NFL Asked Teams for Financial Stress Tests
The 2010 NFL season is back in full swing this week. The league, as you may recall, cut $50 million from its budget during the financial crisis.
Since then, the NFL has further accelerated its fiscally conservative approach.
Most interesting is how Commissioner Roger Goodell and CFO Anthony Noto, a Goldman Sachs alum, have imposed financial discipline on the 32 club owners who make up the league.
About two years ago, in the depths of the financial crisis, Goodell and Noto asked the team owners to perform stress tests to see how their revenue stream would look under various scenarios, if for example there was a work stoppage due to collective bargainingwith the NFL players' union. With the league's current player contract set to expire in March 2011, a stoppage could occur as early as next year.
Some people are said to be unhappy about this conservative approach and have nicknamed the NFL the "no fun league" as a result.
But the commissioner has ambitious goals for the league, announcing a plan to reach $25 billion in revenue by 2027.
To put that number in context, the NFL right now is expected to make $8 or $9 billion in gross revenue this year. While there's still a long way to go, the NFL has the highest credit rating of any major sports league, so they might actually be able to reach that goal.
*This post was updated on September 8.