The NFL
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So in my head phones, I have, are you ready .

for some football? Yeah, I was like to, yes, IT gets you so popped up totally.

Does I feel like I grew up on the fox sports .

team and always makes me think of thanksgiving.

IT makes me think of, I think I was a jock James tape that I bought, or maybe I was like a knockoff jack James produced by fox sports. But I definitely had that theme song on the sports pump up tape.

oh my god, jack James, that needs to make a come back. Busy you with you with that you who got no easy you busy you with you see me down, say welcome two season twelve episode one of acquired .

the podcast about great technology companies and the stories and playbooks behind them. I'm been gellert and I am a cofounder and managing director of seattle based pioneer square labs and our venture fund.

psl ventures, David rosen doll and I am an Angel investor based in the co.

and we are your hosts. Today's episode is on the nfl. Football is america's favorite sport by far. In fact, football is more than three times as popular as the next highest sport, basketball. The super bowl is watched by over one hundred million viewers every year in approximately two thirds of american households. My favorite super bull stat is that it's the weekend with the full st. Weddings planned of the year IT is the nfl s world and americans are just living in IT, especially the TV networks, which have been reduced from pillars of our nation in their hate to largely distribution channels for the nfl today, plus some other lesser programing sprinkled in of the top one hundred TV broadcast aid last year, eighty two of them were nfl games.

Word that is wild.

totally wild. But how do we get here? How did this game become the most valuable media property in america? The story is one of incredible CoOperation, of belief in growing the pie over a century.

And just like our benchmark episode of communist capitalism at its finest, the nfl owners have made bold long term bets in choosing to divide their revenues equally in a way that no other sports league has. Of course, the nfl hasn't been free of controversy. From the horrible recent on field collapse of the hamlet to the now obvious epidemic of C.

T. Among former football players, players are clearly putting their lives at risk. And from national anthem needs to alleged cheating scandals, modern fans relationship with the sport is complicated.

I personally love watching football. IT has been finally tuned over the years to be maximum, maximum entertaining. But IT comes with dream cognitive distant for me every time I tune in. And I know many others feel the same indeed.

talk about cognitive distance. Seventy percent of the players in the nfl today are black, but only two of the head coaches now currently here in genre, twenty twenty, are black. And of course, none of the owners are.

This is very emblematic in many ways of america, as IT was many, many years ago, sort of painfully still in front of us today.

Yeah, I got, we've told so many stories now on acquired, where, you know, in the research, and then telling him like, wow, this is the story of america. I have never felt more that way. Then I feel about this story in the nfl, with all the greatness and all of the notes, the greatness that we're gonna into you.

Yes, whether profitable is your favorite past time or you think it's a societal ill, there is no denying the incredible role that he plays in all of our lives today. Now, listeners, just like our NBA episode a couple of years ago, this is an episode on the business of football. It's not specifically about things I learned reviewing game, film or the merits of the information today. We're talking .

about the business, but we do have some sports. Thank you to say. One, the great friend of the show, former U.

S. Representative and micon sallis, who caught touchdown passes for the cults from patent manning. Who we also have to think, because parents places on the S P N plus is awesome. Highly, highly recommended.

He's so good. Yes, great. I think I watch twenty episodes to that.

And we also a big thank you to Michael mcintosh, author of america's game, which provided much of the research for the subsequent, just like the definitive biography style history of the nfl.

Okay, listener is now is a great time to tell you about long time friend of the show service now.

Yes, as you know, service now is the A I platform for business transformation, and they have some new news to share. Service now is introducing A I agents. So only the service now platform puts A I agents to work across every corner of your business.

yeah. And as you know from listening to us all year, service now is pretty remarkable about embracing the latest AI developments and building them into products for their customers. A I agents are the next phase of this.

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Yep, with service now, AI agents proactively solve chAllenges from I T H R customer service software development. You name IT. These agents collaborate, they learn from each other, and they continuously improve handling the busy work across your business so that your teams can actually focus on what truly matters.

Ultimately, service now, an agenda. I is the way to deploy A I across every corner of your enterprise. They boost productivity for employees and rich customer experiences and make work Better for everyone.

Yeah, so learn how you can put A I agents to work for your people by clicking the link in the shower notes or going to service now, doc m slash A I dash agents. Well, after you finish this episode, come discuss that with the other fourteen thousand smart, curious, kind members of the acquired slack and acquired dot F, M, slash, slack and listeners. This is not investment advice, David. I may have investments in the companies we discuss our David, take us in.

Where are we starting? All right, we start on november six, eighteen sixty nine on the campus of rockers university in new brunswig, new jersey, just a very short new jersey transit train ride up from instant new jersey, as I know well from my time there, where indeed a group of about twenty five or so princeton students, we're up at records to visit a similarly sized group of record students.

And what were they? Therefore, they were there to play a game of football. Now, what was football in eighteen sixty nine?

This is not someone dropping back in the pocket and .

throwing a seventy year bomb. No, no, no. IT was essentially what today is classified as mob football and or the ball. This had been played for centuries at this point in england.

And basically the only goal of the game was for one side to get a ball to a certain spot on the other side. And that is IT. There are no rules. Any number of people could participate on either side. You could do anything up to any flooding, mining and killing people on the other side or your own, which happened quite frequently.

I mean, keep in mind, this is four years after the end of the civil war.

yes. So now why were these two groups of princeton and record students so interested in playing this game.

this terribly violent game?

Well, back in england, IT was quite popular among public school students. Now, public schools in england are like private schools in america. These elect the elite training institutions for wealthy landed century in england. And they were starting to adapt IT into an actual sport.

And so, like any sort of step child nation, these american college kids, we're kind of trying to keep up with the social elite back in the mother country and do the same thing, bring football in a qualified way to schools in america. There were twenty five players per team to fifty people on the field. One point them around, the ball that could not be picked up and Carried, couldn't be thrown, and the object was kicked the ball through the opponents goal for which he received one point.

Okay, so I soccer with twenty five people on a team.

Yes, but that was the start of what would become inner color american football. And this becomes, just like back in the gland, wildly popular. And over the next five to ten years, IT gets more and more qualified and formalized amongst the, I believe, a kind of comes to be seen as this inaccurate l part of the college experience, and that kind of becomes this character building experience, is also still a wildly dangerous.

They are like deaths, serious injuries, very, very common through this period, the first kind of fifty years of football. Finally, nineteen, five, there are nineteen fatalities in intercollegiate football in the us, and a serious injury at harvard to one theater roseveldt unior, son of sitting president theatre rosabel t. So this is a major of ment. After that happens, tty roseville calls the summit of all major colleges and universities in new york city and says he's going to outlaw the game in the us unless they adopt major changes to make the game safer.

And you also have to imagine, of course, IT hits close to home for him with the sun, but he sort of viewing this is, hey, that people that are best and write are playing this game that is actually hurting the nation. We are cutting down people in their prime, and we can have to do something about that. Yeah.

and it's a fine line, right? Like I think the violence is a critical part of this sort of right of passage. And teddy rosabell probably kind of likes IT, because this is a training ground for future military, governmental and military leaders of america.

So I had no idea you'll doing the research this summer, the teddy rose about calls, and then he basically tells all the presidents of the universities like you, you guys got to figure this out of, I outlaw. In response, they create the N. C. W. A. Like, that is the .

beginning of the N.

C. W. yeah. He was to regulate and qualify and make the game of clicked american football safer. Yeah, crazy.

right? So following that, this new institution that becomes the N. C, W.

A, they institute the creation of a neutral zone, the above, the use of wedge formations where you would pile up as many people as possible. Behind somebody was Carrying the ball to push them forward. And apparently that tell most of the deaths and serious injuries happen. So they do make the sport safer. I think they're still like a lot of injuries is not a lot of protective pattern being warned here.

And a lot of this predates even leather helmets. People are just playing this in regular clothes, yes.

but they also make a change to the rules after this summit that would become the defining element of american football and fully differentiated from soccer and rugby, which rugby itself came from. Soccer r, rugby is the set of soccer rules that the english public school rugby used. Answer is called rugby. And this role that the N C W. Institutes is legalizing the forward pass in nineteen .

or five. Uh.

that becomes obviously defining characteristic .

of football and underscore IT how much this changed things. Football was exclusively a violent, dirty game to this point in history, american football. But when we think about american football today, you're watching when at night football and the beautiful popping color and other lights and all the slovo.

There is a beauty to the game. There is a romanticism. There's a moment where you hold your breath. The world seems to move slowly. It's a ballet. This introduced what would become the counter balancing force to the incredible violence of football, which is the try beauty of watching IT, yeah.

the beauty. And the strategic element to the offense of playbook, the defensive coverage, the auto ables. There's no way a casual fan can understand all of IT. And yet the ballet, as you say, is measurable zing to watch college american football just becomes wildly, wildly popular, and still is to this alic. IT is a huge part of the american sports landscape, and IT was even more so than all right?

So the N, C, W, A, A is formed. We've now got the forward pass. So modern football, does that lead the nfl? No, again.

very specifically, we're spending a lot of time on the ordinance of football and the college here. But it's so important for understanding, D, N, F, L. This is a college thing, this is a american colleague experience, that these elite Young men go through this dangerous kind of war like activity. There's this very sacred element to IT, so much so that while in the early nineteen hundreds, some professional teams do start to pop up around the country, these are teams, not league. So these are barnstorming teams that would go around like there's no organized schedule play, but their viewed not only just a second rate to the college game, they're like, dirty.

Why are you taking this esteemed thing that our best and brightest participate in and turning IT into this entertainment act?

A it's even more than that many people, especially the elude, viewed professional football, is actually immoral, because IT was profiting this thing with money. The grape that they had against IT was the money. IT wasn't the game. IT wasn't how the game was played as the same game. IT often the same people who play in college.

oh, I see like it's supposed to be amateur.

It's supposed to be amateur. This should not be a professional activity. This is a right of passage for Young man service to the teens. And twenty is like that was very much the attitude. Now that is not to say the professional football didn't exist or like .

the same period bootlegged alcohol. Oh, alcohol is illegal except rer. That's this massive industry that lots of people are participating in.

Yes, it's not like demand for professional sports in cities and professions. Spectator sports didn't exist. Look at baseball as exhibit. Michael of cambridge has a great quote in the beginning of the america's game where he says, to say that baseball was the number one sport in amErica is to imply a hierarchy where none existed.

Baseball towered above the sporting landscape like a colosse, the unquestionable past time, the only game that mattered most fans had come to accept baseball's primacy as something in beautiful, as much a part of the natural order of things as air and water. Of course, this is the air of the york. Jane ruth luga, all these story parts of american history.

Baseball is very much a professional sport played for money with goal of teams is to make money. And the business model is they sell admissions to the games. yes.

So it's not like professional sports were all like that. Not at all. IT was that football was this very special thing? yes. So into this dynamic environment in one thousand nine hundred twenty enters the american professional football conference soon in a few years to be renamed the national of olive e.

Finally, we get to the founding of .

the nfl and started on August twenty eighth nineteen, when the heads of several these barnstorming quasi professional football teams in the midst west meet at the Jordan and hub mobile auto showroom in canton, ohio. Now the driving force behind this meeting being called is one George heller. And he is currently indicator illinois, where he is an employee of the ae daily starch company, and his main duty is to organize and coach and be the star player for the company football team.

which, of course, is called the dates. Yes, the sponsorship is so deeply rooted in the nfl that the very first team was actually named the sponsor.

They weren't sponsors IT. Was the employees of the company flayed for that. Now how is you sort of had a Mandate to go out and recruit employees?

You happen to be good football players. That's how you kind of get around the professionalism of this. Like go.

No, no. IT is like a company, amateur football. Ty, and we're just happen to pay these people.

So these folks that come together at doral lisas instigation, they have a goal. They want to legitimize professior football in the ice. Americans, and then I only have a goal at this meeting.

They develop a plan for doing so. They think they can really separate the pro game from the college game, make a little legitimate thing that amErica is gonna lern. And they have three parts to the plan.

One, they are not going to sign any current college players. This can be a strict, strict demarcation between the college game and the pro game. They will not trying get any current college players can play for a protein which would happen under assumed names. You could add these colleges, they want to make money.

This is so ingrained in the nf fell that IT is basically still true. One hundred and three years later, here we are. In twenty twenty three, you still can't go to the N, F, L.

Out of high school. You can only go with the junior year of your graduating class from college. You can go one year early in one hundred years. That's the one concession that's been made.

So point one, they're not onna read the college game. Point two, they're going to endeavor to play the game at a high ethical and girls based standard. This was sort of the lesser knock against profits, took all of like, well, this is like a bunch of rapids and barely disguise, excuse to beat up on each other.

yeah. Not to mention these teams are coming together, some more independent. Some were part of the ohio league.

Some were part of the new york pro football league. So there are sort of slightly different rule books and slightly different customs that are going on. And this is the idea that now we need to unify these things to set an expectation .

for the standardized what the game is.

yes.

And then number three, perhaps the uh, most important, they're onna make jim thorpe the president of the league. These guys are smart. Now many of you probably know who jim thorpe was.

Jim was at that point in time the leader of the catton bulldogs, one of the teams that was strategically included in this discussion. And the meeting happened at the canton auto show room. Probably because of this, jim thought was the goat. He was the greatest at that had ever lived to that point time.

which is not to say, like if you put them through the nfl combine today, he would win. It's sort of handy, capped with all of what we knew about modern sport science of his day.

The distance between jim thorough pas athlete in any other athlete in the world at that point time was greater than I think that distance has ever been since. So jim thorpe was a native american who was part of the second facts nation and ended up playing college football at a small school called the car indian industrial school, which haven't to be coached by a guy name pop Warner.

who, of course, is the person that all of the youth football league are named after today, pop warrior league.

He and pop LED this small, tiny, carlie indian industrial school to a national championship while he was playing there against all these big eve league powerhouses. And know I stay.

which, by the way, that was a huge moment of these all White ivy schools think they're Better than everyone else. And carl, I was really a reformation school. And how do I simulate in the White culture? And so IT was this incredible moment of saying, okay, well, as a little bit of a protest, we are going to literally become the best, and then be you at your own game.

Or and the deep, deep irony, given what was about to happen with professional sports in the nfl becoming completely why the first star player, the whole basis of the league, the first president of the league, was a person of color. And IT didn't playing professional football. The thing that is just unbelievable about jim thorpe.

He won two gold medals in the nineteen twelve summer olympics in sweden, in the pantai on and the deathly. He had never competed in the deathly before. Oh my god. The first time that he competed in the japan was in the one thousand and twelve summer olympics.

And he won the gold meddle wild. Wasn't he also an outfielder with the new york giants?

Yes, he played in the major leaks play, dion Sanders. Boj accident, he did all of that and basketball and one gold medals wild. So back to the 12 olympics， when he won these gold medals, king gu stove of sweden was presenting him with the medals famously.

And as he is presenting them to, tim says, user are the greatest athlete in the world to which jim third famously replies, thanks, king. I think that leads to be our next acquired merge t shirt. Thanks.

king. Yes, absolutely.

So this new league, proto nfl formed in nineteen twenty with fourteen teams, and about as much instant legitimacy as you could get from jim, stop being the president and the figure head. They pretty quickly become the biggest professior foobar league in america. There's not a lot of stiff competition and .

they consolidate the smaller leagues to create this in the midwest.

yes. But that said, the twenty years and really the thirties to it's kind of hard scrap. It's an appeal battle.

shall we say? Oh yeah, if you look at the what is IT fifteen teams or so that existed in nineteen, there are three franchise that endured out of all of those. The rest of them, the columbus pan handles the akron on prose, the chicago tigers all went under. And the only ones that stayed the test of time are the decade stales, the racing cardinals. And when we have not talked about yet, the Green paypacket.

indeed, and the dictor sales would become dubai's chicago.

The bears, yes, they became the chicago stales and then at some point adopted a proper name and became the bears actually named after the cubs.

That's right, because they played in riglar field, and bears are bigger than cubs up. So I was in a pilled battle for a couple of reasons. One, even despite all their efforts, the stigma of professional football really does not wear off, especially in the twenty. So after the N, F, L, less forms in starts, getting publicity in one nine hundred and twenty two.

Then michigan, sorry, ban michigan, michigan head football coach fielding used gives a very widely reported speech in new york city where is talking about the new league and he says that, quote, pro football robs the great american game of many of its greatest character building qualities. The ideals of generous service, loyalty, sacrifice and whole hearted devotion to a cause are all taken away. The game is robed of the exhilarating inspiration of achievement merely for achievements sake.

Now, of course he's partisan, a college football coach. But this really was still a lot of the profiling sentiment. yep. The other problems the nfl face are most of these teams are based in kind of small towns. They're not in big cities.

One hundred percent of these teams either fold or move to larger cities except for the packagers that the only small market team that's the test of time.

Yeah, there was no TV. There was no internet. Like the market size was not unconstrained for these team.

The market size was quite constraint. They were filling a nitch and a demand for a football in these towns. But they weren't going to .

make that much money and they're massively loss making. I mean, these teams last two to five years and there's another fifteen teams that are formed between the chicago bears and eventually the new york giants are formed around one thousand nine twenty five. That stands the test of time. So it's amazing all these teams that spin up and spin down within five years of each other in this decade.

And as you say, these teams and small towns, almost all the end up shutting down. All that was mostly due to the depression in the thirties, and thus ble IT just became completely non viable economically for small town teams to survive, except for Green bay. And they all end up moving to the big city, where they're very much playing second field to the baseball teams.

yeah. And most of these don't even end up moving. They just stand up closing their doors.

The other important thing, though, to say about the nfl during this time before world war two is that in the beginning there is jim thr, who was the first president of the league. He's a figure head. He's only president for a year and then they bring on a real administrator.

But you know, obviously he is native american. He wasn't a way person. There were several black players in the league at that point time.

And I was like, not a deal. In fact, the first nfl champions in that first season, the acron prose, the star player and the head coach, was made. The infringed powers who was black.

raise the star player and the head coach. I'd love that.

Unfortunately, in the mid thirties, supposedly after George present martial comes in to the league as owner of the boston braves that became the boston red skins, and then move to washington, D. C. At his behave, they adopt the same policy, is majority baseball and completely kick black, added the league. And IT wouldn't be until after world war two. And for the red gains, not until one thousand nine .

hundred sixty one, the red skins commencer IT with keeping that name for as long as they did. They were very, very, very late in the team. I think they had some really big fan base in the south, and there weren't a lot of nfl teams at that point in the south. And so IT was both because he was racist and also because he realized he would probably lose a lot of his fan base who were also racist by integrating his team, which is like a horrible thing that IT was a strategic advantage for him to get that fan based by having a exclusively White team.

So all this would continue. Can status quote, the league barely creep along until after world war two, when the amErica and the nfl would change forever. And pretty radially.

So after the war, when all the troops come home, and there's the G I bill, there's this new middle class in amErica that didn't go to these elite private school, ivy league institutions, or even the ohio states of the world or the carin, the encourages, and they are coming home from the word. They don't encourage education. They may be now getting them through the G.

I. bill. But they have jobs. They have disposable income. They increasingly have radios and soon to be television sets. They want entertainment.

You have people coming home. You have people looking for jobs. You have with lots of free time and you sort of have this opportunity to be a new thing in amErica that people do with their time and dollars. And keep in mind, every owners experience to this point is subsidizing losses.

If you're bring another people to try and be owners of a team with you, or you're deciding that your families gna sort to Carry the way the whole time, or that your companies gonna Carry the way to the team, you're just subsidizing losses. So every single person involved in profitable ownership at this point is not even lip service for the love of the game, like purely just for the love of the game. But now, interestingly, there is a business opportunity.

