Coming off a year that saw the National Football League lose roughly $4 billion in revenue due to the COVID-19 pandemic, the NFL is counting on a return to normalcy for the 2021 season. In addition to sold-out stadiums and record-setting revenue from TV contracts, significant money will also be made from legalized sports betting.
Even in a pandemic, the NFL did fairly well in 2020 by generating $10 billion in revenue. That came in a year where a majority of regular-season games were played in empty stadiums, meaning clubs lost out on game day sales.
It all resulted in an unprecedented drop in the 2021 salary cap, but many around the league expected it to be a one-year drip. Thanks to new TV rights contracts worth $100-plus billion and the return of fans to seats, revenue was already expected to soar in 2021. Now, thanks to the legalization of sports betting, even more money could be generated this year.
According to the Washington Post‘s Ben Strauss and Mark Maske, there is a league-wide expectation that the NFL will generation approximately $270 million in revenue through gambling deals this upcoming season. Even better for players and clubs, that number might be far higher in future years.
The Supreme Court overturned a 1992 federal law in May 2018, opening the door for legalized sports betting. As soon as that happened, the NFL began aggressively making plans to be heavily involved in the action.
After prolonged negotiations, the NFL announced an exclusive agreement with Caesars, DraftKings and FanDuel as its official sports-betting partners.
League officials certainly have every reason to believe the revenue generated from these partnerships will climb higher in the future. As of this summer, 20 states passed laws to permit legal sports betting and several more are moving forward with similar laws.
Gambling isn’t the only front that could bring in new sources of money for the league. The NFL is exploring deals for its data rights, which could be worth $100-plus million.
With the 2021 season set to begin, it’s evident the league has zero reasons to worry about experiencing another financial blow this year. As a result, the salary cap will keep climbing and player salaries will follow suit.