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SBJ/February 8 - 14, 1999/No Topic Name
NFL taking stake in Arena Ball
Published February 8, 1999
The National Football League is acquiring an option to buy nearly half of the Arena Football League in a move that gives the NFL a direct pipeline into a summertime audience while providing the AFL an added dose of credibility.
The deal between the two leagues was reached over Super Bowl weekend and gives the NFL the option to buy up to 49 percent of the AFL within three years and a role in running the 15-team league that plays between May and August.
"An interest in the AFL would enhance our stake in the future of the game, both in the United States and internationally," said NFL Commissioner Paul Tagliabue.
The equity option not only will give the NFL year-round exposure, but it also likely will create more interest among current NFL owners who are now allowed to invest in individual AFL teams.
Last May, the NFL amended its bylaws to allow owners to buy AFL teams, and a month later, New Orleans Saints owner Tom Benson bought an AFL expansion franchise to play in New Orleans in 2000. Other NFL owners have quietly considered buying AFL teams.
The NFL uses the World Football League, which plays in Europe in the spring, to expand internationally, but an equity position in the AFL allows the NFL to promote football nationally in midsized markets and to a younger audience.
"The NFL clearly has a strategy of promoting football year-round in the United States to compete with baseball and basketball," said Neal Pilson, an AFL consultant. "They see in the AFL an opportunity to promote the game in smaller markets in a time of year when the NFL isn't played."
The NFL's equity interest deal comes as the AFL readies for its 13 season.
The league was created in 1987 with four teams and nearly folded in 1989 after a meager four-game season. Since then, however, the AFL has grown to 15 teams, and in the past three years, the price of an AFL franchise has jumped from $500,000 to $7 million.
Under Commissioner David Baker, the AFL will expand to 17 teams in 2000, with teams set for Los Angeles and New Orleans. An 18th team is expected to be announced in a few weeks; it will be operated by a group headed by former Chicago Bears great Walter Payton.
Last year, the AFL made its network debut when ABC televised the league championship game and ESPN and ESPN2 broadcast 20 games. This year, the league's television package is expected to include another 20 games broadcast by ESPN and ESPN2, with ABC to broadcast the championship game again.
Major sponsors of the AFL include Wilson Sporting Goods Co., the U.S. Navy and Miller Brewing Co.