The AAF’s dramatic collapse, explained – SB Nation

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The AAF arrived with excitement, fanfare, and hope. Less than two months later, operations were suspended and a shutdown of the entire league is imminent. The drama played out with anger, backbiting, and pointed fingers. Was the league poised to break out before having its knees cut out from under it, or was the league swallowed up in a billionaire’s scheme to get his hands on some gambling technology?

Many questions are left unanswered in the wake of the AAF’s rapid collapse, but it’s unquestionable that the move caused a lot of pain for a great many people. Players, coaches, officials, and league employees uprooted their lives with the promise of an ideal of an alternate football league, only to have those hopes dashed 60 days later. Now we’ll do our best to make sense of how things went so badly, and why the league is dead.

How it all began.

Influential TV producer Charlie Ebersol (son of former NBC Sports head Dick Ebersol) formed the idea for the AAF in 2016 after working on ESPN’s 30-for-30 documentary on the collapse of the XFL. In researching and producing the documentary, Ebersol came to the conclusion that the concept for a secondary football league was viable in the US, but the XFL’s on-field product and presentation was its downfall. Feeling he could correct the XFL’s errors, Ebersol planned out how the AAF would operate for a launch in 2019.

During those early planning stages Vince McMahon, chairman and CEO of WWE, announced he would be re-launching the XFL, starting in 2020. Initially Ebersol approached McMahon in the hopes of parlaying his idea for the AAF with McMahon’s vision, but ultimately the sides didn’t reach an agreement — which included Ebersol wanting ownership of the XFL brand.

Ebersol continued work on his concept for a football league, and it wasn’t until 2018 that the public heard more information about the AAF. Ebersol secured the services of renowned household names and football minds, including Bill Polian, Troy Polamalu, Hines Ward, J.K. McKay, and Justin Tuck. He followed this up by announcing Steve Spurrier would be the league’s first head coach, lending more credence to the idea that the AAF was a league in its own right, not the machination of a TV producer.

Ebersol explained how he saw the AAF fitting in when he spoke to SB Nation.com in February:

“If you’re a player who wants to play in the NFL, another league comes along, you look at that league as an opportunity to show your skills off and get back in the big show. The problem is, if they screw with the game, which all these people have done, you can’t get back in the NFL because if you’re playing in the CFL or another league like that, and NFL’s looking at that the game, it’s so wildly different.”

On Feb. 9, 2019 the league launched and things were wonderful … for a week.

The AAF gets bailed out.

Signs of trouble emerged in the AAF’s second week with reports that the league was in severe financial trouble. ESPN’s Darren Rovell reported the league missed payroll in its inaugural week, which was initially claimed to be a “glitch” by AAF officials, before news dropped that the league was on the verge of collapse unless an investor stepped in and propped up the organization.

One major issue was that Reggie Fowler, slated to be a $170 million investor in the AAF pulled back, committing only $28 million to the league and leaving the AAF in a lurch.

How was a league in this much trouble, this quickly, considering its early ratings were promising and people were excited? NFL insider Benjamin Allbright said on the radio show Pushing The Odds that the AAF wasn’t making any money off its broadcasts, no matter how many people were tuning in. Part of its partnership with CBS called for the AAF to provide CBS with programming, free of charge, for the first year. This was designed to be a proof of concept, engendering goodwill with broadcasters in the hopes of cashing in for the second season. This ensured the AAF would get plenty of exposure, but did nothing to actually keep the league afloat.

It’s here where billionaire Tom Dundon enters the picture. Dundon, owner of the Carolina Hurricanes, made his fortune off subprime car loans, before parlaying that into a 55 percent purchase of “TopGolf,” which marries sport and technology. Dundon came through as the AAF’s bailout, committing a reported $250 million to ensure operations could continue, but in reality only gave $70 million to the AAF and was operating on a weekly basis. The result of this investment was that Dundon became chairman of the board — and had full control of its future.

Initially, it seemed like the league would survive as a result of the investment, but it wasn’t long before things went bad again.

A plea to the NFLPA.

It’s here where things get muddy. It appears that Polian and Dundon had differing views about how the league should position itself moving forward. Polian saw the AAF as a potential feeder league for the NFL — giving undrafted and cut players an opportunity to showcase their talents in the hopes of returning to the NFL.

Rovell explained the differing opinion:

“Ebersol and Polian’s plan was to develop the league for three years on its own before becoming a feeder system to the NFL. Dundon, however, wanted to create that minor league relationship immediately and sought to use the leverage of folding the AAF to get a deal with the NFL Players Association to better insure a flow between leagues.”

USA Today reported that Ebersol and Polian’s plan had reached a point where they were having informal discussions with the NFL, but nothing had been cemented. Executives believed it would always be a 2-3 year plan to become a minor league for the NFL.

Dundon, on the other hand, wanted to secure a talent-sharing agreement with the NFL immediately. This would allow signed NFL players to compete in the AAF during their offseason. Reports indicate Dundon was so adamant about the NFL supplying the AAF with players that he indicated he could fold the league without an agreement, but the problem was that any kind of deal like Dundon proposed went against the collective bargaining agreement signed by the NFL and NFLPA in 2011.

