If the NFL and the NFLPA are talking, that means no body is getting out locks or picket signs. Not only is that a good thing, it also suggests that there is a reason to talk rather than lock or picket. Meanwhile, another analyst sees relatively safe passage for networks in the event of a stoppage. And President Obama commented on the situation.
Anthony J. DiClemente of Barclays Capital seconded the notion of analysts at Fitch, saying that broadcast and cable networks carrying professional football games will not take a direct hit on fees, since the NFL has to return any such money paid for unplayed games.
He also said that events may be moving owners closer to seeking settlement over a stoppage. One is the loss of their ability to use $4B in network cash as a slush fund in the event of a lockout; the other is the NFLPA’s threat to decertify the union, which opens up the possibility of antitrust action that could be extremely distasteful for ownership.
Handicapping a stoppage, DiClemente said, “If some games or an entire season were to be cancelled, we believe CBS bears the most risk given its exposure to NFL-related revenues. On the other hand, ESPN stands to gain the most given its carriage of college football, a potential substitute for NFL programming. The network is also hedged given its heavy exposure to affiliate fees.”
DiClemente said that avoidance of a stoppage would certainly be the best news. “Should the ruling cause the League and NFLPA to come to an agreement more quickly, it would be a clear positive for the networks which benefit from the strong viewership that NFL games provide.”
The two sides agreed late Thursday afternoon 3/3/11 to add another 24 hours of talks, and one of the topics was expected to be the possibility of adding another week of talks. Observers believe it is an indication that progress is being made, albeit not fast enough to draw up a deal and append the necessary signatures.
Whatever happens, it will take place without White House intervention. President Barack Obama said this dispute between billionaires and millionaires was taking place against a backdrop of average citizens fighting to make mortgage payments. He said, “The two parties should be able to work it out without the President of the United States intervening.”