Why Los Angeles Doesn’t Have An NFL Football Team

Los AngelesOn shaky ground.

We grew up in Los Angeles watching our beloved Rams, who fled for St. Louis in 1994. The city was also temporary home for the  Oakland Raiders from 1982-94 as the Rams played their home games in Anaheim for almost 15 years. 

It has always been a mystery to us why Los Angeles, the second largest city in the U.S., has been without an NFL team since 1994.

In his excellent piece posted on the Globe and Mail blog, Frances Wooley, a professor at Carleton University, states it’s all about economics. She points out something we did not know,

The NFL, however, is egalitarian. All national revenues, such as sales of television rights, are divided 32 ways. Each NFL franchise receives an equal share. It is impossible to say how important national revenues are relative to other revenues for the league as a whole, as only one NFL team — the publicly owned, small-market Green Bay Packers — makes its financial information publicly available. In 2010, three-fifths of the Packer’s income – $157- out of $258-million – came from its 1/32 share of national revenues.

The revenue sharing system means there is little incentive for a team to move from a small to a large market. Yes, if the Vikings moved to LA, the NFL could potentially gain millions of additional Southern California viewers – and millions more in revenue. Yet the Vikings would only receive 1/32, or about 3 per cent, of that revenue. That’s not enough to offset higher stadium or property tax costs…

Interesting and helps explain why two relatively small market teams are headed to the Super Bowl and why the NFL, unlike Major League Baseball, has fewer major market Yankee-like dynasties.   The piece is short, concise, and worth the read.

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