For the past decade, the NFL has played a game in London in an effort to take the sport global. During the 10 years the NFL has been playing games in London, all the games except one, have been sold out. This week, the Indianapolis Colts will take on the Jacksonville Jaguars, who have become the defacto home team in London. NFL odds have the Colts as favorites going into the game, but the Jaguars are much improved this season and will be ready to play.
Despite the NFL’s popularity in London, Mark Waller, the NFL’s head of international development, said the games are losing money. According to Waller, the production costs for the games are very high, and the league isn’t making enough money from the British broadcasting rights, sponsorship, and ticket sales to break even.
While the games haven’t been profitable, Waller believes things will eventually change. He said that by continuing to play the games in London and making them free on BBC, the NFL has been able to build a fan base. Waller also said that half of the fans that were at a game last year had previously been to an NFL game, and a third of them bought tickets to see the full series.
Waller said that once they have enough fans, the sponsorship values go up, increasing the amount of revenue the league makes. Waller illustrated his point by noting that the price of the U.K rights to the NFL games has doubled since 2007, when the New York Giants defeated the Miami Dolphins at Wembley Stadium.
Waller said the rights will be even more expensive when it is up for renewal again. The BBC currently hold the rights to the games and the Super Bowl for the next two years, and Sky Sports owns the broadcast right for regular NFL games through 2019.
Ticket prices for the games in London are higher than the average ticket price in the US. Fans pay an average of $130 for tickets, compared to the average of $86 fans in the U.S. spend. Since Wembley Stadium is 25 percent bigger than most NFL stadiums, the London games generate more gate sales.
For last year’s games, the games had an average gate revenue of $10 million, which means that the Jacksonville Jaguars, who have made the most appearances in London, generate more gate revenue in London than they do in Florida, where they average an attendance of 61,000 fans, who pay lower ticket prices.
Other reasons the games haven’t been profitable for the NFL is the fact that they have other expenses like travel to deal with. On average, teams playing in London send about 180 people, which means the NFL has to pay for the first-class travel of almost 500 people, their hotel accommodations, and food.
The NFL also has to rent training facilities and Wembley Stadium, where the games are played, while incurring other marketing costs to get people interested in the games.
If Waller is correct, and the NFL can turn its London games profitable, it will be another step forward in realizing the dream of having an NFL team in London.