Yeah, and all these american is coming home from the war and their families. They don't have the same hanging ups and preoccupations about the college fall, our game that the elated before the war, that there is this big opportunity now after the war, for professional football in the nfl to become a much bigger thing.

And they probably would not have realized IT, except their hand was forced, as we will see a couple times here throughout the episode in one thousand forty four rape, before the end of the war, a lot of people could see this opportunity. Football was a very compelling. The nfl was only in what, I think, eight cities at that point in time to really realize IT.

You had to the expand, you had to be in a lot more cities. And there were wealthy business people in cities all across america, east coasts, midwest, the south florida, who wanted to add teams and coming to the nfl. But the nfl owners were interested in expansion.

right? And those eight teams of cardinals, of course, the arizona, today, you get the chicago bears as you get the Green bay packagers, the new york giants, the detroit lions, the boston red skins had since moved to washington. You've got the philothea eagles, the pitzer g stealers. And at this point, and this is crucial, the cleveland rams, yes.

The cleveland, at that point time, owned by the ford thinking dan reefs.

yes. And this is the first clever on team that did not shut down, but instead moved.

So the other potential ownership groups in other cities across america, what in football, this at a certain point come, one thousand forty four were just like, well, to hell with you. N, F, L. Will go to start her own league.

yes. So a new professional league gets founded. The all amErica football conference in one thousand .

hundred and forty four. The A, A, F, C.

and it's got some pretty serious firepower. It's organized by one of the country's permanent sports journalist. Chicago is backed some high power ownership groups, including the famous hollywood act Donna mi in los Angeles wealth business in different ago org o.

The nfl is in some of them, but should be in all of them. And almost like the nfl had, its is up its sleeve with jim thorpe at its founding. The A A F C has its own ACE, which is that they have reached a deal with the legendary ohio state coach paul Brown. When he's coming home from the war, from his service, that he is not going to go back to the college game, he's gonna come coach the new a fc cleveland franchise, yes. Named after him the cleveland Browns.

yes. The man who transformed football, paul Brown. And this is the very first time, sort of the modern and fell era, where you have this real threat of two professional football teams that people really wanted see in the very same city, the clever on rams and the soon to be clive on Browns. In the a fc.

yes. And in a head head war between those two franchisees, the writing is on the wall of who's going to win. And it's not gonna the rams.

Now dan reves had bought the ramps in nineteen forty one even before any. This was on the table. He didn't really want to be clever in anyway. He saw this opportunity too, thought that the nfl should be on the west ghost and should be truly national. And he wanted to move the rams to los Angeles. But the nfl owners, by the bylaws you had, have one hundred percent in the animals approval of all the owners to move a team and they didn't want to move the team.

And IT makes a lot of sense. These teams have lost money forever. It's like we're just on the press of having a real business here. Don't make us figure out how get these other seven teams to L, A, once every e, whenever is six or seven games.

So now the wars ending, the A, F, C and the Browns are coming in. And then the dog comes right before the nineteen forty six. N, F, in your meetings in jane.

Then tapping, who owns the n fels bricklin dodgers and also the new york junkies, the facebook, like the highest profile, wealthiest owner in the nfl, defects to the A, F. C. So there is major crisis up.

First thing they do in the genuine, and six in your meeting as they booed out the then commissioner that they had hired, elmar laden, who was maccoll ge foobar star, but not an effective war time administrator for the n fell. So the owners dell, like, okay, to lead this fight, we can have somebody from the outside. We need to draft one of our own from the ownership group here in the inside who's going to be able to martial everybody together and lead a coordinated response to this existent al threat.

They install a bert bell, who is the owner of the field of eagles, as the new commissioner of the nfl, his test immediately with drafting a competitive response to the a fc. And they decided needs to be three things. One, they need to go meet the A, F, C.

Where they are, which means where the new amErica is post world war two, which means being nationwide in the west coast and going to california. Two, the nfl, if they're onna win, they need to put out a superior product, a Better game on the field than the A, F, C. And then three, for the first time, they need to do a Better job than the A, F, C, or at least as good to job, and actually telling amErica about IT.

They have to go facilities. They have to go win fans and win consumers hearts and minds. So france, one in three, are basically all handled by dam and the rams. So immediately after bell comes in, his commissioner, he orchestrates, the approval for the rams to move out to help for, and it's a good thing they did, because when play eventually starts in the one thousand forty six season, the new Browns, in clean and for their very first home game, draw sixty thousand fans, which is the same or more than the rams did for the entire season the year before. Yeah.

paul Brown was quite the anticipated figure in cleve, one he had coached at muscle and high school in canton. He had coached at ohio state, he had coached one of the navy teams, and he was sort of known for knowing how to whip a football team into shape.

Who would have to know the intellectual side of the game as inside out, as the physical part of the game? IT was a huge part of his strategy to make people memorize the playbook and take written test. And if they failed these written tests about the plays, about the rules, about paul strategy, he kick him off the team, no matter how good they were.

And it's the first time someone really looked at the game and said, sure, it's a game, but actually this could be a science. He was almost like the first money bowler. One of the first innovations he did was he was one of the first coaches to really review film and recognize patterns in players and statistically manually tally. Here's what we have to do against this team and that team, and here's what worked for us last year, and here's what didn't work for us this year.

Program was the first modern, not just football coach, but I think, sports coach period in america. And you know.

every human is flawed. So we shouldn't make him out to be the mister something. But he was basically the first coach to start racial integration of the team and recognize that if we have the best players, then we're going to win.

So we just need to do whatever IT takes to get the best players on our team. The other thing that he did, he employed an entire staff of assistant coaches year around. I think he was six people in addition to him.

No other team did that. There were not full time offensive coordinators and defensive coordinators, and i'm not sure he yet establish them as that. But IT really was saying, look, we're gonna be a team of coaches that coaches a team of players .

and on the racial integration. So one, the a fc, who is going to be an integrated league from the beginning.

that's counter positioning right there.

counter position, the N, F, L, and especially the red kans didn't have a lot interest in doing so. But moving the ramps to L, A forces the league to integrate because the L A color sim where the rams want to play, is a publicly owned building and is controlled then as now by the L. A policy commission.

And when leaves in, the rams come out to petition their case that they should come be allowed to play in the color sim, while the commission says, okay, we will let you play here, but we're not gonna allow any segregated home teams to use our stadium as their home stadium. So you're going to have to get the team. And this is where the public relations aspect of the rams becomes cut.

Uh, the rains were so good at P, R.

so a degree right away. Be not only that, they say, great wall sign kenning washington, who before the war had been a hero in last year. He huge U, C, L, A star for the U.

C, L, A football team. This was a huge P. R cup for the los Angeles area and for the rams. And all this was helped out by a savy Young intern for the realms of the new headquarters in los Angeles, when Young Peter rosel, who helps craft a lot of this strategy.

but put a pin in p. Rol for the moment. So for a quick review of where we are right now, you've got the nfl is an eighteen league.

The rams have just moved from clive and to L. A. And then you've got this, A, F, C. That starting to play what year they actually start.

one thousand nine hundred and forty six. Same meal that the rams of .

the california and the roster of A F C teams is the Cliff, an Browns that we've talked about, the new york yankees football team, the brooklin dodgers football team.

which defected from the nl.

Yes, the buffo bisons. The miami c. hacks. Just interesting. That has nothing to do with the C, L. hawks.

They just reuse the same name, the separate to sco. Forty nine years. The los Angeles dawn. See, you've got two L, A teams. Now you've got an A F C team and A N F L team and the chicago rockets .

down in a labour named after the main owner.

Down to me to the movie is, uh, yeah. So you've got the N, F, L, and you've got the upstart, A, F, C. That would only last four years, but would change the game quite a bit.

And by forcing this competition, they forced the nfl to do a bunch of things that really wasn't the nfl s's best interest, but they wouldn't have done absent competition. And this is the first time where we really learn the lesson. The football that people will watch is the most entertaining game?

Yes, because this is something that would not be obvious, I think group running this experiment, what is the most entertaining game? It's the most competitive game on the field. And for all that we were just loading paul Brown and his legendary, the teams he coached, he was too good.

His teams were too good. So the Browns end up winning all four A, F, C championships. They only lose four games in four years, and the game becomes boring.

There's no drama. It's a foregone conclusion that the Browns gonna win. If your team is playing the Browns and the Browns do grade at home, go there on the road. They're like the fans, like why I even gna go right.

watch my team get destroyed. Ed, by the Browns. Why would I want to do that? By the way, those words have never come out of my mouth before. A mother Browns fan.

well, the current Browns are not the same Browns as the old Browns.

They actually are the same. Importantly, the franchise and records stayed with cleveland. They belt more ravens are a brand new team that started in the nineteen, is not a relocated clever in team despite the fact that they took the hole from office and team and ownership.

That's some seriously writing a history there by the and fell.

So at to your point, the N, F, L. Learned this lesson here of, oh my gosh, we've been sort of fortunate that this didn't happen in our league, but it's really nothing intentional that we did. There's nothing structural that we did to ensure there was no clear on Browns in our league. IT sort of accidentally happened, and by observing the counter example of boring football where there is one dominant team, IT kind of has to become a core tenet of our league now to fight these other guys of enough equality between teams that IT is always very competitive.

And this is still critical today, but is even more important back then because there was radio, but there wasn't really TV yet, even though were in the post world war two era these first few years. Five years after the war, the installed base of TV was just starting to roll out across america. So this is still an in person game.

And so the business model of professional sports was ticket sales in person attendance at the game. So I don't think the A, F, C model of the Brown's being dominant would work ever, but at least today you could watch the games on T, V. I always going to show when the Brown are playing.

That was in the case back then, you had to get button in seats. That was the only way you are going to make money. This becomes a feedback loop. If you don't make money as a team, you can't afford to put a quality level of play on the field, which further tips the competitive dynamic outbaLance totally.

If you have a league that figures out how to make sure that is always competitive. And when I say always competitive, what that translate tes into IT from a business perspective is, let's say every stadium has forty thousand seats and you have eight teams. That means you have the capability to sell one hundred and sixty thousand seats every weekend, and your goal is to sell one hundred and sixty thousand tickets every single weekend.

And so what you basically need is to make sure that it's always a great game to come watch. And to your point, that the business model is around the gate or ticket sales rather than TV, that actually stayed the case until nineteen, nineteen seventy seven. That was the first year that the nfl made more money from television revenue than from ticket sales. That is a full thirty years later than the time period we are talking about here.

I don't realize there was that long yeah, because the television gonna come in big way in short number years here. But back to berbel, the newly drafted commission er of the nfl. This is his great insight that he realizes as he is marching d nfl owners in the battle against the A, F.

C, he adopts this as a monter that literally, like me, they made a movie with this title. On any given sunday, any team in the league should be able to beat any other team. And he pushes this through with the owners and gets them all to agree to this of, like, hey, the only way we're going to survive and prosper is if we agree that one of our teams can get so dominant that we end up with a clever and Brown situation.

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F. L, adopts this mindset of we have to keep the game competitive always. What do they do structurally.

any given sunday? So bert and the nfl do two things. First, pretty immediately after he starts, he completely overhauls the way the schedule works. So in the past, the schedule would be just like whatever you all going to play each other and the border. He realizes that the schedule is actually an incredibly important strategic lever.

And he looks at the results from last year season and arranged the schedule such that the weaker teams from last year play the other weaker teams for the first half of the season, and the stronger teams from the previous season play the other stronger teams for the first half of the season. So that way he can come as close as possible to guaranteeing that roughly everybody's gonna have statistically a relatively even fifty fifty record going into the midway point in the season. So this is gonna drama about who's going end up winning even though the actual level of talent might diverge quite a bit within the league.

Yeah, even if you are great teams, if you've only faced great teams for your first several games, you're gonna be all banged up coming into the second half the season.

And the hell still does this to this day.

You realize.

yeah, this is like a critical side of pay making the old thing work. But this is kind of a came flagged. If there is a competitive baLance problem underlying everything, this is only chem, a flash. How do you fix IT? Well, there's no free agency at this point.

No, there isn't. And that's important because there is no way to just go sign of veteran player whose contract with another team is up to make your team Better. You need to get brand new rockies into the league is pretty ridiculous. There actually wasn't a concept of free agency at all until one thousand nine hundred ninety three in the nfl.

I know, which is ridiculous. And even then, only free agency with a salary cap, which when I was announced, Michael levin, the dallas cowboy's wide receiver, famously said, free agency with a salary cap is not free agency. But we digress. And so the nfl and bert come up with the idea of having a draft of college players and not standing draft, but a draft in reverse order of where you ended up in the standings in the previous season, so that the worst teams in the league get the first picks for the next season draft.

And also in doing the draft, we just continue to see over and over and over again the pro game. Having reference for the college game, because amErica has reference for the college game, is this idea that we will watch the college foobar game very carefully, and then we will create a day where on that day, that is, when we will be eligible to go and pull the people out of that game in into our league.

And it's incredible the the artistic that goes up around this.

a fifty million people watch this thing today.

I mean, we are watching youtube videos and research of telly. Swift was at the a few years ago. I was in a huge, actually the first big cup for E S P N. When E S P N started in one thousand nine hundred and seventy nine and one thousand nine hundred and eighty was televising the nfl draft genius. So these two elements, stacking the schedule and then the reverse order amateur raft, formed the nucleus of berbel in the nfl strategy that had ever since, which comes down to league first, league first, teams second, and some might say players third.

if at all. yeah. And there is a structural thing that they did to, which was to create a shared pool of ticket revenue. Sixty percent of that revenue I get to keep because I am the home team. And at this point in history, super on IT was that the other forty percent would go to the visitors over time.

The league would evolve a structural thing so that forty percent would do a shared pool that got divided among everyone else to sort of lean and harder to this shared mindset. And this is sort of before the T, V revenues that are shared today. So David, maybe this is a time to talk about televisions impact on the n fell.

So as we said, the A, A, F, C only Operates for four years. This plays out. The brands are two dominant, the A, F, C folds. After four years, only three teams of the afc c come over to the unfelt Browns. The forty nine years and the bottom cults.

who are, of course, now the indian appeals cults.

Here we are now is the dawn of the fifties in venture. As like he said, the television installed base is here. It's common. So TV set sales in amErica in one thousand nine and forty six, the first year after the war, or seven thousand tp set sold in amErica in one thousand and forty seven, there were fourteen thousand TV set sales to the market, doubled in one thousand and forty eight, there were one hundred and seventy two thousand television set sold in, and only drew exponentially from there.

I love that you .

look this up by this point in the early fifties, there are twenty five million homes in amErica with the television set. Man, did history turned on a night point for the nfl stick from their perspective? Like, thank god a, the A, F. C.

Went into business and forced the nfl into a competitive response to expand, to change the game, into start, to discover and understand this league first mentality, and then also think, god, they beat them by the end of the forties, in the beginning of the fifties, because now the nfl is the only game in town for professional football in america. And that the only national league, right, as tvs are showing up and really actually, they're the only game in town for national sports television programme period because there are other sports, most notbe baseball, as we have been talking about. But baseball, if anything, they were a victim of their own success because that was the dominant professional sport.

They made so much Better attendance numbers. They head all the games, one hundred and sixty two, the gate. The ticket sales were so important to baseball that with the adam of television, the baseball owners thought television was bad, and they end up fighting IT.

Well, so did the football owners for a while. Well.

so did the good ball owners, but they had a lot less to lose.

Yeah, because pro football is still an underdog sport here. Even in early fifties. They're like up and coming. They are trying to get more people to go to games. And baseball generates a ton of stadium revenue from filling the forty thousand person's stadiums.

Indeed, facebook, I had a lot to lose. And to be fair to all of them, in the early days, and I think for a long time, local market home television airing of home games absolutely depressed in person attendance.

totally when the very first nfl t videos were signed. And of course, these were individual local deal signed by team ownership and their local television broadcasting. A fillip IT wasn't with cbs.

broadly. IT was with, you know, whatever your local T V station is, they would black out of the home games because they would say, uh, we need to fill the stadium. Because until one thousand hundred and seventy seven, the stadium, the gate, was actually the biggest form of revenue. And so why earth would we can abilities our experience when someone could just watch IT from a home?

Absolutely not. IT would later take a presidential order from Richard nixon. And the home blackouts. And even then, only if the home games were sold out with the blackout be lifted.

IT wasn't until after september, the blackouts were lifted even if the home game wasn't sold out and then they reinstated. And now it's not the case anymore, but it's a mass. But then as you say, in the fifties, these early television experiments are being run with sports.

And like IT is pretty bad. So the l. Ms, they do an individual deal in one thousand hundred and fifty with the adorable television company to broadcast the rams home games, I think, home and away games.

But they put a clause in the deal. Ks, they'd seen what had happened with baseball. The admiral would guarantee revenue back to the rams for any loss in attendance. And this is a really bad deal for animal, because attendance declines fifty percent five zero.

which is crazy like for how bad the broadcast were. The fact that that is a suitable replacement to go into the game. I mean, they would put like one camera up on the fifty year line, and they wouldn do like any microphones. And they would just be like, right, this is the game.

And maybe the'd have some commentators have any black and weight on a tiny screen like you, all of these things. But the industry was new. Everybody was figuring everything out, the TV set manufacturer, the networks, the content, the sports leagues.

One of the big marketing messages was the game comes to you. You don't have to leave by the appliance, put IT in your home, and it's like a magical window, like you have a seat. The game and IT really did depress attendance, are saying and up being developed in baseball is sadly for baseball.

They stuck you for a very, very long time. The radio, whats the appetite television, say SHE, it's IT. It's a new revenue stream, but it's hurting the golden goof .

ticket sales. And all the way through the fifties, IT wouldn't really be a particularly large revenue line. But as I did start to grow at first, they weren't really listening to the hard one lesson against the A, F, C.

That that needs to be league first. And so everyone's negotiating individually. IT ended up being the case that the new york giants were making two hundred thousand dollars, and this is in one thousand nine hundred and fifty nine on their T. V. deal. The packers were making zero.

I think the packers, we're making five. They did have A, T, V, D, think five thousand dollars. This is the thing. Football, even amongst individual teams, kept to the early fifties, where as baseball basically shut IT down and turn away from T, V.

And one of the things that they figure out is, oh, television broadcast depressed the gate at home, but there are strong demand in local markets to see the teams away games when they're traveling. And so for the first few years, that's the main model of television broadcast of the nfl is just showing away games. But there's like a lot of demand for that.

And it's funny because now we refer to this as a black out. But at the time, because they were only selling to local affiliates, it's not that, that was a black out. It's that your local T, V station only had the contract to broadcast the oy games. There was nobody within your intended is reached that was broadcasting that gay when I was at home.

So this becomes a pretty meaningful revenue stream, even though, as you say, that would be a long time before TV would surpass the gate in revenue streams for the N F L. By the end of the fifties. The league is a whole with all the twelve separate contract was making over a million dollars in TV revenue annually, whether at the beginning of the decade IT was less than one hundred thousand dollars.

And IT also becomes clear that certain football games, there's like a really big audience on T. V. For them.

And in particular, the one thousand hundred and fifty eight and fell championed shift game, known as the greatest game ever played between the giants and the cults. LED by Jenny united, a sudden death overtime dramatic win by john Y. U. And the cult garners forty five million T. V viewers across the country, including president izon hour.

