local residents fought back. The government used imminent domain to push people off their property to build the arena.

The assumption could be drawn here that if the proposal has advanced to this stage that one or both parties involved has some kind of “inside track” on gaining the land for this potential use, but that is not always the case. In my view, a huge part of positioning a proposal for development is to make sure you have control of the land in the first place. However, the politics of the situation dictates that if they get this “ball rolling”, then the public will back them to gain control of the land, and that is the card that might be played in this case.

The second issue here is that the Chargers may not have the public approval sentiment necessary to get the citizens’ initiative passed successfully. The public perception of the team took a major negative blow when the team and their owners, the Spanos family, decided to pull up stakes and set their sights on moving to Los Angeles. Some residents feel that the team which has been based in San Diego since 1961 abandoned them for a better potential scenario in LA. The Spanos family now has to return to San Diego and gain a two-thirds majority in this ballot initiative to move forward with the stadium plan. That may not occur, which would set the stage for the team to either explore the longer route to the downtown stadium or exercise their option and move to Los Angeles in 2017.

In the event that the ballot initiative is successful, in fact, in the opinion of others regardless of whether it does or not – the politicians were always more in favor of the Mission Valley stadium proposal because the city owns that land. However, the attached convention center project with the stadium downtown being one component of a larger project which could benefit far more residents, could be the reason that this measure may gain approval.

Charged Up

The Chargers are viewing this situation in two ways: they have always favored the downtown site over the Mission Valley option, and they view the convention center being attached to new stadium as a way to compete with LA and other cities for Super Bowls and other large scale events.

That is a good segue to another point that was neglected from the leaked proposal yesterday: it does not state whether the stadium will have a roof or some kind of retractable cover to it. That type of feature adds a great deal of cost to a stadium development project, but it also enhances the functionality of the facility to be able to host political conventions, NCAA basketball Final Four, and other big revenue generating events.

The proposed new Rams stadium in Inglewood, CA will have a roof to be in consideration for just those sorts of events. The San Diego proposal should consider that design feature for the same rationale, however it could add around $200 million in estimated new costs to the project.

The Chargers, as was mentioned earlier, lost their bid to build a stadium in the LA suburbs, but they still have the opportunity to join the Rams in LA if they cannot get a long term stadium deal brokered in San Diego. The Chargers would be a tenant in the Inglewood stadium which means they would not have an equal share in all the revenues in that arrangement. They would essentially lease the building from the Rams and operate it on game days in that scenario.

Greed Wins

This is the main reason why I have maintained the belief that the Chargers are going to remain in San Diego and get the downtown stadium deal completed. In this agreement with San Diego, the NFL is subsidizing $200 million of the $650 million that the Chargers are contributing to the project. That means that the Spanos family will spend $450 million to get a $1 billion dollar new stadium that they will not have to share with any other team. The Chargers will reap all the football related revenue as well as the profits from any naming rights agreement to the stadium.

The Chargers will also remain in a market where they have established relationships with corporate sponsors and an established fan base of season ticket holders and they would not have to compete with another team for those audiences which they would have to in the event they moved to Los Angeles.

It comes down to greed. The reason why the Chargers will stay in San Diego if this deal gets approved is because they will not have to share revenues with anyone, and the city wants to keep the Chargers and have the new stadium and convention area to lure the Super Bowl and other big events back to San Diego. It is the same reason why the NFL approved the Rams ambitious new Inglewood colossal stadium and real estate venture: greed.

I am not a proponent of cities or counties paying for stadiums or arenas, I think the teams and the leagues involved should finance a portion of it and have private financing for the remainder. The Rams project, for what it is worth, will be fully privately financed. The City of San Diego wants to own the stadium though and has decided that is the right way for them to move forward. There is inherent risk in owning structures of that size and magnitude. That risk must be mitigated by the potential revenue return on the investment. In this case, the studies must have proven that out for San Diego to move ahead with this type of arrangement.

In the end, the November ballot measure will be the next big hurdle for this project to clear. Then, the land ownership piece will come into play. The stage could be set for the Chargers to remain in San Diego in a world class new stadium. The NFL will inevitably be the ultimate winner in that scenario, which I have reported about in the past, and it remains a valid point. Then, the league would just have to figure out what to do with the other team that whiffed on going to Los Angeles: the Raiders, but that is a whole other saga for another time. In the end analysis between the money and power of all of this politics is greed, the fans are used as pawns, in the end the pursuit of greed always wins.

