The value of an NFL franchise has doubled in five years. The Denver Broncos are about to be sold for an estimated $4.5 billion, twice the number David Tepper paid for the Carolina Panthers in 2018.
Think of it this way: Denver’s price will be about 30 times what Jerry Jones paid for the Dallas Cowboys 33 years ago. In 1989, Jones paid $150 million for the Cowboys and for Texas Stadium, the team was losing $1 million per month, and cornerstone owner Lamar Hunt of Kansas City called it “the greatest risk I’ve ever seen an owner take.”
What a difference a generation makes. So, I asked the 79-year-old Jones on Friday: How surprised are you that a team not in New York or LA or not the Dallas Cowboys will sell for 30 times what you risked everything to buy 33 years ago?
“Every day, every week, it never ceases to amaze me how the NFL continues to evolve and continues to grow and continues to dominate the [sports] landscape,” Jones said. “Every time I think I totally understand it, it still blows me away.”
A couple of weeks ago, I saw reports that the Broncos could sell for at least $4 billion, with four prospective owners understanding the pricetag and yet staying in contention to buy the team. On Friday, I was told it will be closer to $4.5 billion, with a fifth owner candidate in the picture. And I looked up the recent history of team sales. Six teams have changed hands this century: Miami ($1.1 billion, 2008), the Rams ($750 million, 2010), Jacksonville ($770 million, 2012), Cleveland ($1 billion, 2012), Buffalo ($1.4 billion, 2014), Carolina ($2.275 billion, 2018).
Amazing, especially considering that when Forbes did its annual valuation of franchises this year, the Broncos were 10th. So if the Broncos are 10th and worth $4.5 billion, what are the rolling-in-dough Cowboys worth? Forbes says $6.5 billion. The smartest business consultant in NFL circles, Marc Ganis, told me he thinks Jones would get $8 billion or $8.5 billion if he tried to sell. Jones, when I asked him, said:
Asked to clarify, he said, “more than $10 billion.”
“But let me make this very clear,” Jones said. “I’ll say it definitively. I will never do it. I will never sell the Cowboys. Ever.”
I see three seminal events at the core of the astronomical rise in franchise values.
One: The NFL has made consecutive 10- and 11-year labor deals with its players union. The relationship between players and owners may not seem harmonious at times, but when there’s been 35 consecutive years of labor peace and nine more years on the current labor deal, there’s a certainty of play that other sports can’t match.
Two: The NFL owns the sports calendar, and the media is only too happy to cover the league with an unending year-round fervor. There are now five tentpole events in the league’s offseason (combine, free agency, draft, schedule release, camp opening) that didn’t exist in mega-coverage 25 years ago.
Three: The NFL just made media-rights deals for a decade totaling $113 billion. Within 10 years, the media money each team will get annually, guaranteed, will rise from $250 million to $380 million.
“The NFL has become the emperor of content, in season and out,” said Ganis, the president of Chicago-based SportsCorp, a sports business consulting firm. Ganis does business with about three-quarters of the NFL teams. “Technology is changing, and people’s habits are changing, and the NFL is at the forefront of those things. They’re at the forefront of streaming and gambling. If fans didn’t want more content, more events, they wouldn’t support what the NFL is doing. But they do. The NFL had a strategy of creating more events and they’ve all worked.”
For Jones, the Cowboys have come a long way from the days the franchise was leaking money. “Back then,” Jones said, “Donald Trump said he felt sorry for the guy who bought the Dallas Cowboys. He called it ‘reckless crazy.’ And we really were America’s Team, because the FDIC owned 5 percent of the franchise. Every day, my motivation was simply to survive. I danced with the devil, and it created an edge with me. I didn’t want Jimmy Johnson to f— with me because I just lost my tolerance after what I went through in my early days.
“So how does it feel to see some of these values now, and see the value of the Dallas Cowboys now? Just go back to the early days, and you can see how the game has improved and become such a part of American life. Did you know that 7 percent of fans have ever gone to an NFL stadium? The rest fell in love with it through the viewing of the games. The pageantry, the aura, the interest of a fan base, the fact that an Al Michaels can relay the excitement of the game to a fan base. You put that up beside anything in society today, and you’ll increase the value. That’s where these values are being appreciated.
“Add in the Amazon [streaming] deal, the potential with some of the new technology. The NFL, in my mind, the visibility, the volume, the overall passion, you frankly can’t get it anywhere else. That’s why all these people want a piece of it.”
Jones thinks there’s another part of the story that’s harder to quantify. He just knows it exists. That’s the fact that people want to have a favorite team, and they want to follow the roller coaster of that team, and they want to get to know the players and know their strength and weaknesses and triumphs and foibles.
To Jones, there’s no such thing as bad coverage of the Cowboys. Bad coverage makes the Cowboys human. And he is positive his fan base loves the human.
“Let me tell you a story,” Jones said, warming to this topic. “A few years after I bought the team, I’m out in Los Angeles having lunch with David Hill and Ed Goren of FOX. At that time, there were a lot of negative headlines about the Cowboys. Michael Irvin was in the headlines. People are saying, ‘The owner’s an outlaw!’ And so that day I told them, ‘I’m tightening the lid on this franchise. We’re gonna get control of this team.’
“And David Hill jumped up. He said, “NO! Do not touch my ‘Boys! They are television gold! Don’t even think about it!’
“The foibles, the soap opera, the issues. They create interest. Add in the Senior Bowl, the combine, free agency, the draft, training camp, we always got something going. People follow us year ‘round. The owner every now and then gets in the paper. It just adds to the interest, all of it. People love that.”
The next billionaire to love it, really love it, is going to pay in the range of $4.5 billion to own one of these 32 cash cows in Denver. The NFL’s a freight train, speeding down the tracks. Ten billion for a franchise? The day will come, and sooner than you think.