So that was this, a national broadcast.

national broadcast of the nfl tip. And if game that year.

importantly, this is not the super bol. David and I aren't being coy by not calling IT that like. That is not what this was. And we're still missing about half the teams that will end up competing for the super bowl.

right? But forty five million viewers. This was unprecedented. There is a huge opportunity for professional football and television, yes, which once again, the nfl was not the one two totally recognize which IT is amazing .

and the competition does create the best product. And the nfl, time and time again, has had their hand forced and then reacted really well to a new upstart.

totally. So in this case, as the draw a close, once again, just like towards the end of four war two, in the end of the forties, there were a whole bunch more cities and ownership groups that have wanted in on this is a clear business opportunity. There only twelve teams at this point in D, N, F, L.

But once again, D, N, F, L owners are kind of dragging their feet. They like, we don't really want to expand. You know maybe we'd be open to the chicago cardinal's.

They're kinds struggling. If the ownership group that owns them more to sell, maybe we would allow them to be moved. But you know, go talk to them.

And I really don't think this is like a business decision of we don't want more people all taking our pie. I think they sort of recognize that there could be more money made if you have more cities. But IT was more than the nfl owners at this point, are a tight nit maternity of people who all think the same way, who respect the game largely, who owned the teams when they were massively lost making.

And so they kind of don't want to let anyone into their club, even if IT would be good for business. And the n. Fels, we know that today is a business, you Better believe IT.

But at that point in history, IT was really like each of these teams are kind of on their own island. They're deeply competitive against other players. They don't think of those people as fellow employees of the league. It's more like we each our own club, but the owners of each club sort to have this thing with each other, this fernal bond they're willing .

to submit to this league first mindset because they know it's good for all of them. But that doesn't mean that they want to expand things or change things.

No, they did not. And David, I am excited. We are finally here, the birth of the american football league.

the if, yes.

their competition with the nfl, and really the era of national TV contracts. This is the story of how the nfl became the league that we know today.

Let's go. The story goes that one of the potential new profession football team investors, a gentlemen named lamar hunt, who was a Young air to a very large das texas oil fortune, kept trying to talk to bert bell. The nfl do anything he could to get an expansion team. Or by the Carol, he just wants to own a football team. yes.

So story goes, he's flying back from seeing the cardinals and having been rebuffed and he has a uruk a moment on the plane, he's been hearing that there are all these other people who wants to buy the cardinals to and get in line, this person in this city and that person in that city. And lamar says, wait a minute. I don't need the N, F, F.

L. I don't need the cardinals. I've got a list of all these other wealthy people who also want to have professior football teams. Why do I call them? And i'll start our own league.

yes. And that begins the most successful attempt to chAllenge the nfl by far.

So in August one thousand nine hundred and fifty nine, he and several other owners from the american football league, with six teams, soon to become eight, the dallas, texas, boston patriots, buffalo bills, houston oilers, miami dolphins, new york tightens, soon to be changed to the new york jets, the denver broncos, the l charges and the oakland readers. You've probably heard of most of those teams. Yes.

this one ended very differently in the A, A, F, C.

did very, very differently. So at first, bill and the n fell are like, okay, there's sort of friendly like, well, maybe you know Better to have good relations with lamar and the new A F L, because they're kind of .

a doubtful that it's gonna happen. They also don't want to say anything in the press that makes them look air again. And they are sort of trying to be pretend supportive until it's legit threatened you.

But then still, in one thousand hundred and fifty nine, right after the new A, F, L announced that they're gonna start their league and commence Operations, berbel dies suddenly. And so once again, just like that with the A F C, the league is increases and forced tact. And unlike the A F, C, things are gonna be a little different this time because .

of the television aspect. yes. And this is all being made by, you, mentioned the hunt, who was the dallas texan's owner.

People might know them Better as the cancer city chiefs today. yes. So hunt, unlike the a fc owners, he's been studying the nfl. He knows about the league first mentality. He's also been studying baseball. He's been meeting with baseball owners, including branch Ricky of brick dodgers and jackie Robinson fame, who at that point time was auto major league baseball and was trying to start a third independent league.

independent baseball league.

a third independent baseball league. Yes, with some pretty radical ideas, really borrowing from the nfl and the league first mentality. He wanted to embrace television in this new baseball league and have a radical solution where all the clubs in the league, which share all of the revenue from a television deal .

prety crazy.

So la marhof t in the new american football league D N F L, they take this castle de idea from baseball, and they totally run with IT. Hudd says, will escaped, negotiate one national television contract for the entire A F L, and then will split the revenue completely equally amongst all the teams. This is like the epidemic. The league first mentality will be great for us. It'll help us compete with the n fell.

And in some ways, it's easy for the upstart to do this in counter position because they have no existing TV contracts. But they do kind of get laughed out of the room. They go to the TV networks with this.

And each of the TV networks are like, ah, cool idea, but like, who cares about your league? Who know one's gona watch this? So we hear your pitch. We understand that this is very innovative and breakthrough and very different than what the different nfl teams are doing, and we don't really care that much.

And the two major networks of the time cbs and nbc had deals with nfl teams, the likelihood that they would be that receptive to this in the first place is low. But there was another relatively upstart, canner positioned, TV network out there, A, B, C. And there was a perfect match. So hunt costs to A, B, C, and they find a Young executive there. A, B, C doesn't even have a sports division at this point time, but a Young executive within A B C named run arledge.

This is probably the fourth episode we've talked about .

reno alledge on what a legend so run would ultimately become bobic ers mentor and bobic er would rise to the A B C sports ranks in the beginning of his career before taking over their cities. And then obviously all of disney. So this is ruins, big opportunity he sees. It's obvious at this point time in the last fifties that nationally televised ed football games, there's demand for, there's a huge opportunity.

This is actually shocking, like I know to everyone right now, we're like, well, of course, but IT used to be the case that sunday afternoons kind of had a hole in their schedule like cbs had no good programing. And so that's why they would originally agreed lecture al broadcast in a fell games, but no one expected the american public in their living rooms to take to football as an event, as an entertainment form delivered over the air to the living room the way that I did. And so the n fell sort of rebranded sundays in amErica and turn IT into a completely different way that people spend their time.

And that was shocking. What end with those early nfl deals? IT was like, those were individual deals the teams made with networks in local stations.

So IT was like a local thing. IT wasn't football. Sunday wasn't a national event. This was the first network wide contract.

Networks now had signal that people did want to behave in this way and they could feel safe sort of signing business deals and pursuing this because even though he wasn't what they expect to and turns out there is demand for this product.

yeah. So this was real edges and A B, C S. First huge contribution, and to profit all in amErica and television of sports. So A B C science, a league wide, five year T, V rates deal with american football league for eight, nine half million dollars over five years. IT was by far, far the single biggest sports rates TV deal in history at the time.

one point three million dollars to the league career.

And that was before the league had played a single game. This is all before the league launches. So here we are now, in january one thousand nine hundred and sixty, back to the N F L. They don't have a commissioner, their upstart rivals, the A F, L, who haven't play the game yet.

They have a multimillion dollar .

contract and eight and half million dollar five year T, V deal with a national network that the nfl doesn't have. This is a real extension al crisis. And unlike last time, where they're like, okay, great food is draft.

One of our own rebel or the field of eagles to come in and lead us through this they can agree on a new commission. Er so IT takes eleven days and twenty three separate votes of the nfl owner ship groups in a total knockout down, drag out negotiation. There's multiple camps backing multiple candidates yeah the .

nfl has just gotten too big. Each of the owners has too many of their own interest argue for their entire need of something or someone to unify them.

Indeed, by the end of the process, none of the original candidates are still in IT.

right? So in some ways, it's a tough position to be because all the most qualified people are out. So you kind of have to pick someone that nobody hates, but probably won't be very good by day eight or nine.

That sort of the position that everyone feels like they are in is, oh, crap. Well, we got to pick one we can agree on. But that's not gonna be the best person for the job, unfortunately.

But fortunately for the nfl, they were very, very, very wrong about bb.

lucky, Better to be lucky than good.

Yes, they choose as the compromise dark course candidate, thirty three year old, thirty year general manager of the loss analyst, rams, former public relations, in turn captain, college graduate pete rosel, to be the new Young commissioner of this league crisis and .

create the N. F. L. That we know today.

And IT was totally brilliant to make a russia grows into this just incredible leader, visionary who does so many things that we're gonna IT now for the league, for the game, for television, for america. But I was so not the owner's intention, but they had to go to this compromise. Canada, and this Young person, who most people hadn't heard of anybody else they are considering wood, have been of a different generation, wouldn't understood. The new amErica in the late fifties and early sixties, like these were all old folks who were running the league at this point time. But p, nobody Better embodied everything about amErica in the fifties and sixties, like Young families, suburbs, west coast, los Angeles, television, pr, advertising.

Yes, coming out of the P, R background was the perfect positioning for him, because he knew that every foot that we have to put forward has to be really polished. We got stop doing things that are confusing or canvas zing each other, or send mixed messaging, or perhaps put a bad taste americans mouth. And we need to figure out the very best media strategy, the very best strategy to make IT.

So all the newspapers and all the T, V. Stations talk about us all the time. The N, F, L. And our teams and our players need to be on the lips of americans as much as possible.

And this is a small, short track record of what rosel had done before becoming commissioner S. G. M. Of the rams for only two or three years.

The rams were not a successful team on the field even during his ten year, but he makes them into the most profitable team in the league. They actually started making a lot of money because he gets IT right there in the second biggest TV market in america, N, L. A, A very wide, geographically spread out market where people want to watch football games on T, V.

He sets up the first in house, can institutionalize ed merchant this store for the rams. He opens up ram's merchandise art, the partners with roy Rogers ink the actor roy Rogers had like a White label merchant dice brand to bring actual high quality branded rams jersey hats, mugs, ta. That becomes a huge revenue line for the rams that nobody else has.

So he's got very background here and he comes in. This is pretty crazy. I mean, this is a very volatile ged situation with a lot of elder and opinions folks around the league that he's going up to deal with.

And within a year, he completely changes the n felt. So the first thing he does when he comes in as commissioner is he ratifies an expansion plan for the nfl to meet the A F. L.

Remember one of the bigger reasons why hunt and the a ffo owners started the league in the first places they wanted to bring profits. T all the more cities. The nfl was drag its feet, just like back with the A F.

C. Now they realized they gotto go meet the enemy on the field where they are. So the original plan is to expand to both dallas and houston immediately to meet the a fell there in texas. The houston franchise, I think, ends up becoming the minnesota franchise instead. But they do go to dallas with the .

cowboys immediately and meet the hunt and head on his own time. He's leading effort. And the idea you're just going to open up shop and say, ah we're going to give away the franchise to a new owner of the cowboys right here in your backyard yep.

right down the street speaking of praxis im ity and right down the street, the next move that rosel makes, remember he's from L A. He gets the importance of media advertising everything he knows he can't run. The n fell out of los Angeles, but at this point in time the league offices were in filled because bert bell was in filled alpha here in the war of the eagles. He's like, phillippa is not the place where we can run the modern fail.

And bert ran at a very idiosyncratic way, too. I mean, he had obviously no computer system, but like he did all of his business by phone calls, he was posted notes. And phone calls is how the N.

F. L. Ran, like, just not a professional organization.

Oh yeah. Famously, the stacked scheduling, he would do IT with dominoes on his kitchen table. So results like that. This is not going to work. We're going to move the headquarters to new york, to to midtown, first rock, fEllies center and the the park avenue where the league is.

I believe to this day, we need to be right there next to the television industry, next to the media industry, and just as important, next to the advertising industry. Yes, these are relationships. We got a cultivate with medication after he moves the headquarters to new york rozel contracts.

The alliance sports buro, which did professor statistics for majority baseball. The nfl, up to this point, didn't have professional statistic. Arms that would distribute games, stats and box scores out, told the newspapers across the country the only .

way anybody's gonna write about us and give us space on the sports pages if we make their job easy and put the stats right their hands every day.

Speaking of writing about the nfl and publishing, the other thing that rosel knows is, especially with the game like the nfl, which is a weekly drama, it's not just about like baseball, with getting the daily box cores in the newspaper, you also got to create human stories and arts and mythology around the game. And so he intentionally cultivates a tiger relationship with timing, and specifically the sports illustrated.

And over the course of the sixties, sports illustrated really becomes the major advocate for the new modern game of football and the nfl. So much so that in one thousand nine hundred and sixty three, just three short years later, the magazine sports illustrate names, Perez, L. T.

Sportswomen of the year, the first ever none athlete that I did ever name, sports of the year. I think about that, the commissioner of the league being named sports of the year by sports illustrated. And that is interest, huge mindset shift.

We should also say, the end of the fifties began in the sixties, you know, baseball, still a dominant port in the U. S, the dominant football franchise, college football franchise. The nfl, still an underdog. And now they're being chAllenged by this new upstarts. So the sort squeeze in the middle, like people don't care enough yet, but they also have a competitive threat and so resolves having to do some innovative things. David, didn't he like higher writers in house at the nfl to craft the story lines and then send those to all the reporters who like we're too busy to actually go to nfl games because they didn't respect the nfl enough. But maybe if we send them the stories, then they'll week a little bit and publish them.

famously. He did, starting back when he was with the, even when he was A P. R. In turn, there he would just write the stories for the reporters, which one is that they would actually get in the papers, but two, he could control and craft the narrative. Man, you can totally still see this to this day in the nfl to see those IT was so important strategic advantage for them and help them get where they are. But like the nfl keeps such a high grip on the narrative.

oh, dude, the sideline reporters aren't allowed to talk to anyone. It's kind of silly that we have sideline reporters today. Just an illustrative example of how tight the nfl controls the media relationships they have.

And all this starts with brazil. One other thing that he does immediately after taking over and moving headquarters to new york that would end up paying huge, huge, huge dividends, is he also started cultivating political relationships and influence, specifically with the Kennedy family, both john and Bobby, who are big football for ends.

yes. So this is perfectly into what happens in one hundred sixty one, right after rozella on the job. That would change the face of football forever.

So it's obvious to rosel once the A, F, L signs there, big deal with A, B, C, that that's the path forward there.

One point three million dollar a year deal with A, B, C.

and importantly, the league de revenue sharing national deal with the national network. Now this is not how the end of elaborate at this point. no.

Brazil, within the space of a year, corals all the nfl owners and gets them to realize that the nfl has to do the same thing. They have to give up their individual TV rights to their individual teams. They have to pull together.

This is the continuation of the league first mentality, and they have to fight the A, F. L. So finally, after wrangling in politicking with the otherness group.

and the reason is politicking is because clever g and bolt, or actually will end up losing money in the short term on this, because rozelle is itching and i'm going to go goal ate a big group deal and they are all three saying we are they have very good deals locally, were very popular teams, were in great football cities. Um no but ultimately they do say yes. And I really like speaks to the thing that has made the nfl successful, which is saying, no, to growing my slice of the pie to grow the greater pie.

So once he gets authority, rozelle goes in the good hits with cbs, which was the dominant at ork, both in the country and had the majority of the individual team and f deals. He negotiates a two year deal with cbs at four point six five million dollars in rates per year to be shared equally among the teams over .

the three, X, D, A, F, D, O.

A huge. Shot across the bow to the A, F, L. Fortunately, and unfortunately, they immediately encounter political pressure in response to this. This triggers, I believe, I guess, the department of justice to start an entire trust violation process against the nfl. This is like a potentially clear use of monopoly power in bargaining.

But this is the very first question where you say, well, what is a monopoly and what is anti trust and what is the nfl and what are the teams? And in this situation.

is the N, F, L the business, or are the teams, the business right? If the teams of the business, then, yes, this is. And I trust if the N, F fell, is the business?

No, this is one entity acting on behalf of itself. There's no collusion. There is no monopoly. Plus in this particular situation, they actually aren't a competitive landscape against the A F. L. So there's strong argument to be made that this is not and I trust that argument does not Carry the day.

no. So pretty immediately, the courts strike down this deal and there is about, I think I want to two months period where it's all in limbaugh. And this is where the Kennedy relationships come in, clutch for brazil and the ana fell. So both the president and about canada in congress and wake up enough support to pass through new congressional gisle tion.

a new congressional act specifically to advantage .

the nfl and to allow for national sports contracts on the league wide basis is called the sports broadcasting act. IT ends up getting past towards the end of one thousand nine hundred sixty one, the day after the bill is passed and signed by john of knee in the White house. He literally host a party at the White house for the nfl, which is like this, tells you everything you need to do right there pel all the owners. They are invited to the White house to celebrate this new antitrust exemption that has been passed through congress to allow them to negotiate this land mark deal because the president wants to watch this football.

Is that but rosel also makes the strong case that this is good for america, for a game that is growing in popularity and a game that unites communities. They're really starting to lean into this idea. This brings a lot of people together in a city.

IT is a shining example of teamwork and a shining example of hard work and celebrating sportsmanship. And this is a great thing that we should spread to more of amErica and make IT easier for more people to consume. They're starting to make arguments about the economy around, you know, it's good for people to have gathering points, both at stadiums, but around stadiums with hotels, for people to throw parties at their houses. All of this is goodness. And if you like the american economy, you should let us have a national tb contract for the nfl.

And at this point in time, I think a lot of those arguments told water. This actually was driving a lot of commerce for the nation totally.

A fun aside, I did the math on that four point six five million dollar per year deal. That value of that contract would grow twenty five hundred x over the next sixty two years. Well.

did you look at what I would be?

Inflation adjusted? Yes, inflation adjusted. It's about two hundred and fifty .

x still free again. So on the back of this landmark T, V deal, rosel does two other really brilliant things for the nfl in the next year. First comes as kind of another accident. So the league every year sold the rates to the nfl. T, T, F, inf, game, sold rights to make a .

movie out of IT. And they are always like kindle .

ah they were kind of hockey, like a really rudimental tary highlight real type thing. In thousand nine hundred sixty two, they get a bid for the rights. The bidding is a seal doctor.

They get a bid that comes in from a guy named ed, who was a suburban dad in philadephia, who like to make home movies, particularly home movies of his sun Steves go foobar games. This guy eb bids on the rates to make the nfl champion chip movie for thousand and sixty two weeks of the bizzare unsealed. And I had done a little homework.

He found out that the company that had won the past few years only paid twenty five hundred dollars for the rates. So is like, I can been five k he bds, five thousand dollars. He wins the auction.

And rozell, like, who is this kind with no experience, what's happening? So rosel goes to his dom and ed of pitches, pete, on doing something completely revolutionary for the one hundred and sixty two champion. He wants to make IT like an actual movie, not a hockey sports movie, a real movie with montages, with cuts, with professional hollywood quality cinematography.

slow motion voice .

over everything, sideline cameras, really a passion project to make this an incredible piece of content results. Kind of like, well, I mean, that sounds great. I don't know if you can do IT, but it's like, what have I got to lose? So he lets go go IT up and the movie he makes totally revolutionizes sports video content. I think this is another thing that we just take for granted today. It's like air and water that sports content, sports video is not just like a fixed king camera at the fifty airline that panes back in fourth.

Not only does this film get greater claim, but it's a revolution to go and create recordings of sports, not to be broadcast. The broadcasters weren't recording tapes of everything. They have a broadcast. There's a lot of like baseball games and stuff that have been lost to history because there was no recording of IT made.

Meanwhile, the nfl, for this championship game and for other things that enabled in his crew, would film after this IT is high quality film, not video tape recording, not over the air broadcast film stock recording from a bunch of different angles. And some met high frame rate camera s and some met twenty four friends for second cameras. And you get this smooth, beautiful, slow motion. IT provides this unbelievable archive of the game for which other sports have .

no archive yeah well and that's just the video aspect to IT, but there's also something that stable gets intuitively the same thing that rosel gets the narrative. It's not just about showing what happened, it's about telling a story and IT just completely messes with results, philosophy. And what's onna Carry the nfl into what IT becomes today, which is that we can't just show these games.