Left Out of L.A. – The Future of the Raiders & Chargers

The recent decision by the NFL ownership to allow the relocation of the Rams to Los Angeles has left two franchises, the Oakland Raiders and the San Diego Chargers, with uncertainty regarding their future in either of those markets. It is rather unusual for a multi-billion dollar entity such as the NFL to have such instability with their franchises, let alone with two of them in the same geographic region.

The Raiders and Chargers also bid to move to Los Angeles in a joint project for a new stadium proposed in Carson, California; this measure was defeated by a resounding vote of the full ownership panel of the NFL. However, as part of the Rams winning bid to gain the foothold into LA, the Chargers have a full calendar year to determine if they will join the Rams in their stadium in Inglewood.

The Chargers have an agreement where they will play the upcoming 2016 season in San Diego and could move to LA in 2017 because they struck a tenant agreement with the Rams. However, many NFL insiders think that it is unlikely that the Chargers would want to move to LA under that deal because they will not be entitled to the full revenues available in the terms of that tenant arrangement.

The Chargers are focusing their efforts on securing a long term stadium solution in San Diego which is anything but a sure bet. The people in San Diego are rather upset (understandably so) at the Chargers ownership for their willingness to move the team to Los Angeles. Both the Chargers and the city politicians are harnessing their energy on passing a citizen’s initiative which is a mechanism in California which allows for the public to vote in a combined measure over the new stadium and the land involved in that project. If the measure successfully passes the public vote, the lengthy environmental review process is voided.

It should be noted that this procedure was the same technique used by Dean Spanos and the Chargers management in gaining a faster approval process for the land in Carson for the proposed stadium there in the “race to LA”. It circumvents the rather cumbersome and time consuming environmental review which could delay the land for a stadium site for development for years.

The stadium quest between the Chargers and the San Diego politicians has revolved around a couple of central issues over the past fifteen years. The first issue is the location of the stadium and the second issue is the funding for the project. When you consider that those are the two main issues to moving a stadium construction forward that is why the two sides have remained in limbo for a decade and a half.

The condensed version of each issue can be summed up in this way. First, the location of the stadium has revolved mainly around two areas of San Diego (I do not believe that the team was ever going to move to the suburbs – that was strictly a tool for leverage by the Spanos family) and both sides have disagreed over that stadium location. The two areas proposed in this situation are: Mission Valley and downtown San Diego.

The essence of the situation regarding the site proposals is that the politicians favored the Chargers build a stadium on the same site in Mission Valley where the current stadium is located. The Spanos family favored the downtown site and wanted similar concessions to those given by the politicians to the Padres ownership when they built the downtown baseball stadium now known as Petco Park.

The second issue is the funding for the site and for many years the Spanos family was trying to gain public dollars for the stadium project by requesting that the politicians attach the new stadium proposal to the measure to renovate the convention center downtown. The politicians refused to combine the two proposals and felt that essentially the family had billions of dollars and should foot the bill for the stadium. The politicians also wanted the stadium in Mission Valley so that stalemate continued for years.

The current situation is still pretty messy. The Chargers formally announced their proposal for a downtown stadium adjoining the convention center site last week. The politicians responded with their rationale behind why they believe the Mission Valley site is a better fit for all sides. The main issue is that the land that the Chargers would need to fulfill the downtown project is not owned by either party in this scenario. The costs, the risks, and the potential for public approval are all significantly greater with the downtown proposal because of the purchase of the land and the associated legal costs. The financing for that endeavor becomes tricky because the public has to vote by a two-thirds majority to approve any ballot initiative that includes a tax increase. The public support may not be there for this project which will set back the entire time frame of getting the stadium built.

Meanwhile, the Mission Valley site is where both the city and the county proposed a $1.1 billion stadium project on land that is city owned. The viewpoint of the city officials is that this project site will provide a smoother and more cost effective option to development of a new stadium. The Chargers, according to ESPN and other news outlets, have been working with JMI which is the same real estate developer that helped the Padres develop Petco Park.

According to JMI they estimate that the cost of the expansion of the convention center and the new football stadium downtown to be at around $1.4 billion. In a move to push back against the city and county officials, JMI claims that the cost to develop both sites, the convention center and the Mission Valley stadium would cost the city close to $1.8 billion dollars for two separate, stand-alone buildings.

