If you want to know what’s driving the Canadian Football League towards an integration with the XFL, you can start with a simple understanding.
Unless the league comes up with a vision that gives all nine teams reason to push into the future, its very existence is in jeopardy.
So, if a potential injection of cash and a new business model built around collaboration with the XFL can guarantee that all nine teams stay in the game, then that’s what the CFL has to do.
And that’s exactly why the league is pursuing this direction.
The CFL is a unique mix of three publicly owned and six privately owned franchises that operate with minimally shared revenues, in what amounts to an every-team-for-itself kind of operation.
Without a season in 2020, every team suffered significant losses, with the publicly owned Winnipeg Blue Bombers recently reporting a $7 million deficit, a figure that’s likely to be reflected in the year-end statements of every team, both public and private.
The nature of public ownership among Winnipeg, Saskatchewan and Edmonton means they will almost surely find a way to survive, or at least will be given the opportunity to adapt to the new reality. Their businesses were solid if unspectacular before COVID-19, and each team has a significant presence in its respective market.
They aren’t going anywhere, for now.
The same can be said of the Hamilton Tiger-Cats, where owner Bob Young had built his team into a stable business before the pandemic.
Young, who bought the Ticats out of bankruptcy in 2003, has both the wealth and the apparent wherewithal to see his team through the league’s darkest days. The Ticats were one of the teams that pushed to play last summer. And for Young, CFL ownership has always been more about passion than profit.
The CFL’s Ottawa and Calgary franchises are owned by parent companies invested in other local sports properties. Each has been able to operate its CFL franchises without taking on great losses.
Which brings us to the CFL’s three biggest markets, starting with the Toronto Argonauts – long the league’s greatest source of concern and by far the weakest link in a Maple Leaf Sports & Entertainment family of teams that also includes the Maple Leafs, Raptors, TFC and Marlies.
Bell, Larry Tanenbaum, and later full MLSE ownership, bought the Argonauts in 2015, anticipating that a move to intimate BMO Field on the shore of Lake Ontario would change the team’s image in Toronto and bring people back to the stands.
It hasn’t. Instead, amid record-low announced attendance figures, the losses have piled up.
That’s never going to sit well in a company that is all about driving revenues and franchise values. It’s going to sit even worse when MLSE hasn’t taken in ticket revenue from the Leafs or Raptors in more than a year.
MLSE is believed to be among the CFL owners most bullish on the idea of an XFL collaboration, presumably seeing it as a way to turn their football asset into something of value. It’s not hard to understand why they might rather roll the dice on an XFL venture than continue funding losses under a business model that hasn’t worked in Canada’s biggest city in 30 years.
So what if MLSE concludes that, under current conditions, the Argos just aren’t worth it under the traditional CFL business model? Would there be such a thing as a next owner of the Argonauts? Logic says the white knights disappeared the day the league allowed David Braley to own two teams.
And what then of Montreal? Gary Stern and Sid Spiegel took over the team in January of 2020 at the urging of CFL chairman of the board Dale Lastman, a boyhood friend of Stern who happens to sit at the right hand of MLSE chairman Tanenbaum.
If MLSE decided it wanted out of the CFL, would Stern and Spiegel remain committed to Montreal? It took the league a full year and a boatload of money to find the current owner of the Alouettes. How hard would it be to find someone else who wants to own the Als under the current business model?
And then there is Vancouver, where the estate of the late David Braley owns the Lions.
It’s believed Braley left the team enough money to see it through at least a couple of seasons. But does the pandemic change that equation? And how on earth could the league even begin to negotiate with potential buyers when it’s impossible to know what’s being sold?
Is this B.C. franchise part of a nine-team CFL? An 18-team CFL-XFL? Or a seven-team CFL? And what’s the business model for any of those?
Is there another owner waiting to invest in the Lions under the CFL business model? Or would the league be more likely to attract investment as part of a much bigger league, one on American television with big-money U.S. investors behind it?
The answers to any one of these questions about Toronto, Montreal and B.C. are critical to the future of the CFL.
That’s why the league needs a plan that gives all nine teams a way to see beyond the limitations of the current business model; a reason to believe that funding teams through the current pandemic-driven crisis is more than just an exercise in staving off the inevitable.
That’s where the XFL comes into the picture.
There are endless questions about how a CFL-XFL joint venture will work, but at the very least it will be different.
There will be a new business model to test and new sources of revenue to potentially tap.
CFL teams may have been forced to open their minds to the XFL collaboration out of fear of the status quo. But emerging from dire circumstances is a broad enthusiasm about trying something new, of exploring a way for the league to reinvent itself for the future.
Make no mistake, there is going to be plenty of risk associated with an XFL-CFL venture, given all the dynamics and leaps of faith involved.
But if such a collaboration holds enough promise to keep all nine CFL franchises committed to the future, that’s going to be inherently less risky than trying to steer forward with the status quo.