We have to tell a story. This has to be drama. This has to be made for TV content.

And IT has to be super polish and IT has to be super controlled. And ed stables, little outfit that would become nfl films, is the ultimate embodiment ment of rosse's mindset. I don't think rosel could have created this on his own, but when you watch anything from n fell films, IT has pete results personality woozy all over IT in terms of what we are creating is entertainment and polish.

So for two years and and his son Steve would come on board and work with them and eventually take over and fell films. They do the champion of game. And then in one hundred and sixty five ad comes to pete with the idea of, like, hey, let's make this a core in heal division of the nfl and they start nfl films.

Yeah, you should buy my little film company.

What a radical idea. The nfl should become a movie producer. This is, you remember, there's no E S P N. There's not going to be an E S P N for fifty years. All of this content that we're just bombarded with today at all starts here with the stables and with nfl films.

Yeah there is a couple interesting things to note too. Once rosel Green lights in F, L. Films, he basically says, okay, there is a lot of people in my organization that might want to do something with this at some point. But like many successful acquisitions we've covered on the show, he says, we want to be hands off.

I just don't want your p nl that ever go negative so you can run as a break even business as long as you are fulfilling the mission of promoting the very best of the nfl and helping to create law and story. And they build this completely full fledged film studio that is actually the customer who buys the most film from codec other than the U. S. Army in the entire country, super high volume film studio, because they start sending full film crews to every single nfl game every single week. And is this unbelievable Operation to then overnight mail, or drive themselves back all this footage to start editing IT right away, so they can use IT for what we will talk about soon, but for many purposes.

But this is what's so amazing. They did all this as this investment, as a labor of love and passion on the saplings, part on results, part though the motivation. As you are saying, it's not about making money.

It's about raising the statue of the league, yes, about putting the most highest glass shine on the product that we are producing. And the product is the game on the field. They couldn't even even foresee how important this would become that will put a slight pin on and come back to in just a minute.

The other thing that rosel does in the next couple years is the merger idea, the store that he was doing back with the ramps. He brings that in house on a league wide basis and starts nfl enterprises again, totally radially. He goes to all the owners, all the teams and says, whatever you're doing on merch, whatever you're doing on brand and opportunities, you are no longer doing that individually. We're going to bring a centrally collectively in house under nfl enterprises. We're going to standardize, to merge the jerseys, the hats.

We're going to set a .

quality bar so that any time a fan, because it's all about the relationship with the fan, is like a fun o bring a man from T, V, get him to the game, get them to buy, merge. They're just deepening the relationship. They have to have a good very experience. They can get some shati pen in from the giants that looks like x, and somebody else gets something from the cardinals that looks like why? Like it's got to all be the same.

And you got to a remember the way that the n fell is structured. The result is not their boss. In fact, he works for the owners.

So they're all making money and he's going to them saying, hey, just like TV, I want you to give up the rights to make money on your own even though some you are doing a prego job at IT and we're going to do this thing as a league and we're going to cut IT equally. So I don't care if your teams bad and their teams good were going to all the reviews can be equal, just like TV. And he's so good at playing the politician with the owners that they keep agreeing. To give up revenue generating parts of their p nl for the league to take over on their behalf.

Yeah I mean, like let's take the ground and how many pendents do you think the Brown's sold you know in the city of clever in with this big and story as the Browns are versus the packagers in a town like Green bay?

What is Green bay is something like the two hundred hundred largest media market in the united states. And they've got this nfl team.

And what rosel is saying is just like TV, I OK how much merchant dies you sell, packers are getting the same check for enterprises .

as the brands are. Yeah, we should probably take a sixty second aside. But the unique structure of the packagers is totally amazing. They are owned by a publicly owned nonprofit CoOperation.

And so what that means is, rather than one individual who could just decide to approve the team and leave them, the ownership of the team lies in this entity that is theoretically a publicly own identity. Anytime they want to raise money, they go and sell more shares, more stock in the Green bay packers ers. And there's hundreds of thousands of people who have bought this stocks. So this very distributed owercome group of the packs ers.

not with any expectation of financial return, literally just so they can hold a piece .

of the packers or control because nobody can own more than a certain number of shares, but this mechanism has kept the packing ers in Green bay, even while capital forces and individual wims of billionaire have moved many other teams around.

Yeah, it's such an amazing low quark and like so fun. Have you ever been to label field?

I've not. I really want to.

I went once, not for a game, but I ve got a wedding in Green bay. I H the file I took, Green pay. Is this very quant, little, little town in wisky sin? Uh, there's this giant nfl stadium in the middle wild .

and for a lot of the analysis will do later. The data comes from the Green bay packers annual report because no other team publishes their pl, but the packers do okay.

So the last thing rosel does in this miracle run in his first couple years as commissioner, as he creates the profit ball hall of fame in canton in thousand nine hundred and sixty three. Ah so well, I ve never been in. We gott go.

We should do in a quired field trip. We should. That would be fun. So there's this amazing fly will I get really is like the disney story that he gets. I don't think he thought about IT in fly wheel terms, but the most important thing, everything he's doing is through the lens of how do we raise the stature of the league, not a team, but the league, the nfl as a league, how do we add higher glass ship to the product.

to the shield?

One might say exactly, exactly. And his logic is doing that will attract more fan interest and deeper fan interest. And the more and deeper fan interest that you attract, the more TV dollars you're going to make.

And this is revolutionary to back in the day, you were limited to the number of seats you had in your stadium. So if you're like a major ee baseball team in a major market where you're selling out your stadium, there is not a strong incentive to keep adding shame to the product. You're at maximum revenue capacity, right? But with the nfl and now with the new TV model, there is no ceiling to revenue capacity.

yep.

So more fan interests, more TV dollars, more TV dollars shared evenly amongst all the teams raises the level of play equally among the the teams. As the overall level of play goes up, as long as the competitive baLance stays tact well, that improves the product, which then adds more seen, which then drives more fan interest. And IT becomes this amazing fly wheel and literally, I mean, there's so much more to the story, so many twists and turns will tell, but that's the core of IT. That idea is what leads to what's the current annual national revenue for the nfl, like ten billion, eleven billion that .

comes through shared agreements is eleven billion dollars. And then there's another six or so that comes from local revenue that teams individually generate.

Yeah, that's per year, right? Just to be clear, that is per year IT. Is this fly .

we all that makes the N, F, L teams collectively worth something like a hundred and forty billion dollars today?

So remember that initial landmark deal that they got, the anti I trust exemption from congress, foreign ninety six one, for the nineteen fifty two season, there was two years the nfl is locked up. For five years the nfl gets to renegotiate. Every two years that all this stuff has happened in the previous two years, rosel opens up the bidding to all three networks.

Of course, C, B, S, wins, again, somewhat argue that IT was a rigged bid in brazil, was tipping off his counterparts at cbs. We may never know they win another two year, twenty eight point two million dollar bid fourteen point one million dollars per year, up from four point six two earlier. So every single team in the league now gets one million dollars before the season even starts.

A cool three x from the last deal he negotiated two years before.

pretty freaking incredible. And also just so much about to the point with knee ties and politics about the commerce. The D, N, F, L.

Is ready. The T, V. Networks were getting a great deal here. These were landmark contracts. But the attention, the viewership that the games got and then the advertising units that were sold and then the ultimate products that were moved as a result of those ad units, this was a steal.

And you could argue that the T, V. Networks were getting a great deal for many, many, many more years. And I think at the end, I want to discuss when they get in a good deal today. But everyone was getting a pretty good deal here because the fan base was growing so much more quickly in the number of viewers was growing so much more quickly than these .

deals could get renegotiated when that just takes time for people to realize the power of a new medium for the monodist ation side to grow as the engagement side grows. okay. So resell.

unbelievable. First five years in office literally cannot imagine executing Better, the nfl, going from major crisis death of its owner, commissioner verbel, to the place is in in the midst, is incredible. What about the a fell? We have to talk about them in a while.

What happened to them? Well, here's what's funny. They're doing pretty great too, unlike before the war, before television. If this had played out in something similarly did with the A F C, the A F C was dead at this point of four, five years in the A F L would have been dead too. But they're thriving, and it's all as a television, even though the nfl is doing great, there are still lot of to and fur football on TV and the A.

F, L. To put a finer point of what you're saying, they had to shoot the moon strategy. They wanted to come out of the gate with a bang.

It's almost like the soft bank or tiger global analogy, where they wanted to burn real hot and under the right circumstances have that go really well for them. And they had the exact orate circumstances. IT was the boom of TV in america. So they could do things like go sign joe name for the jets to a giant tic contract and just have new york and half of amErica fall in love with him and turn them in to a superstar that benefit the league.

The jets in the A, F, L, formally the titans, their owned by Sunny web lin, who almost nobody will know that name, but he was one of the co heads of M, C, A, the big agency.

as discussed on our interview with mo love's.

Indeed, indeed. So just like rosel gets whats going on in the nfl side, Sunny, even though he's not as much of a clear leader, he's the media guy for the A F, and he totally gets IT too. So Sunny sees the big second N F L deo come across in ninety sixty four.

So all the other A F L owners are like desperation. The nfl just got this huge deal. How are we ever gna compete? They're going to have so much more money, will never be able to sign any players.

This is the end sunnies like on to know we're going to be just fine. We're gonna be great because the nfl did this deal with cbs. Well, there are two other networks out there. There is A B, C, who the A F L has a current deal with. And then there's also N B C. And so there are two Betters out there who are going to a, be very, very, very sad that they just lost out on the most compelling content on television, professior football, and who's dare to give IT to them the A. F.

L. Yeah, we'll take second place when through a bunch of sad people willing to throw .

money at second place and throw a lot of money. So the very next week after brazil and cbs announced their deal, the A F L in N B C announced that they've just signed a new year, thirty seven point five million dollar deal. So bigger overall dollar number for a longer number of years .

even though it's like less than half the per year amount.

Yeah, it's less than a half at seven and a half million dollars per year. But by this point time, the nfl has fourteen teams. The a fl.

Still only has eight. So on a per team basis, it's pretty close. It's not as much as the nfl, but for a five year old upstart league, this is a big success.

So just like you're saying, right on the hills of that Sunny and the jets, they know what to do at that money. They turned around and they give a huge chunk of IT to broadway. Jo name. And probably lot of listeners are going to know the name name with maybe familiar with him a little bit.

I honestly, I only know that because I saw on a brady bunch episode.

on a brady bunch of said.

it's not like I was alive during the when that was earring, but there's a very famous episode of the breedy bunch that I watched because it's like this cultural touch point where a joe name is was so big that he actually appeared on a pretty bunch episode. And that's super unusual for a sports star in that is such a heart throb.

Do I mean he had his own talk show? It's not just that he is on the pretty bunch. So everything we were talking about a minute ago with a film, films and rosel and all the brilliance there, and how was so important in this realization that football and the nfl would be made for TV?

Joe named was the first modern cultural celebrity athlete. The only thing that was closely a probably bigger was mohamed's. He transcended sports. He transcended football.

He's also a heartthrob. There's like millions of t women in amErica like throwing themselves.

This exactly what I was gonna. He was the first professional athlete that appealed equally to men, women and children.

At a great point before him.

there was nobody like that. So he comes and he's playing in new york. Accurate in the biggest market.

The brightest st. Lives right there with the TV industry, right there with the advertising industry. He knew exactly how to play.

He wore White kites, everybody else where black high tops. Famously, he wore a mink coat on the sidelines, just like, amazing, amazing. Like he started movies in the offices, and there were other nfl superstars before him, even N, F, L. Superstar's, that had gone on to movie careers, but just on a broad cultural basis across all demographics, broadway geo was IT.

Well, continuing in that thread from earlier, where I was talking about how cbs had this like hole in their schedule. And everyone was skeptical that sports would fill IT. Everyone thought sports, we're like a very male thing, and especially as sort of brutish of a sport as football.

They didn't think IT would do well, certainly done in prime time, but not even sort of in the sunday afternoon slot because, you know, it's just gonna attract the husband's to come and watch IT and IT doesn't have a family appeal. And john name is is like the first big example where everyone realized a football totally can be for everyone. You continuing that thread from earlier why I was talking about how cbs had this like hole in their schedule and everyone was skeptical al sports would feel IT.

Everyone thought sports were very male thing, and especially sort of a brutish of a sport as foobar, certainly not in prime time, not even sunday afternoon slaw cause you know it's gonna attract the husbands and joe name is is the first big example where everyone realized, oh, football totally can be for everyone. We want to to think our long time friend of the show, venter, the leading trust management platform, venta, of course, automate your security reviews and compliance efforts. So frameworks like soc two, I saw twenty seven O N G gdpr and hypo complaints in motoring. Vento takes care of these otherwise incredibly time and resource training efforts for your organization and makes them fast and simple.

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So the name of signing is the first big post T, V. Money contract signing in the A, F, L, N, fl. war.

But IT starts a whole wave now of competition between the two leagues to go sign all the college superstars coming out for the next year. So IT gets pretty crazy. At one point. The nfl starts what they referred to as a code me as a babysitting program.

This is literally a kidnapping program where they will send agents to colleges and the top color athletes who are seniors about the graduate and literally keep them out of the hands of A F L. Humes, not allow them to sign contracts. H, pressure them into signing with the N, F, L first.

They just put up in hotel rooms. They don't tell anyone where they took them, so nobody can tell the A, F, L team rep, this is where you can find the star. It's just like you got him captive to sign him.

The interesting thing too is that the leagues are respecting each other is drafts. So IT doesn't matter if you draft someone in your league. I'm citing him to a contract in mine and that contract is valid in the united states. I don't care what your draft says.

This is the battlefront. It's with rockies and the draft. What they don't do yet is started seeing each others players that's like hitting the nuclear button an option, right? So they're keeping this to rockies. But still like pretty quickly, contracts for rockies get into the close to million dollar range, which is way more than the veterans are making. IT starts causing these problems across the league.

And at this point time, by the beginning in one thousand nine hundred and sixty six, the nfl, and in particularly the owner's group in the nfl, realizes that, hey, A, F, L isn't going away. And this is not onna. Be like last time. We're going to have to play all with these guys.

literally. And IT begins a super delicate dance of their, my swire enemy. But there are some owners who see the writing on the wall very early and say, we're gonna have to combine these, and it's probably not actually legal for us to combine them, but we're gonna kill each other if we both keep going.

So what do we do? And so IT begins this multitude negotiation, where certain people at the top don't know they're negotiating. Meanwhile, certain owners are forming side deals with other people who own teams in the other league.

Is this fascinating spy game. Oh, happens next is like a mafia movie. It's like a godfather film.

So a few of the most influences owners come to rozelle in thousand nine sixty sex, and they say, the way things ago, when the A, F, L, we're gonna beat them. This draft situation with the rockies is out of control. The contracts we're paying, we're losing too much money.

This is gonna ill. The league, if we keep the war going, we ve got to get to a choose, which that means we're gona have to merge. So we're gona direct you rosel to go start merging negotiations with the A F.

L. Rozel doesn't want to do IT. He thinks they can win.

He wants to fight. But he's like, okay, I worked for you. He's the company man, one of his superpowers.

The way he's able to achieve of this is he really is good at pleasing everybody, finding solutions that work for everyone. And so he says, okay, i'll move forward. So he drafts the cowboys G.

M. In texas and dallas, getting tex stream to secretly open negotiations with lamhorn t. Lama, at this point has moved the taxes to cancer city, where they become the chiefs, but they have a working relationship also.

How great is that? That the first covey's owner is named text.

I don't think he was the G. M. I don't think he was the principle owner, but I think he had a ownself stake. So tex approaches lamar in early one thousand nine hundred sixty six, says, hey, i'm the emissaries of the nf.

You know, rozelle sent me, i'm here to talk merger, but we gotto keep this underrated ts, because if before he gets out, then, like all health, going to break this. And oh, by the way, the number one sticking point for the nfl that he tells lamar up front, they will not consider deal otherwise, is that rozelle remains commissioner of the combined league. So hunts like I think we can work together so they start working, discussing there are no notes, there's no written notes. It's just like them chatting with each other for a couple months as they start. The other owners don't know about IT.

which is hard because when you're not the designated representative, you can't say i'm coming to you with something I know will work. You're saying, hey, enemy, I no, you can't know for sure that I can get this done, but you have to trust me enough that i'm pretty sure I know my fellow owners enough that they would agree to this. So if you and I can kind of get close to agree to something, that I can take IT to them. But this is all subject to them blowing IT up.

Yes, very delicate situation. Now you might ask why on the N F fell side of rosel and SRAM not going to their counterparts on the a fl side, they're going on right to the owners till the well, there's a weak lame duck commissioner in the A F. alga. Name, joe foss.

And especially as the war and the T, V money start escalating between the leagues, the a, fl owners, he is enough their respect, they don't trust that he can be the general to lead them to war against the n felt so right is the negotiations start happening at the A, F, L. Annual meetings. The owners fire joe, so the commissioner is out on the af side.

They decide, just like the n felted. With the A, F, C. He, we're about to go to war thing against serious with the nfl.

We need somebody who's gna kick them, ask for us. They draft. Fellow owner had coach gm of the oakland raters, al Davis to become the new commissioner of the A. F. L.

right? So now we've got this cast of characters to paint agent to. On the nfl side there is the commissioner Peter rosel, and dallas cowboys gm tex.

sharm. And on the a fl side there is new commissioner and radar owner al Davis and the chiefs owner lamar hunt. And lamar hunt, of course, was the guy who started the whole A F L. In the first place.

And l davy's. legendary. There's a quote about him in america's game outside of oakland, IT was not certain where al Davis would finish in a public pully contest among sharks, the mumps, the income tax and himself.

If the voters were the other american league ootside all coaches, Davis would probably be third, edging out the income tax in a thrilling, he is the epidemic, a mafia. Dan, you can't trust l Davis any further than you can throw him. And he is the perfect new head of the A, F, L. In this war.

And basically the head. Just to go beat them up and negotiation. I mean, at this point, it's like, hey, we fired our guy. We understand where in a negotiation just like go get the best deal you can and if you have to pissed everyone off such that you have no working relationship with the rest of the owners, al Davis is a kind of guy is like, i'm totally for that. That's fine IT for the next thirty years, everyone that I have to work with hate to me.

They don't let him know about the merger negotiations. They don't actually want him to negotiate. They just want him to start a war and improve their negotiating leverage.

I see in .

literally one of the most incredible unfold stairs of all time, the nfl fires the first shot in the new war as soon as Davis takes over. So in main thousand nine hundred and sixty six, the giants in the nfl break the gentleman's agreement. They go over and they poach a veteran from the bills in the A, F, L, A kicker, literally a kicker. They start a war over a kicker.

And that makes sense, the giants, because they are the most harmed here. I mean, they have in their own city the jets with john name.

Once this happens though, the other N F owners are just apple plec, a giant owner willing to mara. They like you throwing this all away over a kicker. So the owner of the courts, the quote that is attributed to him, got David mara. If you wanted to kick her, why didn't you just ask me? I'd have given you one.

So eighty of the thirty million americans who play that acy foobar can relate to this situation.

So Davis gets the news that the gentle's agreement has been broken and the kicker has been signed. The kicker signing heard around the world while he happens to be literally in the middle of meeting with the bills owner, supposedly Davis, he just sits there in his chair and he leaned back and he smiles and he says, well, we just got our our merger. The bills owners like, what are you talking about? Davis says, because now we're going to go out and sign all of their players and we will destroy them and they will come begging to the table.

