April 23, 2024

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As broadcast patterns shift, potential antitrust liability looms in the NFL

As broadcast patterns shift, potential antitrust liability looms in the NFL

For the most part, the NFL sails across clear, open waters. But there is an iceberg out there, whether the university is worried about it or not.

The shift from traditional over-the-air television to broadcast could eventually land the league in an antitrust mess, for one very important reason. The antitrust exemption from the Sports Broadcasting Act of 1961 does not, if not likely, apply to NFL games sold through web-based services.

This is a fairly recent item From the Journal of Corporation Law at the University of Iowa on legal challenges looming in the league, if/when (when) the bulk of streaming money comes from the likes of Amazon, YouTube, and other tech companies that don’t make games freely available on channels outside of the markets they play in which teams participate.

In short, a strong case can be made that the antitrust exception does not apply to streaming based on subscriptions, not ads. No matter how the issue is resolved in court, the NFL becomes vulnerable to the argument that this new era of non-television eliminates the ability to legally sell all games in one block.

Of course, there can be no legal entanglement without someone actively trying to change the status quo. To get things started, a plaintiff is needed. An entity that claims that antitrust laws apply in the world of broadcasting, and that a streaming service should be allowed to strike a deal with (for example) the Dallas Cowboys to make its games available to all customers—without having to buy the wider, league-wide package that would become, at least Annual basis, a box of Forrest Gump-ian chocolates.

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It is not necessarily a one-way street. The prospect of an antitrust battle becomes even more compelling if/when a team like (say) the Dallas Cowboys wants to break ranks from the model that has existed for decades.

Really, what’s to stop Jerry Jones from standing up during the Annual Meetings in Arizona and going on (etc.) about how this new world of broadcasting is changing everything? Would he like to be able to sell the rights to live-stream his team’s home games to Amazon or someone else, and keep all the money?

At its core, a sports league considered by many to be a shining example of the exceptionalism of American capitalism shows powerful elements of socialism, with 32 companies working together to ensure that the rising tide lifts all boats equally.

What if Jones or one of the other owners of what would be one of the most sought after teams decided it no longer made sense to do without helping others get more?

This is not an expectation that this will happen. It is an acknowledgment that this is possible.

The fact that the owners will vote to adopt the view Thursday night in order to bolster Jeff Bezos’ billion-dollar-a-year investment underscores the league’s discretion and awareness of where the world is headed. It’s only a matter of time before he takes over broadcasting. When that happens, the NFL may be dealing with a can of worms that has been kept closed since the early 1960s.

Whatever the league’s plan for dealing with this fundamental change in its potential portfolio of responsibility, it needs one. It might only be a matter of time before someone convincingly argues that while the league has an antitrust exemption that allows for all-or-nothing rights deals with the likes of CBS, NBC, Fox and ABC, the league can’t control the world. Broadcast rights – and each team should be able to strike their own deal for their own home games.

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And yes, when that happens, the league will fight back. You will resist. He will try to find a way to force the whole thing on arbitration to be decided by the commissioner.

Still, the iceberg is there. And the NFL is getting closer and closer to it.