Report: CFL Proposed NFL Ownership

Published on June 6, 2008 9:32 PM by dbo.

David Naylor of globesports.com reported today on the breaking off of talks between the CFL and NFL that the CFL proposed the NFL take an ownership stake in the Canadian league. Naylor names no sources and provides no quotations from anonymous insiders to corroborate the report.

The CFL proposals reportedly declined by the NFL included both an equity position on the CFL and the CFL becoming a formal development league for its southern neighbour. NFL representative Bryan McCarthy, on the other hand, is quoted as saying the NFL was willing to partner with the CFL on “media, ticketing, event and grassroots programs”. With each sides proposals unacceptable to the other side, the talks reached an impasse this week with CFL commissioner Mark Cohon stating that the proposals on the table were not enough to strengthen the league in his and the CFL governors opinion.

The unconfirmed revelation that the CFL was actively courting the NFL for an ownership stake comes as no surprise. The reasons for such a proposal are to provide the CFL with some protection from an NFL with an increasing incursion into Canada in the next few years. However, an ownership stake by the NFL, or an agreement to develop players as an NFL Europe substitute is no guarantee that the NFL will continue to support you. As the fate of NFL Europe showed, the NFL is perfectly willing to pull the plug on their own development league after a long period of operation.

The rejection of these proposals by the NFL is a silver lining to the cloud some see hanging over the CFL. The CFL has a better chance to prosper as a national, traditional league with its unique game and independence than as a feeder league to the NFL with the NFL firmly entrenched in Canada. Don’t be confused, an agreement with the NFL would be beneficial to the CFL, but not at any cost. The CFL should be ready to go back to the table without an ownership stake being the starting point of the negotiations. Negotiations to get any substantial amount of dollars out of the NFL may be difficult, but with the NFL’s toe already in Canada, the NFL must be wary of impacting the CFL for fear over legal and political battles over the wielding of their monopoly. Besides the continuing promotional and grassroots programs, the CFL should be negotiating for a small percentage (1% or less) of business done on their turf. The NFL doesn’t pay if they don’t come, otherwise the CFL gets a some cash for the NFL operating in their territory, offsetting the impact, and in return remove any threat of legislation or court cases against the NFL.

Unrealistic? Likely. I’m not a negotiator responsible for a billion dollar company. NFL owners will not want to give one dollar to the CFL. The original agreement in 1997 was a $3 million loan that was eventually paid back, and since then the same agreement has been in place with nothing but co-operative grassroots programs to show for it. For providing loopholes in player contracts allowing the NFL to poach players a year early the CFL has not received one dime from the NFL. It is time to use what leverage you have to protect yourself from this monopoly which has never allowed competition to stand in its way before. What will happen when an NFL franchise moves to Canada, no agreement is in place and there is no warning to the possible consequences?

Update:  CFL commissioner Mark Cohon has posted a denial of the developmental league proposal story on CFL.ca.  He did not deny the ownership stake part of the story.  Cohon is quickly becoming the fans commissioner, using the Internet to repsond to stories quickly.  Who can say any other major professional league commissioner even appears to put fans first?

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Report: CFL Proposed NFL Ownership was published on June 6, 2008 9:32 PM by dbo.

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This article is categorized under Finances and tagged with league, nfl and partnership.