Money doesn’t buy everything, especially wins in the NFL.
Parity is again the major topic this season, and for good reason: After 14 weeks, only four of the 12 playoffs spots have been claimed, and several divisions are unlikely to be decided until the last weekend.
Off the field, the NFL is witnessing financial parity of sorts this year. The Dallas Cowboys and the Washington Redskins, the league’s two most valuable franchises, have losing records, yet the Atlanta Falcons, one of the least valuable, are tied for the best record. The 16 most valuable franchises as ranked by Forbes have won a combined 117 matches through 14 games, just 10 more than the bottom 16 teams in the league.
The competitive balance up and down the valuation chart reflects not just the drawing power of the NFL, but the league’s lucrative television contracts, licensing contracts and other revenue that is shared evenly among its 32 teams. The sharing of revenue keeps the financial divide between larger-market teams like the Giants and smaller-market teams like the Jacksonville Jaguars from exploding, as it has in baseball.
Like hockey and basketball, the NFL also has a salary cap (though not this year because the league and players let their cap run out as they negotiate a new collective bargaining agreement), which prevents teams from spending far more on player payrolls than others the way, say, the Yankees outspend the Kansas City Royals in baseball. A deep pool of talented collegiate players makes it possible for weaker, smaller market teams to rebuild relatively quickly.
“On any given Sunday, one team can beat another because of the television money that ensures they can compete,” said Scott Minto, the director of the sports business MBA program at San Diego State University. “The Redskins have been one of the five most valuable teams for a long time, but I can’t remember the last time they were in the Super Bowl. Atlanta might win the Super Bowl this year and not move up in valuation rankings.”
Among the four major leagues, the NFL and the NBA have the most financial parity. Based on Forbes’ valuations, the wealthiest team in these leagues is worth only about 2.5 times that of the least valuable franchise. In the NHL, the Toronto Maple Leafs are worth 3.8 times that of the Phoenix Coyotes, while in baseball, the Yankees are worth 5.7 times that of the Pittsburgh Pirates.
Teams in smaller markets or with limited payrolls like the San Antonio Spurs or the Florida Marlins occasionally bubble to the top and break up the long line of powerful franchises that dominate in these leagues. The NFL, though, is filled with teams that, regardless of their market, can rebound a year or two after being left for dead, and vice versa. The Cowboys, who are worth US$1.8 billion according to Forbes, have won only five games this year after winning 11 games and their division last season. The Houston Texans and the Carolina Panthers, ranked fifth and 12th in the Forbes survey, are having terrible seasons after finishing strongly last year.
At the same time, the Tampa Bay Buccaneers (13th most valuable), the Oakland Raiders (31st) and the Jacksonville Jaguars (32nd and last on the survey) have had surprisingly competitive seasons after winning a combined 15 games last season. Instead of spending heavily on free agents, they have used the college draft to sign young players.