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Copyright (c) 2006 Vanderbilt Law School 
Vanderbilt Journal of Entertainment and Technology Law

NOTE: Revenue Sharing and the Salary Cap in the NFL: Perfecting the Balance Between NFL Socialism and Unrestrained Free-Trade

Summer, 2006

3 Vand. J. Ent. & Tech. L. 641


Clay Moorhead*


I. The Pre-game Show: An Introduction
Since its inception in 1961, the revenue sharing system utilized by The National Football League ("NFL") has been instrumental in propelling the League to the forefront of professional sports in America. 1 In the early 1960s, Commissioner Pete Rozelle ushered in an era of collectivism among the individual team owners that came to define the NFL's economic approach for the next four decades. Relying on the collective outlook that became known as the "League Think" philosophy, Rozelle convinced the individual owners that by pooling their resources and sharing their profits, they would be able to provide a product that, as a whole, was much more valuable than the sum of its parts. 2

The idea took off in 1961 when Rozelle successfully persuaded the individual owners to give up their local television broadcasting rights and instead sell all broadcasting rights together as a national package; the proceeds were then split evenly among each NFL team. 3 From 1961 onward, the League's continued commitment to the equal sharing of television revenues has remained the foundation of the NFL's revenue sharing system. 4 Furthermore, the financial parity that resulted from this collective philosophy enhanced the competitiveness of the League as a whole, thereby fostering the massive popularity still enjoyed by the League today. 5

For nearly forty years, the NFL's revenue sharing system remained largely unchanged as NFL owners were content to rely on the success that revenue sharing brought to the ...
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