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Sat. Jan 15, 2005

Playoff Losses

It’s that time of year when fans talk about “playoff losses.” They’re referring to the scoreboard. But when NFL owners talk about “playoff losses,” they’re talking about cash money.

Yes, your reward for a victorious season in the National Football League is the opportunity to play a week to a month longer … bleeding cash the whole way. Despite their regular absence in the playoffs, despite 70,000 pumped fans in the Georgia Dome, tonight, victory or defeat, the Atlanta Falcons will lose money.

“I would expect to lose a little bit of money on the game,” Falcons president and general manager Rich McKay said. “It is not a money-maker.”

Told that such economics will strike most observers as strange, McKay said: “It seems strange to the owners, too.”

All of the ticket receipts from playoff games go to the league, which will return a flat fee of $580,000 for expenses to each team participating in this weekend’s games, according to NFL spokesman Steve Alic. By contrast, teams keep two-thirds of their home gate receipts during the regular season.

But after the Falcons cover other costs associated with tonight’s game against the St. Louis Rams — primarily stadium costs and bonuses to coaches and other staffers — they will have spent more than the $580,000 they are reimbursed for the game, McKay said.

AJC: “We’re (not) in the money”

And this isn’t due to some new financial adjustment, or a sudden increase in costs. It’s been this way for some time: “The Green Bay Packers, the NFL’s only publicly owned franchise, reported a loss of about $1.5 million on their trips to the Super Bowl in 1997 and 1998. The St. Louis Rams said they did not make money during the 2000 postseason, which culminated with a Super Bowl victory in Atlanta.”

Of course, this is the short term budget picture. A victory in the Super Bowl presents financial opportunities long after the season is over, from increased tickets sales the next season due to excitement over the team, to merchandise marketing, to the ability to woo free agents and improve the team further.

But tonight, it’s “open the wallet” time. And not just for the owners. The players are taking a hit, too: “Teams don’t have to pay their players during the playoffs, because the league covers the postseason player salary pool, which is over and above regular-season pay.”

A player’s salary for the season is split up among 16 games (no, they don’t get paid for preseason games, either). For example, if you were to divide Michael Vick’s $130 million contract by the 160 games it covers (yes, it’s more complex than that, but bear with me), we find that Michael Vick has an income average of $800,000 per game. During the regular season.

Tonight, the NFL will pay Vick $18,000. And the third string defensive back who never steps on the field? He’ll make $18,000, too.

So when you watch the playoffs this weekend, keep in mind that everyone you see on the field and in the owner’s booth is taking a bath in red ink. They stopped playing for money two weeks ago. Now they’re playing for the chance to prove they’re the best.