Football as a game has gained so much popularity all over the world. It’s no different in America too. The game has become a personal part of everyone’s life. Funnily enough, it sometimes goes to an extent where relationships are formed and broken based on the teams a person loves. Let’s know ‘Is the NFL a private company?’
NFL- an Overview
In 1920, the NFL (National Football League) started. The NFL and AFL (American Football League) compete at the famous Superbowl. Even the Super Bowl commercials are legendary that companies spend and focus more on developing these commercials.
The following is the NFL team structure: It has thirty-two clubs divided into two conferences – the American and National Football conferences, each consisting of sixteen teams, further divided into four clubs each -East, North, South, and West.
According to Wikipedia, the sixteen teams under the American Football conference are East – the Buffalo Bills, the Miami Dolphins, the New England Patriots, and the New York Jets; North – the Baltimore Ravens, the Cincinnati Bengals, the Cleveland Browns, and the Pittsburgh Steelers; South – the Houston Texans, the Indianapolis Colts, the Jacksonville Jaguars, and the Tennessee Titans; West – the Denver Broncos, the Kansas City Chiefs, the Las Vegas Raiders and the Los Angeles Chargers. The sixteen teams of the National Football Conference are East – the Dallas Cowboys, the New York Giants, the Philadelphia Eagles, and the Washington Football Team; North – the Chicago Bears, the Detroit Lions, the Green Bay Packers, and the Minnesota Vikings; South – the Atlanta Falcons, the Carolina Panthers, the New Orleans Saints, and the Tampa Bay Buccaneers; West – the Arizona Cardinals, the Los Angeles Rams, the San Francisco 49ers and the Seattle Seahawks.
NFL members history
August 1920 – American Professional Football Conference was started by four representatives from four states – Akron, Canton, Cleveland, and Ohio, to increase the game standard.
September 1920 – It was then, the APFC became the American Professional Football Association (APFA).
1921 – The number of teams participating increased from 14 to 21
1922 – The American Professional Football Association (APFA) became the National Football League.
1923 – The teams Duluth Kelleys and St. Louis All-Stars were added and Louisville Brecks and Oorang Indians folded.
1924 – Kenosha Maroons, Frankford Yellow Jackets, Kansas City Blues joined NFL
1925 to 1931 – During these years, the league had teams join and leave
1932 to 1939 – League split into Eastern Division and Western Division
1950 to 1959 – The Eastern and Western Divisions got renamed to the American and National Conference.
1960 – the American Football League started, and initially, eight teams were in the league.
1967 – NFL Eastern and Western Conference splits further into Capitol and Century division
1970 – AFL became the American Football Conference, and NFL became National Football Conference. Both the NFL and AFL merged.
The above is the history of how the NFL developed and how the existing 32 teams came into the picture, which is part of the trade association.
NFL- Private Company
The NFL was a public-owned company. It enjoyed the preferable treatment like any other public entity. The NFL comprises 32 representatives from each team. Following much criticism for its public entity status regardless of its income, NFL decided to become a private organization. Until 2015, the NFL was a nonprofit organization. As most of the public was against the tax-exempt benefit the nonprofit status offered. Finally, in 2015 NFL gave up its tax-exempt status, as a result, every income generated through various modes like sponsorships, ticket sales, licensing agreements became taxable.
The leadership hierarchy of the NFL is as follows – the commissioner, whose function involves making executive decisions in hiring, negotiation of contracts, authority over NFL team, clubs, or an individual.
The next positions are secretary and treasurer, which is appointed by the commissioner.
In the NFL, every team owner, that is, all thirty-two members gets on the executive committee and functions as one governing body. Currently, the Commissioner of the NFL is Roger Goodell
Even though the functions of the commissioner are listed, the final say would be in the hands of the 32- member executive committee.
Among the 32 teams, Green Bay is the only public franchise, maintaining the non-profit corporation status.
Since the ownership of the NFL is by 32 members, a Collective Bargaining Agreement (CBA) is signed between the team owners and the players, which is meant to cover most of the issues that can arise.
Some of the popular NFL franchise owners are David Tepper, Stan Kroenke, Jerry Jone, Shahid Khan, Stephen Ross.
The preseason match for the 2021 Superbowl championship is currently going on. The NFL also has the NFL Players Association which represents the union of professional football players.
Among the thirty-two teams, the Pittsburgh Steelers and the New England Patriots have six Super Bowl wins each. Next, to them are the Dallas Cowboys and the San Francisco 49ers, each with five wins. With four super bowl wins, the Green Bay Packers and the New York Giants stand third.
How does the NFL make money?
The source of revenue for the NFL comes in two forms, they are National Revenue and Local Revenue. Since the NFL has become a private entity, they don’t have to disclose its earnings and profit.
National revenue constitutes – TV deals, merchandising, and licensing contracts. Since the NFL’s Super Bowl is the most viewed event, it gets massive TV deals. The following media companies – CBS, NBC, Fox, and ESPN, have broadcasting deals with the NFL. The NFL also gets its revenue from merchandising and licensing. It signs contracts with the companies selling items about the NFL and stars. The local revenue stream involves earnings from ticket sales, concessions, food & beverage sales, and corporate sponsors. The NFL earns over 9.5 billion dollars through national revenue.
The expenditure also comes close to the earning as it involves the upkeep of the stadiums, expenses of teams.
In conclusion, the NFL is a private entity functioning as a trade association with thirty-two members, each sharing the profit earned regardless of the team performance.