NFL teams face financial challenges when playing internationally, but owners view it as essential to expanding the league's global presence.
LONDON—The Washington Commanders are “hosting” the Indianapolis Colts in London this Sunday, a significant affair taking place at Tottenham Hotspur Stadium. This matchup replaces what would have been a standard home game in Maryland, introducing a whole new economic dynamic.
Traditionally, NFL teams receive the bulk of ticket revenue from their home matches, but the international series operates under a different model. Previously, teams received compensation for the loss of ticket sales, but this policy was scrapped in 2022. Now, the NFL primarily reimburses teams for travel and accommodation costs instead of lost ticket revenue.
So, how does this shift affect the host teams financially?
“It’s not good,” quipped Commanders owner Josh Harris while engaging with fans at a London pub the day before the game. “It’s bad in many ways. But honestly, I’m not focused on the economics. I’m more concerned with being part of the NFL community and helping grow the game internationally.”
Team president Mark Clouse mirrored Harris's sentiments, framing the situation as a strategic investment. “I would view it as an investment in the future of the league and the team,” he stated while interacting with around 2,000 enthusiastic fans.
International Expansion and Its Impacts
The NFL’s drive towards international expansion has rapidly evolved over the last ten years. The 2015 season featured only three games held overseas, all in London. In stark contrast, this year will see nine games across seven countries on four continents.
The international matches serve several purposes. They not only cultivate new fan bases in fresh markets but also strategically extend the NFL's broadcasting schedule. For instance, the Commanders-Colts game is set to kick off at 9:30 AM ET, allowing the league to capture additional media revenue by filling the television slots.
Despite the economic drawbacks, international games provide franchises with both opportunities and hurdles. While the financials may not balance out perfectly, these games enable U.S. fans to partake in unique experiences abroad and potentially win over new supporters in different regions. However, such endeavors demand financial investment; for example, London franchises often create dedicated fan hubs, hosting events with past and present players leading up to game day. By Saturday, the Commanders had sold a significant amount of merchandise, indicating strong fan interest.
The Commanders currently hold a valuation of $9.64 billion (according to Sportico), placing them 11th in the NFL. Last season, they reported approximately $719 million in revenue.
In standard regular-season matchups, teams generally retain around 66% of ticket sales, with the NFL taking 34% for its collective sharing. Other revenue avenues, like concessions and on-site merchandise, principally benefit the home team, which is where the London games pose a significant financial disadvantage.
Clouse opted not to disclose specific figures regarding the NFL's financial support for international games. In earlier years, the NFL compensated teams with stipends, but the league adjusted its approach in 2022 to only cover incurred costs as teams were mandated to play overseas under a different scheduling structure.
“We all agree to share and invest in a great experience,” Clouse remarked. “We’re happy to do it, and it’s exciting to see our fans travel with us.”
Currently, most teams participate in international events less than once a year, with the Jacksonville Jaguars being the exception, enjoying an arrangement for two "home" games in London each season. Harris noted that, although teams have limited control over these international games, it signifies the league's confidence in their appeal.
“You really don’t have a choice,” he explained. “The NFL designates teams based on their popularity, saying, ‘You’re going to London.’ So, we aim to create a memorable experience for our fans, community, and players.”
(This story has been updated with additional details regarding the NFL's compensation structure for international games, beginning from the second paragraph).
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