The Chargers are pushing for the downtown site for two reasons: better access points for fans and the inclusion of the convention center and the other areas surrounding it in the downtown Gas Lamp district would provide for a great setting for the Super Bowl and other large scale events. The Chargers know that to keep the franchise in San Diego they need to be able to compete with Los Angeles for those big events, and a new stadium in Mission Valley will not achieve that objective. The public vote in November is the next big hurdle in this scenario.

Out of Oakland?

The Oakland Raiders have also been left without a long term solution for a place to call home for their franchise. They did just agree to a new stadium lease that allows them to keep playing in Oakland Coliseum until another arrangement can be made.

The team owner, Mark Davis, has explored relocation to San Antonio and has just met with officials in Las Vegas recently as well. The main issue with remaining in Oakland is that the city and county have basically zero money to allocate for the stadium project and the public appetite towards public finance of a stadium in any form, whether it comes from an increase in a hotel tax or via another mechanism, is not very likely at this point.

Davis has scaled back his proposals to Oakland with the last proposal seeking land for a smaller venue that was more intimate for fans. The Oakland politicians are concerned about the viability of any project because they also feel pressure from Major League Baseball to figure out a new stadium solution for the A’s.

The developers in Oakland had once pitched the Coliseum City project which would have encompassed 800 acres and included new stadiums for both teams. That proposal, which you can read plenty about if you wish because many news outlets in the Bay Area covered it extensively, died out and is no longer an option.

In all my research and in covering both the NFL’s “race to LA” and the Raiders and Chargers over the years, I just do not see a way for the Raiders to stay in Oakland. I also thought they had a slim chance of going to LA because of the grudge that the NFL owners have for the Davis family built over years of hostilities.

Conversely, I have had a gut feeling over the years that the Chargers could wind up staying in San Diego. The community there is very supportive of the team and they have built a history there spanning decades. It is a great city for the Super Bowl because of the climate and location, but it needs an upgraded stadium to host that event in the future. I think that the Chargers could end up making it work there with the downtown site.

In the event that the Chargers and the San Diego officials cannot make it work, then I think the Raiders have a chance of going there next year if the Chargers leave for Los Angeles (they have a one year option to do so). The Raiders could end up going to San Diego and leveraging the city and county into a new stadium once the Chargers have moved on.

The San Antonio option for the Raiders is interesting because Mark Davis owns land halfway between San Antonio and Austin where he could build a stadium and take advantage of a rapidly growing area in football crazy Texas. However, the political NFL reality is that it is unlikely that Dallas Cowboys owner Jerry Jones or Houston Texans owner Bob McNair would vote to approve such a move. They are both powerful owners with friendships with other owners, so Davis probably faces a steep hurdle to gaining approval for that endeavor.

The Las Vegas option is interesting and could gain some traction. The Raiders had discussions there regarding a new project that potentially would build a domed stadium on land on the Vegas Strip for a facility that would be shared by the UNLV football team and an NFL team and cost close around $1 billion. The big casino and hotel resort owners are backing the project because they see the potential for that investment to be paid off by having new visitors who would otherwise not come to Las Vegas. This new untapped customer base could be worth a significant return in hotel rooms and additional tourist dollars for having a stadium capable of hosting large scale events.

Mark Davis came away impressed and called Las Vegas “a global city” so that is speaking directly to the league office which has sought different ways to grow the NFL internationally in recent years (i.e. games played in London, Canada, and Mexico). That is a subtle play by Davis to try to leverage that sentiment from the owners for a potential relocation bid.

In my view, I would be surprised if the Chargers left San Diego at this point, unless the whole thing falls apart with the public financing for the downtown site, because even if the team could play in a bigger market in L.A. they would be sharing that market with the Rams. Furthermore, the Rams will have had a full year in the L.A. market and have gained all the top sponsorships. The Chargers would be a tenant in L.A. and stand to make less on the ancillary revenue streams due to that type of arrangement; where by staying in San Diego they are the only team in the market and they would have their own stadium with full access to more revenue streams.

The situation bears watching as it is very fluid in the case of both franchises involved. The end game will be that both Oakland and San Diego work with the teams to keep them in those markets, or two new cities will be on the NFL map in the future.

“Must See TV” – NBC Gains Rights to Thursday Night Football

In reading the news earlier this week that the NFL had reached agreement on a new television contract for the Thursday Night package of games and that the rights to those games would be split between CBS and NBC; I could not help but think that NBC finally could reclaim their lost title of “Must See TV” for that night of the week.


