Interesting concept regarding the lockout (1 Viewer)

[Horses Mouth]

Marketing guru Seth Godin had an interesting idea he discusses on his blog. Thoughts?

link



A game theory of NFL negotiations

Off topic here, a bonus post for those that might be interested:

When two sides are negotiating over something that spoils forever if it doesn't get shipped, there's a straightforward way to increase the value of a settlement. Think of it as the net present value of a stream of football...

Any Sunday the NFL doesn't play, the money is gone forever. You can't make up for it later by selling more football--that money is gone. The owners don't get it, the players don't get it, the networks don't get it, no one gets it.

The solution: While the lockout/strike/dispute is going on, keep playing. And put all the profit/pay in an escrow account. Week after week, the billions and billions of dollars pile up. The owners see it, the players see it, no one gets it until there's a deal.

Seeing and counting money you don't get to touch is a very different story than merely imagining the money you didn't get to touch, money that's gone forever... Change the story, change behavior.

The alternative (if you don't do this) is that down the road, instead of announcing a deal where everyone gets a windfall, you are forced to announce a deal where everyone already starts way behind where they would have been in the first place. That money is gone forever, no one gets it back. The problem with the game of chicken is that someone has to lose.

I'm not even a football fan, but this seems like a clear way to both maximize value and minimize the damage to all those involved. Especially players with short careers and those fans with nothing to do on Sunday afternoons.

 

[Jercules]

The trouble is no football is more damaging to the players than to the owners. The money is indeed lost forever, but for billionaire owners facing years of future earnings that fact is merely unfortunate, whereas for the players it is catastrophic. Even premium players are out sizable percentages of their potential net worth if an entire season is lost, and for non-premium players, entire careers will be lost.

If the money is still being earned, and the issue is merely how to divvy it up, the owners would lose a lot of leverage.

Also, even more importantly, not even the NFL is so successful that no percentage of the money it generates isn't necessary for immediate reinvestment. The owners may profit millions to billions, but if you present them with a scenario whereby all costs remain but revenues are effectively frozen, you no longer have a sensible business model.

Now, you specifically say place 'profits' in an escrow account, but the owners refuse to open their books, so what are profits? How do you protect against any 'scorched earth' tactics the owners may employ, like giving away free tickets, etc., to ensure that account stays as small as possible?

In the end I believe what you propose is approximately what will happen, in that temporary agreements regarding some key issues will allow football, and the labour strife, to continue.