AT&T gets naming rights to Cowboys stadium

Posted Friday, Jul. 26, 2013  comments  Print Reprints
More information Top 5 naming-rights deals
Stadium City Team No. of years Value
Citi FieldQueens, N.Y.New York Mets20 years$400 million/$20 million per year
MetLife StadiumEast Rutherford, N.J.New York Giants, New York Jets25 years$425 million/$17 million per year
Levi’s StadiumSanta Clara, Calif.San Francisco 49ers11 years$220 million/$20 million a year
Reliant StadiumHoustonHouston Texans31 years$310 million/$10 million a year
Barclays CenterBrooklyn, N.Y.Brooklyn Nets20 years$200 million/$10 million a year
Top 5 NFL naming rights
Stadium City Team No. of years Value
MetLife StadiumEast Rutherford, N.J.New York Giants, New York Jets25 years$425 million/$17 million per year
Levi’s StadiumSanta Clara, Calif.San Francisco 49ers11 years$220 million/$20 million a year
Reliant StadiumHoustonHouston Texans31 years$310 million/$10 million a year
Gillette StadiumFoxboro, Mass.New England Patriots30 years$240 million/$8 million a year
FedEx FieldLandover, Md.Washington Redskins27 years$205 million/$7.5 million a year

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Cowboys Stadium will now be known as AT&T Stadium under a multimillion-dollar naming-rights deal between the iconic football team and the Dallas-based telecommunications giant.

Cowboys owner Jerry Jones declined to reveal the financial details, including how many years the contract covers. But one sports marketing expert estimated that the deal is worth up to $18 million a year.

“Welcome to AT&T Stadium, home of the Dallas Cowboys,” Jones said at a news conference to announce the deal Thursday at the $1.2 billion, 80,000-seat stadium in Arlington.

“This is not the most in dollars there has been for naming rights, but this is the best naming-rights relationship,” Jones said. “This was clearly the right company for us to move forward with. What greater icon in America than AT&T? You know, we’re pretty proud to be called ‘America’s Team.’ And so whose name would fit better [with the Cowboys] than AT&T?”

Since AT&T was already an anchor sponsor at the stadium and was probably paying the team $6 million to $12 million a year, the total naming-rights agreement could be worth $12 million to $18 million a year, said Kirk Wakefield, executive director of sports and entertainment marketing at Baylor’s Hankamer School of Business, who has worked with the company.

As part of the deal, AT&T has doubled its 4G LTE network capacity to benefit its customers inside the stadium, in the plazas and in the parking lots — and is working to nearly double the Wi-Fi capacity for all mobile technology users at the stadium, said Cathy Coughlin, AT&T’s senior executive vice president and global marketing officer.

AT&T is also enhancing the Cowboys’ mobile app with maps and wayfinding information to improve the fan experience on game days, she said.

“There is no grander stage than AT&T Stadium for us to showcase our technology and build on a best-in-class mobile interactive experience for our fans and for our customers,” Coughlin said.

Arlington, which owns the stadium, will receive up to $500,000 a year from the deal. Mayor Robert Cluck said that money will be used to pay down the city’s portion of the stadium debt more rapidly.

After the bonds are repaid, the city will use naming-rights revenue in any way it chooses. The money will come to Arlington as long as the Cowboys have a deal and a lease on the stadium.

Cluck said the city was not involved in negotiations between the Cowboys and AT&T but had negotiated with the team years earlier to receive a percentage of any naming-rights deal.

“We did it mutually,” Cluck said. “Our staff worked on it a lot. It’s a good deal for us. It’s just some more revenue that I say we can use to decrease that debt.”

Rumors of a naming-rights agreement with AT&T resurfaced this week, years after the two parties failed to close a deal in 2008 when the economy fell apart. Jones said he always intended to partner with the company, adding that he would write AT&T on drawings of the stadium when it was being designed.

“This is what we had in mind. It has been a fit and an idea to have AT&T Stadium since we broke ground,” Jones said.

Stadium debt

With the additional revenue, Arlington’s stadium debt could be paid off up to a year sooner, City Manager Trey Yelverton said. Because revenue is coming in faster than expected, officials have said that the debt should be paid off by 2024 or 2025 — at least 10 years early.

As part of its contract, Arlington gets 5 percent of the annual naming-rights payments, not to exceed $500,000 a year. A team representative told Yelverton that the city should expect to receive the maximum, meaning that the deal is worth at least $10 million a year.

In 2004, Arlington voters approved a 30-year, $325 million bond package to help build the stadium. Those bonds are being repaid with a half-cent sales tax, a 2 percent hotel occupancy tax and a 5 percent car rental tax.

The city has the ability to audit the deal if the team pays less than the $500,000 cap, Yelverton said. Under the contract with the team, the payment is not due until Dec. 31 each year.

As part of the deal, Legends Way, which runs east of the stadium, will be renamed after AT&T, Jones said.

Other naming-rights deals

AT&T moved its headquarters to Dallas in 2008 after its merger with SBC Communications. This week, it reported a $3.8 billion second-quarter profit, with revenue of $32.1 billion.

AT&T has naming-rights agreements with the San Francisco Giants (AT&T Park) and the San Antonio Spurs (AT&T Center) that it acquired with SBC. The company also has the Jones AT&T Stadium at Texas Tech University in Lubbock.

In 2008, the Star-Telegram reported that the Cowboys were in serious talks with AT&T to name the facility AT&T Field. But the deal was abandoned as the recession deepened. AT&T announced later that year that it was cutting 12,000 jobs.

While it would have been better to sign the deal before the stadium opened, the venue’s ability to attract different types of sporting events may have mitigated any possible lowering of the naming-rights value, said David Carter, executive director of the University of Southern California’s Sports Business Institute.

“The stadium is one of the most diverse and desirable in the country because of the number and style of events that it has,” Carter said, noting that it has hosted international soccer, concerts and college basketball.

“It’s a signature event if your team happens to be playing at that stadium.”

Wakefield, who conducted research for AT&T several years ago on the benefit of its naming-rights deals, said he found that passionate Spurs and Giants fans tended to spend more as AT&T customers.

“There is that effect that if you care about something and are passionate about a team, you tend to pay more attention and focus on things associated with your team,” Wakefield said.

Placing its name on the Cowboys’ stadium doesn’t necessarily improve AT&T’s national image, since the company is already a well-known brand, analysts said. The ability to market directly to Cowboys fans and try to win their business may be why AT&T signed the deal.

Getting used to a new name

Michael Leeds, an economics professor at Temple University’s Fox School of Business, said there is no net impact for companies that sign naming-rights deals, because ad campaigns can be just as effective. In some cases, fans have been hostile to name changes, such as when the Denver Broncos changed the name of Mile High Stadium to Invesco Field.

“I don’t think it will happen in Dallas because the stadium hasn’t been there as long,” Leeds said. “If it had been Texas Stadium, there may have been more hostile reactions to the name change.”

Jones said he’s not worried about people getting used to the name because AT&T is an iconic company with more than 100 years of history. He did joke that he wouldn’t mind if people stopped referring to the stadium as “Jerry’s World.”

“I have often said we wanted this building to be more familiar than the White House,” Jones said.

The stadium hosts about 30 major events annually, not including Cowboys football games. Major sporting events scheduled in coming months include the 2014 AT&T Cotton Bowl Classic, the 2014 and 2015 Cowboys Classic Kick-Off games, the 2014 NCAA Men’s Final Four and the first-ever College Football Playoff National Championship Game in 2015.

Staff writer Jimmy Burch contributed to this report.

Susan Schrock, 817-390-7639 Twitter: @susanschrock

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