Some doctor evil shit right there.

don't believe. That night, the new ork times asks Davis for his comment on all this, which, by the way, you couldn't design Better drama, especially doing the N, F, L. Off sea, until they keep amErica interested in football.

amazing. The york times asks Davis to comment and he responds, quote, this is something i've been aware of, and I anticipated the probability, but you don't make threats at a time like this. Our answer will be an action. This is not the time to speak.

I wanna steal that word for a word, for something in the future.

So, great. So his first reaction, like any true mafia, dan, he doesn't really want to go into all out war because he knows that's going and badly for both sides. He wants to send a targeted message like the equivalent of, you know, a fish raft to delivered on the doorstep or .

a horses had in your bed.

exactly the horses head that he decides to send is he is onna target resell lsd team, the rams, and he's going to sign the quarter back away.

We just walk from a kicker to a quarter back that escalated quickly.

Well, he got to, you're gona send a message. You're gonna come at the king. You does not mess.

Yes, so within three days, the readers have signed away Better and start quarterback for the rams, roman Gabriel. And this is where, again, the nfl makes another tactical air. They don't respond to that.

They don't come to the table. Nothing happens. So a few days after that, Davis does unleash all out war talk about, and I trust, violations. He literally directs the gms of all the a fl teams to go out and sign all of the quarter vex in the interface l.

which to do this is an economically negative move.

of course, which is why he didn't want to do IT.

They're already making the maximum amount you should be willing to pay them for what their brain, your team or likely close to IT and you're .

going have to pay them a lot more. Switch leagues. So lamer hunt course gets word of what's go on on him and while he's in secret negotiations with tax and rosel for a merger and hunt, like rosel very diplomatic man, know he would never do anything like this.

He doesn't think this way and he gets word from the oil from their G. M. That Davis just instructed him to go sign the forty nine years quarter back and hunt to find like this is too far, stand down and cancelling Davis orders.

Don't go do this. The oil is gm gets off the phone with hunt, calls up about Davis and says he lamer just called me, heard about what we're doing. He told me to stop.

Davis supposedly sits there for a second and as did you give lamar your word that you won't do IT the oil H. G M says, yes, Davis is there again. Think about IT and says, fuck IT sign up anyway so they do the oil lers go sign the forty nine years counter back.

And that is what makes IT all work. So Davis hangs up with oilers calls. Hunt needs like you.

Dumas, why on earth would you stop me from doing this? I know you're working on a merger. I am your best weapon that you have. I am giving you leverage. Of course I need to do this and the most like, oh ah yeah OK go head right.

I'm not being in secondary against you. This is a weapon for you.

Yes, I may be a dog, but I am your dog in this case. So within a couple days, it's all over. On wednesday, june one thousand nine hundred and sixty six, merger agreement gets announced in a press release unalike with the A, A, F, C.

This is a true merger. All of the A, F, L teams will join all of the nfl teams together. They promised to add at least four totally new teams and cities.

right? So there's twenty four combined teams, and they promise to expand to twenty eight over the next three, four years up.

They announce that because of the separate TV contracts on the A, F L in the nfl side, they will not begin a joint season immediately. We'll let the new a of L, T, V contract play out, which we will go through the one thousand nine hundred and sixty nine season. The first fully combined season will be in one thousand nine seventy, but in the interm they will start hosting a new pro football world championship game between the winners of the two leagues starting in the nineteen sixty six season. And boy, that would be a super event for television.

This officially called A F C N F C world championship game sounds like a ducey. Sounds pretty cool to watch.

Some other points to the deal. There will be a single common college draft starting immediately. No more these separate drafts, no more babysitting, no more ridiculous contracts, which of course, took for the anti trust and played.

And the players hate this. Of course, rosel will remain the commissioner, and al Davis is going to go back to running the readers, which dave is fine with. That's all he really wanted. Anyway, not announced, but included this. I believe when they came out much, much later, the A F L franchisees did collectively pay the nfl owners eighteen million dollars to join the league over .

a twenty year period.

Yes, this though, was an enormous Victory for the A F. L. For two reasons. One, the nfl obviously had a the larger TV contract. So that's just like found the money right there. B, they had all the upper ATS they had and fell films and fell enterprises that said everything.

And by the way, immediately, even before they combine the league officially in one thousand, nine and seventy, they form A F L films. For that, 3NFL films highs twice as many people， and they go film every single A F L game to starting immediately.

So both themselves, huge reasons why paying only eighty million dollars was a win for the A F L. That even bigger reason when the negotiations started between sham and lamar, the n fels initial asking race was fifty million dollars per t from the A F L as branches v so to go from fifty million per teen to eighteen total paid over twenty years, all thanks to al Davis, the A F L owners owed aldavini big glass champion jelly.

That's an incredible leverage shift over the course. The negotiations .

and IT happened in like a couple months. Yeah.

there are some other interesting deal points to. One of them is that the eighteen million actually didn't go to all the nfl teams. They went to the giants and the forty minutes because those were the two teams most affected by now having another N, F, L. Team in their city.

interesting.

That makes a lot of sense. And i'm like pretty sure of that. If anybody listening to this knows that for sure. I know that was floated.

I don't know that ended up being in the final deal e points, but specially in demand that I think is how I got written down that because the existence of this merger now causes one of the league ownership rules to be in violation, which is no two teams can be in the same media market. Well, we know of a problem. We indeed to compensate you for that.

And I think the giants actually got more because john nameth was the other one in their city. And so what you also start to see, because this deal is the real modernization of the nfl. They decided that anyone with less than a fifty thousand seat stadium needs to change that.

They said that for what foobar has become after this merger, modern nfl in america, that's not a suitable place to play foobar anymore. And so you either need to build a new stadium or expand your stadium. And then the other final thing that is a consolation prize for the A F L is that they actually got to bring their records over whether the A, F, C, I don't think they did.

I don't think those fell records. I did find mrs. Linked in the shower notes in our sources. I kept reading about the nfl records in the n fell rule book. And the this, this exist. Is this like, therefore, al, every year the nfl publishes a one thousand page P D F of all of the historical, everything, all the scores, all the games. That's awesome.

IT being in P D F for .

makes IT pretty useless. But I assume it's A P D F of a physical book that exists with all the records in IT.

I would assume somewhere through hell enterprises, you can probably buy a take skin bound version of that.

yes. So this announcement in june or sixty six, you would sort of think, okay, this now just clears the way the next few decades are just laid out in front of us. There's one league.

There is no real competitors. What could possibly chAllenge football? And the answer is, yet again, the love of land in the united states. So in october, congress actually passed a law to allow this merger and grant yet another antitrust exemption. This time, london Johnson signed IT into law.

And great say, why did they need another one? Well, the murder of two completely different organizations that were competitors, that's kind of a different thing than allowing one owner ship group or one trade organization to negotiate on behalf of a bunch of sort of member teams. So this actually is a different, the anti trust issue.

right? It's actual monopoly versus collusion. The first one was collusion, right? This is creating a monopoly.

And so resell in the nfl are calling on all the favors they can get, but the bill that will allow them to do this is stuck in committee. And so here's the paragraph out of america's game. Rosel, seeking a way to break the log jam, called his friend David dickson to see if he knew a north lousianner congressman on the committee.

For someone as sophisticated as pete, he was rather naive when he came to politics dickon. And so he eventually finds his way to the housemates, orty leader, hill bogs, who is an old maternity brother of dickon's, at to lane. And he said, I can find the votes for this.

And this is how the neutral states came to exist.

yes. And IT was basically a quit procol where box said that he would pass this law and allow this merger to happen.

Wap up the support. Wap up the votes.

Yes, if there was a implicit promise that luiz, I would get a and fell team. I'm to quote this again, walking up the stairs of the rotunda when the vote looked like a sure thing, resell whatever his usual humble self congressman box. I don't know how I can ever thank you enough for this.

This is a terrific thing you've done. What do you mean you don't know how to thank me? He said, newer links gets an immediate franchise in the nfl, and rosell says, I want to do everything I can to make that happen at that bogs stopped in turn on his heels, setting back in the committee room. Well, we can always call off the vote. Well, you result took two giant strides afterwards, turned around him gently and said, it's a deal congress' men, you'll get your .

franchise of basic.

So it's like how many presidents and how many congressional and how many, like the nfl, requires this perfect storm of postwar america, technology, the growth of television, all these innovations, all this fly wheel, and also the repetitive CoOperation .

of the U. S. government. So once this has congress and the merger is proved, remember, IT won't actually happen until one thousand nine and seventy.

But we're now in the nineteen sixty six season. There's this little matter of the world jeopardy game, this super matter. And this is, again, credit to brazil.

And counterparts like Sunny in in the A, F, L, saw that this was an incredible opportunity. There had never been anything like this before. This is the wholesale invention of a new major sporting event for the first time within the T.

V. air. Nothing like this had ever happened. The world series was created away before the T. V.

Era, totally. And you mentioned before during the june united game, the gress game ever played that that drew forty million people. And that was much earlier in the T.

V. Fiction of america. IT wasn't really the nfl that we know. There's all these other teams, there's all these other markets. So if we can sort of Taylor make a game for national television as this entertainment event, IT can be much, much more .

significant. Not only that, these guys are smart. They're smart business people, the smart media people. Even though the TV contracts are already in place on the nfl in the A, F, L side for their respective seasons, including their respective championship games, this is a new game.

There is no contract in place yet for this, so they remit the rights to this world championship game to all the networks. And C, B, S 和 N， B, C. Are living. S theyve already got the rates to the respective leagues.

They thought they both had a chip in ship game, but IT turns out they both had to send my final.

So what ends up happening? They both feel like they can't bear to not win the rights to broadcast this new game. The each end up paying one million dollars for the rates to both broadcast. So this game now is gonna be broadcast to the nation on both cbs and nbc, and in addition to them each spending a million dollars for the rates to this one game, they also both pledge to spend one million dollars each in promoting IT in the lead up to the game. This is unprecedented, has never been anything like this in media history.

This ended up actually having a seventy nine percent share of american T. V. Whatever Nelson measures. So it's the share of all the TV are turned on at this point because IT was on two networks.

incredible. IT ended up being watched live by over sixty five million people. Super ball one at the l color .

um you can call out that, David, this is the A F L N F L world chian ship game.

I about is the world championship game at the L A M and in like such a perfect symbol of the new world order, the new media and scape largest television event in history, unpressed ground breaking live in the stadium. The only polity is pretty big. IT seats.

About ninety five thousand people. Only sixty three thousand people showed up life. There is only two third attendance live at the game, and I didn't matter at all .

when I twisted about super bold ones like pictures from at the other day. And I didn't realize you can see there's an area that stands where people are not sitting. I assumed IT was like too later, too early. That's like during the game .

and they didn't fill IT. Wow, they didn't fill the stadium and everybody got rich anyway. okay. So a few things leading up to this.

I again like there so good rosel and football at this time, they're just architecture all of this life. So they know this is an incredible opportunity. Nothing has ever happened like this before.

During the age of TV, they're creating a television event whole lot. So they're totally lean into a media week that is a delivered invention. Bip raz l and the nfl leading up to the super ball, all the crazy interviews, everything that happens that we take for granted right now, like that was intentional. IT was designed. IT was created that way.

The commissioner's press conference the friday before the super ball.

yeah, which is designed to take the pressure off of coaches and the players who have been been girdled all weeks so that they can actually prepare for the game.

And it's about league business. So there's all this news that comes out about the nfl and how IT will be changing for the next year right before the super poll to draw the attention to the nfl right before for the super ball.

And that's just the public facing stuff. During the week leading up to the super bowl, they host parties, they host events, they the concerts. They host experiences, not for the public, but for their partners, for the TV partners, for the advertisers, for the press, is all about adding the glass and the in to the people who are going to add the glass.

And literally reserves directive to the nfl staff was he wants every media person in partner leaving the super bow to be saying, man, this is a lot Better than the world series. great. So great.

The game itself, the packer is end up destroying the chiefs totally validates all the nfl teams. The game on the field, they had a huge superiority complex. They were like the, hey, F, L, in feria. They'll never win. How do we let these bozos in our league the next year in super bol two, the packers again beat down the raters this time.

And if this were a football podcast, we've talking about the dynasty of the packet ers. But IT is worth saying, wow, the dominance of the packs ers right around this time. Vence bari winning .

the first two super balls there. IT wasn't for super about one or two. And then the one game we will talk about here.

super bowl three. Yes, by this point, the game is formally called the super bowl the press had been looking for something to call IT. And, you know, lamer hunt, I think i'd been the one who observed his kid playing with a amo super ball. And so in the league, discussions were sort of going on about, and he proposed super ball. But Peter roll hated IT.

He wasn't serious about IT like I think lamar was like god just kind of a funny place holder name but then I just stuck.

But IT came out in some press interview and then they just ran with IT and then IT was .

at at least control yep, it's a super, about three. The narrative leading into the super bowl is the old N, F, L, soon to be N, F, C. teams.

That's real football. That's real football. The A, F, you know, fluff. And there's, like, real bad blood between the coaches and the players on the field. Severable three, the cults versus the jets, the old cults, june united, different era, the thousand, nine hundred and fifties against broadway. Jo name is and the jets.

And this is still .

baltimore cults, right? Bolt, more cults, yes. In the lead up to the game, the cults are nineteen point favorites heading into the game. Nobody thinks the A, F, L can compete. They've been destroyed the last two years. And then during the media week, this the reason we're talking about this sporting event here in the midst of this business podcast, it's just like, oh my gosh, you can't design .

this any .

Better broadway to guarantees and A F L Victory during media week, during a press conference like you can't make for Better TV drama than that. There is this very famous photograph that will link to in the shower notes of broadway G O.

At the pool during media week with the playbook in his life, he said, like to reverse the sex employees like IT is no swim trunks and there's just all these pressing cameras and all these women like gathered around him like staying at human IT was a moment like this was all over that, you know, news all over a television all week like, what an incredible media event and then during the game, joe delivers on his guarantee. Huge upset beats the colts, the first A F. L. Victory over the nfl at the after party. Carol risen bloom cold owner, is like, totally deal IT he comes up to rosel he's saving and rozell like, just like so many conversation is like, I know, sorry, this is the best thing that has ever happened to the game and to us he's so right.

That seems like one of the obvious playbook themes here is every time you think you just got beat by some other football team or entity or personality, IT ends up being so good to raise the profile for the game that everybody wins IT. Turns out the answer is, most of the time, everybody just keeps a winning.

Yep, as long as there is drama, as long as there is competition, everybody wins. Yep, I mean, this is the great paradox of the nfl. Everything is about the game on the field, and nothing is about the game on the field.

The same time, what this is about is making sure the game on the field is compelling. Whoever wins, they all win. Well.

this is kind of the debate today between the new group of owners and the old group of owners. The original owners are so steadfast in this is about football, and we make a great entertainment product, but there's foobar at the core.

And the thing that they're all a little bit nervous about with the new group of owners who are so excited about building these unbelievable businesses, taking on more and more sponsorships and sponsoring team jerseys and on field sponsorships and building the spectacle around every game, and what if we had a super able half time show at every game? It's like, are we not a football product anymore? Are we some kind of entertainment franchise that has lost its way? And I think that's the interesting dichotomy between owners these days.

Yeah how far is too far? But at this point time, they are nowhere there too far.

Yes, lean way and do IT.

The next year, the chiefs beat the vikings and the premerger super ball series ends tied two to two. Two Victories for the N, F, L, two Victories for the A, F, L. Again, could not be Better for for football and the newly combined, and fell because that leads right into the first joint, fully integrated T, V negotiations for the one thousand and seventy season.

This feels like it's going be a big package.

Oh boy, the network is going to have to pay up and pay up. They do. They decide to keep both cbs, N, N, B, C, essentially with their same packages.

C, B, S, hearing the N, F, C games and N, B C airing the A F C games. There is some relevant at the conferences. So some of the nfl teams go over to the A, F, C. The combined contract value is now a four year contract. Combined contract value of a hundred and fifty six million dollars, that is forty million dollars per here, has a lot of money.

And this is where the genius starts of the nfl, realizing we don't have to assign one contract. And for anybody is look at the contracts today, there's a lot of contracts and there's pretty much not A T V distribution company that is not distributing some shred of what the nfl has carved up. But then realizing here in one thousand nine hundred and seventy, we don't just have one deal of sign. We have an A F C package and A N F C package.

And we might actually be to invent .

some more here, too. yes. So David, take us to monday night.

Oh, let's go to monday night. So they got C, P, S. We've got N, B, C. Remember, A, B, C. A B, C has been out in the cold fur several years now, since the A, F, L signed their second deal with MBC.

which is a real shame, because you ve got relish there. He's a visionary. This is still before E S P N. right?

Still before E S P N. Well, well, before E S P N, ten years.

So yeah, that still far often the future. But A, B, C is clearly interested in sports.

Yes, clearly interested in something. So rosel and runi start chatting. Rosel has always, supposedly always had the inkling that football and the nfl would do really well in a prime time slot.

But this is crazy. Like you talking about a little while ago, sunday's were perfect for football sunday afternoons because the networks didn't have anything else to air. The except of thinking at the time, was like a sports of perfect for sunday afternoons. But like the core business of the television networks.

right, sports is not prime time.

is showing shows and news and entertainment in prime time. And that is not .

sports that appeals to the wide range of people. And that we still don't know for sure that the n fell is that.

you know, it's very telling that all of these networks had separate sports divisions and that A, B, C, did you even have one until they got the first day of al deal? IT was the separate thing.

And just to keep tracking our baseball versus football comparison this moment in one thousand and seventy is right. Or on the time where the nfl is eclipsing baseball to become america's favorite sport, it's been slowly gaining ground over the last thirty years. And the merger post secretion, the super bowl really puts the nfl here squarely in the lead, making IT the perfect candidate for this sports prime time experiment.

indeed. So rozelle is like, this can work. And real or ledge is like, yeah, I think this can work.

So they brainstorm and together come up with the idea for one single game every week, with incredibly high production values, broadcast in prime time in the evening, on monday nights after the false late has concluded on sunday. And oh my god, so many advantages to this on the sunday games. There are always habit.

So many games that happen on sunday, you can't watch them all, all, all at once. They're all happening. And currently, you're seeing different games in different markets.

There's not a national event to watch because the way the local affiliate works, it's still this point in time where you can watch a home game at home. So whatever is on T, V, in your city is wherever your team is playing, if they're playing in a way game and no nfl on sunday, if your team is playing a home game, either you are going to the nfl game on sunday or it's a non event for you that week.

right? And that's on the viewer side. But from the production standpoint for C B S N B C, they're sending each of them like five, six, seven T V crews out all across the country like their resources are getting totally deluded. Every sunday, they can put all their effort into one prime time game.

And the broadcast, other than the super bowl, and honestly, like even kind of the super bowl at this point in time, are pretty bad that we talked earlier about. They got Better and they learned. They didn't learned much.

They were still referred to around this period of time, one thousand hundred and seventy, as football in the cathedral. You had no fun camera angles. You probably had three, maybe four cameras in the entire broadcast.

And most of IT really is just that, fifty eight camera that are as soon and out. And the announcers are kind of relying on the fact that you're watching the game. So they're not really commentating that much. They would just sort of help you know that there's audio associated with the broadcast your watching yeah I mean.

step back and think about the last nfl game. You watched the transitions between the camera angles, the music, the sound affects the microphones, the analysis, the sideline reporting.

the lower thirds, the graphics.

None of this existed.

