NFL revenue will impact the 2021 salary cap
Aug 18, 2020; Thousand Oaks California, USA; A general view of a NFL official Wilson Duke football with metallic shield lgoo introduced for the 2020 season at Los Angeles Rams training camp at Cal Lutheran University. Mandatory Credit: Kirby Lee-USA TODAY Sports

The NFL knew it could lose billions of dollars in revenue this season by playing amid the COVID-19 pandemic. Now, the magnitude of the potential losses and the impact it could have on the 2021 salary cap is becoming clearer.

Already amid a season when NFL TV ratings have taken a hit, revenue has been driven down even further by the absence of profits generated from the game-day experience. With stadium capacities limited across the board, the cost could be staggering for the NFL this season.

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NFL salary cap: NFL estimated to lose $2.7 billion this season?

While teams like the Dallas Cowboys have permitted 20,000 fans into AT&T Stadium for home games, plenty of NFL clubs are playing in empty buildings. The Denver Broncos, Philadelphia Eagles, Green Bay Packers, Las Vegas Raiders and Seattle Seahawks have all banned fan attendance this season.

Many teams were preparing for the NFL salary cap to drop to sink next season, potentially by tens of millions of dollars per club. Now, recent estimates by Team Marketing Report’s 20202 Fan Cost Index highlight just how bad things could be.

The NFL is projected to take a $2.7 billion hit this season due to the massive drop in stadium revenue. While every team would be impacted, the FCI indicated the Raiders, Eagles, Packers, Patriots and San Francisco 49ers would be hurt the most.

Before the COVID-19 pandemic hit, the NFL hoped to soon have a salary cap in excess of $200 million by 2021. That number was projected to be even higher in future years once the league and the players’ union signed the new CBA.

It became evident this summer that the league wouldn’t enjoy the record-setting revenue it enjoyed every year. With profits expected to take a hit, teams started preparing. Meanwhile, the NFL and NFLPA negotiated how to “share the pain” and found some creative solutions to lessen the financial blow.

As part of the agreement before the season, the NFL and NFLPA agreed to a $175 million salary cap floor for next season, a steep drop from the 2020 salary cap ($198.2 million). With the CBA signed, the economic fallout this year can be spread across multiple seasons.

Fortunately, there is some good news for the NFL. Its contracts with television networks are set to expire by 2022, creating new opportunities to cash in with monster deals.

ESPN and NBC are in a multi-billion dollar bidding war for Sunday Night Football and FOX is discussing a record-breaking offer for expanded broadcasting rights for future NFL seasons. So, while stadium revenue might be down until a vaccine for COVID-19 is available, it seems the NFL will be able to avoid a financial disaster.

Matt Johnson
NFL, MLB & college football writer for Sportsnaut. Graduated from San Diego State University with BA in Journalism, 2019. Grew up in Sacramento, now based in Indianapolis. Seen on MSN. Previously: eDraft, The Connection, With the First Pick