Players can’t simply be asked to play in another league, and that’s before talking about injury risks. Essentially Dundon wanted NFL players to play in his league, away from their teams, doctors, strength and conditioning staff — allegedly delivering a quick-turnaround ultimatum on an issue that would take months for the NFL and NFLPA to agree upon, assuming they saw value in working with the AAF in the first place. Especially considering they had a CBA negotiation looming.

The end of the AAF.

Reports emerged less than a week after Dundon floated the idea of dissolving the league that the AAF would cease operations at 5 p.m. on April 2. Players and coaches learned of the decision mid-practice, weeks removed from the playoffs and a championship game slated for a primetime slot on CBS, which would have turned more eyes to the league than ever before.

Polian issued a statement prior to Dundon’s announcement blaming the chairman for dissolving the league.

“I am extremely disappointed to learn Tom Dundon has decided to suspend all football operations of the Alliance of American Football,” Polian said. “When Mr. Dundon took over, it was the belief of my co-founder, Charlie Ebersol, and myself that we would finish the season, pay our creditors, and make the necessary adjustments to move forward in a manner that made economic sense for all.”

Then, at 5 p.m. Dundon made a statement to AAF players announcing the league would cease operations. No press release was made public, and the AAF’s own website makes no mention of the league dissolving.

Why did this need to happen?

Currently there’s no good answer. It’s unclear why Dundon felt the issue needed to be forced with the NFL just a year out from the league needing to negotiate a new CBA with the NFLPA. Trying to play hardball with the NFL at a time its hands were tied seemed misguided, at best.

The league now needs an estimated $20M. That would keep the AAF operational for the remainder of the season and through the playoffs, but that seems unlikely unless a Hail Mary investor emerges immediately.

There’s an alternate timeline here where the AAF could have continued its operations until the NFL/NFLPA negotiations and attempted to be added to the CBA as a viable play alternative to young players, securing Dundon’s longterm goal, instead of pushing for it early.

However, there’s speculation that none of this was really about football. One of the AAF’s most valuable assets was proprietary gambling software the league had built into its app. This combination of real-time fantasy football paired with sports gambling had attractive potential, especially at a time where more states are legalizing sports gambling. Some believe that Dundon’s interest in the AAF was only to secure the technology behind the gambling app.

Perception inside the AAF is that Hurricanes owner Tom Dundon bought a majority stake in the league simply for the gambling app being developed.

Source: “Dundon got the technology he wanted and he’s now minus one rather large headache.”

— Albert Breer (@AlbertBreer) April 2, 2019

It’s unclear if Dundon has the right to claim ownership to the technology, should that be his play. Everything hinges on whether his investment agreement with the AAF included AAF technologies, or just the league itself — in addition it’s murky whether the AAF owned the intellectual property of the app in the first place, or whether MGM Casinos owned the app and licensed it to the AAF. Reports indicate that Dundon does not own the technology, regardless of what happens.

If this speculation is true, it could be a long time before we see how it plays out, with the court system getting involved.

It’s important not to forget the human toll of this situation.

It’s easy to look at the AAF as a curiosity, or laugh at its failure — but the reality is that dozens of athletes, coaches, and employees relied on the AAF for their livelihood. Even if the league was mismanaged the people associated with the league didn’t deserve to have the rug pulled out from under them like this.

Players went from preparing for a game one day, to being kicked out of their hotel rooms and stranded.

Source says AAF teams making players pay for their own flights home. What a clown show this was.

— Robert Klemko (@RobertKlemko) April 2, 2019

Things reached a point where players weren’t even fed before games. It was on them to find their own food, using a per diem to cover their costs.

Couple other cost-cutting AAF details I unearthed/found interesting …

• Only coaches/players were allowed eat on the team plane. Docs, trainers, equipment guys weren’t fed.

• Night-before-game team dinners were eliminated. Players got a $30 per diem instead.

— Albert Breer (@AlbertBreer) April 2, 2019

Employees were sent a cold email notifying them that their employment had been terminated.

The email #AAF employees were sent minutes ago, announcing the almost assured end of their inaugural season and the immediate suspension of their league’s operations. (Via an AAF source.) pic.twitter.com/iS2rPzXy4d

— Aditi Kinkhabwala (@AKinkhabwala) April 2, 2019

While others just wanted to know about their healthcare and paychecks.

“Questions immediately shifted to how long their health insurance would last, and whether they’d just received a final paycheck. Some coaches simply sent their teams home.”

There were laudable things the AAF attempted to do that would have changed football for the better. It tried to provide opportunities to overlooked players. It gave them healthcare. The league brought innovation and integrated fans into the experience in a way the NFL has never done. The early returns showed that these were influential enough to have the NFL considering some innovations, with variations appearing at the NFL owner’s meeting in March.

In the end, the story of the AAF might not be one of a league full of promise that flew too close to the sun, and instead the tale of a billionaire destroying a league to get some software. Nobody is better off for the AAF dying, and it’s all a shame.

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