Sports Business: FOOTBALL
CANADIAN FOOTBALL IS RUNNING OUT OF PLAYS
Since the Baltimore Stallions began playing in the Canadian Football League last year, they have been the winningest expansion franchise in the history of professional sports. In their first two seasons, the Stallions took an incredible 75% of their regular-season games. And on Nov. 19, they played in their second straight Grey Cup, the CFL's answer to the Super Bowl, and won it--a first for a U.S.-based team.
But winning isn't everything--or, a wag might say, anything--if you're an American team in the Canadian Football League. The league's ambitious drive into the U.S. seems to be coming to grief, and a National Football League expansion into the Toronto market would threaten the league's existence.
IMPATIENCE. Three years after the CFL pushed south, four of its five U.S. teams are threatening to move or disband. That continues the disastrous pattern set after the 1994 season, when only two of the four U.S. franchises then in existence (the Stallions and Shreveport Pirates) stayed put. The Las Vegas Posse folded, while the CFL's first U.S. owner, Fred Anderson, moved his Sacramento Gold Miners to San Antonio. Although Anderson says he's willing to stick it out for one more season, his patience has been wearing thin. No wonder: Every U.S. team in the league is hemorrhaging red ink, and this year, Anderson figures, "Our [collective] losses will be in excess of $20 million." Concedes Larry Ryckman, owner of the Calgary Stampeders: "The U.S. expansion is an experiment that may end up not working."
The CFL's U.S. follies provide fresh evidence that it's still impossible to compete with the "Not-so-Fun League," despite the NFL's numerous woes. The CFL's expansion follows several other failed efforts to launch pro football leagues in the U.S., including the U.S. Football League in the 1980s and the NFL's own World League of American Football in the early 1990s.
When the CFL launched its invasion in 1993, it hoped to avoid its predecessors' mistakes. Unlike the USFL, the CFL assiduously avoided markets where the NFL was entrenched. And the CFL was the first to offer a different brand of football: Canadian rules give teams 12 players, longer fields, and just three downs to advance 10 yards. With the pressure on to make each play count, many think the result is a faster-paced, more wide-open game.
At $3 million a franchise, the CFL looked like a bargain, and it attracted some top-flight owners, including Federal Express Chairman Frederick W. Smith, who bought the Memphis Mad Dogs. The CFL secured leases at such big-league stadiums as San Antonio's Alamodome (which seats 59,000), and Birmingham's Legion Field (75,000). And it signed up coaches who brought instant credibility. The Birmingham (Ala.) Barracudas hired former Houston Oilers coach Jack Pardee; the Shreveport (La.) Pirates signed former Green Bay Packers coach Forrest Gregg.
CRIMSON TIDE. But despite rock-bottom ticket prices, no U.S. team except Baltimore could average even 20,000 fans per home game. In Birmingham, the 'Cudas--who sank over $10 million, twice the league average, into their inaugural season--couldn't draw even 10,000 once the University of Alabama Crimson Tide started rolling. "In Alabama, college football is a religion," sighs 'Cuda Executive Vice-President Ty Coppinger. "We don't want to come back for another season if it means playing in the fall."
The U.S. teams were also hurt by lack of TV exposure. Although ESPN broadcast 25 CFL games, most were aired on its second-tier network, ESPN-2, and drew just 0.3% of available viewers. And in four of the five CFL markets, most households don't even receive ESPN-2.
The future of the CFL's U.S. expansion hinges on a Nov. 29 Toronto meeting of the league's Board of Governors. U.S. owners will be pushing for big changes. They at least want a division that clearly identifies their teams as American. Some, including Mad Dogs President Pepper Rodgers, want to jettison Canadian rules in favor of the U.S. game. "Selling the Canadian game on American soil has been real tough," Rodgers complains. Maybe so, but the Canadians aren't about to compromise. A change to U.S. rules "would be divisive and will not be negotiable," says CFL Chairman John Tory.
Instead, the CFL seems headed for another game of musical markets. On Nov. 14, the Shreveport Pirates announced plans to move to Norfolk, Va. And James L. Speros, who as owner of the Stallions will have an NFL team in his town if the Cleveland Browns move to Baltimore, says that he has "been flying all over the country looking for a new home" for his team. Speros says the chances are pretty good he'll move the Stallions to Houston. With Birmingham and Memphis still mulling where and even whether they'll play in '96, only San Antonio's Anderson is committed to staying put. But even he worries that "it will be very tough [to survive] if we don't have at least four U.S. teams."
ARGO ANGST. "We're still committed to seeing if we can be successful in the U.S.," says CFL Commissioner Larry W. Smith. But, he warns, "We've always had a backup plan" in case the U.S. adventure aborts: "to retrench in Canada." That would hardly end the league's problems, however. At best, two of the eight Canadian teams will turn a profit this year. Worse, there's growing concern about the team in Canada's largest market, the Toronto Argonauts. The Argos are up for sale, losing money, and threatened by a well-heeled effort to bring an NFL franchise to the Toronto Skydome, where the Argos play.
That effort is being led by Paul Godfrey, chief executive of Toronto Sun Publishing Corp., who played a key role in bringing Major League Baseball to Toronto in 1977. "I hope to have an NFL team in Toronto by the year 2000, if not sooner," says Godfrey, who boasts he could sell 10 years' worth of NFL tickets before the opening kickoff. Although there's no guarantee Godfrey will grab a team, Argo President Bob Nicholson admits he's worried. "I've never seen a scenario where both teams [the Argos and an NFL squad] could survive in Toronto," he says. And if the Argos fail, many Canadians believe the end of the 83-year-old CFL wouldn't be far behind.By William C. Symonds in Toronto