In the world of the NFL lockout and labor talks, it's all about the money. Specifically, the ongoing labor talks have centered around the revenue distribution model meant to divvy up the money between the players and owners. The owners want to take a cut off the top before doling out a percentage of the revenue while the players are looking for a simplified formula that simply distributes the revenue by a percentage.
While talks have been civil and encouraging, the negotiations reportedly took a step backwards on Thursday after the owners brought expense credits back into the mix. Before the reported snag, NFL commissioner Roger Goodell and NFLPA executive director DeMaurice Smith had been playing nice, even flying to the NFL Rookie Symposium together. But now, the revenue issue has reared its ugly head, and has the players upset again.
Player sources reaffirmed that a setback in talks occurred when owners last week went "retro" on the formula that will divide the estimated $9.3 billion in annual revenue. Whereas the players believed the two sides had reached an understanding on a simplified formula in which they would receive 48 percent of all revenue, sources say owners re-introduced its previous formual by asking for $400 million-to-$500 million in expenses credits off the top.
The credit, worth hundreds of millions of dollars, cuts another three percent, or thereabouts, from the players' take of the revenue. While that doesn't seem like a big number, it's significant when looking at the $9.3 billion revenue pot the two sides are splitting. Again, it's all about the money.
The revenue issue has always been the biggest stumbling block in negotiations, with both sides wrangling over billions of dollars. If the two sides can figure out how to split-up the money, it would appear few other hurdles remain. But it's a big if, and any major disagreements could set the talks back significantly as the NFL lockout drags on.