Contract Negotiation NFL Teams Sports Agents

Will The Colts/Chargers Success Hurt Agents?

Last week I wrote a post titled, Will The Yankees Success Hurt Agents?. The post received a lot of hits and I received a lot of personal e-mails to further discuss the matter. Within the article, I mentioned SBR’s note on how the Yankees’ team may be the worst Return on Investment in the history of team sports. Return on Investment should not mean as much in leagues controlled by a salary cap…right?

That may not be the case. This year, the San Diego Chargers and Indianapolis Colts look like early favorites to win the AFC Championship and there is a good chance that we see one of the two teams in the Super Bowl. Their payrolls are $65,472,365 (Colts) and $70,719,178 (Chargers). Both teams are having great success while the Oakland Raiders – spending $89,442,910 – might as well forfeit the rest of their season and start rebuilding for next year [NFL Teams with Best ROI for 2006].

While the difference in pay between the Colts and Raiders ($23,970,545) is not nearly as large as the difference between the Yankees and Tigers (~$115,700,000), the fact that the grand spending of money in professional sports with salary caps has a small correlation to success (if any at all) means that Sports Agents could see commission cuts in the future in sports other than baseball.

The one interesting point that SBR makes; however, is that owners in the NFL make great profits, and that the Atlanta Falcons with their league leading $109 million payroll still manage to make a healthy profit. By maintaining a payroll close to the top of the league’s salary cap, a team can keep its fans happy by saying that it is trying its absolute hardest (by spending as much money as possible) to increase its winning percentage. Attendance at games would not suffer as much during losing seasons and profits for owners should remain at high levels.

So maybe owners will not decide to cut their payrolls and mimic the success of the Chargers and Colts. But if teams decide to do so, expect a decrease in the average salary of football agents.

p.s. – After writing Part I of a 3 part series analyzing Rick Karcher’s newest article: Solving Problems in the Player Representation Business: Unions Should be the “Exclusive” Representatives of the Players, my domain’s server was rebooted, and the post was deleted. Of course, I failed to make a backup copy of the post, but I will get to analyzing Mr. Karcher’s article sometime in the future and will make sure to not skip over the portion that was covered and lost.

[tags]san diego chargers, indianapolis colts, sports agents, sports agent, salary cap, payroll[/tags]

By Darren Heitner

Darren Heitner created Sports Agent Blog as a New Year's Resolution on December 31, 2005. Originally titled, "I Want To Be A Sports Agent," the website was founded with the intention of causing Heitner to learn more about the profession that he wanted to join, meet reputable individuals in the space and force himself to stay on top of the latest news and trends.

Heitner now runs Heitner Legal, P.L.L.C., which is a law firm with many practice areas, including sports law and contract law. Heitner has represented numerous athletes and sports agents as legal counsel. He has also served as an Adjunct Professor at Indiana University Bloomington from 2011-2014, where he created and taught a course titled, Sport Agency Management, which included subjects ranging from NCAA regulations to athlete agent certification and the rules governing the profession. Heitner serves as an Adjunct Professor at the University of Florida Levin College of Law, where he teaches a Sports Law class that includes case law surrounding athlete agents and the NCAA rules.