The trial has begun. The final bill could be so large that the NFL will have to work very hard to pay it.
Via the Associated Press, Opening statements took place on Thursday In the massive antitrust class action against the NFL over the Sunday Ticket package.
The plaintiffs argue that the NFL, DirecTV, CBS and Fox have colluded to make Sunday Ticket more expensive than it needs to be. The NFL, represented by Beth Wilkinson (whose investigation of the commanders paved the way for Dan Snyder’s exit), claims that this is all about giving consumers full access to content.
“This case is about choices,” Wilkinson told the jury. “This is a valuable, premium product. Think about all the options available to fans. We want as many people as possible to watch the free broadcast.”
That, in a nutshell, is the issue. The NFL wants Sunday Ticket to be priced in a way that strikes a balance between generating significant revenue for its “premium product” while also not driving away viewers who would otherwise watch Sunday afternoon games on their local network affiliates.
During opening statements, attorney Amanda Bonn showed jurors Fox’s 2020 term sheet, in which the company asked the NFL to ensure that the price of Sunday Ticket would be more than $293.96 (the Sunday Ticket fee in 2020) during an 11-year period beginning in 2023.
Former NFL Network chief Steve Bornstein testified Thursday that Sunday Ticket was always intended to have no impact on ratings for the networks that paid big bucks for over-the-air broadcast rights in various markets.
The Wall Street Journal Recently, Polygon took a closer look at what the case means. With damages of up to $7 billion, and considering that antitrust law requires that damages be tripled, the league could face a judgment of up to $21 billion, or $656.25 million per team.
The case began in 2015, when a San Francisco pub known as the Mucky Duck launched a legal challenge to the league’s out-of-market broadcast arrangements. It has turned into an ambitious assault on the way business is done, with millions of fans in the square and the NFL forced to defend its practice of keeping Sunday Ticket prices at a fixed level.
This case tests the limits of the NFL’s anti-broadcast rights waiver. Ultimately, out-of-market rights could be sold on a team-by-team basis. This could potentially create huge revenue disparities, unless teams agree to share that money.
Evidence in the ongoing lawsuit includes documents showing the NFL rejected bids that would have offered Sunday Ticket at a lower rate, and that the league chose a company that agreed to restrictions that would have boosted CBS and Fox’s ratings.
As expected, the NFL says it did nothing wrong.
But something has always felt wrong about Sunday Ticket. They sell it as a way for fans to watch their favorite teams’ games if their favorite teams aren’t playing in the local market. Yet the NFL demands fans buy the entire package, forcing them to purchase the ability to watch games they don’t want to watch, including weeks when their favorite team has a prime-time game.
Why? Because if it were cheaper for Vikings fans in the Pittsburgh market to watch a Vikings game at, say, 1:00 pm ET and not watch a Steelers game on the local CBS or Fox affiliate, more people would buy that package – and fewer people would watch a Steelers game on CBS or Fox.
The NFL loves to point out that it makes all local sports available on free TV. Which is fine. The question is whether the “alternative” that Wilkinson mentioned is available at a reasonable price, or whether it is artificially inflated to force Vikings fans in Pittsburgh to watch Steelers games.
Fans, clearly, should be on #TeamMuckyDuck. If the NFL loses, Sunday Ticket will get cheaper. And you’ll be able to buy it for one team, and possibly one week or one game at a time.
If the NFL is truly committed to choice, this is what the NFL needs. Give all fans the ability to watch the games they want — and only the games they want — without artificially inflating the price to ensure that CBS and Fox get an adequate return on their investment, since fans who can’t watch the game they want to see will be forced to watch the game that’s served to them by their local CBS or Fox affiliates.
The bottom line? The NFL will only change its ways if the litigation dramatically affects its outcome. A $21 billion judgment would be more than enough to do so.
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