The good side is that there’s… tradition, for lack of a better word. Your rivals are always going to be your rivals, they’re not going to drop out of the league after a bad year.

The bad side is it encourages tanking. You have owners spend just enough on the roster to keep people coming to the games, and sell it as ‘ we’re retooling for the future ‘

One big pro is that the team gets a somewhat guaranteed revenue. In the American sports, a bad team may still be quite profitable. In European soccer, if the team is bad and gets relegated, they stand to lose millions of dollars.

Franchise model has more stability, for owners and fans.

The drawback, depending on your point of view, is that it's locked down. No one can force their way into American football, without permission.

In European football, you or I could conceivably start a team tomorrow, and we could hypothetically be in the premier league in a few years.

The downside, major cities could be without a competitive team, the team you've always rooted for could fall apart.

Franchises can be anticompetitive, which is why they do things like drafts and salary caps to help maintain equilibrium since there are no external forces to balance it.

European model is based on sport and is open to teams to go as far as they want/deserve up or down the leagues. That’s the fundamentals of sport, the way it should be. US franchises can get up and move away to another city or state.

Americans have tied extremely successful business models (sport teams) to their Education system resulting in billions of dollars in funding for the schools. In Canada, we do not have this.

But most American sports also come with good aspects like salary caps. An owner worth 20 billion won’t have a significant advantage over a team with an owner worth 3 billion. This system rewards good management and talent development since all teams are competing with similar financial limitations.

In European soccer the rich teams stay at the top because they can continually offer the largest contracts to the best players. If small clubs want to win and consistently compete at the top level, they can only hope to be bought by a rich sugar daddy. The pure capitalism of European soccer also kills competition. The financial gap between the top and bottom of the table is too massive to be fair by any stretch

Cons are that there is no incentive for some team owners to field competitive teams, especially when so much revenue is tied to league revenues or long term broadcast rights.

Pro is that the American sports with giant stadiums, conferences and division alignments and such would all make a relegation system hard to implement logistically.

Say the NFL were to relegate the Texans and Bears at the end of the season, there is no second tier to send them to / from which to promote new teams into NFL. Even in sports with minor leagues, those teams are owned by major league teams to develop talent.

For example, the way the NFL's broadcast contracts are structured, the owners could play all of their games in empty stadia, and they would STILL turn a profit.