A Look at How The NFL's Revenue Sharing Works
Published on August 9th, 2022 7:50 pm ESTWritten By: Dave Manuel
As of the end of 2021, the Dallas Cowboys were the NFL's most valuable team with a value of $6.5 billion.
The Buffalo Bills, on the other hand, were the least valuable team in the NFL, with a total value of just $2.27 billion.
Why the big disparity between the league's most valuable and least valuable teams?
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To get the answer to that question, we need to first look at how the NFL's owners divvy up their revenues.
First off - there are national revenues and local revenues.
From 2023 to 2032, the NFL will collect the following amounts from their media partners:
ESPN/ABC - $27.2 billion
Fox - $25.2 billion
CBS - $23.6 billion
NBC - $22.6 billion
Amazon - $13.2 billion
Divide this by ten (the number of years in the deal) and you have $11.18 billion/year, which is the amount that the 32 NFL teams receive before the season even starts.
Other national revenue sources includes the NFL Sunday Ticket deal with DirecTV, the NFL network, merchandise sold through NFL.com and more.
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Now, let's look at local revenues.
Home teams receive 60% of ticket sales, while the other 40% is entered into a "pot" that is split between all of the teams in the league. This has brought a fair amount of consternation from Jerry Jones in the past, who feels as though he shouldn't have to split his ticket revenues with other teams.
The rest of the "local" revenues, however, go straight into the pockets of the teams without having to be split.
These revenues include:
-Concession sales
-Stadium merchandise sales
-luxury box sales
-stadium sponsorships
-stadium naming rights
-Parking sales
The Dallas Cowboys make hundreds of millions of dollars per year from stadium sponsorships and stadium naming rights, for instance. Their stadium is a money-making machine, which is why the Cowboys are the most valuable franchise.
Last season, the Dallas Cowboys made nearly $300 million in net operating income from $800 million in revenues.
The Buffalo Bills, on the other hand, made a fraction of that amount.
A favorable stadium deal and an uber-popular team - this is why the Cowboys are worth more than every other team in the league.
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This is how the NFL's revenues are shared.