Commissioner Tagliabue With CNBC’s Scott Wapner
August 19, 2003

Commissioner: …Every team is getting the same national television revenue, roughly 80 million dollars, whether you’re in Green Bay, Buffalo, New York, Kansas City, Chicago, San Francisco or Dallas.  Just as important is the exposure.  Every game of every team is guaranteed to be on a national carrier.  So that is also critical and that spreads the playing time around.  Our Collective Bargaining Agreement with the players union builds around that and spreads the talent in a way that has proven to be very effective.

Wapner: So every team has a chance to get the best players available?  Every team has a chance to compete for players, as well as the Super Bowl, regardless of the size of the market?

Commissioner: That’s the goal of the revenue sharing.  It’s the goal of our league investment in new stadium construction.  This year we’ll be opening new stadiums not just in two big markets, Chicago and Philadelphia, but in Green Bay, Wisconsin at Lambeau Field.  So that’s one aspect of it. 

The other aspect is that no team is able to have an inordinate share of the player talent.  We don’t have talent sitting on the bench.  We’ve got the talent on the field. I think when this system came in, there was, number one, a concern that it would produce too much movement and the fans would lose the ability to identify and would lose interest in their favorite players. They’d never know who their favorite player was.  That’s been addressed and we now see that the great players tend to stay with the same team for most of their career, which the fans love.  But by the same token, you can turn the franchise around by accessing young players through the draft on a selective basis and the free agent market.

Wapner: So by-in-large the salary cap both for players, owners and fans is a good thing?

Commissioner:  We think so.  We think that’s reflected in fan interest.  Over ninety percent of our games are sold out, so then we’re able to lift the local television blackout.  That’s a record.  We’ve never been up to that level in prior decades.  We think that when we get to the end of the season and two-thirds of the league is competing for an opportunity to play in the playoffs, and those playoffs are restrictive and exclusive, with the number of sellouts we have we think that the system is getting its vote of approval with the fans with their attendance at games and their viewing on television.

Wapner:  When we look to try and determine how well the NFL is doing, who do we match it up against?  Do we look at what it does compared to the NBA, the NHL and Major League Baseball, or is it something greater than that?

Commissioner:  We compete with a lot more than that.  We compete against leisure time activity in the broader sense of the word, and obviously when we kick off in September, people are still heading to the beach or to the mountains.  When we get into December and January, people are heading for the ski slopes or warm weather climates.  So we think that selling out our stadiums, having the fans passionate about our great game and having very large audiences on television are probably the best measures of success.  And certainly when asked what’s their favorite sport, we don’t shy away from the fact that a big part of the public says NFL football.

Wapner:  Is it fair to say that you are more entertainment-oriented at this point than some of the other sports leagues?

Commissioner:  I don’t think so.  Certainly the NBA has been a leader in national television and in making their games very entertaining and appealing to a young audience in addition to a veteran audience.  What we’ve tried to do is to make the experience in the stadium more than a three-hour experience, and that starts with the quality of the stadium itself.  It starts with the pregame activities.  It starts with the types of facilities where fans can go and watch pregame shows and then stay to watch later games either in the lounge area or in their own suite area.  And that includes entertainment.  It really has a lot to do with the gameday experience being a full day’s experience rather than just ad hoc entertainment.

Wapner:  Do you need to do that more and more these days simply because there are so many choices for the consumer, for the fan?

Commissioner:  We have found that first of all when you have a great stadium you can give the fan an outstanding experience, and some of that includes football being tied to activities.  But I’d say yes.  When people make the commitment to go to an entertainment event, it can be a full experience for a large number of people.  There’s an element of community to it.  There’s an element of family to it.  It’s inter-generational.  And that’s what most of our clubs have been able to accomplish.

Wapner:  This league will become even more entertainment oriented and have a greater media presence with NFL (Network).  What is that going to mean to you?

Commissioner:  It gives us the opportunity to keep connected to our fans on those six days of the week that intervene between Sundays.  Unlike the other sports, we’re not playing on Tuesday night, Wednesday night, Thursday night.  The nature of our game is such that you can’t do it every day of the week.  But you can get insight into what the players are doing.  You can get insight, as a fan, into the strategy of preparing for the next opponent.  If you’re a more casual fan, you can get insight into the lifestyle of the players, what they’re doing in the community, what they’re doing in their own family.  So all of these things take the helmet off the player, take the cap off the coach, and let the fan get the perspective on who they are and what they do to be great on the field.

Wapner:  So you don’t just necessarily want the fan to be thinking about football on Sundays only.  You want to keep them connected to the game throughout the week.

Commissioner:  Yes.  And most important of all, connected to the people in the game, the players and the coaches.  Fans will cheer most passionately for those athletes that they respect.  Look back to the USA hockey team of 1980.  We’ve all read a lot about it and talked a lot about it with Herb Brooks’ untimely death.  But those guys had an element of respect in the public because of what they accomplished.  The same is true for Bart Starr or Joe Montana.  For Steve Young, or Donovan McNabb or Brett Favre or Tom Brady today.  The public needs to know who they are cheering for and needs to respect who they are cheering for to really be passionate about those athletes.  So I think our Network will help make those players open and available to the fans. 

