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Thursday, May 24, 2012
Putting the Cowboys' worth in perspective

By Calvin Watkins

The Los Angeles Dodgers sold for $2.175 billion in a deal that was finalized earlier this month.

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And a report in today's New York Daily News that the New York Yankees might be for sale -- one deemed false by the club's management Thursday morning -- raises one question locally: How much are the Dallas Cowboys worth?

They have that billion dollar stadium in Arlington, Texas. They also have one of the more marketable teams in the United States, if not the world.

Several of their key players -- Tony Romo, DeMarcus Ware, Jay Ratliff, Sean Lee, Jason Witten, Miles Austin and Dez Bryant -- are in their primes.

"In some ways NFL franchises (are) more valuable with network deals and (a salary) cap," said ESPN's Andrew Brandt, a former player agent and vice president of the Green Bay Packers who is also full-time lecturer at the Wharton School of Business at the University of Pennsylvania. "Yet MLB has high local (television) for marquee teams like L.A. and MLB has no 'minimum' spending from a cap. In terms of legacy franchise having high premiums, yes, (that) bodes well for Cowboys."

So is the Cowboys' worth in the billions?

"Comparing NFL and MLB franchises is a little tricky because the leagues are organized differently from both revenue sharing and media rights perspectives," said David M. Carter, executive director of USC's Sports Business Institute. "While the Cowboys and the Dodgers both have incredible brand strength and loyal followings, the Dodgers sale consists of two important elements not readily available in Dallas, namely the ability to extract billions from a local cable television deal and the potential for sports-anchored real estate development in the parking lots at Dodger Stadium. These attributes drive the total value of the enterprise up."

Andrew Zimbalist, professor of economics at Smith College in Massachusetts, believes the Cowboys are worth more than the Dodgers but cautions that the local money the baseball team attracts is important in terms of sale price.

"The impact, I believe, is indirect and modest," he said. "There are special circumstances in Southern California now, largely connected to competition between Fox and Time Warner to control the (regional sports market) that do not affect the Cowboys.

"I'm not sure that it is safe to assume that, but I do think that the Cowboys would probably sell for above that. The market for sports franchises is thin, so what it sells for depends of various idiosyncratic factors."