Snyder still wins.

[Touch of Class 17]

http://www.newsweek.com/id/227815

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Tackling the Washington Redskins

Despite a five-year losing streak, the defection of its most important Beltway fans, and a key management shake-up, the Skins generate more revenue than the Yankees. How is that possible?

Larry French / Getty Images

The Redskins' Devin Thomas scores a touchdown against the New Orleans Saints on Dec. 6

By Matthew Philips | Newsweek Web Exclusive

Dec 21, 2009

When the Washington Redskins host the New York Giants on Monday Night Football tonight, the 90,000 Skins fans at FedEx Field might look a little happier than they have in a while. That's because last week, team owner Daniel Snyder did what most thought he never would: he fired his friend and longtime front-office executive Vinny Cerrato. To the Redskins faithful, Cerrato is the architect, or at least Snyder's sycophantic yes-man, most responsible for what's been a decade of dismal football. This year will be the team's fifth losing season since 2000, a span in which the Redskins have compiled the eighth worst record in the NFL.

In Cerrato's place next to Snyder in the owner's box tonight will likely be his replacement, newly hired general manager Bruce Allen, the son of Redskins legendary coach George Allen. The move comes as a ray of light at the end of what's arguably been the worst season under Snyder's 10-year ownership. But as the Redskins close out a decade of losing, one thing is undeniable: off the field, the team has been a roaring success.

The Washington Redskins make more money than any other professional sports franchise in the United States. Their estimated annual revenue is $345 million, according to Forbes. Their closest contender, the New York Yankees, bring in somewhere around $320 million a year—but the Yankees bring home championships, 27 and counting. By comparison, the Redskins are lucky to simply have a winning season. They've had all of two since 2000 and won just a single playoff game. And yet, at $1.5 billion, the Redskins are the third most valuable sports franchise in the world, behind English soccer powerhouse Manchester United, and their rivals the Dallas Cowboys, who leapfrogged the Skins this year to claim the title of America's most valuable team.

Since buying the team in 1999 for $800 million, Snyder has doubled its value by saturating every orifice of the D.C. area with Redskins' burgundy and gold. He's bought radio stations, charged fans to watch players sweat through training camp, and opened 14 Redskins retail stores to sell as many jerseys, hats, and Redskins' paraphernalia as possible. Snyder was even rumored to have considered selling a brand of Redskins cola at one point.

Since 2000, he's crammed 10,000 extra seats into FedEx Field, many of them high-end luxury boxes; sold the stadium naming rights to the Memphis-based shipping company for a reported $7.6 million a year; and upped ticket prices, though the Redskins have always had the NFL's highest seat prices. Snyder's used all that extra cash to sign big-name players and coaches to record-breaking contracts, which in turn fuels more ticket sales, more merchandising, etc., etc. "Snyder took a very under-marketed asset and squeezed every last cent out of it," says Dan Kaplan, finance editor at The Sports Business Journal. "He's turned the Redskins into a cash machine. And the result is a completely soulless, corporate product."

It's also a losing team. Under Snyder's tenure, the Redskins have been a testament to the fact that in the NFL, winning and making money can be mutually exclusive goals. With one does not necessarily come the other. For the past couple of years, corporate America has done some searching on the issue of pay for performance. Why reward top execs with stock-option-loaded contracts and buyout packages even as their companies fail. When it comes to the Redskins, "the traditional P-and-E ratios simply don't apply," says Kaplan.

The NFL likes to point out that the Redskins and Cowboys are its most heated rivalry, convenient since they're also its most valuable teams. The rivalry dates to 1960 when the expansion Cowboys invaded what was then Redskins country: the South. But unlike Yankees–Red Sox, where the teams that really do hate each other the most are also perennial contenders, the Redskins and Cowboys have defined mediocrity over the last decade. Sure they have 13 Super Bowl appearances and eight Lombardi trophies between them, but that's ancient history. The Redskins and Cowboys both rank in the bottom third of the league in terms of winning percentage since 2000. Dallas hasn't even won a playoff game since 1996.

[munchak21]

The truth hurts.

[Jofizz]

Makin' bank son.

[RedskinInExile]

"Snyder took a very under-marketed asset and squeezed every last cent out of it," says Dan Kaplan, finance editor at The Sports Business Journal. "He's turned the Redskins into a cash machine. And the result is a completely soulless, corporate product."

God, that hurts. And it's the reason why the game-day experience at Fed Ex has become so abysmal over the last ten years.

[MarkB452]

Since 2000, he's crammed 10,000 extra seats into FedEx Field, many of them high-end luxury boxes;

>> I agree with 99% of this, but gotta disagree with this statement. The stadium went from about 78,000 to 91,000 under Snyder. Sure the "Dream Seats" were added, but there were about 6,000(?) Obstructed view seats put in a few years ago and additional seating added in the end zones as well. I would hardly call those luxury seats.

[Hubbs]

God, that hurts. And it's the reason why the game-day experience at Fed Ex has become so abysmal over the last ten years.

Ding.

I was at the game tonight. Somehow, Snyder has managed to cram more commercials in between series than ever before. My friend and I felt lucky to park in some shady under-the-table lot for $25 and hike about 2/3 of a mile to FedEx. And even the sponsors have sponsors.

Somehow, I still want to go when I get the chance. But I wish I wanted to go to other stadiums instead.