As a footnote to my Pinocchio Story columns from the past week, I discovered today that Forbes just released their 2008 analyses of the financial health of the NFL. There are a number of different ways that we can look at the data. But tonight, I want to focus on the fact that the figures back up the idea that Cleveland is a die-hard football city - regardless of record.
In short, the data indicates that the Browns’ organization has no financial incentive to win games.
Declaring the city’s preference for the Browns shouldn’t shock anyone reading this blog. I remember a Bud Shaw column in the Plain Dealer back in the spring that began something like, “The Cavs are the #1 seed in the NBA and the Indians play their season opener this week, so it’s only natural that most of the emails I got from readers are about Brady Quinn.” This infuriated me (and my dad and Mike) to varying degrees as the Cavs were demolishing the NBA season while being led by one of the greatest players of all time. But there’s nothing that seems to be able to change it.
The Browns are just the favored son. It’s in the city’s DNA.
Here are some quick facts from the Forbes’ analysis to prove it:
1) Despite their 4-12 record and an entire spring / summer of Browns blog commenters claiming they are ready to quit following the team, Browns season ticket renewals were at 90% for this season. The league average this year is 85%.
Critics will note that there are multiple games on the Browns schedule that are in danger of being blacked out because of non-sellouts. However, Forbes argues that - as of the 3rd preseason game - 10 of the 32 franchises were currently in danger of being blacked out at least once, making the Browns hardly an exception.
2) Of the 16 most valuable teams in the NFL, the Browns ranked #13 overall (they also pulled in the 12th highest revenue total). The overall franchise value remained steady from the previous year despite the extreme economic downturn.
There were only three other teams who managed to crack the top 16 in value without trending upward. Those teams were the Giants, the Jets, and the Colts - in other words, the biggest market in the league and a perennial contender.
3) Al Lerner bought the Browns in 1998 for $530M. The franchise’s value has now doubled to $1.06B (yes, that’s a ‘B’). As we all know, during that 10 year span the Browns have fought their way into the playoffs exactly one time.
4) With one exception, the Browns’ franchise value and revenue have increased every year since the reboot. That exception was 2006-7, where their revenue remained steady. Neither of those numbers has ever declined, regardless of the product put on the field.
5) Of the top 16 most valuable franchises in the 2008 NFL, the Browns were one of only two to post a record worse than .500. The other team was Kansas City, one spot behind the Browns in the value ranks with a record of 2-14.
6) The Browns are still more valuable than the Steelers (#16 overall), who have won 2 Super Bowls in the past 4 years.
So if you look at all of those facts, an interesting point rises to the top: contrary to popular belief, winning actually seems to have very little impact on how the Browns do financially.
Granted, their operating income was in the lower third of the NFL this year, but my quick read of the data suggests that that’s mostly because their payroll was at an all-time high. To support that idea, the Browns’ most profitable year from an operating income standpoint ($59M) was 2004, when their payroll was the lowest in “new” team history ($70M), Butch Davis was fired mid-season, and the team finished a pathetic 4-12.
However, the Browns aren’t necessarily special in terms of their finances’ immunity to record. Of the 8 teams that declined in value over the course of the past year, 3 (Atlanta, Indianapolis, and Miami) were playoff teams in 2008. This is especially worth mentioning because it’s the first time in a decade that ANY team in the NFL declined in value - and yet the Browns still weren’t one of those teams.
Also less valuable than the Browns are perennial playoff teams like the Titans and Chargers, as well as the Cardinals, fresh off a Super Bowl appearance and entrenched in a beautiful new stadium.
On the other side of the coin, the Houston Texans are the sixth most valuable franchise in the league - despite having never made it to the playoffs.
There’s a much longer post that could be done on the reasoning behind this apparent lack of relationship between competitiveness and value / profitability in the NFL. But I don’t have it in me tonight, and it’s possible that even if I had the time, I wouldn’t have the economic expertise to carry it out. It may just be that I’m not controlling for the right factors, and that if I did, the trends I’m seeing now would disappear.
But let’s get back to what it means if I’m right.
I believe players want to win. Or at least, I believe that our players want to win. I know without a shadow of a doubt that Alpha Dog wants to win. But unless Randy Lerner is more emotionally involved than he seems, the Forbes data indicates that he has very little incentive for his team to do well. Because regardless of who he puts on the field, it appears that the fans will never desert the franchise.
That’s great news for Lerner. I just wish that it was better news for the rest of us.
-T
