Sunday, August 24, 2014

Pay to Play: There's Bologna in our Tight End

The first time I recall learning about Pay or Play contracts was from the Animaniacs theme song. I was surprised to find that it's a real thing.

And now we find that a related contract (long in use in the exotic dancing circuit) has been floated for the Superb Owl: big name artists are being asked to pay (follow the links! follow the links!) for the privilege of performing at halftime.

The idea is pretty simple: Rihanna gets a bigger boost in sales out of the gig than the NFL does, so remuneration flows accordingly. Fair is fair, after all.

Of course, fair isn't fair when one party to the contract is a giant organization. If Forbes is correct, the 32 teams in the NFL are worth, in toto, close to $46B. Rihanna, in contrast, is worth a (relatively) measly $120M. Talk about a BATNA disparity!

Sure, there are probably only a handful or two of bankable performers who'd be a good fit for the Superb Owl halftime show (for my money, it's long past time for Weird Al to hit the stage), and each one of them is more than well-off enough to tell the NFL to stick it where the sun don't shine.

But the brutal economics don't lie. If a performer gives up the spot to someone with a little less pride, it could well mean leaving money on the table. What price pride? The typical high-performing musician has much less audience goodwill to squander than the NFL, and maybe that's what Goodell's counting on.

It's tough to feel sorry for a mammoth organization with abundant assets, even when they have the economics on their side.

Then again, it's just an offer at this point, right? Lowballing is a common practice in negotiation. Maybe they'll agree to bump it up to 0. Who knows?

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Do you have suggestions on where we could find more examples of this phenomenon?