Daniel Kaplan and Bill Shea of The Athletic recently published a lengthy article about if the XFL and USFL coexist or need to merge. They talk about both leagues, where they came from, and how they are now. The article includes quotes from people in the sports business world. They discuss if there is an appetite for year-round football and if the leagues will merge at some point.
There were a couple of interesting tidbits about the XFL. Something fans have been wondering for some time. Did they XFL get money from Disney this time, or did the league make a similar deal like they did back in 2020?
We learned from the Athletic that the deal between the XFL and Disney/ABC/ESPN includes money.
“The new XFL has the weight of ESPN behind it. When the league announced its eight home markets, ESPN sent out a push notification. The parties won’t comment on the economics of the deal, but a source said there is a rights fee.
“There is substantial income from day one,” the source texted of the ESPN contract, who then compared the league’s strategy to the 2020 startup version. “But every aspect of the overall plan is better, from the way they will leverage their new owners (which include Dwayne “The Rock” Johnson) … to the way they see the game being played, to the TV deals, to the marketplaces they chose, to the way they’re housing players, to fan engagement plans.”
They also mention the ad money coming in for the XFL. Will there be enough money for both the USFL and XFL to coexist in 2023?
“This year, USFL games generated about $65 million in TV advertising revenue for Fox and NBC, according to EDO, a New York City-based advertising metrics data firm that tracks commercial engagement.
In 2020, ads during XFL games ginned up $50 million during the truncated season but were more effective than USFL in-game ads, the firm said…
EDO data shows that TV viewers were 30 percent more engaged with ads during the shortened XFL season in 2020 than the USFL in 2022.”
The question with those numbers is that it was 2020. Things are a lot different now, after you know what. People’s television habits are different now. Can the XFL 3.0 era bring in the same interest or better?
The next question is whether advertisers will spend on the XFL and USFL. The USFL already has 50% ads sold for its 2023 season.
“While brands will certainly manage their overall ad frequency during XFL and USFL games, there’s no known downside to investing in both environments,” Grover said. “Airing head-to-head ads will undoubtedly impact brands’ performance, but going into the season, we expect XFL has an advantage, given it has proven to be a stronger environment for advertisers.”
In the end, for both leagues, it comes down to who has the better business model, who is willing to lose money, and how much in the beginning.
We will find out when the XFL kicks off in February 2023 and the USFL later in April.
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