NFL games in London sell out every time and still lose money

By Tariq Panja

The Indianapolis Colts and the Jacksonville Jaguars play at Wembley Stadium on Monday (NZT). Photo / AP
The Indianapolis Colts and the Jacksonville Jaguars play at Wembley Stadium on Monday (NZT). Photo / AP

In the 10 years the National Football League has played in London, tickets for all but one of the 14 games have sold out, including seats for this season's matches, which start Sunday with the Indianapolis Colts and the Jacksonville Jaguars at Wembley Stadium.

For all that popularity, the games are still losing money, said Mark Waller, the NFL's head of international development. The productions are extraordinarily expensive, and the league has yet to make enough from British broadcast rights, ticket sales and sponsorships to offset the costs.

That's going to change quickly, Waller said. By continuing to play games in London -- and making them free to watch via the BBC -- the NFL has succeeded in slowly building a fan base. Half of the fans who went to a game at Wembley last year had been to a previous football game, and one-third bought tickets to the full series.

With enough fans, Waller said, "media values go up, your sponsor values go up and the commercial side of the arrangement reaches scale." As it is, the price of the U.K. media rights for the NFL has already doubled since the New York Giants beat the Miami Dolphins at Wembley in 2007, and Waller said they will be more valuable when they come up for bid again. The BBC owns the rights to the London games and the Super Bowl for the next two years; Sky Sports will air the NFL's U.S. games in the U.K. through 2019.

"If we continue on the path we are on, there will be no discussion about when the games break even," said Waller, an Englishman. "If we were to double our media rights again, we would more than break even."

Tickets sell for around $130 on average, compared to $86 in the U.S., and with more than 80,000 seats, Wembley is 25 percent bigger than most NFL stadiums. Last year, gate revenue averaged more than $10 million. For the Jaguars, who have a multi-year deal to play in London, the Wembley games are far more lucrative than their own games in Florida, where they average 61,000 fans at much lower ticket prices.

Still, the games are very expensive to stage. Each team travels with around 180 people including players, coaches, trainers and other personnel who all need to be flown over, lodged and fed. Add the league's technical staff, cheerleaders and more, and the NFL is paying for first-class travel for nearly 500 people.

The league also pays to rent Wembley Arena and training facilities for each team for the duration of their stays. It also covers the cost of promotion and events that go on for days -- costs that would, in the U.S., be born by the local franchise.

The costs are only going up, at least in the short term. Last year the league signed a 10-year partnership with the Premier League's Tottenham, pledging to play a minimum of two games per year at its new stadium, which is slated to open in 2018, plus at least two at Wembley through 2020.

And the league is openly considering basing a team permanently in London, if it can figure out the financial model and a punishing travel schedule that could upset the parity the NFL works so hard to achieve. Expensive as it is, London is still one of the five most successful host cities including U.S. markets, according to the league.

"If you are in one of the top five markets it's a pretty good bet that the core of the proposition is sound," Waller said.

- Washington Post

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