CLEVELAND: Cleveland Browns Stadium is being renamed FirstEnergy Stadium: Home of the Cleveland Browns, the team and FirstEnergy announced Tuesday.
Akron-based FirstEnergy Corp. bought the naming rights for the stadium. Officials for both organizations said they agreed not to disclose the financial terms nor the length of the deal at the request of FirstEnergy.
In an interview after the news conference, FirstEnergy President and Chief Executive Officer Tony Alexander said it was a multiyear deal and would be paid in installments.
The Cleveland City Council must approve the name change. Browns CEO Joe Banner said the city of Cleveland would not receive any money from the deal. The NFL also does not need to approve the deal or the name, he said.
The deal includes an illuminated FirstEnergy Stadium sign on the exterior that will be complete by April, as well as interior signage and logos on game tickets and promotional and advertising materials.
It will mark the first time since the stadium opened in 1999 that it has been named by a sponsor.
At a news conference, team officials first showed a video montage of Cleveland’s sports history, followed by short statements by Browns owner Jimmy Haslam, Alexander and Banner.
While dramatic music played in the background, a large white cloth dropped down on the stage behind Haslam and Alexander and, when lifted, unveiled the new blue-and-gray logo of FirstEnergy Stadium.
When the idea of putting the stadium’s name up for sponsorship was conceived, “it was our sincere hope and desire that it would be a Cleveland or Northeast Ohio-based company for obvious reasons,” Haslam said.
Negotiations started late in the summer and were wrapped up by the end of the year, he said.
‘Good business sense’
Alexander said having the electric utility’s name on the stadium “makes good business sense to better align our brands in ways that not only can help FirstEnergy grow its customer base, but also helps us highlight in the national media one of the region’s leading companies, FirstEnergy,” Alexander said. “This partnership is good for Cleveland, FirstEnergy and good for the Cleveland Browns.”
City Council President Martin J. Sweeney said FirstEnergy was appropriate, because Haslam has brought energy to the football organization since taking over officially in October.
“This naming question has been around since 1999 [when the expansion team returned to Cleveland],” Sweeney said. “In four months, the question has been answered. Four months. Decisive decisions are going to be good for the city of Cleveland.
“One last word. First ... when I think first, the first Super Bowl in the FirstEnergy Stadium, home of the Cleveland Browns,” he said.
The move helps the image of FirstEnergy, University of Akron Marketing Department Chair William Baker said.
“What they’re trying to do from a consumer behavior perspective is link themselves to the Browns. When they do that, there are some associations and imagery associated with the Browns that can transfer to FirstEnergy.
“People identify with the Browns. They might be frustrated or annoyed, but they’re still going to identify with the team ... If FirstEnergy is well associated with the Browns, some of that identification ... and good feelings can leak over into the FirstEnergy image,” he said.
FirstEnergy is the corporate parent and holding company for regulated utilities Ohio Edison of Akron, Cleveland Electric Illuminating Co. and Toledo Edison. FirstEnergy also is parent to FirstEnergy Solutions, a competitive supplier of electricity.
Company officials said electric rates would not go up to pay for the sponsorship since those costs and other promotional costs are paid by FirstEnergy shareholders, not rate payers.
Question about layoffs
Responding after the news conference to a question about the sponsorship decision in light of recent company layoffs, Alexander said each day the company makes decisions that have an effect in different ways.
“Whether it’s a decision to expand our marketing and expand our national presence and regional presence through this signage, or whether it’s deciding if we need a new substation or transmission building in Akron, those decisions have to be made in the context of everything that we are doing.
“So, yes, there are times ... you may be cutting costs in one place and expanding in another part of the business. That’s just natural,” Alexander said.
The company just approved a capital budget that’s well more than $2 billion, he said.
“Yes, I’m still spending. We’re still growing a business. We still have obligations and expenditures on various aspects, but yet we still have to manage our costs in other parts of the business appropriately,” he said.
In November, the company laid off 142 employees, including 56 in the Akron area, saying it was realigning its work force to “best meet the challenges of the continued weak economy.” Workers were in a variety of corporate support departments and FirstEnergy Solutions. The company said further reductions were expected this year, but would occur through attrition instead of layoffs.
FirstEnergy has a sports sponsorship presence in other areas of Northeast Ohio, including naming rights to the University of Akron’s soccer stadium for $500,000. FirstEnergy’s name is also on a minor-league baseball facility in Reading, Pa., where the Reading Fightin Phils play.
Last year, FirstEnergy agreed to be the title sponsor of the financially struggling All-American Soap Box Derby in Akron for three years. Financial terms were not disclosed.
The company also has had signage at the Cleveland Indians’ Progressive Field and in Akron at Canal Park, where the Class AA minor-league baseball Aeros play.
FirstEnergy is one of the nation’s largest investor-owned electric systems. It serves more than 6 million customers through its operating companies in a five-state footprint: Ohio, Pennsylvania, and parts of New Jersey, West Virginia and western Maryland.
The Browns become the 23rd NFL stadium with a named sponsor among 31 facilities (the New York Jets and Giants play in the same New Jersey park, MetLife Stadium).
The Browns’ stadium situation could be compared with rival teams in Pittsburgh and Baltimore. The Steelers are in the midst of a 20-year deal with the Pittsburgh-based Heinz food company, and receive $2.85 million per season. The Ravens have a 15-year deal with M&T Bank at $5 million per season. The Bengals are one of eight NFL franchises that play in a stadium without corporate naming rights. Cincinnati’s park is called Paul Brown Stadium, named for the franchise founder and former Massillon and Ohio State coach who led the Browns from 1946 until he was fired in 1963.
FirstEnergy stock closed up 38 cents to $39.87 on Tuesday.
Sports writer Nate Ulrich contributed to this report. Betty Lin-Fisher can be reached at 330-996-3724 or firstname.lastname@example.org. Follow her on Twitter at www.twitter.com/blinfisher and see all her stories at www.ohio.com/betty .