The notion that there's play by play in color, this idea that there should always be someone talking, saying something interesting while you're watching a game.

yes. So this whole vision for monday football that ruin our ligion A, B, C can make happen for the nfl and new media rates for the nfl to sell more revenue. They've got IT all line out all the details and right before they're about to sign a deal results like, by the way, we have these partnerships with cbs and nbc, we got to offer this to our partners first, which you rose.

He has this reputation and history treats him as like a incredibly kind, incredibly accommodating. And I am sure that's true. But he had a little bit out.

Davis in immature. He knew exactly what he was doing here. He knew that there was no way that nbc and cbs were going to take this package. Yep.

he just wanted a stocking horrors. He's like, I don't want to leave any money on the table. This, whatever we're signing here, they have to fear they were .

going to walk totally, of course, breaks out. This is his baby. This his career with an abc.

He's been preseli this to his bosses. So he looks bad if they lose this now.

So they come in with the over the top deal. A, B, C gets exclusive tes to money in our football for a new deal, new product, eight point five million dollars per season.

And the other deal was .

the other deal was forty per season for essentially fifty six more content, I think.

right? Each T, V network is paying about twenty to have either the A F, C package or the N F, C package on sundays. And A B, C is coming in and now spending eight and half just for one game on monday nights.

And you might say, wow, that's terrible. Their way over paying for the amount of content that is. But actually what you want to be paying for is the smallest amount of content possible that gets distributed to the widest audience possible.

So you actually should be willing to pay up to twenty million as long as the aggregate number of viewers that you get on that day is the same. Because if i'm A B, C M, like while those guys actually sucks for them having to produce four, five, six different games, I only have to produce one. And its nationally broadcast across all my affiliates. This is amazing. We are going to go hard on posts on the production side to make IT the most dazzling possible experience.

And we're going to make IT back, avoid the day ever. The first monday night football game that there is. That season is watched by sixty million U.

S. households. That is like literally super bol ever. I super able. One was sixty five.

They invented a holiday out of nowhere.

and it's every week. They totally invented a weekly holiday. It's amazing. C, B, S, and abc must have been .

passed seriously, because they also know they sign the contract, thinking, we, between the two of us, we basically have a lock on all the football. And then they invented more football.

exactly for the newly combined dfl. They invented more football. They invented revenue. amazing.

And by this point, the nfl starting to wake up to this idea that, you know, there are still not willing to play IT with the black outs at all, but maybe people watching on TV can be Better than people coming into the stadiums. Maybe there's enough money in this that for us to be nationally broadcast on a monday night.

I still think IT was blacked out in the home market, but they recognize the value of everyone else watching and how that's even more important than the stadium itself. Okay, I made a list of things that monday night football invented that was not a part of your typical football. And I fell broadcast before monday night football.

And IT is astonishing. This is everything that you expect in every nfl and Frank, every college game that you watch now. And IT was brand new for monday night football all, and in fact, was monday night football exclusive for twenty or thirty years in a lot of the cases.

But the overriding idea that we are going to cover a football game like show business, this is not a sport or broadcasting. This is show biz, and we will make you feel like that. So what are we going to do? We're going to put cameras at field level.

We are to put Cameron people shoulder, and they're actually going to get to us how to run around and get up close footage of people while they're celebrating, touch down dances or when they run in back in from the sideline. We're going to put cameras on the twenty eight lines in addition to the fifty yard line so that we can get a straight down view in there in the red zone. That's not just so of this weird 3 from the side angle on on touchdowns like we're going to get great footage head on during touchdowns instead of two commentators went up a three man booth and there is going to be be real action oriented commentary there。 And of course, we can talk about and I foobar without Howard cosell and his unbelievably unique style of nearby and really injecting himself into the story of the broadcast, rather than just being a sort of opinion list third party observer, he created a little bit of a foil to play off of for the other commentators. Where there was real relationship and you were tuning in not just to watch whatever the football was, but to watch these announcers who you sort of got to know over time and really observe their charisma with each other about the game.

That's exactly what I was gonna. It's the same dynamic with pocket. Now it's like they became your friends in the booth.

right? It's not just that you're listening to business stories. It's that you're hanging out with David and I while we talk about business stories. It's one of the first examples ever of realizing the power of that. They went from the four cameras that typically would cover a sunday broadcast to nine cameras and then eventually up to seventeen cameras.

They invented the parabolic microphone coverage that you O S see on the sideline, those sort of clear plastic microphones that are aimed at gathering the sound from on the field. They had forty engineers. They had twenty production people.

They invented these split screens you could watch. Two cameras can currently cover the game. They had on field interviews, shots of cheer leaders, to add a little bit of a sex appeal to the game for the first time.

And they also used Green screens, which is so funny to watch some of these early. I guess they didn't have room in booth, according to the patents places. E S P N.

Video that we watched about this, where for the three men booth, they needed more space than they had in the press box. So they ended up putting them, like, out in the hallway and built a little custom room to do this in. But the background wasn't good.

So they put in a Green screen, and then they would put another camera in the press box, and so they would superimpose that the field was right behind them. But I actually wasn't. IT is so obvious watching IT today.

like floating on the stadium. retaliation? Yes, but this is revolutionary stuff.

yes. And there was one other really, really big innovation. And this was a thing that would go on to be the predecessor for E S P. N as a network, for sports center, as a program, and that would create billions and billions of dollars of enterprise value. And that is replace yeah.

the highlights before we thought pilots, did you say the theme song too?

No.

yeah, I thought actually that's where you were going with the P. M. I mean, the theme song is like there were no theme songs before this.

right? This notion you're actually tuning into a program that has an associated pump up song that is built for that franchise is unique. okay.

So let's talk about highlights. So how could you have possibly watched highlights before my night football? All the games were on sundays, and that was really the only football that was on all week. And know we didn't have the internet, there wasn't esp. And there wasn't sports center, so there really was no place to go in watch highlights.

Now football and all sports are unbelievably highlighted events that if you string together a bunch of the very best place, it's really, really interesting and really entertaining, especially if they are covered by great cameras. Now compare this to baseball, where not only was there no place to go watch them, but there was no one capturing the footage to even highlighted. But nfl has nfl films, and using high quality cameras and film stock, they are capturing great camera angles of every game.

And so between sunday and monday, the nfl films team would go and take all of the footage from the game the previous day, caught up a highlight, real and as soon as possible, get that to whatever city the monday night football broadcast was happening in, so that they could play IT at half time. And how our cosell could give his commentary, often having never seen the footage. Well, the highlight real is playing in the background and really invents this idea of, for the first time we're going to watch highlights of yesterday's games.

I got to imagine the highlight light real was literally being slid into the machine as they were getting ready to broadcast IT. Because think about the logistics in there. You get the film stock back from all the games all around the country, back to N, F, fl films.

They produce the highlight real. They get that finished real. Back to the money in foobar location, which is another location somewhere around the country total, all within twenty four hours.

It's really amazing. There is one interesting piece of legacy at of all of this. One of my favorite things in preparing for the episode is discovering all the pieces of the modern deals that are in place that have been lawyer to high heaven, that have their origin in some interesting logistical piece of how the league used to work. I think the way that the rights are cut up today includes highlights as a part of the monday night football package.

Oh, interesting.

So the way that the write are sold today, one network is the a ffc on sunday. One gets the NFC on sunday. Amazon now has thursday night football. A, B C, E S P and disney has monday night football. And then of course, there's n fell on a ticket, which is another completely different sort of rights. I think the way that E S P N has the rights to all the nfl footage for sports center is because IT is bungled into the rights for monday night football because that is the origin of highlights.

No way. Oh.

that's super cool. yeah. Because I saw a few times in different legal blogs trying to dissect exactly how the rights package worked. They kept saying money, night football and highlights and I was like, oh, and that's probably also why E S P N is so invested in keeping the monday night football package because IT gives them so much to .

the value that they is more, oh yeah, there's so much more value. And that specifically for disney. And yes, first, is any other bitter? Yes, interesting. And if any listeners .

know this for a fact or have any more color on this, I would appreciate IT acquired F M H M outcome. Oh yeah. I can't believe .

only up to one thousand .

hundred and seventy.

I know. Well, the good news is this is the good news.

Yes, yes.

you can get any Better from this. This is now the fully formed entertainment products of the nfl. And they add stuff like sunday ticket in their state football, everything else over the years. But the trajectory is said, there are some ups and downs in the seventies, but it's basically just like gonzo for the nfl.

There's one more presidential intervention in one thousand nine hundred and seventy three. Nixon really, really, really like watching the red skins, but he's sick of taking the helicopter to camp David to watch their away games, which he actually was doing, which is he was .

a nut mixing, literally phoned in a play for a red skins playoff game from the White house.

Maybe should have been pay more attention to foreign policy and things like .

victim isn't not in many ways.

yes, but camp even is sufficiently seventy five miles away, by the way, there is a whole cottage industry that sprouted up of hotels that were outside of the seventy five mile radius. And there were buses. So people would go to these hotels and they would get rooms for the day to go watch the games.

This dynamic formed like plot lines on sit comes in the seventies. In the eighties, I think the bob new hard to this was like a plot line of, like they go to a hotel to watch the king.

I heard about this. Yes.

I was a thing.

So nixon calls pete rozelle personally, the president, the sitting president, united states, and says, hey, we're in the playing fs this year. You know, I think you will be a good idea for you to air playoff games, not every game, but playoff games locally. And pete result, even in one thousand nine hundred seventy three, is pretty doug in in on this issue.

That is a bad thing. And it's canvas zing to our most important thing, our date revenue, if we do that. So he says no to the sitting president.

And so then nixon goes to congress and says, will you please draft legislation which got known as the black out ban? And so because rossel denied the president, there is actually legislation that was passed in order to force the n fell's. Hand in broadcasting away games locally.

And what's so cool, there's an amazing paid in places episode de on this, because nicks on recorded everything in the White house, the White house tapes, the water gate tapes, all that this is on tape. Nixon's conversations directing his staff and congress telic a piece of worms of the nfl, which was good for the country. It's all on tape.

That's an amazing effect. He was wild. And this is one of the things that result got super wrong. The right thing was as soon as possible, the nfl to get as much distribution as possible, because the T, V rights would become the most important revenue line.

But also the thing that most fuel the fly wheele, that more people watching the games is Better for everything, for continued fandom. It's like how disney wants you to consume the content so that you go to the park and you buy the merge. So the disney plus came out as a very cheap option. Here's one of his few strategic flaws, I think, was gaining the content for too long.

And one of this is directly related. But I think so much of the seventies and the eighties and the nineties were also about just like the continued growth trajectory of the incredible marriage of the nfl and television. And the money just keeps getting bigger and the stage keeps getting larger and the viewer ship goes up and need all, all the things.

yeah. And this is probably we're saying that we aren't going to go blow by blow on the nf felt time line past nine hundred and seventy the way we did during the rosel era. There is a bunch of stuff to skip like the U.

S. I. Fell and all the teams moving cities and deflate gate to focus really on the strategic moments that created the conditions of the n fels business today.

Yep, all of those great stories, but like you say, don't really contribute strategically the where the nfl is today. So probably the biggest impact decision that happens during the time may be related to like this continued focus on the gate.

The league first mentality kindly gets broken or diluted with the stadiums that you referred to along the way because as all the teams start moving into the bigger stadiums, they start building amends into the stadiums. S, in the stadium, experiences totally changes, which IT needed to. As television became premise, there had had to be a reason to go to the stadium.

Stadiums become all about the luxury boxes, the sweets, the experiences, the corporate partners, the advertising, the drinks sponsors, all of this stuff. And that becomes huge money for the N. F.

L. But it's not shared money. It's all local money.

Yes, this is my biggest criticism. The thing that got them here, this league first mentality, is eroding because of the way that the revenue splits are happening. So you look at the local stadium sponsorships, you look at every stadium is dedicating more, more real state to luxury sweets.

A lot of the local merchandise sold in the stadiums is local revenue. And so the teams are making more and more money locally and I mean, more money overall. So IT saw good, but a greater percentage is coming from things the teams are doing on their own. And you got ta wonder if that individualism, I am Jerry Jones and the cowboys deserve all the revenue. A mindset will be the thing that eventually kind of causes them to get unseated in some way.

And you know, I think the thing that keeps the competitive baLance in place, even its revenue divergence, is the salary cap.

Yeah, this is a great place to talk about that. Let's go to one thousand nine hundred ninety three and talk about the first time free agency and the salary cap comes into the nfl, how that's computed and how that impacts the sort of leverage going forward. okay.

So one thousand nine hundred ninety three rules around the league has been negotiating with the players association for a while, I think, since the sixties, in various collective bargaining agreements. But the one thousand nine hundred ninety three one is unique. IT puts some stuff in for the very first time.

And specifically, the players have been really mad about something called the rozelle rule in the nfl. And I think this actually does get legally struck down. It's not literally called the rosel role but he was commissioner er and he sort stood by IT and IT basically prohibited free agency.

This is the thing where if a player wanted to move to another team, the team that they were going to would have to reimburse team that they were leaving. Forer negotiated amount. And so I added a lot of friction to signing a new player. So IT had two practical effects, IT hurt the player's ability to earn the most money. And IT decreased the likelihood that a player would move teams.

right? I think importantly, the compensation afforded to the team that was losing the player wasn't just economic to rally drapes could be involved.

Yes, that's right. And so the F, F didn't really have free agency for a while. And in one thousand nine hundred ninety, three players finally got IT, at least as long as a player had been in the league for four years.

In exchange, there was a salary cap put in. So this was the league saying, okay, fine, but we're going to make sure that i'm pretty sure I was kept at some fixed percentage of the amount of revenue that the league generates, right? So that today is actually a pretty high number, is forty eight point eight percent or something. So players are effectively a partner in the league because the league success ends up being very success, not necessarily evenly distributed huggles players by any means, in fact, quite the opposite. But at least players are virtually guaranteed in whole to make close to half of the leagues overall revenue. But how does that work with local and national revenue? Well, since IT is based on the total revenue, if a team makes a whole bunch of local revenue and the salary cap is the same between them and another team that doesn't make a lot of local revenue from a fancy stadium, they're gonna have no problem making the obligation that they have to pay the players close to fifty percent because it's a fixed amount and they make a bunch of gravy locally on top of that amount.

And you're saying that, that fixed amount is a league de aggregate, including all the local revenue from all of the teams. yes. So this potentially could .

create a baLance. It's OK as long as the revenue doesn't become too big of a part. But at some point, you have to imagine that what is forty eight point eight percent of league average could be ninety percent of what I make as a team in a small market with a crappy stadium. And then because I have to pay players so much, there's no way I can pay for other stuff. And so, you know, my coaching gets hurt, the production for fans gets hurt, or something that makes me a less competitive team, even if the players on the field are paid just as much as players on the field from other teams.

yep. And importantly, this collective bargaining agreement and the of this form of free agency for the nfl, I think, was the first C, B, A that he results successor portugal negotiated. So IT really was a new era for D. F. F.

yes. And it's interesting, I think in ninety three, when the salary cap first came out, I was just of the shared revenue. But now that in the more recent agreements, IT includes all the revenue and local revenue is actually growing as a portion of the overall revenue for the top teams.

Unshared revenue, four teams grew from twelve percent in one thousand nine hundred ninety four to twenty one percent in two thousand and three and is over thirty percent today. So there's definitely a meaningful and ever growing part of N. F.

L. team. Revenue really does come from just the team itself and what I can do in his local market, not from that sort of locked brotherhood of were all in IT together .

league revenue. Yeah IT is a serious threat to this magical fly wheel that has made the nfl function and succeed well beyond any other sport on a revenue basis in the world, given the football and the nfl is not the most popular sport in the world, that is by far the highest monetized and largest sport by revenue. I think actually, I don't know.

He said this a friend. I'm pretty sure the nfl is the largest single media business in the world, not an agreed diversified media business. Believe if you consider the league as a single property, then I think this is the largest individual single property in the world.

A good question. The comes would probably be like marvel or lucas film up.

I looked at that bigger than marvel, bigger than the .

film really yeah because the n felt is eighteen billion a year in revenue right now, which is expected to grow a twenty five billion by twenty twenty seven.

Yep, I believe marvels not anywhere near that.

wow. Yeah.

that's well because it's an annual basis that's every year.

I mean, this T V contract that they just signed, the ten year deals for one hundred and twelve billion dollars across all these entities. Just wild. And just to share what that specifically looks like.

Cbs broadcasts a sunday afternoon package for one point eight five billion a year. Fox has a sunday afternoon package for two billion a year. They invented a new skill, the sunday night package, and they invented this a while ago.

But N. B. C has that for one point seven billion a year. Disney owns monday night fall ball, as we mentioned, for two point five five.

IT is a single game per week, and it's the most expensive package. It's incredible. Amazon has thursday night foobar for one point three billion a year. And of course, then we just got the news last month that direct T V has lost nfl sunday ticket and that is moving to youtube. T V N felt under ticket is also a genius move because you're .

reselling the same content you've already sold.

It's the same content. It's the content that is exclusive to C B S, fox, abc that those networks produce. And pretty sure it's even like their cameras. They are on their talent, all that. But the nfl IT has the exclusive right to bundle all that together and sell IT as a package directly to a consumer.

If you want access to all of the games, if you don't just want the ones that are on T, V near you, if you want the ability to watch any game at any time. And IT is incredible to me, that is worth two billion dollars, given the nfl is actually not doing the work to produce IT. People who are doing the work to produce IT are the people who are paying for the privilege .

to cover those games. amazing. And then there's more now and let's catch us up to the present day.

There is revenue from the to fill films division. I think it's probably couple hundred million dollars. I would expect at this point time, there's other lending rates, particularly video games and man.

So I don't think it's public, but IT was reported that the latest main licensing deal with ea was a total of one point six billion dollars for a five year rights. Wow, which man remember that evicted we do with trip on E A back in the day was so fun. And talking about the origins.

that's a three hundred million dollar a year deal. So that's like a sixth of what one of these channels pays broadcast the actual N F L. That's what E A pays to just license the use of the player names and team logos and all that. Oh, I assume player names is actually licensed from the players association separately.

It's all single negotiated. I believe it's reported that I think six hundred million of the one point six goes to the players, then there's fancy about betting and non betting.

Yeah and this is a good point to fully bring us to today. I think IT is totally reasonable to say that the things that powered the rise of the nfl, where national T. V.

Postwar prosperity, the rise of the middle class, the medicine national explosion and the league first mentality, but all of this is in the fifties, sixties and seventies. The thing that powered the n fell to be such a dominant force in society today is fantasy football and sports bedding. So let's talk about fantasy first.

great.

There's like thirty or forty million people a year in the united states that play fantasy football, thus making IT the way that the centerpiece of conversation with their closest friends and families and coworkers, which means you have to watch football in order to have those conversations with the people that are closest to in your life.

Fantasy is such a great example of driving and adding to the rosel fly wheel, Better products, deep in fan engagement, more viewership, more advertising, which really now translates to more revenue opportunities. Because this revenue opportunities from fantasy sunday ticket, that whole package basically was to cater to two audiences, one bars and restaurants who want to be able to show multiple games within their establishment. But two, and even bigger, the fantasy crowd, they are going to be willing to pay a lot of money to see all the games live. And then that feeds back into the product and the fly wheel spins.

And of course, then there's sports betting, which is now becoming legalized in lots of states, but has been a force for a long time. Of course, you could bet legally in los vegas, but obviously tons of people have bookies that can just place bets for them no matter where they lived.

And I shock define cample going on in the establishment so shocked.

I know its a very somewhere how we mentioned prohibition earlier. Despite alcohol being illegal, there was plenty of IT to be found. And in this example, when you got money writing on a game, you are absolutely going to tune in.

