High Commissioner

By Michael Lewis

When most people think of Pete Rozelle, if they think at all of Pete Rozelle, they probably recall a genial fellow with a balding pate and the ready smile of a car salesman who popped up at the end of the Super Bowl. Rozelle was the commissioner of the National Football League, of course, but what did that really mean? The players played, the coaches coached, the owners owned, the fans stomped and hollered, but what the hell does a commissioner do? Commission?

Until his death in 1996, Rozelle was dwarfed in every way by owners, coaches and players, and it was impossible for the viewer innocent of the inner workings of pro sports to view him as much more than a functionary. The hired help. The guy whose job it was to order the stuffed mushrooms for the party after the game.

Those a bit closer to the game had another opinion of Rozelle: as a shrewd promoter of his sport. He invented the Super Bowl, for example, and sold the rights to the first game to two networks (NBC and CBS), which forced them to compete for viewers. He invented (with ABC Sports chief Roone Arledge) Monday Night Football, which is the second longest running prime-time show on American television, after 60 Minutes. He exhibited a taste for kitsch and spectacle unrivaled in professional sports. He loved floats and glitter and marching bands. His idea of beauty was a balloon drop. (He did not, however, like the name Super Bowl. It was coined by the son of Kansas City Chiefs owner Lamar Hunt, whose imagination had been captured by the newly invented Super Ball.) It is now commonplace for a regular-season football game to attract ratings that surpass the playoff games in other sports. And the reason for that is Pete Rozelle.

But there is a third view of Rozelle espoused by those who watched him work: he was an iron-willed tycoon who created the business model for all of professional sports. In addition, he figured out a way to make the NFL far more valuable than other sports, including the national pastime, baseball. Rozelle recognized that a sporting event was more than a game--it was a valuable piece of programming. Such media moguls as Ted Turner and Rupert Murdoch have used that strategy to build entire networks. Rozelle, however, did them one better. In the long-winded discussions about the money sloshing around professional sports, the structure of the businesses receives little attention. But the structure, as designed by Rozelle, has been largely responsible for the money. That structure, in a word, was a cartel.

The football league Rozelle inherited in 1960 was a fragmented collection of 12 franchises, each run more or less as a stand-alone business. The squabbling owners faced serious competition from the newly formed American Football League, bankrolled by one of the richest men in America, Lamar Hunt. Rozelle's first trick, one that Rockefeller would have admired, was to put an end to the unprofitable competition. In 1962 he traveled to Washington and persuaded Congress to grant the NFL the first of two exemptions to the Sherman Anti-Trust Act. The exemption enabled Rozelle to fold the two leagues into a single, albeit fragmented, business.

Rozelle's next big move was to weld the owners of the new, expanded league into a cartel. This too required an exemption from the antitrust laws, which Congress granted in 1966. One morning the three major television networks woke up and found not a collection of individual teams competing with one another to sell their broadcast rights, but a single entity with a growing sense of its value.

The result, as we now know, was wonderful new bargaining power. The new revenues went into promoting the game and grabbing an ever greater slice of the entertainment business. "When the networks put up as much money as they did for the rights, they felt they had to promote the game," says NFL spokesman Joe Browne. "And by promoting the game, the game grew." Back in 1960, when the 33-year-old Rozelle accepted the job as NFL commissioner, the combined revenues of the NFL and the franchises were less than $20 million. The NFL this year projects combined revenues of nearly $4 billion. Similarly, the Dallas Cowboys and the Minnesota Vikings were each sold for about $1 million in Rozelle's rookie year. The newest NFL franchise, in Cleveland, was auctioned for $530 million last year.

In his eulogy of Rozelle in January 1997, Arledge said that a president of a sports division negotiating with Pete Rozelle and the NFL had "about as much clout as the Dalai Lama has dealing with the Chinese army." What he failed to mention was that Rozelle had created the army.

In retrospect, the whole thing looks like an outrageous violation of old-fashioned American free-market principles. But in 1966 virtually no one but Rozelle was thinking of pro sports as a seriously big business. The notion of pro football's "bargaining power" was patently absurd. Having formed his cartel, however, Rozelle managed it in much the same way the Japanese zaibatsu manage their cartels--with a view to market share (read: global domination).

He understood, somewhat ironically, that the key to attracting fans was fierce competition on the field, and that the key to fierce competition was every team's having roughly the same amount of money to spend on players. To that end Rozelle persuaded NFL owners--two dozen raving megalomaniacs--to share their television spoils equally. While there still remains a discrepancy between the richest franchise (Dallas) and the poorest (Indianapolis), the difference is a fraction of that in other pro sports.

Probably it helped that unlike so many would-be power brokers, Rozelle did not look like a man who wished to wield power. Of course the gifts required to pull this off aren't the ones normally associated with empire building. They are to a large extent the gifts of a diplomat. Diplomat in this case is another word for a man with a talent for dealing with megalomaniacs. Each year that Rozelle presided over the NFL, another owner published his autobiography explaining how he was the visionary behind the rise of pro football. Each year Rozelle laughed and let him enjoy his press. Rozelle seems to have been the sort of spectral tycoon who took his satisfaction in managing other people without their knowing it.

Looking back, one can see that Rozelle's career was built on his talent for 1) persuading rich men who were unfamiliar with not having everything they wanted to take less than they deserved and 2) preventing full-scale revolt the minute the stakes became high. The subsequent endless pressures on Rozelle are familiar to anyone who has ever built a successful cartel--and cartels by and large fail. A member is more inclined to cheat the group the more successfully the group drives up his price. When Jerry Jones of the Dallas Cowboys cut a side deal with Pepsi to become the official drink of Texas Stadium, thus violating at least the spirit of the lucrative agreement the NFL had cut with Coca-Cola, he was playing the same game as the renegade Libyan oil industry.

By today's standards, Rozelle was vastly undercompensated, given the wealth he created for the NFL's owners. He was a special case: the business giant who didn't lust for financial fortune and overt personal dominance. But if the measure of business success is the creation of new enterprise, then Rozelle was one of the greats. Once, late in his career, after it was clear what he had accomplished, Rozelle was asked by a reporter if he had an ego. Pete Rozelle replied that if you took all the egos in pro sports--the players', the coaches', the owners'--and averaged them out, his ego was just above the average. It might have been true, but no one ever knew it. That was his genius.

Michael Lewis is the author of Liar's Poker and Trail Fever