Supposing there wasn't just a VFL takeover like in reality, the only fair way to assign teams is by population. The 1987 populations of heartland AFL cities were:
Melbourne - 3 million
Perth - 1.1 million
Adelaide - 1 million
If we go roughly by a team per 500 000 people, this would leave 6 clubs in Melbourne, 2 clubs in Perth and 2 in Adelaide, and let's say 4 other clubs from the rest of the country. After assigning a number of clubs per city/region, I would have had a bidding process for the licences, and encouraged existing clubs to band together to bid for licences, unless they thought they were big and powerful enough to go it alone. And gently advised clubs if their bid wasn't strong enough, to get as many clubs as possible to have a stake in the new competition.
Probably would have ended with:
Perth City (Perth, East Perth, West Perth, Swan and Subiaco)
Fremantle (the two Fremantles plus Claremont)
Adelaide (some combo of SANFL clubs)
Port Adelaide (maybe a joint bid with WT and/or Wests)
Carlton
Collingwood
Essendon
Richmond
Melbourne (joint bid of Melbourne, Footscray, North and Fitzroy)
East Melbourne (joint bid of Hawthorn and St Kilda)
Geelong
Sydney
Brisbane
Canberra or Tasmania
Really not all that different to what it ended up being. There's a reason the AFL has gone from strength to strength in a financial and media attention sense, the clubs have largely been placed in the right areas. The only real inefficiency has been too many small Melbourne clubs, but revenue sharing has allowed them to survive in the modern day, and we're better off for it, Fitzroy aside.
Melbourne - 3 million
Perth - 1.1 million
Adelaide - 1 million
If we go roughly by a team per 500 000 people, this would leave 6 clubs in Melbourne, 2 clubs in Perth and 2 in Adelaide, and let's say 4 other clubs from the rest of the country. After assigning a number of clubs per city/region, I would have had a bidding process for the licences, and encouraged existing clubs to band together to bid for licences, unless they thought they were big and powerful enough to go it alone. And gently advised clubs if their bid wasn't strong enough, to get as many clubs as possible to have a stake in the new competition.
Probably would have ended with:
Perth City (Perth, East Perth, West Perth, Swan and Subiaco)
Fremantle (the two Fremantles plus Claremont)
Adelaide (some combo of SANFL clubs)
Port Adelaide (maybe a joint bid with WT and/or Wests)
Carlton
Collingwood
Essendon
Richmond
Melbourne (joint bid of Melbourne, Footscray, North and Fitzroy)
East Melbourne (joint bid of Hawthorn and St Kilda)
Geelong
Sydney
Brisbane
Canberra or Tasmania
Really not all that different to what it ended up being. There's a reason the AFL has gone from strength to strength in a financial and media attention sense, the clubs have largely been placed in the right areas. The only real inefficiency has been too many small Melbourne clubs, but revenue sharing has allowed them to survive in the modern day, and we're better off for it, Fitzroy aside.