Breaking down Jennings' deal

Inside the Jennings' deal

The contract that Greg Jennings completed with the Packers last week is an interesting study of the dynamics of negotiations and valuations of contracts in ways that include more than simple dollars and cents. As an admitted fan and friend of Greg, I strongly believe he deserves the money he received, and I give kudos to the Packers and agent Eugene Parker for ensuring that the two core players of their offense – Jennings and quarterback Aaron Rodgers – are now locked up through 2012. Looking closer at the deal brings out some attention-grabbing numbers.

As to the total deal, it can range from $26-30 million for four years. For discussion purposes, let’s say the deal is worth $28M, an average of roughly $7M per year, putting Greg’s average per year near to the top tier of wide receivers, a group that includes Larry Fitzgerald and Randy Moss at $10M per year and Lee Evans, Calvin Johnson, Andre Johnson and Roy Williams below them. That, however, is too simplistic a way to look at the contract.

Jennings had one year remaining on his rookie contract, which would have paid him $535,000. Thus, his “new money” in the deal will pay him $27.5M over three years, giving him a “new money” average of over $9M, inching him closer to the top.

The other complicating factor in looking at this deal is that – as we sit here today without a salary cap for next year – Jennings would have become a restricted free agent next year. Assuming the Packers would have placed a first-round tender on him (the tender was $2.2M this year) combined with the $535,000 he would have made this year, they would have Jennings’ rights for 2009 and 2010 for approximately $3M. This would make the “new money” in Jennings’ deal $25M over two years, an average of $12.5M, putting him at the very top of the receiver market.

Will there be a new Collective Bargaining Agreement next year, meaning the value of this contract is more in the three-year “new money” category rather than the two-year look? Time will tell, but the uncertainty of the labor future in the league shows the tricky nature of valuing contracts at this point in time.AP

The other fascinating factor about the Jennings deal, as well as the Fitzgerald deal last year, both done by Eugene Parker, is the length. Jennings, who is 25, will have another bite at the free-agency apple (and the leverage associated with that) in four years, still at the tender age of 29. For a blue-chip player like Fitzgerald or Jennings to have two opportunities for free-agent riches following their rookie contracts is as important as anything else. Parker is someone who truly understands the concept of value in NFL contracts (even though I would not let him get away with a short deal when we worked on Jason Peters’ contract in April). Listening to Greg’s appreciation for Eugene after the deal indicated that he understood the value as well. …

Dolphins add more ownership

The new owner of the Miami Dolphins, Stephen Ross, appears to be trying to leverage the use of celebrity in marketing his product. First, he partnered with singer – and entrepreneur – Jimmy Buffett in a short-term naming-rights opportunity for Land Shark Lager as the name for the stadium. Although the inventory for Land Shark does not include the Pro Bowl and the Super Bowl, both of which will be played at that facility this season, it did and does include concerts and appearances by Buffett in bringing more awareness to the team from casual fans.

Continuing that theme, Ross has brought on Emilio and Gloria Estefan as minority owners of the franchise. It’s not know what role, if any, the Estefans will have beyond a small piece of ownership, but they’re another step in the building of brand awareness for a franchise on the upswing after a magical season a year ago. …

And in the “Master of the Obvious” headline of the week:

“Cowboys are charging fans for tours of new stadium.”

Uh, ya think?

Of course they are. They’re not going to let fans into their new $1.15-billion edifice and its sanctums, including the locker room and field, for free.

In Green Bay, my office looked out on the gathering area for tours, which were always full this time of year. Admission in Green Bay is $11 for adults and $8 for children. Cowboys Stadium charges $15 for adults and $12 for children.

At Lambeau Field, these tours sold out regularly; the Packers could certainly charge more. At Dallas, I would suspect it’s the same, at least for the short-term honeymoon of the new building. Having said this, we must remember that these are two of the most recognizable brands in football. They are not typical.

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