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Heard of the Alliance of American Football (AAF)? The new American football league launched a week after Super Bowl LIII, kicked off to over two million viewers for its debut game. Its second week pulled in 400,000 viewers.
Not bad, but within its second week of the league it needed an injection of $250 million from one team owner (Tom Dundon), just so the league could make payroll.
Two weeks in, struggling to make payroll was not a good look for the AAF.
But the AAF is dead. Already.
“I understood they had a need for someone like me to step in. It all came together on Wednesday and Thursday of last week. I wish it was more thought out than that, but it was that simple.”
Tom Dundon, comments to ESPN on giving $250 million to the AAF
How did the fledgling league actually shut down?
“Without a new, nine-figure investor, nobody is sure what would have happened. You can always tell people their checks are going to be a little late, but how many are going to show up on the weekend for games when they don’t see anything hit their bank accounts on Friday?”
Unnamed source, talking to The Athletic
Given that the AAF had a clear cost structure ($250,000 contracts for players, over three seasons), and numerous broadcast deals (with CBS, Bleacher Report and also the NFL Network), how could it die in just its first season?
In fairness to the AAF, it did have some recognizable faces, current players like Trent Richardson are playing, with coaches including people like Steve Spurrier, Michael Vick and Daryl “Moose” Johnston.
Interestingly the AAF was founded by Charlie Ebersol, a TV and movie producer, who directed an ESPN “30 For 30”, entitled “This Was The XFL”, on his father, Dick’s, failed bid to take on the NFL with a new league with Vince McMahon in the early noughties. He founded the league with football guru Bill Polian.
“When I started to dig back into that a couple of years ago to do the film, I started seeing how the potential was never met in terms of what you could do with football. You had lots of people show up. They just showed up to bad products. So if you really focused on having a good product, there’d be something there.”
Charlie Ebersol speaking about the XFL, to CBS Sports
Why The AAF Could Have Succeeded
Let’s get it straight from the off. The AAF was not trying to take on the juggernaut that is the NFL. In fact, with the NFL’s NFL Network showing games, it looks like the AAF was actively courting the NFL’s interest.
“We’re not looking to be a markedly different product. We’re actually looking to be a very, very similar and very parallel product to what the NFL has.”
Charlie Ebersol speaking to CBS Sports
As you can see from the below summary of the AAF, was seeking to simplify the game, make it quicker and, interestingly, trying to make the league tech-heavy.
- Eight teams in the AAF
- 50-player rosters
- 10-week regular season, finishing in April
- Games will be two and a half hours long, compared to the NFL’s three
- Fewer ad breaks
Specifically, it wanted to marry the league closely to betting. If you did visit the AAF’s website, the first tab invited you to download its app. This is really where Ebersol wanted to take the AAF. Get people on the app, and with a new liberalized gambling environment in the U.S. (read more about that here in this post from Business Of Sport), get a market on the “in-play” betting audience. The AAF had already partnered with MGM, who had an exclusive license for its sports gambling technology.
This is where the real money lied and why the AAF was aligning itself so closely to betting. Not only this, the league was collecting copious amounts of player data to feed into its model and help fans make informed choices on who and what to bet on. Not only this, Ebersol had a clear vision to “white label” the AAF’s technology and sell it to other leagues.
“The long-term goal is to build a technology company that has a multi-billion-dollar valuation, and so we’re going to invest heavily in putting good football on the field that mimics in the NFL in terms of the quality and the type of play, so that our technology can travel to not only the NFL, but other sports and other industries.”
Charlie Ebersol, to Fox Business
How The AAF Failed
As mentioned, the AAF’s model to position itself, not only as a technology company, but also a potential partner to the NFL, clearly marked out what the founders were trying to achieve.
They wanted a professional league to buy it out. Like any startup firm. Even if this didn’t happen, the AAF could have become a good feeder league to the NFL, much like NFL Europe was (unearthing Hall Of Famer Kurt Warner for example).
Despite all these good intentions – the AAF filed Chapter 7 bankruptcy, with a measly $11 million in assets versus a whopping $48 million in liabilities. The AAF has just $536,160 in walking around money which is simply staggering.
“This feels like the Fyre Festival.”
Unnamed player, SI
Unfortunately for the AAF its backer, Reggie Fowler’s money dried up at Christmas time, likely connect to being charged with bank fraud. Then Dundon came in to “save” the league.
Dundon was nicknamed Trump as he sought to slash budgets for the entire AAF – with every expenditure having to be justified. By April 2nd, Dundon had made his decision on the AAF. An associate told Ebersol: “Everyone is fired at 5 p.m. today.”
The reason is simple. Dundon’s team had assessed that if the AAF completed its first season it would cost a cool $100 million, against revenue of just $12 million.
Vince McMahon’s XFL must have been licking its lips at the AAF’s demise. In fact, Alpha Entertainment, which owned the XFL bought the AAF’s equipment for just under $400,000.
But even the XFL couldn’t survive – Vince McMahon’s league failing for a second time – read more here.
It honestly seems like America will never get a league to rival the NFL at this stage, unless the NFL actually creates it.