I looked IT up just to put a number on this. The current estimates are that forty six million americans, or eighteen percent of bedding age U. S.

Adults, that on the nfl this year, and that number continues to grow this year. Yeah, wo people bet on the nfl? More than any other sport in the us.

Riding reports, eighty one percent of sports Betters bet on and fell games versus just over fifty percent for the N. B. A, and forty four percent for major baseball. Interestingly, the nfl doesn't generate meaningful revenue from betting yet, though I am sure they will in the future.

Yes, you can probably bet on that.

you. So I guess .

it's worth pausing.

Understand the shape of the n fels business today and how the revenue breaks down. So on average, about two thirds of any given teams revenue comes from shared national revenue that we talked about. The remaining one third comes from the local revenue.

But again, this is just on average. So some teams are very good at the local revenue, like the dallas cowboys, and some teams are very bad at this, like the bills or alliance. And I have some numbers to put that in perspective.

This past year, each team got right around three hundred and fifty million from the shared league revenue, but that extra local revenue obviously can cause a gigging tic swing in the teams total revenue. And forbes has an estimate that the cowboys made over a billion dollars last year, whereas the lions only made four hundred and fifty million. So not really much on top of the shared revenue from the league. Ww.

so much for the league first mentality from Jerry Jones there.

right? So it's also useful, I think, to slice IT a different way rather than just the shared versus local. Here is how the nfl team revenue breaks down purely by product.

So this is essentially answering the question, how does the nfl make money? So sixty one percent comes from media. Most of that is the TV from the shared league revenue. Ten percent comes from general seating, which is regular plastic seats. Uh, another ten percent comes from premium seating.

the pillar.

yes, the premium seeing that we mentioned is the sweets and all that stuff. That's a big growing revenue line for the people with no stadiums.

and most of that is corporate.

right? I think so. That's my best guess. It's super different city to city. This is play the most variable? Yes, ten percent comes from sponsorship and advertising and then about nine percent is other, which i've guessing is where nfl films and a lot of that .

stuff sort lize maybe the man deal is there.

yeah. So that's the shape of the nfl as a business today. So before we kind of finish that out and get into analyzing the business, I mention the complicated relationship that people have with football.

In the two thousands, IT became clearer day that C, T, E is very real and caused by playing football and causes shorter life spans and immense physical harm. Two players and C T E, as many of you know, is chronic traumatic and spooky thy, which is a terrible brain condition that develops from the many repeated sub concussive hits to the head. And the symptoms are devastating.

Mental, emotional suicides, everything.

I mean, the n fell, settled a billion dollar lawsuit to pay out victims and families of city. Yeah.

you know, it's even worse than that. There is a bunch of dimensioned here. I played football all growing up, middle school, high school, college.

You know my feeling. This was in the ninety, nearly two thousands. You know, my feeling on the matter was, I for sure, risking my body by playing.

But the risk calculation of my mind was all short term. I could tell. N, A, C, L, sure.

I could break my ARM. sure. sure. R, I could get a concussion, sure. But in my mind, those were all the same things that like there was no broader understanding among general football potion or there's been a budget research on this or the nfl players themselves that there was real long term mental emotional risk to playing the game.

And then here's what's really bad is dan felt knew IT and they covered IT up. So the nfl started doing research into long term effects of concussions and other head drama from playing football in the nineties. And then they SAT on the data for a long time. And then when they did release a, they claimed that there was absolutely no approvable link, no evidence at all that head injuries from playing football LED to a long term damage.

He didn't acknowledge that until twenty sixteen. A super babin.

this is the worlds Smith movie. Can question about IT. We don't need to go into a unto the specifics, but I think like from the acquired stand point and the nf and stand point, this was a major, major trust breaking moment.

I feel guilty enjoying football. I think a lot of people do. I don't know that that's a super widespread.

That's probably west coast. You live in a city, you read about a lot of the stuff type thing, but certainly IT affected. And enough for lebron James to say, I don't want my son playing football. I mean, that was a huge cultural moment.

One knows the direct impact like you're talking, but I think you're right. That's probably limited in the broader landscape of the american, the media diet. But the second order effects are pretty large from this.

One is what you said about parents allowing and wanting their children to play a football. Certainly, the statistics are down now. Youth football remains a bus. College football remains robust.

I don't think you football remains robust from twenty ten to twelve of the decline, five percent per year. A lot of the data showing that continued. Interestingly, all you sports are down. And I don't think football is down much more than other use sports, video game, social media.

phones and the pendel c yes.

youth sports are like weight. So all the fear systems for all prosper ts will be dramatically less twenty years from now than they are now. And come on foot, all is gone to bear the worst of that. Yep, totally.

But I think the real risk, and this is starting to be shown out in the data, is how our future generations going to a view the nfl and football. And if you look at the data, U. S. Adults as a whole, thirty three percent say the nfl is their favorite professional sports league. And that's down like maybe a little bit.

And I think basketball is like a eleven percent, which is where I got the three x state for americans preferred to basketball.

Soccer grown a lot. Baseball declined significantly in the past couple generations. But if you look at G, Z, only twenty three percent of gz say that the nfl is their favorite professional sports of ten points less the browser population. And basketball in Jenny is nineteen percent right. There are pretty closed to .

football from a revenue perspective. The nfl today makes twice as much as basketball, but that's a pretty damming trend looking at where jerseys interest lie.

Yep, we can talk much more about the broader context of dfl and analysis, but this whole thing was just bad period for the nfl. How do you bury these studies .

and how do you deny the existence of these things when people in your organization have been higher to commission this research and then your very being at for decades and it's your players .

IT is your product on the field. The betrayal trust happened on so many dimensions, but also the timing of this was really bad. This came out at the donor, the social media era.

Had this happened during, say, you know, the sixty, seventy, eighty. Like, of course, what IT actually was would be just as bad, but the rosel nfl approach control the narrative. What IT worked so much Better, we would not be talking about this in the same way. But IT came out at the dawn of the social media area. And that really was botched by the nfl.

Yeah, that's a great point. It's like the old playbook sort of didn't work anymore in the social media. A it's also interesting to note who wasn't producing content about concussions. I mean, this wall Smith movie came out that I don't think was through the media channels of any of the n fels partners. I think the nfl wields a lot of influence and saying, oh, uh, you may not be a part of the networks that get our broadcasters in the next generation.

I don't think this is true, but there is accusations that the nfl created a crappy monday night football schedule a few years ago to get back at some of the S B. N. Commentators for the way that they sort of were critical of the nfl.

And then S P ended IT up actually firing those people. And they said IT was unrelated reasons. But I think the nfl whelps a lot of influence over their broadcast partners and thus over how the nfl talked about.

A of course they do. B, that bad of itself. See again the timing on this, and I don't think the nfl understood or was prepared for that strategy would worked really well thirty years ago. But in the social media era, where individuals have twitter accounts and players have twitter accounts and all of those fired reporters have twitter accounts, a lot harder to control the narrative.

You speaking of harder control the narrative. Let's talk about black bowling calling cabinet. And I think that interesting place to start is the job of the commissioner. So the commissioner is not the president or C E, O of football with any obligation to customers the way the C E O would, or a preview over high ranking executives that they can order to do things. The owners are not their executives, and the commissioner's obligation is not to the fans.

The commissioner is hired to do one job, and that job is speak for and do things that are in the best interests of the owners as a whole. And so if the most powerful owners want something, that is what the commissioner does, that is what the message is from the nfl. The nfl itself is a very thin layer on top of a whole bunch of teams that are their own very large businesses.

In fact, a lot of hay was made about the nfl switching in twenty fifteen from a nonprofit to a four profit. The nfl has like very little nett income. Who cares what its tax filing status IT all gets distributed .

out to the teams, right?

The teams are their own taxpaying entities and their own businesses. And so, you know, Roger, get l makes forty plus million dollars a year to do what the owners want, and they hire him to do that. And they will fire him if he doesn't do that.

Oh, men, there are these great quotes in america's game where the owners are talking about the result with the represented for the players at the time negotiating contract, that players are complaining that Peter zell isn't being neutral. Al, in these negotiations, the wners. Of course, he's neutral.

We pay and well to be neutral. So yeah, the commissioner of the nfl is like the ultimate in shareholder responsibility. In fact, shareholder responsibility is his .

openly responsibility. Yeah, he is acting as directed by the owners, which we should say that direction by the owners includes the two most important powers granted to the nfl front office by the owners, one negotiating their revenue share deal with the players association, which is the collective bargaining agreement that we mentioned with the salary cap, and to their deal with the T, V. networks.

And of course, this is their largish expense on the player side and their largest revenue stream on the TV deal side. But that colon caporal, yep. So in the good old days of football, IT was a bunch of reasonably Young, enterprising who loved football and owned teams.

IT wasn't clear if they're going to be good businesses or not, but they were super competitive. The league as itself, and those all the owners were cowboy, is trying to make IT for themselves in the world and feel the thrill of willing something into existence. And those people all got old and didn't wanna change at all.

Now most of those people are dead, and it's their descendants who are also old.

Who are these teams? yes. And so now there's these very interesting artifacts of the league being grown up, old stogy. The incoming, something like that when they were once to start up, especially when IT comes to just acknowledging that a guy can protest the national anthem.

I do think when that happened in twenty sixteen, IT was a lot more of a radical act that IT might seem today. And there are a lot of people at the time we were deeply offended by IT.

He was using the nfs platform to sort of make a very personal argument.

And there were a lot of people in the nfl who understood why he was doing IT because seventy percent of the nfl is black. So there is a lot going on here.

right? And we should say what actually happened. Capital, in twenty sixteen took a knee during the national anthem to protest police brutality and ratio inequality in the us. After that season, he was a free agent. Zero team signed him, and of course, he had some disappointing seasons and injuries, but the nfl never explicitly said that all the owners colluded and agreed nobody should hire him for taking a knee.

But let's be really here. The nl black bolt calling cabinet, after this one hundred a percent oh cabinet.

filed a grievances and eventually reached a confidential settlement with the nfl. I know the whole macro thing here is very strange of the owners to let the seemingly minor thing turn into the giant tic media mess, the way that .

they I think interesting thing for the purposes of our discussion here about this, I don't think this ever would have happened or happened in the same way. In the N. B.

A, the MBA embraced both social media and the strategy of letting players have their own platforms, be their own voices and promote the league through that. And the nfl was the opposite of that, like they were the command in the control. We own the message. Players do not have a voice. And like there was no clear example of this.

I mean, tear point earlier, seventy percent of the players are black. The players are the core product on the field. They're effectively your partners. They make forty eight point eight percent of whatever the league makes up.

which makes them effectively an equity partner.

Oh yeah, in the very same way that warned buffett always refers to the government as our large silent shareholders. The bottom line, the nfl wildly, is handled this. Let IT get completely out of hand.

This is the way that we know of colon caponi c. Now he's sort of like an icon for this thing. So I mean, if what the nfl wanted to do was not amplify his protest by black bowling ham and making him not able to play, IT totally blew on their face. And he became a national headline for months and months and months.

which is empac of the nfl, not understanding the social media era.

yep. So all this to say, IT was very compelling for David, you and I to spend a unch of time talking about the nfl up through nineteen and eighty and the rose elle era, but the paul teg libo era and the Roger gl era. I mean, revenues have gone up.

Team values have gone up. Games have gone from standard death to H D. To fork. But you're not particularly more inspired about what the nfl has done in all these years.

And it's sort of no wonder we want to to spend less time on IT because IT seems like it's just one train rack after another in terms of missing and ling situations, I don't know. It's certainly the end of the heroes journey sort of happened at the end of the rossel era. yeah. And IT won't heard their business for a long time.

That's the interesting thing. I think there's a good point to transition into analysis and why do we do playbook and then do power one? There just really strikes me through all this is the Linda effect. Despite everything you just said, football is bigger than .

I ever hasen. Twelve billion dollars year in revenue from the TV deals alone.

a huge amount of revenue and now diversified those revenue sources. It's not just old line broadcast networks trying to hang on that paying them this money like no, it's google and amazon that in them this money.

they're paying what close to four billion dollars a year from the biggest tech .

companies in the world is going to be fine. And that revenue is almost a surely gonna grow at a very healthy clip. So even despite all this, people love their foot. All guys still love what in foobar.

Totally, me too. I thought that was important to open the episode. With that, I have feel like i'm a slight apologist for still loving football as much as I do. I was getting ready to tweet that while a super poll one looked a really fun thing.

And I was like, I wonder if i'm going to take heat for people being like, hi, I wonder if I think less of bed now because he really likes football. And that's probably overly sensitive. But the fact that the thought existed is not good for the nfl long term. And I know that I represent a more left leaning group of people, which would cause me to ask that question to myself, that most people wouldn't even cross their radar, but not a long term, that that thought occurred.

Two things when, I mean, again, that just reinforces the power of the india effect. To me, the nfl is just fine and is gonna just fine for a very, very long time. now. I do think the Younger generations thing is a real risk. And I think related to that is, one, basketball definitely won the social media era in a way not as to a bigger degree as the nfl won the TV era, the basketball is on the rise. And we're related to that is, number two, the nfl has never figured out international many fits and starts.

Have you read about these homework and agreements? No is really weird. The n fell now because there's zero international interest in the nfl like zero, like they go play these other games and other countries and the people who watched them are people from the U.

S. Who fly to go watch their favorite team play. And somewhere, oh.

I mean, forgot six. Baseball has a robust international presence, right?

And as we talked about our N B A episode in basketball, entire future growth and current. So a groundswell of .

popularity is Young people and international.

So the nfl has tried nfl europe gonna shut that down, couldn't get the owners to care about IT this whole marketing agreement. Thing that they're doing is saying that teams have an exclusive right vers other and fell teams to market in certain countries.

Oh, no way.

I didn't see this. I think I like the cowboys can advertise the cowboys in mexico. It's that sort of thing. They want to try to build affinity for teams where there is like some theoretical mapping that country based on ethnic groups in the area or proximity. It's a very odd sort of falls air and that international expansion .

that not seem like a sound international strategy to me now.

And the question kind of becomes, how can the nfl continue to grow or can IT? Because the average number of people who watch any given nfl game pick your metric is that the average money in football game? Is that the average kickoff game of the season? Is that the average super bow? It's like up and down over the last twenty years.

It's amazing that it's as higher IT is when people don't watch anything else on T. V. But I honestly, I am having a hard time understanding how they grow the fan base.

Well, clearly, the fly wheel is no longer spending faster. IT is still Operating very efficiently. But like the core to growing the original N, F, L fly wheel is increasing fan, which an engagement and that's no longer happening, right?

And then you have this interesting question of, is college football starting to pay players competitive to the nfl or additive? Because college football has fueled the growth of the nfl. I can think of about at this way at the N.

B, A. And majority baseball teams have to pay to Operate farm teams that no one wants to watch or play in. And the N F L gets all the benefit of all the development of all of these players in their college years for free. He right?

They benefit from the storylines around them too.

So when someone comes in mediately ly baseball and gets promoted to the miners, everyone like, who cares? I have no idea who that person is. Whether the highest and trophy winner who you know about what their childhood is like comes out of N, C. A. Football.

out of the the story lines are fully baked and ready to go.

Yeah, college for ball, all has been the best thing ever happens to the N, F, L. For basic whole existence.

right? IT was the worst thing for the first twenty years, and I was the best thing.

Good point. Yeah, I think the biggest players getting paid in the N, C, W. A right now with the sort of weird way that the booster stuff works is like two million dollars.

They're not competing for talent. And I don't think the nfl will start trying to sign earlier college players. I don't think we'll be competing directly or in the same order of magnitude.

The revenue that big colleges making that these conferences make isn't nfl size, but these are huge deal. So the nfl, for comparison, has a twelve billion dollar aggregate set of media rates at IT sells. The big ten deal is a billion dollars year.

They just signed a seven year deal at a billion dollars year, which is twice their previous deal from twenty sixteen. And somewhere in the, I wrote a hundred million a year are going to each school. The S.

C, C, deal is kind of a bargain. it's. Three hundred million dollars a year with E, S P, N. I understand how the whole S, C, C is worth only three hundred million year when the fells were twelve billion.

But that, I don't know, just kind of feels like born negotiating all this to say the business of college foobar is still much, much smaller than the and I felt that I will be really interesting to see sort of how as players start to get paid more, where IT finds its putting in the landscape and if IT changes IT, often more is today. Yeah okay. So that's college.

A thing in pava care that I think is interesting to talk about is the relationship that the nfl has with its players as a supplier and with the networks as a customer. So I got itself into this trap for a while where IT was negotiating with the networks and so would sign a big deal to get a bunch of revenue and then would quickly have, uh, negotiation coming up with the players. And they seemed to have switch to this thing now where they signed a collective bargaining agreement for a decade with the players.

I think they did that in twenty, the last three, twenty, thirty, and then in twenty two, that's when they renegotiated the ten year rights for media. So they seem to have switch to this, which is a good business decision. Poly doesn't boat all for the players, but before anyone knows is what the big new revenue contract looks like, they go and they lock in all the pricing on their suppliers. Now granted, it's a rev share.

The percentage is yeah right.

So in that respect, it's fair. But IT is quite clever to have gotten off the tiktok cycle of, you know having the players have a bunch of leverage after seeing what the media of looks like and doing IT in this order.

Yep, the other .

thing that i've been sort of charting is the media deals go up dramatically in value, but the average viewers kind of stay is the same. Like two thousand and two, the kickoff game had about twenty million people watch, and IT rose and IT was in the ID twenty years and IT back down below twenty. And last year, about twenty million people watched the kickoff game.

Sorry, about two decades of audience stagnation. yeah.

So why is IT that the media rights are worth so much more when the number of audience impressions stays the same? I'm curious. Swear, your head is on that eyes and theories. But on A C. P. M basis IT seems like the advertisers are all just paying more money now or at least the TV networks believe that they can make more money from something and so they're willing to pay more for the rights.

That a great question. So without having thought about that too much, my first instinct is to say I think it's scarce city value and that I don't think there's in the mother media world anywhere else except live football where you can hit a huge amount of people all at once across demographics .

yeah I think that's definitely part of IT. Another argument would be, well, they're finding a way to put more ads slots in to the same amount of media, but that's not true. Theyve actually held flat or in some cases, even decrease the number of commercials over the last fifteen years in n fell broadcast.

So you're thinking OK, the audience size about the same, the number of ads slots is about the same. So what else could be going on here? I think part of that is, you're right, is that the networks are quickly getting into a place where they're like, we really have any other content that people wants to watch, so we kind of need this no matter what.

And that advantages, the na fell and negotiation where they come in and they say, look, I know you used to be super profitable on buying these rights from us and then your business on the back end, we're selling all these advertisements against IT. We think you should just compete against each other until your margins are zero and we're gonna a crew. All the profit pool now because there's basically nothing else that you'll put on that .

people wanted watch. I think that's probably right both in that over time, regardless of what happened with the media landscape, the nfl would proudly ly be built to run that strategy and capture more the profit pool because there's four major competitions now with fox on the customer side for those networks for the last decade run the counterfactual of the network no longer had football. They don't exist anymore. This has been life support for them for a decade.

So here's the interesting thing, as you might say, like, well, if the margins are razor, then they need a ton of volume because effectively, what is happening here is the profit is getting replicated to a different part of the supply chain. There is no more value in distribution and all the value is screwing to the content creator.

You could make an analogy to the airline industry where no one was willing to pay for a Better experience on a flight. All the margin got competed away between all the airlines. So all the airlines had emerged because you had to have massive, massive scale.

