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Rights to players set to expire in March
By Liz Mullen and Daniel Kaplan, Sports Business Journal, 8/16
The NFL Players Association’s marketing arm recently notified NFL sponsors
that their rights to use players in advertising end in March if, as
expected, the league’s collective-bargaining agreement expires. The group,
NFL Players, in a letter dated Aug. 6 also offered league sponsors the
opportunity to continue using players through a separate union deal.
In addition, sources said, NFL Players has been talking to NFL sponsors’
competitors as well as marketing agencies about potential deals.
The sponsorship agreement regarding NFL players is not part of the CBA but
it runs concurrently with the labor deal. The NFL pays the NFLPA as part of
the agreement, which was signed in 2001. In return, the union does not sign
competitor sponsors, while league sponsors have to go through the union for
player group licensing deals.
Last year, the NFL paid the NFLPA a $25.1 million sponsorship fee as part
of a $43.8 million sum that also included fees for Internet rights and
other player marketing, according to the union’s annual filing with the
U.S. Department of Labor.
“The overall Sponsorship Agreement between NFL PLAYERS and the NFL is set
to expire on March 4, 2011,” states the letter from Allison Tucker, vice
president of business development and corporate sponsorships for NFL
Players, which was obtained by SportsBusiness Journal. The CBA expires at
the same time.
“NFL PLAYERS has exclusive group rights of all players in the National
Football League and we receive a portion of your sponsorship payments to
the NFL in exchange for access to these rights. As of March 4, 2011,
however, we will no longer be receiving this payment and the group player
rights will no longer be included in your NFL sponsorship.”
“Looking ahead, we want to prevent any interruption to your business, and
want to continue providing you with the ability to market your products,
brands, and services by using our players, while continuing to restrict
access to the group player rights by competing entities,” the letter said.
“Accordingly, we wish to discuss an option we have developed to continue
our partnership in the event that the overall Sponsorship Agreement expires
for any period of time.”
It is not clear how the option for continued access to players rights would
function. NFLPA officials declined comment for this story.
Greg Aiello, NFL senior vice president of public relations, when questioned
about the letter, responded, “This just came to our attention, and we will
address it with the union.”
The NFL, Aiello added, has not advised sponsors how to continue using
players if the CBA and sponsorship agreement expire in March.
Industry experts said they were not surprised NFL Players had sent the
letter now, seven months from expiration, because companies plan their
sponsorship activities months before the NFL season.
If NFL Players were to sign companies that compete with league sponsors, it
wouldn’t be the first time for that type of union-based effort. The NFLPA
competed with the NFL for sponsorships from at least 1989, when the union
decertified, until 2001, when it reached the current sponsorship agreement
with the league. The league and union signed the current CBA in 1993, but
it would take another eight years to strike the sponsorship side agreement.
Some industry insiders viewed the letter to the NFL’s sponsors as a veiled
threat. Frank Vuono, who ran NFL licensing and marketing from 1985 to 1993
and now works as a sports consultant and adviser, said the letter is
certainly a threat to sign with the union, or else.
“The people involved are very savvy,” he said.
When Vuono was at the NFL, the league at one point represented 900 players
for marketing rights, he said. Ultimately, the NFLPA assumed that role, but
Vuono said if the current structure evaporates, there is nothing to prevent
a third party from trying to represent them.
A key question, Vuono said, is the value of the players without the team
marks — meaning that by divorcing team rights from players, the players
could not appear in uniform in ads. Also, the use of the term NFL would be
restricted. In 1999, for example, a federal court ruled that the NFLPA
could not tout Coors as the official beer of “NFL players” because the
league controlled the word NFL.
To that end, Dockery Clark, a former sports marketing executive with Miller
and Bank of America, said players historically are used more by non-league
sponsors in advertisements, pointing to the example of MasterCard spokesman
Peyton Manning. Rival Visa is the NFL sponsor.
“Player rights are not as important as you might think [to league
sponsors],” Clark said. “I haven’t seen much activity with the significant
sponsors. All the league [sponsorship] represents is the shield, the jewel
events and collective rights of all the teams.”
Some sources saw nothing threatening in the letter. One person noted that
if the union wished to act threatening, it could have sent a letter
warning, “Your rights will expire by March 4 and you are hereby notified.”
In the letter, Tucker wrote, “We are working hard to enter into a new
Collective Bargaining Agreement and an extension to the Sponsorship
Agreement. Please note that it is our sincere intention to shield you from
any dispute we may have with the league — our sole concern is to allow you
to continue your utilization of group player rights no matter the overall
labor or business climate.”
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