I remember growing up that NBC owned the ratings on Thursday night, which continued into my high school and college years as well when the network cranked out new episodes of shows like “Friends” . Then later still it was “The Office” and a decent comedy lineup that anchored Thursday nights on “The Peacock” network.


However, that all changed for the network TV landscape with the advent of streaming devices and services such as Netflix, Hulu, and Amazon Direct that made live television viewing a concept of the past. The busy nature of people’s lives coupled with the fact that nobody works from 9 to 5 anymore, fueled that change towards the way we watch television.


The lone exception, as I have written about previously, is live sports programming. The ratings for sporting events of essentially any kind are “ratings gold” for the network which holds the broadcasting rights. The NFL takes this trend and puts it into essentially a “five times multiplier” with nearly all the top 10 most watched “programs” on TV in 2015 being NFL football games.


The ratings bonanza surrounding NFL games makes the addition of the Thursday Night Football package by NBC even more influential to advertising revenue and sponsorships that the network can attract. The network can also utilize “drop ins” to promote their own programs and events that are upcoming to a huge and diversified audience. NBC already receives a tremendous ratings boost through their agreement to broadcast Sunday Night Football which frequently is either the top watched program of a given week or in the top three spots. That ratings jump has boosted their overall viewership levels in the past and the promotional aspects of that broadcast have definitely had an impact on the ratings of their other programs.


Steep Price


NBC and CBS paid a steep price for the rights to broadcast five Thursday Night NFL games each over the next two seasons ($450 million combined between the two networks per year) which demonstrates the amazing draw that NFL live games have on advertising revenue for the networks.


In the case of NBC, they have been struggling to rebrand Thursday nights to compete with CBS and the other networks. They needed this share of the NFL package much more than CBS did, as CBS is the most watched network in terms of total viewership. Then, on the other hand, the fact that CBS has over the past two years pre-empted their regular Thursday night programming (in the Fall sweeps period no less) for NFL football demonstrates the enormous draw of the NFL. The shows in the regular CBS Thursday night lineup generate rating numbers that other networks can only dream about, yet CBS is committed to expanding their relationship with the NFL on that weeknight for two more years.


I must admit that following the ratings and the world of both media and sports business related topics, I did not initially understand why CBS would have paid the broadcasting rights fees that they shelled out for the Thursday night games initially two years ago. However, over time, I understood what the NFL and CBS were looking to do and subsequently accomplished with that initial contract. The league realized that the Thursday night games could be an attractive package to sell separately while keeping those games on NFL Network. They also identified a need to provide better promotion to both the games and the broadcast itself to make them look and feel like a “stand alone property”.


The addition of CBS Sports to that mix accomplished all of those objectives. The Thursday night games received an enhanced production value from CBS as well as their top announcing team of Jim Nantz and Phil Simms (who will continue to work those games in the new contract) CBS created theme music for the Thursday night telecast and cross-promoted the package very well to appeal to a wider audience.


Now, the Thursday night package will take another step in the evolution with the addition of NBC to the fold, and the NFL will gain viewers from cross-promotion efforts on NBC programming. In addition, NBC will most assuredly use their Sunday Night Football platform to promote the upcoming Thursday Night game so that will be a very effective marketing tool.


Streaming Sold Separately


The NFL also announced that with this new Thursday night television package they would be selling the rights to stream the games over the internet separately. The streaming capability was an aspect that both CBS and NBC were hoping would be included in their contract so that they could gain additional revenue from advertising on that platform.


The NFL will now begin negotiations for the streaming rights to the Thursday night games with the obvious players being mentioned in reports: Yahoo!, You Tube, Facebook, and Amazon. The NFL partnered with Yahoo! during the 2015 regular season to stream one of the games played in London between two subpar teams, the Buffalo Bills and the Jacksonville Jaguars, and the experiment was a huge success. It remains to be seen if the recent issues surrounding Yahoo! and their announced plans to cut jobs and shut down certain areas of their business will impact these negotiations. It also bears watching if Verizon will make an attempt to purchase the internet search giant outright (Verizon and the NFL have an exclusive agreement to show live local games on Verizon supported devices).


The recent Thursday night NFL broadcasting deal made two things clear: live sports programming is the gold standard which is keeping both network and cable television relevant, and that NBC finally has something deemed as “Must See TV” at least for five weeks out of the year.