The Chargers will play the 2016 NFL season in San Diego.
After that, nobody knows.
“Dean has his options now,” former Raiders executive Amy Trask said on CBS Sports Radio’s The Doug Gottlieb Show, referring to Chargers’ president Dean Spanos. “He has until January 17th of next year to make a decision as to whether he wants to remain in San Diego or relocate to Los Angeles, and he has to play offense and defense, to use a football analogy. Offensively, he needs to decide where do I want to be? And if San Diego is a choice, can I get a stadium deal done in San Diego? From a defensive standpoint, he has to decide am I willing to stay in San Diego knowing that if I choose to do so, it is very, very probable that the Raiders relocate to Inglewood.”
Trask, who worked in the NFL from 1983 to 2013, gave listeners a rundown of some league financial basics.
“There’s two separate categories of football revenues,” she explained. “So you have national revenues, which are shared equally among the 32 clubs – national television as distinguished from preseason games that the team sell on their own. But the big nightfall television packages are split 32 ways, as are national sales or licensing of the team marks and logos. Local revenues are those that the team derives from primarily its stadium deal – luxury suites, club seats, in-stadium sponsorships and advertising. And the gap between Team No. 1 in terms of those local revenues and Team No. 32 was, at the time I left the league, over a quarter of a billion dollars. That’s just the gap between those teams. Stan Kroenke is looking to a lot of non-football revenue as well (such as a real estate development or a shopping center nearby) that will be served by fans on game day.”
The financial difference between San Diego and Los Angeles is sizable, but moving isn’t necessarily a no-brainer.
“It depends on the cost of the stadium to which you commit in San Diego or in Los Angeles,” Trask explained, “Values of teams placed in Los Angeles have skyrocketed. But if you are going to commit to a $550 million relocation fee to go to Los Angeles and if you are going to commit to contribute to a building that is going to cost over $1 billion, sure, your revenues increase exponentially, but so do your costs, and I think that needs to be factored into the analysis. The Raiders have a choice to make in that regard. Do they want to move into a market like Los Angeles – and clearly they did; that’s where their aims were with Carson – but do they want to be in a market where revenues will be on the upswing but so too will costs?”
Doug Gottlieb figured the Rams would want the Chargers more than the Raiders for a variety of reasons – larger fan base, less unruly fans, etc. – even though some people in Los Angeles would welcome the Raiders with open arms.
Trask doesn’t know if the Rams have a preference one way or the other, but we may soon find out.
“Certainly if the Rams’ desire is to have the Chargers – and I don’t know that to be the case,” she said. “A number of people have suggested it. I’ve heard it secondhand but not firsthand. But if that’s your desire if you’re the Rams, you have the ability to make that a reality by sweetening the pot. If your goal is to attract the Chargers, well then make it attractive to the Chargers. It’s simply a business calculation. I don’t know if the Rams are concerned about the Raider popularity and if that’s factoring into their calculus, but you’re right, the Raiders are tremendously popular in Los Angeles, and were I the Rams, that would be a factor in my analysis.”