Commisioner Tagliabue with Abe Madkour and Dan Kaplan
Sports Business Journal, August 19, 2003

Q:  What’s the state of NFL Business currently?

PT:  The fans seem to think it’s healthy because they continue to have tremendous interest in our teams and our games as well as in the postseason and in the Super Bowl.  We like to think it’s healthy, but we also have to be realistic.  Everything that’s healthy also has challenges.  That’s where we are.

Q:  What do you think those challenges are?

PT:  The challenge starts with keeping the game as great as it’s been.  That involves youth football, high school football, college football and NFL football.  Part of that is keeping the Collective Bargaining Agreement in place with the mechanisms that are in there for distributing the talent in an equitable way.  One of the challenges is to keep the public tuning into NFL telecasts in a big way – in a television universe where there are more channels and more and more alternatives for the viewer.  The United States and its economy have a way of growing and we’ve seen that decade after decade in every new technological change and every new change in the economy.  Leisure time entertainment presents challenges to us.

Q:  You mentioned TV.  You were one of the few leagues to avoid declining ratings last season.  What do you have to do this coming season to keep up that counter-cyclical effort?

PT:  It starts with the game, the quality of the game, the intensity of the competition as we move into the late part of our season and the postseason.  We have to be smart about how our season is structured – the combination of the preseason, regular season and postseason, the number of teams in the postseason, all of those things that have an impact on fan interest.  It also means being wise about when we play our games.  Right now our games are focused on Sundays and that gives us an advantage in terms of the aggregation of all the games – being a magnet for football fans.  It’s the one sport where you can set aside a day and see everything that’s happening in terms of the competition with the exception of the Monday night game.  But we’re focused on the weekend.  I think that’s important.  Moving some of the postseason games later in the day, on Saturday in particular, when there are more people at home able to watch the games is important.  Looking to the future, we need to consider whether the balance we have with early games on Sunday, late games on Sunday, late games in primetime on Sunday and Monday whether that’s the right balance or whether there’s a better balance.  All of those things are in the future when it comes to what we are considering.

Q:  There’s been some criticism about those late postseason games in terms of the crowds in Green Bay and whether you put the fans in danger by having winter games at night and having fans drive home later.  Are those considerations?

PT:  Not really.  I don’t think you can show there’s any significant difference between the weather conditions when we’re playing our games at night.  It’s subject to a lot of things, global warming, northeast drought, so we’ve looked at all those issues and studied tables relative to temperature and so forth.  We haven’t heard any significant complaints from fans.  What you do hear frequently is that “football is about athletes battling athletes and also battling the elements.” 

Q:  What about the Monday nights?  The ratings are going down.  Are you concerned about strengthening that part of the programming?

PT:  In actual numbers the ratings for everything have gone down because you’ve jumped from three channels to 400 channels in a lot of households.  So if you divide the audience among 400 channels you are going to have a smaller audience than when you have one-third of the country watching one of three networks, which is what it was in the 70s.  Monday Night Football keeps coming up in the ratings in terms of where it ranks among primetime programming.  It is holding very well compared to the audiences for the other mega shows that are out there for advertisers.  So that gives us encouragement about the future.  By the same token, we will look at whether there should be more than one game in the Monday night and Sunday night primetime windows because the quality of the games can be a factor in viewership.  But we also have to recognize this is a multi-channel universe and it’s not going to be possible to get 50 percent of the audience except maybe for the Super Bowl.

Q:  Could the NFL Network be a possible avenue for games on Sunday night or Monday night?  Bringing up the NFL Network, how have your immediate partners reacted to the creation of your own channel?

PT:  We don’t see the NFL Network carrying a lot of games.  We think keeping the product strong for our network partners is critical.  Right now the AFC package is strong.  CBS has done a great job in handling the AFC package.  The NFC package has always had an historic edge because the NFC teams in the aggregate are in larger metropolitan markets.  FOX has done a great job with that.  The two Disney companies ABC and ESPN are doing an outstanding job in primetime.  That’s our goal; it is to keep the product there and not to dilute the product.  We’re all convinced that the thing not to do is to let your product go thinner and thinner.  Ultimately, you end up marginalizing it.  Instead of having a vast audience you have a non-existent audience.

