I’ve been threatening for a while to do a deep dive into the numbers behind moving an NFL team to Los Angeles — in short, does market size still not matter much in the NFL because everyone shares the same national TV money, or have the economics changed to where L.A. is now a potential goldmine? Thanks to Vice Sports, I finally had time to do so, and the answer is: a little of both. The short version:
- NFL revenues may still be fairly flat across franchises compared to other leagues, but they’re up overall — and even if owning a big-market franchise is only worth 30% more than a small-market one, if the actual value of that 30% has risen, it means building an L.A. stadium is a better investment for owners than it was just five years ago.
- Personal seat licenses have potentially changed the game, since now that the 49ers paid for a stadium essentially by crowdfunding, everyone else thinks they can, too, if the market is good enough.
- It’s still not enough to explain why St. Louis Rams owner Stan Kroenke would want to spend $1.8 billion on an L.A. stadium. Says Roger Noll, dean of sports economists: “Yes, it’s worth something. It’s not billions of dollars.” But Kroenke may have other reasons for wanting in to L.A. — and even if he doesn’t, the gamesmanship behind the fight to move to L.A. may be making his decision to take on the risk, as well as that of the San Diego Chargers and Oakland Raiders owners, unstoppable.
Anyway, go read it for yourself and then we can always debate the numbers in comments below. It’s not quite a definitive answer to whether all the L.A. move talk is serious, a bluff, or somewhere in between, but it’s at least an attempt to establish some basis for discussing it.