Reports are that boththe San Diego Chargers and Oakland Raiders are exploring an unusual deal: moving to Los Angeles and sharing a stadium.
The Los Angeles Timessays the two NFL teams "will jointly pursue" a $1.7 billion NFL stadium in Carson, Calif. That said, the two teams will "continue to seek public subsidies for new stadiums in their home markets.”
Sounds crazy? Here’s why it isn’t. In pure dollars and sense, Los Angeles is a bigger market than either San Diego and San Francisco-Oakland for local TV advertising and carriage deals with local TV providers. LA hasn’t had an NFL team in years.
Still, both teams would have to pay a $250 million penalty to the NFL for doing so. But who cares? Look at the valuations of the likes of the Los Angeles Lakers -- a $2.6 billion value, according to Forbes -- and the Los Angeles Clippers -- around $1.6 billion, nearly a 200% improvement thanks to Steve Ballmer’s $2 billion purchase of the team.
For both the Chargers and the Raiders, there’s room to grow. According to a Forbes report, the San Diego Chargers were valued at $995 million (ranked 26th of all teams); the Raiders were at $970 million (ranked 28th). And consider the dollars to come, as TV advertisers continue to place a premium on live TV, and live sports programming in particular. There are also really big dollars to be made from pay TV providers. For example, the Lakers inked a $4 billion 20-year TV deal with Time Warner Cable in 2012.
For years Los Angeles, the second biggest TV market, has been eyed by many NFL teams -- as well as property developers -- looking to gain big business.
You can, of course, worry that rebuilding a fan base isn’t easy -- as well as the negative karma of abandoning long-time fans But in a competitive entertainment/TV world, looking at every possible niche to make big gains is the rule.
Hey, don’t you favorite TV shows get canceled sometime?