Q:  Is there any concerns your media partners have conveyed to you about competition for ad dollars, creative content, viewership in relation to the NFL Network?

PT:  No.  Right now all of the networks have been positive about the power of the NFL and the strength of the advertising marketplace generally and in specific to the NFL.  Obviously, if you look back at the economy you saw some softness in the economy before 9-11.  There was obviously an impact on television and television advertising and spending after 9-11.  But as we look at the 2003 season, the networks advise us about the strength of the market and they say its very, very positive.

Q:   How often do you talk to Steve Bornstein?  Is the network still scheduled to launch on Nov. 4?

PT:  Steve and I talk if not everyday then almost everyday.  We’re on schedule for Nov. 4. I see it as clearly complimentary to our NFL partners for two reasons:  No. 1 is the size of our audience.  More than 100 million people watch our games during the weekend, but with the exception of ESPN our other network partners do not have heavy programming on the ensuing weekdays.  So I think there’s a real opportunity there Monday-Saturday for the NFL Network.  It will give our fans, both casual and avid, an opportunity to see the teams up close, to see what they did to get ready to play and to also see who they are.  We have 1,800 players in the league. Most of them are tremendous leaders on the field and in the community and the network would give us the chance to have an insider’s view.

Q:  We don’t know when you’re going to retire, but if it were to be today, what would you say your legacy would be?

PT:  The most significant thing would be labor peace for, hopefully, two decades or more.  More broadly, understanding the traditions and structure of the league that have been established over decades that are critical and keeping those in place, strengthening those institutions, which includes smart revenue sharing.   And then be willing to make a change.  Probably the biggest change we’ve had in the league under my time as Commissioner is from the old player system to the new player system.  It seems to be working.  It has produced tremendous competition on the field, which is always the first concern.  We agreed to the system.  We made some judgments based on information and speculation that it would not harm the game.  In fact it seems to have made the league even more competitive.  Part of that is the athletes.  The talent in the league competes as passionately as it ever did.

Q:  There are some owners out there right now who are grumbling about a possible revenue disparity with new stadiums.  What are your thoughts about this issue?  Would the league change the revenue sharing formula to help those teams without new stadiums who are falling behind?

PT:  I don’t think revenue disparity comes from new stadiums.  I think the revenue disparity comes from a lot of things.  Stadiums, market size, disposable income in the community, competition from other entertainment, including major league sports.  You can have a great new stadium and a lot of debt because it was privately financed.  When you see your revenue subtracted from the debt service you are not going to be one of the major revenue teams.  On the other hand, you can have a publicly financed stadium in a small town and you can be at a revenue disadvantage because you don’t have major corporate presence or you can be in an economy where people are being laid off.  So it’s not stadiums alone.  There are a lot of reasons for revenue disparities and we’ve adjusted some of our policies in recent years, adopted new policies and I’m sure we’ll continue to do that, and try to guarantee that there’s an incentive at the team level to promote NFL football and the team.  At the same time, we have to give all the teams the ability to compete for player talent within the framework of our collective bargaining agreement.

Q:  Does that mean you would be able to tweak the revenue sharing formula?

PT:  Absolutely.  We’ve done it many times in the last dozen years.   I’m sure we’ll continue doing that. 

Q:  Why do you think it’s so important that the NFL return to LA?

PT:  If you’re in the entertainment business it’s important to showplace to people not to trees and other inanimate objects.  There are a lot of people in the Pacific Coast time zone.  There are a lot of people in California.  That’s one thing, and another thing is that football has a great tradition in southern California.  We were all reminded of that at the Hall of Fame when Marcus Allen was inducted.  He was a great player who competed in youth football, high school football, college football and NFL football in southern California.  That’s part of the tradition that also includes people like Anthony Munoz.  Anthony is important because southern California has a great Hispanic population.  We should be there with teams where we have fans, where our game’s well-supported and the diversity in America is clear.  Los Angeles is one such market.

Q:  Is the television rating impact important to you or are live spectators more important ?

PT:  You can’t separate the two.  You can’t make decisions on the basis of television ratings alone.  We are in a sport which is attractive to people both as a spectator sport and as a sport in which people want to participate.  We need to know which are the areas where there are people who will participate and cheer for teams.  Los Angeles is such an area.  But it’s the whole Pacific coast.  It’s not just Los Angeles.  It’s not just San Francisco.  America’s a big place and roughly one-sixth of it happens to be in the Pacific Time zone.  It’s one part of a much broader fabric of American society. 

