The costs of convergence

 Are now hitting the NFL hard:

Even though the NFL managed to play all 256 regular-season games and all 13 postseason games, the league lost a large chunk of money due to the pandemic. According to Ben Fischer of Sports Business Journal, the league saw its revenue fall from $16 billion in 2019 to $12 billion in 2020. The league had expected to generate $16.5 billion last year, before the pandemic changed everything.

That’s a 27 percent decline in revenue, in just one year. Sound familiar?

From Corporate Cancer:

It’s one thing to simply claim that something is bad, it is another to demonstrate exactly how bad it is. Once a corporation contracts Stage Five convergence, it can go downhill very fast.

How fast? On average, as a rough estimate, up to 20 percent in just one year. This decline can take place in terms of either revenue or units….

While the NFL continues to publicly dismiss its declining ratings as a temporary problem, the fact is that they caused the league to fall short of its predicted 2017 revenue of $14 billion and knocked the league considerably off the track of its revenue target of $25 billion by 2027. A four-percent reduction in annual revenue may not sound like much, but it represents a 10.7 percent decline in expected revenues which is not insignificant to any business, no matter how big it is. Indeed, there are even some who believe that this unnecessary, convergence-caused debacle may represent Peak NFL.

Keep in mind that the TV money is actually increasing while the viewership is declining. This is a fragile situation; it’s more likely that the future will see an NFL with annual revenues of $8 billion than $25 billion in real 2020 dollars. 

And it’s not the pandemic. The pandemic should have boosted TV ratings. The NFL’s real fear should be that it did….