Wapner:  Is it even more important because of the nature of the sport?  These guys wear helmets, it’s hard to see their faces.

Commissioner:  That’s always been a factor.  Going back to the 60’s and 70’s, part of Pete Rozelle’s genius was to see that football players had to be more than just helmeted gladiators.  People wanted to know who they are, what motivates them, and most of all how they get to be as great as they are on the field.  And that involves taking the pads off and seeing how they developed.

Wapner:  Will we ever get to a time where corporations will be allowed to own NFL franshises?

Commissioner:  Every decade we seem to start by saying it’s inevitable.  And then at the end of every decade we stick with our ownership policy which requires individuals to own teams.  We think it works very well, so we’ll continue it.  There’s no real pressure at this point to change that.  The NFL has really been built on three things; the focus on football with individual ownership, the commitment to the city where you have your team, the Steelers represent Pittsburgh, the Bears represent Chicago, the Texans now represent Houston, and so on, and thirdly a very sensible approach to putting the game on television, meaning for the most part wide exposure on broadcast, over-the-air television.  If we can continue to do that, putting the emphasis on individual ownership, we’d like to do it.

Wapner:  When you see what has happened with some of the major corporations that have owned professional sports franchises, getting out in waves in the past couple of years, AOL, Time Warner getting out of the sports ownership business, NewsCorp, Walt Disney Company, is that more proof to you that your system works?

Commissioner:  It goes back really to CBS owning the Yankees in the 60’s and other companies who have gotten into sports both because of an interest in the game, in the sport, in saving a team or supporting a team in a given community.  It is also a platform for exposing their corporation, its values, its products.  I think many of them have found that you can’t be all things to all people and you’re better off not trying to mix ownership of a sport with a business in that way.

The other thing is that many of those large companies have seen that their best platform is a national platform, and a local team doesn’t necessarily serve that national purpose.  You can have conflicting agendas and conflicting business plans that don’t always work out the way you would like.

Wapner:  The corporation has to first worry about shareholders.

Commissioner:  They have to worry not just about shareholders, but they have to try to balance conflicting objectives in blending a sports product with another unrelated product, and in doing it in a market that is both local and national, it gets to be complicated.

Wapner:  You mentioned the new stadiums earlier.  How vital have they been to your success?

Commissioner:  It’s been critical.  You can see in all of entertainment, as we evolve and as television became the focal point of a lot of in-home entertainment, the experience of leaving a home and going out, whether it’s to the movie theater, a baseball park, a football stadium, it had to be a special experience.  To the extent that the facility can make for a day-long experience, and for one that enables the fans in our league to see everything that’s going on, and not just the one game in the stadium that they’re attending, that’s a big thing.  The new stadiums have been able to do that.

Wapner:  Using the bond market to produce new revenue, how has that helped you?  We’ve heard time and time again about owners holding fans hostage over the stadium issue.  In the NFL, you’ve kept that from happening up to this point.

Commissioner:  We try to approach the cost of building stadiums in a balanced way, and that’s included an unprecedented commitment for us, which makes us the only league to take a piece of television revenue, which has grown dramatically, and invest it in stadiums at the league level.  It’s enabled us to partner with some public financing arrangements on a shared basis, in Pittsburgh, Chicago and elsewhere.  It’s also enabled us to have really high quality stadiums, and in some instances, through public funding, pay for improved access and improved roads.  So the net of it has been good for the community, with the stadiums and the teams as an asset, and good for the National Football League.

Wapner:  When we look at franchise values, I think it was yesterday that the Washington Redskins were valued at one billion dollars, the most valuable professional sports team on the planet.  Is it a good or bad thing for teams to be growing and growing and growing to huge values like that?

Commissioner:  It’s good in the sense that it’s a barometer of the quality of product, quality of management, quality and service to the fans.  Your valuations don’t grow unless you really are serving your customers well.  That’s what the Redskins have done over many decades and Dan Snyder is working very hard at maintaining that tradition.  That’s also a testimony to the attractiveness of our game across the entire league.  When you go to see the Redskins play, they’re always pitted against another member of the league, obviously, so it’s that competition which drives the value of any one of the teams, whether it’s the Redskins in the nation’s capital, or the Packers in Green Bay.

Wapner:  How do you keep the game accessible to fans from a ticket price standpoint?

Commissioner:  A number of teams have tried to keep some tickets available outside of the season ticket package at more modest price points.  We need to recognize that on any weekend, we have about a million people in our stadiums and over 100 million watching on television, so I think we have to look beyond our games.  We have to look at youth football.  We’ve created the NFL Youth Football Fund as a partnership with the Players Association, and we’re investing people and money in the game at those levels.  All of our teams are doing that.  So enabling kids to participate, supporting youth leagues, helping youth football gain access to television in some communities and hosting state championship games, all of that is important.  And I always say you have to occupy the whole space.  You have to be thoughtful about the amateur game, high school game and collegiate game and be supportive without taking it over.  We’ve worked hard to do that in the last 15 years and it seems to be working.

Wapner:  Let me ask you about the buzz word around many circles, “parity.”  I know you like to call it competitive balance around these halls here.  Is it good or bad for the league?  At some point do all leagues need a dominant team to peak interest?

Commissioner:  All league’s need great athletes and frequently great athletes produce dominant teams. And so that can be attractive, to say that this team in the NFL today could have competed with the Miami Dolphins of the 70’s or the Steelers of the 70’s or the Packers of the 60’s.  Yes, that’s important.  I think our system enables us to have those kinds of teams because we do have mechanisms for keeping the best players on the same team.  At the same time, it is a level, and you have to be concerned about the balance between leveling and breaking.  The fans seem to feel right now that we’ve struck that balance in a good way, and I wouldn’t want to see it tilt too much in the other direction where there was so much movement that you couldn’t have a John Elway with the Denver Broncos for his entire career, you couldn’t have a Steve Young, who was with the 49ers for those many years.  I think our system is going to continue to prevent that.

Wapner:  So you’re not concerned at all that there are perhaps too many good teams but not enough great teams?

Commissioner:  We don’t have that concern now, and when you see the kind of postseason play we’ve had and when you talk to people who played the game 20, 30, 40 years ago, you get a tremendous vote of confidence that the current athletes through their training, through their immersion in the game, are at least as great, if not more outstanding, than they have been over the decades.

Wapner:  We’ve looked at many of the positive things in the league, let’s talk about some of the potential risks.  Three years from now, the major TV deal is up.  Is there any concern at all that the networks will go the route of NBC and just say, as they have been saying in other sports, that this product is just too expensive?

Commissioner:  Obviously you can’t be obtuse to what’s going on in the world and you cannot be smug, or worse yet arrogant, about what people will be prepared to pay for your programming rights.  We have to make certain that we get the kind of audience that will justify the rights fees.  We also have to be concerned that broadcast television remains a strong medium.  Some of the ways in which federal policy is evolving have been helpful to broadcast television, but it’s a big part of what we worry about, so we’re being responsive not just to our own needs but to the needs of our television network partners.

Wapner:  At some point do you worry that it is possible that rights fees just can’t continue to escalate the way they are?

Commissioner:  That’s possible.  But if the programming is strong and it continues to attract the type of audience that we’ve been able to attract in those time slots that are critical for both the viewers, the advertisers and the networks, we hope at least we can see some modest increases.

Wapner:  Probably if you went around and you asked fans what the worst thing about sports is, they’ll probably say the player and the owner relationship, labor if you will.  Your deal will be up in three years.  How critical is it to have labor peace?

Commissioner:  It’s very important.  First of all, the distraction of labor strife, even when you solve your problem at the midnight hour, is a big, big price to have to pay in the entertainment business.  So what we’ve tried to do is not just have labor peace, but to deal with the issues early and well in advance of the expiration of the agreement, which in turn is a statement to television and a guarantee that we will not have labor strife interrupting our seasons. 

That continues to be a very high priority both for us and for the Players Association, and as long as the system is balanced, as long as the system serves the game and is responsive to the players’ needs about getting fair value in the marketplace and provides a level playing field for all teams in the league, then it should be a win-win, unless one side or the other begins to overreach.  That’s the way we’re approaching it and we’re optimistic we can keep extending it in some form of this agreement into the future. 

Wapner:  How important is football in Los Angeles?

Commissioner:   It is important because Los Angeles is part of the west coast.  Los Angeles is part of one-sixth of America, which is the Pacific time zone.  It’s also a place where our game has been vibrant and a lot of great players have come out of southern California.  Marcus Allen going into the Hall Of Fame reminded all of us what southern California football has meant to the game, both at the youth level, the intercollegiate level and the NFL level

The other aspect of it is the diversity of the population.  If we’re going to continue to be America’s passion, then we need to make sure that we appeal to the new Americans, who are increasingly Hispanic and Asian and from other non-European backgrounds.  I think we can do that successfully in Los Angeles as we are doing it in other major cities.  So it’s an important goal for the league to continue to pursue.

Wapner:  The Kobe Bryant case has once again shined the light on the character issue of professional athletes.  Your league has had some issues with players.  How concerned are you about those issues?

Commissioner:   Very much so.  We have programs, not only at the league level but that bring in outside professionals, outside counselors and also are institutionalized at the team level to help the player deal maturely and responsibly with his responsibility.  That includes on-field conduct as well as off-field conduct.  It goes back to what I said earlier.  People will cheer for the players that they can respect and they have to be confident that they can identify in a very real way with the athlete they are cheering for.  So for us it’s a big priority.

Wapner:   Doesn’t it all fit together in that it’s critical to attracting sponsors to your game, it’s critical to drawing ratings?

Commissioner:   The players recognize that.  One of the very positive things in the NFL today is the quality of the leadership of our Players Association.  Players like Troy Vincent, who is heavily involved in his own hometown in New Jersey, Derrick Brooks, who is on the board of his own university, Donovan McNabb and others.  These players understand that they have a responsibility not just to get the big pay check, not just to win the game, but to be involved in the community and let the public know that they deserve their support.  We’re blessed today with great leadership from our players.

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