When the owners and players of the National Football League shook hands last August after a lockout, a strike and weeks of heated bargaining, it was believed all would be well again in a world that is supposed to be violent only on weekends. New player benefits had been agreed upon as had new pension contributions. Certainly the season that followed indicated that pro football was moving into the '70s at the same phenomenal growth rate at which it had left the '60s. Last season over 13 million spectators bought tickets to 264 preseason, regular-season and postseason games. The three networks paid $45 million for TV rights. In fact, the NFL's gross revenue may have gone over $120 million in 1970, up from $107 million in 1969. Not bad for a sport which so many of its entrepreneurs claim is a lousy business.
Regrettably, success at the gate and on the tube doesn't hide the fact that all is not well. The contract agreed upon last August was only drawn up this month. At week's end it was still unsigned, and owner-player relationships haven't substantially improved since last summer. The owners grumble that the players have become greedy and militant. The players say they are no longer willing to be regarded as beasts of burden and charge that the owners have been attempting to bust—or at least to weaken—their Players Association.
The most immediate area of conflict involves the amount of profit each team makes. This isn't easy to determine. Of the 26 NFL clubs only Boston and Green Bay are publicly owned and, because of its peculiar corporate structure, Green Bay doesn't have to account to anyone, including shareholders. Private ownership can hide profit figures more effectively than tax write-offs, amortizations or the commingling of jointly owned enterprises. An owner can simply say that owning a pro team is a fun thing, not a moneymaker. The protesting chorus goes something like this:
Clint Murchison Jr., owner of the Dallas Cowboys: "A man has to be out of his mind to go into pro football to make money. You buy a team because you're kind of an addict."
Gerald Phipps, part owner and chairman of the board of the Denver Broncos: "Pro football is not a prudent business investment."
Art Modell, owner and president of the Cleveland Browns: "Operating profits never justify your investment. You've really got to love the game."
The Players Association claims otherwise. Its figures indicate that the 26 AFL and NFL teams as a whole probably made a pre-tax profit of $12.7 million on revenues of $106.7 million during the 1969 season, that the merged league made pre-tax earnings of $22 million on revenues of $122.9 million in 1970 and that by 1973 the pre-tax profit may reach $37.6 million on revenues of $158 million.
"The players' figures are pretty far out," commented NFL Commissioner Pete Rozelle last week. "Last year the accounting firm of Arthur Andersen did a study paid for by the players and the owners as an aid in negotiations. I think I recall that the figure for total revenue, based on the 1969 season, was something like $102 million. It was a difficult thing to put together, because each club has different accounting methods. Frankly, I'm in favor of the owners issuing financial statements, putting them on record."
Arthur Andersen computed $11.8 million as the pre-tax and tax write-off profit for all teams in 1969, but apparently wasn't satisfied with the information provided it. In a preamble to its report it states: "The scope of our work did not include all procedures considered necessary under generally accepted auditing standards, and does not permit us to express an opinion on the accompanying statements."
Arthur Andersen's figures for 1969 aren't far under those arrived at by the players, but the players say their estimates are conservative. For the benefit of anyone who, to the contrary, finds these estimates unbelievable, see below: