London Before Los Angeles

Eventually Los Angeles and London will have their own National Football League franchises. Commissioner Roger Goodell has made it clear what he wants:

I want both [London and LA], but it doesn’t matter which one is first.”

NFL Commissioner Roger Goodell

It’s been almost two decades since the Oakland Raiders and St. Louis Rams called L.A. home. The NFL Draft may be held in the City of Angels next year, but residents shouldn’t get too excited too soon because London will have a team first.

The league is just putting a lot of emphasis on playing abroad. Goodell said this to a crowd of fans in Europe last October:

 We are making sure we can bring more football to more people. The UK fans have been terrific. Seeing over 500,000 people the day before the game at a rally is really extraordinary. It is a signal that there is real interest in our game internationally.”

Wembley Stadium

The NFL has gradually increased the number of International Series games at Wembley Stadium since 2007; this year there will be three games. There’s even talk they could play four games next year and five games in 2016. As Pro Football Hall of Fame President David Baker pointed out, L.A. has no games scheduled.

London is a new market with a ton of potential. Europeans haven’t been overexposed to American football, so they are loving every minute of it. Every game at Wembley has sold-out and television ratings in England keep increasing.

London, England

Here’s another factor: London has a population of 8.3 million, while Los Angeles only has 3.8 million. That’s 4.5 million more wallets the league can try to open up — and that doesn’t even consider the folks who live elsewhere in Europe who are also interested in the NFL.

As the L.A. Times explained, staying out of L.A. may be the best move for right now:

This market has already lost two teams, and three if you count the short-lived L.A. Chargers. In that sense, it’s about as rock-solid reliable as a Hollywood marriage.”

Here’s the biggest hang-up: League officials have made it clear that L.A. lacks the proper stadium to house a team. Even experts have weighed in:

The political structure with funding stadiums is horrendous in the state of California. The other big challenge from having lived down in LA is the amount of transplants that live there.”

At a media event two weeks ago in Beverly Hills, New England Patriots owner Robert Kraft backed up what everyone is saying:

“But like [Roger] said, the most important thing is to have the right facility. You have so many choices in L.A. of things to do. And the weather is great; the people are great. If you don’t have something really compelling, people won’t be there all the time.”

Here’s another hint at what’s to come: NFL officials have confirmed they’re shopping around for a new venue in London when the contract with Wembley expires in two years. Check out this previous blog post for more on that.

At least Goodell has given a timetable on when to expect an expansion across the Atlantic Ocean:

We actually couldn’t be more surprised by the tremendous demand for NFL football in London, in the UK in general, and frankly in Europe. So it’s not something that I think is 15 or 20 years away. It could be five or 10 years away.”

When you compile all the obvious signs, the NFL has made it pretty clear that it wants to get to Europe tomorrow. That’s the first item on their agenda. Plus, they’d become the only American professional sports league to have a team based in Europe. Maybe after they complete the task, then they can work on getting a franchise in L.A.

Recruiting A Good Team of Attorneys

The National Football League‘s plans to expand to Europe raise a lot of questions. When will it happen? Will a team relocate or be created? How will schedules be created? Who will want to play there?

It’s drawn a lot of criticism. Green Bay Packers president/CEO Mark Murphy recently told shareholders:

I anticipate that the Packers will probably play there in the coming years, but it will be an away game. They will never take a home game.”

It’s also drawn a lot of positivity. Oakland Raiders team captain and fullback Marcel Reece told Brit View NFL:

I’m excited that the Raiders finally get a chance to come out to Wembley Stadium, to have some fun and get a win. We’re an international team and we have an international fan base – there is only one nation and that’s the Raider Nation.”

No matter what side of the fence you’re on, the NFL has some pretty big legal hurdles to jump over first. It’s all about the money, right?

United Kingdom tax laws are very different from the United States. Athletes competing in the UK are taxed up to 45%, while the highest rate in the U.S. is 39.6%.

As ESPN points out, athletes playing overseas are also taxed on global endorsement income:

The amount is determined by dividing the number of days the athlete spends training and competing in the UK annually by the total number of days he trained and competed around the world. That percentage is then multiplied by the athlete’s total global endorsement income to determine the amount subject to taxation.”

Sounds pretty confusing! The teams who play in the NFL International Series games are only in London for less than a week, so the financial burden is very minimal right now.

Wembley Stadium

The bottom line is athletes playing for a London team will have a far greater tax burden. Forbes published an article back in 2012 that really explained the complicated issue. Michael David Smith from ProFootballTalk also posted a few suggestions, like creating extra salary cap space or giving relocation stipends.

A full home schedule in London also means players will need work visas. Ian Robinson, manager at the immigration law firm Fragomen in London, said there may be a quick fix:

The league could negotiate with the existing British American Football Association or it could negotiate with the government to establish its own office based in the UK.”

Players with criminal convictions would have to stay in America, though.

Michael Vick on the Atlanta Falcons

The league will also have to handle labor laws, particularly competition laws and free movement laws. The NFL Draft may become an issue as attorney Andrew Nixon points out:

The trickier issue with the draft system would be that it would breach a worker’s right to move freely, and the EU distinguishes between exemption under competition rules and exemption from free movement rules.”

Have a headache yet? The NFL will need a good legal team to sort through all these stipulations. They can’t expect the United Kingdom to change or bend the rules, either. They have to accept them and make the necessary adjustments. You may consider reading this academic article on “Antitrust and ‘Free Movement’ Risk of Expanding U.S. Professional Sports Leagues into Europe” for more insight.

You Can’t Go Home If You Don’t Have a Home

It’s only a matter of time before the National Football League establishes a team in London, however they’ll first need a place to call home.

Wembley Stadium

The NFL has been under contract since 2007 to play its International Series at Wembley Stadium through 2016, but it’s never too early to start planning ahead.

According to the Sports Business Journal, league officials have started exploring other venues. Chris Parsons, NFL senior vice president of international, confirmed it to the reporter:

Clearly Wembley gives us some great options. At the same time, Wembley also has England [soccer] games going on during the weeks we play. That is a challenge for us if we want to play more games, how we actually fit into the schedule.”

Even if the NFL didn’t have to work around soccer games at Wembley, it would be great if the league could continue playing sold-out games there, but that’s just not a reality.

We are constantly looking at where we can play, what options we might have. We would be stupid not to.”

Wembley Stadium

Wembley is built for about 90,000 spectators, yet there are only about 84,000 available seats once you consider the space needed for the teams and broadcasting equipment.

Filling 84,000 seats for eight home games will never happen, as SBJ reports:

The average capacity at NFL teams’ venues last season was about 71,000.”

Wembley has nearly 2,000 more seats than MetLife Stadium in New Jersey. There’s no way a new franchise can expect to play in what could be the biggest NFL stadium.

The only reason the league can sell-out the venue now is because there are only a couple games a year, which creates more of a demand and carries a “can’t miss” vibe. The league will see if it adds four games in 2015 and possible five games in 2016, the demand may not be quite as high.

If the league wants to make this London franchise successful, it has to avoid empty seats.

Olympic Stadium

Olympic Stadium is a possible alternative. It will reopen in 2016 after a lengthy renovation with around 54,000 seats. There is talk that it will have retractable bleachers near the field to accommodate football and soccer games.

London mayor Boris Johnson was in talks with league officials about Olympic Stadium just two years ago.

The talks were exploratory and we are at an early stage but the signs are encouraging.”

There’s even word of plans to build a soccer-football specific 58,000-seat venue to open in 2017.

Some suggest the NFL stay put in Wembley. Terry Byrne, a marketer, says:

The problem with playing in the home of an EPL team is that fans of other soccer clubs might not want to go to that venue even to watch American football.”

Either way, the NFL is going to have to find the perfect venue and step on some toes along the way. There aren’t many options, so finding the right one will be tough and will either make or break whether a team calls London home. Good luck, guys!