Time for the NFL to say 'lights out' to the blackout rule
Commissioner Ajit Pai of the Federal Communications Commission, Ralph Wilson Stadium, the Sports Blackout Rule and your author each shares something in common: we are 40 years-old.
Like many mid-lifers, the four of us are ready for change. The Ralph recently enjoyed a $130 million face lift. This lawyer, your author, is blogging about legal issues. And FCC Commissioner Pai wants to end the federal government’s support of the outdated television blackout rules.
Fans of the Buffalo Bills are all too familiar with the NFL’s blackout policy. It seems like at least one game falls victim to the antiquated blackout policy every season. In fact, but for our sainted mother’s heroic purchase of Houston Oilers AFC Wildcard tickets from AM&A’s on January 3, 1993, my brother Bob and I would have missed the Greatest Comeback in NFL History.
The SBR, of course, impacts more than just Bills fans in Western New York. This rule allows the NFL to prevent home games from being televised locally if the game is not sold out 72 hours prior to the game’s start time. Although nationally-televised games in the National Hockey League, the National Basketball Association, and Major League Baseball are often blacked out in the local markets in which they are airing, these games can still be seen on their local regional sports network that normally has their local broadcasting rights.
Although the FCC is not authorized to review or approve contractual agreements between any of these professional sports leagues and their television programming partners, Commissioner Pai opined that “[t]here is no reason for the FCC to be in the sports blackout business” at all. “We should be on the side of sports fans instead.” For Mr. Pai, support of the SBR runs afoul of the FCC’s basic mission: “I don’t believe the government should intervene in the marketplace and help sports leagues enforce their blackout policies. Our job is to serve the public interest, not the private interests of team owners.”
The NFL does not agree. Its lawyers, lobbyists, and Commissioner Roger Goodell argue that the SBR actually helps consumers. In recent months the NFL has been dispatching emissaries to meet with the FCC. The NFL argues that the FCC must continue to support the SBR as “a key component of the commercial and regulatory system that has enabled the NFL to keep its games available on broadcast television.”
The suggestion, of course, is that without the blackout rule, the average consumer of broadcast television would be denied the opportunity to watch NFL games unless he or she shelled out the cash to attend in person. The implicit threat is that, absent the SBR, the NFL would enter into exclusive deals with cable and satellite providers and would turn its back on network broadcast television. Although Mr. Goodell acknowledges that the NFL is “99 percent sold out,” and a potential repeal of the FCC’s support of the SBR “has very little impact on [the NFL’s] business,” he nevertheless says a repeal of support from the FCC “could have an impact on the overall business model for free television,” adding that it would be “devastating to [NFL] consumers and consumers in general.”
Congress is skeptical of Goodell’s argument. In fact, Representative Brian Higgins (D-Buffalo), a long-time opponent of the SBR, recently invited FCC Commissioner Pai to join him for a power lunch of chicken wings and conversation at Buffalo’s iconic Anchor Bar. The Congressman joined Commissioner Pai in voicing his strong opposition to the SBR. “The 40-year-old sports blackout rule is unfair, antiquated and harmful to fans that have backed their hometown teams through their support and tax dollars,” Higgins said.
Congressman Higgins is not alone on Capitol Hill when it comes to opposing the SBR. Senators Richard Blumenthal (D-Conn) and John McCain (R-Arizona) have also reached out to the FCC.
“Now that the comment deadline has long passed, we urge the Commission to move forward expeditiously on eliminating the sports blackout rule,” Senators Blumenthal and McCain wrote. “We believe that the rule unfairly harms consumers by insulating the NFL from market realities and punishing fans in cities with large stadiums and declining populations. We applaud the FCC’s decision to propose elimination of this outdated rule that is no longer supported by facts or logic, and blocks fans from enjoying their favorite teams.”
The Senators added, “[w]e agree wholeheartedly with the Commission that, ‘the sports blackout rules have become obsolete,’ and we believe the record clearly supports the FCC’s tentative conclusions in favor of eliminating this unnecessary rule. In sum, the Commission has collected the facts and has a rich public record upon which to base a decision. Now it must act.”
And act the FCC should. Anyone who has seen the renovated Ralph knows that change is good. The Sports Blackout Rule is a pre-cable, pre-satellite relic that no longer serves a legitimate purpose. NFL revenues are at all-time high. Commissioner Goodell acknowledges that NFL games are 99% sold out. It’s time for the FCC to withdraw its support of sports owners in favor of serving the broader public interest.
Kevin Burke is a partner in the Civil Litigation and Labor and Employment Practice Groups at Lippes Mathias Wexler Friedman LLP in Buffalo. He can be reached at kburke@lippes.com