That also, what happened to these media companies that are distributing the content? I mean, A T N T slash direct, T V N B C slash universal. The companies that are buying the rights are massive combinations that can actually afford to generate any margin. And I I didn't dive to look at like and i'm not sure you actually could isolate this of what are the unit economics of buying nfl rights and selling a bunch of ads against them. But I have to imagine they're much worse than they used to be.

They have to be. I mean, with these numbers like there's no way that they can never rote IT.

And it's pretty genius that the nfl doesn't do this themselves, that they rely on broadcast partners because they basically observed that they can get all these people to do all this work and pay them all this guaranteed money. And the nfl still gets to keep all .

the profits right and they can resell IT like six times over.

The nfl doesn't have to film the games other than nfl films. They don't have to you know how the broadcast trucks. They don't have to have the relationship with the consumer and do all the direct marketing the consumer to onboard to their direct video platform.

They don't have to sell the ads to the advertisers. They somehow have outsource and commoditized all of that. And I think they get to keep the vast majority the profits and will continue to shift that baLance in their favor.

This is finally good time to bring up the amazon deal that we have referred to with thursday football. And news is coming out. This is the first season that I was the exclusive destination for thursday for .

the correct yeah. They used to air thursday night football also on fox and on the nfl network, which is the nfl s own channel, to do mostly non game programing, but some experimental stuff themselves, like red zone and alternate game broadcast. But thursday night is just amazon now.

and news is coming out now at the end of the season that from a economics perspective for amazon and an ad basis that vastly under performed.

yeah. So then amazon is having to do make goods with the advertisers because amazon wasn't able to get enough people to watch the streams because Frankly, I think a lot of people want to watch the nfl on T. V.

And it's kind of complicated to figure out how to streamer and watch IT through amazon. And I know I can just happen on my little set top box on my apple TV and store the APP. And is that thing, you know, what is easier for most people turning on channel three? So it's totally fascinating watching the baLance of power in the value chain. You might think, huh, well, is the packaging component that the nfl does. The packaging of the talent and the coaches and creating the story lines actually were all the value lies. It's interesting to me that the players, the N, F, P, A, has managed to negotiate for half the revenue good on the players association for getting that bigger piece of the pie because they're actually done a pretty good job of managing to shift some of the value from the nfl even further upstream to the nfl suppliers rather than letting IT all sort of collect in the packaging component the nfl has .

yeah doing this whole epo de has made me really realized, ed, that there is a huge amount of value had that the nfl and their partners bring to the products beyond the players. Now nobody should ever set a tear for the N. F, L.

In the owners at the expense of the players ever. But if you were to make an argument that the players are everything they are, the product, the game on the field that they play is the product full stop, they should get much more. I don't think that's a fair argument. They play a football game, but the nfs product is sports entertainment.

Yes, completely agree with that. There are so many here that we've talked about is just the n fels sort of for the greater good mindset, getting them to where they are today going to be so hard for them to keep taking advantage of that going for. There is a very interesting one, which is on a revenue basis to eighteen billion dollar a year revenue business. The nfl actually owns way more mindshare than its revenue with illustrate a strange statement to make us, the nfl is an oddly small business for how larger role IT plays in our lives and to contextualize, who else makes eighteen billion dollars in revenue, general mills, adobe and halliburton. The n fels share of lips is way higher than any of those companee products.

What general mills is a really interesting one. How much of general mills business is generated by advertising time on nfl games?

Ah that's a great point.

I'm a very large percentage.

yeah. I continue to think that networks are just on this tread mill where they're just going to keep paying more and more and more for nfl rights until is actually noneconomic for them to do so. But they'll be in so deep that but it's prety hard to recover from that.

You i've got one more playbook team that I want to throw in. Buying any professional sports franchise ten to fifteen years ago was an incredible trade for two reasons.

By the way, just to add some numbers to at the average and fell team value, one point two billion in twenty twelve, that's a decade ago, average one point two billion and today is about four and and a half billion for the average and fell team. We're not talking cowboys. We're not talking giants. If those were to change hands.

yes, we texting with friday reMarks, the lead up to preparing for this episode you know he made by those are based on forbes valuations. You can trust those valuations. I think any actual trade would have to be higher than that reason.

Number one is to scarce the value. There are a finite number, these things, and they're not making more. And there are a lot of people that want to own them for a lot of reasons, not all of which are economic. Yep, that's one. And that's never gonna.

The owning and nfl team is like a grown up. N F T.

I is the ultimate N F T.

If you are a Gillian er and you want a flex on other guggle anas, this is a way that at least is very likely to have a lot of durable value for you to get to keep doing that regardless of its underlying cash flows.

That is a represent happiness of value, positive trade for a lot of billionaire.

But I will say when you have something that increases in value because of social signaling and desirability and not tied to underlying cash flows, that is a potential sign of evaluation bubble. No, not always. There is luxury watches that have kept their value for centuries. But IT should make you wonder. I mean, team values have balloon to the point where there are very, very few people who can buy one today.

which means that a change in sentiment among that very narrow market will have .

a huge impact totally. But for now.

I think the valuations are probably safe.

All right. Well, to see in a few years, I think they've reached a plato. I don't think we're going on anywhere north of eight, nine billion in the near future.

Oh, I agreed. I just don't think you're going to a Price.

Yeah, we should say to all this is using a combination of estimated data reforms, but also the Green bay packers ers and your reports, the average revenue multiple in twenty twelve of a team went for about four x to about a dex between twenty twelve and twenty twenty two.

Well, see a multiple expansions along with the rest of the market. But I think this is going to be more durable.

potentially justified by the fact most people don't actually own these things for their cash generating characteristics. Anyway.

it's a very fancy gem, total OK. That's one. But then two, the more applicable lesson, I think for most people listening, oh, maybe we've got some people listening. You could buy nfl team that be cool, include us in the wners ship group of itself out acquired if email outcome.

Point number two is I think there was a narrative around cord cutting ten years ago that was lining er broadcast television is that live sports and especially football of the last year but who knows how long this all last and I think that was only half the picture. I think what I at least a lot of people didn't see back then is that these leagues, the nfl especially, are going to be holder ly fine in a post linnie TV a and no further proof is needed. Then amazon and google are the latest people to pay boat loads of money to the nfl.

The nfl will make the transition to digital distribution. And it's pretty amazing that they didn't need to build themselves. M, L, B did the whole bam.

Tech thing. The N, F, L has built basically no technology, basically no distribution and basically no direct relationship with the audience. And they'll still be fine.

They'll still be fine.

They outsource all the hard parts.

and they also completely wift on strategy for the social media. A, but they are still find .

yeah IT is while we talked .

about this a lot in the NBA epsom. But just to recap here, because the story hasn't really changed, lebron has well over a hundred million social media followers, instagram alone, and the two largest N F L players by social media following R O B G A and time, both of winter in the low teens. So like a tenets.

difference is that interesting that people don't want to follow and fell stars the way they want to follow N, B, A, stars on social media.

I think if I remember that the court thesis of our M B A episode is what they got so right through the social media era was give the players the voice, give the players the platform. The individual person is the hero and social media. And that's so antithetical.

the nfl is, take away the player's voice, control the message.

And that's also reflective of the sports themselves, right? Like basketball is a team sport, but like on the spectrum of individual to team, like football is one hundred percent on the side of team. And then there's just obvious stuff too.

Like, and if all players were helmets best, all players don't wear home. You know it's that stuff. But IT does not matter as a business and if else fun.

they're totally fun. Yeah well, we're contrasting leagues. There is pretty interesting thing that i've been thinking about, which this CoOperative capitalist committee thing that the nf fell did. IT was really good at creating parity among teams to be the most competitive. But let's take IT to the level of the players.

Interestingly enough, the nfl has been the best of any of the leagues at creating the nearest band of player compensation in the same philosophy that they applied to the league. Competition now, of course, is nowhere near equal pay among players. And like, yes, it's a bomber that while iron Rogers makes fifty million dollars year, there's a long tail of players that only play one to three years making league minimum and then turn out, which I think is mid single digit millions of lifetime compensation from football.

Still, that's good.

Yeah, lifetime though. So players are definitely variably rewarded based on their value to any given team. But the N, B, A and the M L B are way less equal than the nfl.

The superstars in the N B A, like lebron James, including sponsorships, makes one hundred and twenty seven million dollars a year. There is no one in the sport of foot. All that comes close. There are three baseball and three soccer players at the top of list. Before any football players the nfl has manage smooth the curve more than other sport.

Taf one, I think this is also related to the social media thing. And really, this is like the big divergence between the players and the sports in the league. And I fell as a league, great. They're fine, but the players AIDS just the direct endorsements. But I think other league players, and especially the NBA, have been able to build wealth and businesses and revenue streams much Better than nfl players because there are the platform and the audience value accused to them so much more.

You agree.

lebron, I think, is already a billionaire. And especially once his playing days are over, he will be a multi, multi, multi billionaire because of the influence that he has.

Apparently, lebron James has signed some secret deal with nike for the rest of his lifetime. That something crazy high that is just not even account for in these numbers. Wow.

well, I think we need to do an nike episode at some point.

Agree, this actually a good place to flip to power.

Awesome for new listeners. This is the section we do an analysis based on the great book by hamilton helmer, where we run through each of his seven powers that a business could have to earn long term differential profits versus competitors. And the seven powers are counter positioning scale economies, switching costs, network economies, process power, branding and cornet resource.

I think they definitely have a corporate resource. If you wanted watch professional football played by this set of athletes, they are the only game in town. Yes.

they absolutely have accorded resource. Yeah, I think this .

is like maybe the most clear cornered resource that we've ever had on the show.

You completely agree. And clearly this is why the fight with the A, F, L is worth IT. We need the greatest players on earth to play this game, and we can't have them spread across two leagues competing in to each other. We have all the best players. Then we get to do all the incredible things that the nfl is gotten to do, like the video rates negotiations up.

I think during the rosea and the dawn of the TV R, I think they were counter positioned against major league baseball in the while. Decline in revenue from the gate by adding TV certainly was a hit to them. IT wasn't as much of an existent al hit in the way IT was for majority baseball. And so the nfl was more able and willing to experiment with the new business model of TV as the primary revenue source than baseball was able to.

Yeah certainly. And I think generalizing from that, I agree with even more that this for the greater good mindset was easier to do when everyone's individual franchise was smaller. But when you've got these teams that have already even been around for a hundred years, like good luck talking them out of a machine .

that dirty works well, right? There's no way, even in one thousand forty nine, that the ange's would have agreed to .

a league first mindset, yes.

let alone today yeah, when they have their own television that works. Kids at you, you know.

I have been thinking about branding. I actually don't think this one has branding power because the definition of branding powers, if somebody offers you the same thing with that, have a brand on IT, will you pay more? The thing about getting multiple congressional anti trust exemption is that there isn't another game in town.

I mean, there's sort of a reputed X F, L. They're sort of a rebooted U S, F, L. But it's not that people don't care about those because the nfl brand isn't there. People don't care about them because it's not good football.

IT all comes back to court resort. They have the players.

right? exactly.

You could maybe put the anti trust exemption you could to shoot horn that into process power or .

are corner resource?

H, yeah, our cornered resource. And like is that note league is .

gonna that it's like totally facin that the government thinks it's good enough for the country to issue on the entire trust exemption. It's like, well, having a big popular sports league is good for us. So let's enable that to be as big as possible.

Oh, man, guess I just thought about the captain stuff that's got to be playing into the nfl stop process here too. Like they need to maintain healthy government and relationships, not just government, but healthy political relationships with the current political party, whatever.

That is a great point. I think .

there's definitely gae economies here in the sports entertainment aspect of the product. Yeah.

there's no way you could spend the amount of money IT takes to produce a good N F fell game without the audience that they have to justify that level of cost.

Even a single sunday game won't bank up and he start up league to put those kind of production values in.

right? I think is about forty four million dollars per game is effectively what the average broadcast partner is paying. The ana felt just for like one single game yeah .

and just for the right.

right. If you're the nfl, if you can go make forty four million dollars by making a game happen and that doesn't include anything on the fields, searing tickets or that revenue just from piping that game to A T V. 你 ork or they're not even doing the piping， allowing A T, V network to come .

on the field to show up and produce the game. Yeah right.

Then you can afford to have a whole bunch of cost to make that experience happen. Job value creation, value capture. And the way that I want to do valley, creating Better capture here, is of the value created by the N. F.

L. In the world. how? What much of IT do they capture? There is an thing we didn't talk about, which is taxpayer funded stadiums.

All the research you read about new stadiums that are funded by taxpayers, and not every stadium is fined by taxpayers. Like the new giants jets, one in new york is funded by the team in the nfl. Whether like the bills won is going to be funded by the state of new york.

larger. And every pizza research you read there is like a there are a best break even for communities unless it's part of some like larger economic redevelopment thing. So I think the nfl has they're now unbelievably extractive of the networks.

They've historically been very extractive of players, but now the players seem to have a pretty good or at least Better deal than they ever had before. And nf fell teams are very extractive of communities in the stadium deals. And I think if you look at the eighteen billion dollars year of revenue, the nfl, if you include the players, captures as much value as IT possibly can. They're unbelievably good at .

value capture. I mean, they literally resell the same mediate .

multiple value capture. Believe is a phrase that we used. Done another episode.

okay, that to be another quiet man .

star t shirt. But IT is amazing how much mindshare the nfl does own. In my opinion, on top of the actual revenue number, they don't leave a lot of consumer surplus in dollars. But given our earlier conversation, that eighteen billion isn't that much revenue compared to other companies we've covered on the show, maybe there is some kind of unquantifiable consumer mindshare that does exist on top of any of the revenue they generate.

I think you could totally make that argument. I mean, you are making that argument. Here is beyond the scope of this episode, the number of sitting U.

S. Presidents that become deeply in mashed in the then current activities of the nfl. It's like almost every .

single president totally. How can you put a Price on the fund of a super bol party? You're texting about an amazing catch with your dad or there's all starts of things that are hard to value.

Well, it's also a little bit similar to the trading value of nfl teams in like what Price would they actually treat at even as the nfl has become this incredible business, they don't trade a rational economic places because the people buying them are doing their present happiness value equations, you know, not economic value.

right? As we talked about, these N, F, L teams are valued more like scary speech front property, more so than cash flowing businesses. I'd be curious to hearing everyone thought on if the nfl generates more value than eighteen billion dollars a year. 嗯， interestingly, the nfl today is less about sort of what I was in the 4 fifties and sixties。 This team of guys who really hates another team and wants to destroy them at all costs, and they're LED by this fearless leader who's probably also their owner and maybe a player on the team.

At this point, the players seem to recognize that they're all basically employees and the players are more in IT together as co workers than they are against each other, even for players who are on opposite teams the way that before after a game, they'll common how each other rekindle a relationship with another player. At the end of the day, they all work for the owners. And so it's probably a good thing for them to recognize that now the real reality on the field, and at least that means they're gonna be Better at arguing what's fair for them from a business that demands an immense amount and maybe even years of their lives for a lot of people.

I think this has actually been a great development for certainly the pro game. But football in general too, like first so long, I think it's a hang over from all the college stuff that we talked about at the beginning of the episode and like what football was in this sort of eighteen, early twenty a century american like ideal of manhood in character building. But the opponent was the enemy.

This is what these are bad people that are fighting games like. No, they're the exact same as you. We are a different uniform. And I think most of those toxic elements are mostly gone from the game now or not totally gone, but way more diminished first is what they used to be. Even when I was going up.

There is definitely finally an acknowledged that they are entertainers above all else. There is a good amount of comradery among we are here to put on a show and be in the business that the n fels business is in. That seemed to be the case for a couple decades before the players acted like IT was the case and IT almost felt like they are being take advantage of which not that they're not being taken advantage of now, but at least they seem to recognize what's going on.

what there was a whole institutional complex around that, that arted a pop on our football and with you high school and went to college of, like this game is greater than yourself. And this is about an epic struggle, good and bad, and like this is not the case.

Yep, I also think is just terribly tragic reading about the long term impact on some of these players when we didn't even talk about is that seven players from the patriots two thousand one championship have already passed away between the ages of thirty five and fifty, and twenty four total members of that team are afflicted with symptoms of football brain injuries. Two thousand one wasn't that long ago. I remember watching that super ball for the number of people that got duped into continuing to play football when, if they knew the information they probably wouldn't have is just .

massively value destructive. This was only playing if I had known what I know today. I have made different decisions for sure, that era of players.

And before, up until all the news started coming out, any of the veterans at that point time, like you got got to feel so bad for those guys you didn't know. Now everybody knows you can have lots of different opinions, but it's all in the open. And like, you know what's going on.

But yeah like two thousand, one there was guys didn't no, like that's created. What did you say? Seven players out of there.

what? Fifty three? I think on an n fell roster.

I have passed away. Yeah.

have passed away. wow.

So let's not end on that note. Let's close with what's the bare case and what's the bulcke for the nfl going forward. We've talked about a lot of the bears. The CoOperative armor that has got them here begins to shatter youth not playing, player safety issues, the failure of international expansion, Frankly, like for the same multiple, like much rather by A, N, B, A team than an fell team. But i'm curious to hear your thoughts on a bulcke for the n fell up.

My bookcase is what i've been saying here for a while now. On analysis is the Linda effect. I kind of think all this is noise from a business standpoint for the nfl and a staying power standpoint.

It's not going anywhere. It's one of the most incredible corporate red resources in the world. It's gonna a be completely fine.

I completely agree with you and it's funny. All the negative stuff we've talked about, the nfo will continue to be a gorgeous, successful and growing business for a long time, was my opinion. And of course, we even even talked about the sports bedding, which is now illegal in the united states, which we don't exactly know the ways that, that will occur the nfl. But you can be very sure the nfl gonna generate a lot more revenue from legalized sport betting.

Indeed, we shall see on that front. And you know, I just want to say to leg doing this episode, IT was really fun.

And just like on a personal though, I I think pretty similar a relationship to football with you over the years more complicated to I talked about here and I played for many years yeah, I had, you know, certainly a lot of mixed emotions over the past decade, including many years where I just stopped watching football altogether and I was really fun in this, like reengaged with the game, reengaged with all the content around the game, all the entertainment content like IT is great. The nfl puts out great content, the quality, the play on the field is great. There are so many problems around IT on so many levels.

But IT, was this really fully gary kindle a personal relationship with the game and with the nfl in particular through this episode? So I think the game is going to be fine. Clearly, the business is gonna fine, whatever either of us thinks. Yeah, i'm glad this. He was fun.

Yeah, all this to say, can't wait to watch the playoffs going to have some mixed feelings and some cognitive distant. But no doubt i'm so excited to watch the playoff and super able me too.

You ready for some football?

I am ready for some football, all right, tens I can carve out on my end. Go watch the menu. IT was a unbelievably fun movie. Beautiful ly shot. That's all I have to recommend.

David, my car vote was going to be be patents places on the S. P. M. Plus, which I know we talked about the top of the epsom, but it's so good nostalgia when the effect is right there.

Go out IT true with that after you first episode, come talk about IT. There are fourteen thousand other smart members of the acquired community acquired A M slash slack, got a merch store.

It's not as good as the n fels, but .

surprises acquired that FM slash store. And if you're looking for more acquired between now and our next episode, s search acquired lp show in the podcast player of your choice. We just did awesome interview and not that are part of the interview is awesome, but he was awesome with Megan. Rentals from ultimate building a capital formation function at an investment firm. With that listeners.

we'll see you next time, will see next time. Easy you, easy you, busy you. Who got the.