One of three resolutions likely awaits the NFL Sunday Ticket lawsuit.
The boring optiona legal victory for the NFL. Last week, a jury ruled that the league acted as an illegal monopoly by pooling individual teams out-of-market media rights and as a result, fans (as well as bars) faced limited access at higher prices.
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But as soon as July 31, the presiding judge, Philip Gutierrez, could vacate that verdict or modify the decision to allow the league to continue business as usual. If the NFL comes up short before Gutierrez, the league can and will appeal and ask for a stay, which if granted would mean potential payments and changes would be tabled as the case moves up the legal ladder, possibly landing in front of the Supreme Court.
The hard-to-imagine scenariocongressional intervention. The NFLs TV strategy has long brought legal scrutiny. After the NFLs first attempt to sign a league-level deal with CBS was blocked by a judge on anti-competitive grounds, then-commissioner Pete Rozelle secured Congress support in the form of the 1961 Sports Broadcasting Act (SBA). The law allowed the NFL and other pro leagues to sell their entire TV rights as a package provided the broadcasts were over-the-air (rather than via yet-to-be-invented satellite subscriptions or paid cable).
Jurors seemed to dismiss the NFLs defense via the SBA this time around. The SBA only relates to over-the-air broadcasts on channels like CBS and FOX, not distribution via satellite (DirecTV) or the internet (YouTube), though league representatives argued that Sunday Ticket stemmed from those traditional deals in critical ways.
In theory, legislators could update the SBA to include those modern methods. But I dont foresee current commissioner Roger Goodell betting on bipartisan agreement in todays D.C. if theres another option (despite his family history). Not to mention that leagues existing antitrust exemption status has already come under Senate questioning.
Barring those results, the third possibility is more interesting.
If the NFL is forced to change how it distributes games not televised on local TV and cable, it might have the option of following the NBA and MLB practices of making an out-of-market service available through multiple providers (such as Amazon Prime Video, YouTube, league-owned apps, etc.). NBA League Pass and MLB.TV are also offered at lower rates than Sunday Ticket, with single-team and single-month options available as well. Notably, NFL action is cheaper internationally through its Game Pass product, too.
However, other sports deals are reportedly structured around the leagues receiving a share of subscriber revenue, rather than an upfront fee. YouTube is estimated to pay the NFL $2 billion annually for the exclusive Sunday Ticket rights.
Sunday Ticket remains relatively inaccessible stateside, the plaintiffs argued, because the NFL restricts market access to increase the money it receives for the games CBS and Fox are able to broadcast (roughly $4.3 billion annually between the two). Those networks and the league, meanwhile, have said that local exclusivity is what allows them to invest so much into the award-winning coverage, which make up a bulk of the most watched TV programs each year, and to keep the games on freely available stations.
It remains to be seen just how much of an impact a cheaper Sunday Ticket product would have on local ratings (recognizing that those new Sunday Ticket viewers would still be watching CBS and Fox productions, just not the ones served to them over traditional TV, but would likely be less valuable to local advertising buyers).
In a potential worst-case scenario for CBS and Foxs NFL dominance, the ongoing legal dispute could theoretically end with a reversion to the status quo of the 1950s, when individual teams handled their own TV negotiations.
In that world, we could see non-nationally televised Cowboys gamesyes, there are still a few of thoseavailable via Max, for instance, or Steelers games streaming on Netflix. In baseball, weve already seen Amazon invest in a Yankees-only package, though for now that is limited to the teams regional TV territory.
The entire concept of differentiating viewing access based on a fans physical location was already outdated before this case came to the fore. So-called geoblocking strategies are a vestige of pre-digital times. Now regional sports networks face extinction as leagues consider all-in streaming products, such as Apples MLS Season Pass, that dont divide nearby viewers from those farther afield. However, at least one expert has gestured towards the legal risks those packages could face based on the outcome of the NFL lawsuit. Surely some coordination between franchises is necessary to put on and televise a sporting event; the question is how much would be unreasonable.
Assuming YouTube doesnt lose access to the games it currently airs, giving up exclusive privileges might not be so bad for the streaming behemoth in a new world order. The service could be freed up to offer cheaper and more flexible packages to fans as a result, while competing with other platforms based on customer experience.
Thats a battle YouTube regularly wins. The app controls about 10% of TV time according to Nielsen, more than every distributor besides Disney, to say nothing of its mobile supremacy. Its now regularly referred to as a viewership giant and even possibly the most powerful media platform in the history of humanity.
If that sounds familiar, then know that, yes, YouTube has also faced calls for an antitrust probe of its own.
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