Monday Mailbag: CFL revenue, Canadian content, American TV contract

The 3DownNation Monday Mailbag answers questions from readers across the country.

You can submit a question via email ([email protected]) or direct message on FacebookTwitter and Instagram.

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Please note that by sending us a question you are giving us the right to publish it along with your name. Questions may be lightly edited for spelling and/or formatting.

We’ve answered a handful of questions below. If your question didn’t get picked, don’t panic — we’ll save it to potentially answer here next week or on the 3DownNation Podcast.

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Randy Ambrosie told the House of Commons finance committee last May that the CFL loses $10-20 million every year.

In John Hodge’s article on 3DownNation on March 21, he says that since 1976, total league revenue has quadrupled and television revenue has increased 700%. Yet player salaries as a percentage of total revenue has fallen from 52% to 25% during the same period.

How can both these things be true? If the cost of player salaries has fallen, where exactly is the CFL losing money every year?

Best regards,

Brad Carpenter

Thanks for the question, Brad.

In my debate with TSN’s Dave Naylor on this topic, he pointed out that the $12.9 million figure from 1976 likely did not include sponsorship dollars. This extra revenue would have helped cover costs and decreased the percentage of money flowing to players.

With that said, we know revenue has grown substantially since 1976 while player salaries have increased only slightly. It’s clear that if the business model is broken — which I don’t believe it is — it’s been broken for almost fifty years.

When the CFL says it loses $10-20 million each year, that means its nine teams combine for a net loss of that amount. Considering league revenues are between $200-240 million, that’s not an overwhelming deficit.

This is purely hypothetical, but consider this: if eight CFL teams netted a combined $5 million profit and the ninth lost $15 million, that would mean the league collectively lost $10 million.

Framing it as a “league loss” of $10 million would make it sound like the CFL was financially unviable when in reality, eight of nine teams had perfectly fine seasons.

The league’s six privately-owned teams provide no transparency regarding their finances, so it’s impossible to say where exactly the league loses money. Until I see the numbers, I’ll continue to be skeptical regarding league losses.

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A merger with the XFL is a terrible idea. The CFL should be focusing on increasing Canadian content, especially at the QB position. If three downs, the rouge, etc. leave “our” game, so will I.

-Edward Aiston

Thanks for the note, Edward. We’ve received the same sentiment from hundreds of our readers.

Rob Vanstone wrote on this topic and I’m in agreement with him. The CFL needs to do more to celebrate its Canadian talent.

Homegrown talent is the best its ever been. We’re seeing more and more Canadians getting drafted by the NFL and lighting it up in the NCAA. When they come to the CFL, we often make them play fullback, safety or ride the bench. It’s silly.

Every now and again I hear people say, “I don’t care who’s Canadian — I just want to watch the best players!” I appreciate their sentiment, but I think they’re missing the point.

The ratio ensures that Canadian players receive the development they deserve.

Stars like Andrew Harris, Chris Van Zeyl, Kwaku Boateng and Brad Sinopoli did very little at the beginning of their professional careers. It took time for them to become full-time starters and grow into elite players.

Without the ratio, teams would have no reason to develop Canadian talent. U.S. colleges graduate almost 4,000 players each year — there will always be enough good players to slot directly into the lineup.

The CFL will never beat the NFL at its own game. The more that we celebrate the uniqueness of the Canadian game, the more people will buy in.

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We love football — NFL in the US and CFL in Canada — and the XFL didn’t last long. We have been big fans of the CFL for years now.

Our major complaint is trying to find the game on the US television networks. We don’t have TSN.

We are requesting that when you publish the scheduled games, if possible, please indicate the US television network (channel) the game is on for the CFL fans in the US.

-Bruce & Patti Boyce

Thanks for the question, Bruce and Patti.

The CFL has had a television agreement with ESPN since 2014, but it’s hardly an ideal contract.

Financial terms of the agreement have never been disclosed, but it’s only reportedly worth around $200,000 per year. The point of the deal is to garner attention for the league — not dramatically increase revenue.

ESPN makes most CFL games available via streaming on ESPN+, which is good for American cable-cutters. For traditional cable subscribers, the schedule is very inconsistent as games are rarely announced more than a few days in advance.

One of the reasons the CFL and XFL are discussing a partnership is the potential of negotiating a large American TV contract. It remains unclear what the CFL would look like if the leagues merged, but it would probably make the games a lot easier to find for American fans.

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