NFL Delays Playoff Expansion

No Bonus Football This Season, but Additional Wild Card Games are Inevitable

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NFL Commissioner Roger Goodell
NFL Commissioner Roger Goodell Credit: Bloomberg News

The NFL will not expand its 10-game playoff package for at least another year, although the addition of two bonus teams to the current roster of a dozen postseason contenders is all but inevitable.

Speaking Wednesday after the final session of the league's annual owners meeting, NFL Commissioner Roger Goodell said that while all parties concerned have had a "healthy discussion" about the matter, expansion of the playoff field is on hold for another season.

"This is something we've been evaluating over the last couple of years and several factors went into the decision to at least postpone the expanded playoffs," Mr. Goodell said, noting that scheduling issues made adoption of a new postseason format tricky. "We've looked at Monday night, but college football has the National Championship on Monday night and we certainly don't want to conflict with that."

The NFL also must determine how to sell the additional games, and to whom. (When asked if the league may be leaning toward its in-house NFL Network, Mr. Goodell demurred, saying only that there would be interest "regardless of [whether] they were part of the Thursday night package.")

Given that eligibility most likely will be extended to one AFC team and one NFC team, the move would necessitate a new playoff opportunity for each conference. Rather than jump into a new playoff structure, Mr. Goodell said the NFL would "take another year, evaluate all this, and make the right decision long-term."

The additional revenue generated by even a single extra Wild Card game is hard to understate. For one, the home team would be guaranteed a sellout crowd and all that entails. Meanwhile, bonus football almost certainly would generate a whole stack of extra ratings points for the TV partner carrying the game.

Per Nielsen live-plus-same-day data, the Jan. 3 and Jan. 4 Wild Card games averaged 30.1 million viewers and a 17.0 household rating. Fox boasted the biggest draw of the opening weekend, as its coverage of the Cowboys' controversial 24-20 victory over the Lions drew a staggering 42.3 million viewers and a 23.6 rating, where a ratings point is equivalent to 1% of TV households. To put those numbers into context, the Fox broadcast out-delivered three of the four subsequent Divisional Round games as well as the AFC Championship game.

Based on average unit costs for this year's Wild Card games, a bonus play-in contest airing on one of the league's three traditional broadcast partners would likely generate on the order of $58 million in ad sales revenue.

Word on the playoff situation came shortly after the NFL announced it would sell the rights to a single in-season game to a digital-video distributor, marking the first time the league will offer a national window on a non-linear platform. The game in play is the Oct. 25 Buffalo Bills-Jacksonville Jaguars skirmish, one of three 2015 NFL games scheduled to kick off in London's Wembley Stadium.

While no prospective bidder has been identified, it's likely that Google will look to outflank Facebook for the right to stream the Bills-Jags game. Two summers ago, Google CEO Larry Page met with NFL officials in a series of exploratory talks surrounding the league's Sunday Ticket package. (Legacy rights holder DirecTV eventually re-upped with the NFL in an eight-year, $12 billion pact.)

The Bills-Jags game will not be shown on national TV or via Sunday Ticket, but fans in the Buffalo and Jacksonville markets will be able to watch over-the-air on local affiliate stations.

If the prospect of a Bills-Jags tussle that starts at 9:30 a.m. Eastern Time is underwhelming -- both clubs are all but invisible, satisfying the league minimum in 2014 by appearing in just a single nationally televised game a piece -- that's a function of the NFL wanting to protect its broadcast partners. Locking perennial ratings-champion Dallas Cowboys or the Super Bowl champion New England Patriots into a pre-dawn time slot is bad for business, especially when one takes into account the $2.2 billion per year in annual rights fees paid out by Sunday afternoon rights holders CBS and Fox.

As the NFL contemplates its digital future, it is also dismantling one of its more backward-looking institutions. The owners unanimously voted to suspend the league's longstanding TV blackout policy for at least one season, eliminating the possibility that fans in local markets will be prevented from watching undersold home games.

The league this season will closely monitor attendance and local ratings trends before making any permanent decision on its in-market blackout policy. "Let's see what the impact is long-term. Our clubs have done a great job aggressively marketing themselves in their market. There's a positive, obviously, to having your games on television," Mr. Goodell said.

The current policy stipulates that a home game that isn't at least 85% sold out 72 hours before the opening kickoff cannot be televised on the local affiliate. No NFL games were blacked out in 2014, and fewer than 80 local telecasts have been impacted since the 2010 season.

As it so happens, the Bills were one of the last teams to be blacked out in its local DMA, as its final defense of its home turf in December 2013 failed to sell the requisite number of tickets. For its part, Jacksonville hasn't faced a blackout since the tail end of the 2009 campaign, although the team in the past has resorted to creative measures to make selling out the stadium a lot easier. In 2014, the Jags tore out 9,500 seats and replaced them with a two-swimming pool party deck.

The suspension of the policy comes just six months after the Federal Communications Commission repealed its own blackout rules. The NFL said it would revisit the blackout situation at the end of the upcoming season.

Lastly, don't expect to see an NFL franchise return to the nation's No. 2 DMA in the near term. Mr. Goodell on Wednesday reiterated that while bringing a team to Los Angeles remains a top priority, there's no rush to get it done before 2017.

"We're focused on doing this right. If we go back to the Los Angeles market we want to succeed for the long-term and we have a lot to do to get to that place," Mr. Goodell said. "So we're not focused on '16 .... Right now our focus is on the process, making sure that we're evaluating the opportunities and their existing markets. We're also making sure that we understand what it takes to be successful in Los Angeles [in the] long-term."

The Rams and Raiders both played their final games as representatives of L.A. on Christmas Eve, 1994.

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