Q:  What’s the status of NFL Europe?

PT:  It should continue.  It serves important purposes.  We’re in a world ever smaller because of technology and specifically telecommunications.  We’re in a world where hopefully growing standards of living will enable more people to participate in a diverse way in different sports.  NFL Europe is one way of exposing our game to people outside the United States.  Our relationship with the CFL and football in Mexico is equally important.  I could see a day down the road when there could be competition among a Canadian league, a Mexican league and a European league.  That’s the vision of where our sport can evolve.  You can never get there without some baby steps and promoting the game in Europe.  When I think about Europe, I have to think on two levels.   First is the strategic vision for our game.  And then tactical steps to move toward that strategic  vision.  In that context I think it’s important.

Q:  What about the financial losses?

PT:  The financial losses have to be compared with the revenue and other costs.  Every dollar you spend on one subject could be spent on another subject.  The cost of running Europe is moderate compared to the many other costs we incur and I think the payback in Europe is greater than some of the costs that teams are incurring.  It’s about less than one percent of revenues and less than one percent is less than one percent of player costs.  You have to judge every investment you make in terms of alternative uses of those resources.  I think Europe is a sensible investment.  It’s less than a half a million dollars per club and in this environment that’s modest.

Q:  There’s been a dispute between the New Jersey Sports Authority and the Giants over stadium issues.  How does that impact the Giants getting the 2008 Super Bowl?

PT:  I don’t think it ruins their chances of getting a Super Bowl in 2008.  Washington is a strong candidate with an outstanding stadium.  Having the game in the nation’s capital could be very attractive.  It’s certainly not good for New York’s prospects because from day one the owners were told the quality of the stadium for a Super Bowl in a northern city would be a key factor.  So we’re still hopeful dialogue will be resumed between the Giants and the sports authorities in New Jersey so their Super Bowl bid would remain viable.  If not, it would have to be deferred for two years.

Q:  Are you taking any role in that?

PT:  I’ve had some conversations with representatives of the state.  I will try to continue to do so as long as people think my participation is constructive. 

Q:  Are the two sides still talking?

PT:  They are still talking.  They don’t seem to be making too much progress.  Sometimes progress comes when you least expect it.

Q:  Detroit and Jacksonville are future sites.  They may not be as attractive as Miami, San Diego, New Orleans.  What’s the plan for awarding Super Bowls for the future?  Do you want to keep spreading among a wider range of cities?

PT:  I think so.  Houston, for one, will be a great venue for the game.  The stadium is one of a kind. All of the feedback I’ve had is that a wide range of groups have an interest in attending the game and are very positive.  I don’t have any concern about any of the upcoming sites.  We will continue to bring the game back to sites like Miami and New Orleans and hopefully somehow in Los Angeles as well as New York and Washington.  America has grown and there are a lot of places where you can host a Super Bowl.

Q:  Can you talk about the changing NFL sponsorship model in March of 2004?

PT:  Mostly it has to do with how the marketplace has evolved.  Overall with the popularity of the NFL, companies have used the NFL as a vehicle to make a statement about their product and their brand.  Stadiums are a part of it.  In the old days, there weren’t opportunities for teams to have sponsorship arrangements associated with stadiums.  Those opportunities now exist.  Opportunities exist in radio, preseason television and other media.  What we’ve done in the last two years provides a template in other areas to carry us into the future.  I’m certain there are ideas we haven’t thought of yet that will also be part of the future.  We’re going to be addressing a master agreement on all of these commercial opportunities particularly in the retailing, sponsorship and related advertising areas in our meetings in September and in October and again next March.

Q:  There’s another deadline in March 2004.  The NFL has the option to buy in on the Reebok sponsorship deal.  Do you see the NFL taking that option?

PT:  We’ve been having constant dialogue with Reebok.  At this point it’s too early to tell what way we’ll be leaning with that.

Q:  Is there an update on Malcolm Glazer buying the Dodgers?

PT:  I haven’t heard anything from the Glazers.  We’ve told him if they were going to structure some ownership within the family it would have to be independent of Malcolm Glazer and his resources since he’s the controlling owner of the Buccaneers.