Tom and Mike have climbed to the top of the Hill of Nonsense and unleash another wave of insane wagering on the world.
24 Jan 2007
Guest column by Maury Brown
A week until the Colts and Bears square off and you're going through withdrawals. "Next year will be different," you say. "Next year I'm getting hooked up for as many out-of-market games as I can by getting Sunday Ticket." Ahh... football bliss, right? That depends.
There's a steady shift going on with how out-of-market games are being delivered to your home. It's the NFL now, but MLB, NASCAR, and possibly the NHL have come into play. What's the shift? DirecTV being the exclusive provider for such packages as Sunday Ticket, and -- as became public this week -- MLB Extra Innings. DirecTV is bidding $100 million over seven years to be the exclusive provider of the Extra Innings package, $30 million more than current provider InDemand. It will cut access to Extra Innings from roughly 75 million households to roughly 15 million households.
Many football fans have criticized the NFL for not making Sunday Ticket available anywhere but DirecTV. But there's a chance that an exclusive with MLB for Extra Innings might elevate the monopoly aspect of DirecTV to get members of Congress into the mix, more than they already have.
In an overall sports business sense, DirecTV looms large. It may be one thing to deal with the NFL and missing out on 16 out-of-market days to watch games. It's another when you add baseball into the mix and have fans missing as many as 150 games or more (those interested in the MLB aspect can read articles on Baseball Prospectus and The Biz of Baseball). The NFL went with DirecTV from the get go on Sunday Ticket, and therefore fans have never known anything different. But while MLB Extra Innings was initially only offered on DirecTV in 1996, the package has been available on cable since 2001, and on Dish Network since 2004.
In other words, there is a growing legion of fans that are none too pleased with this paradigm: one, and only one option for getting out-of-market games. Satellite is satellite, which means not all can make the technology fly at their domicile due to mundane forces of nature such as trees blocking the line of sight of the southern sky. Some may think that by being in apartment that your landlord won't go for the dish being mounted on your deck. Fear not, the FCC ruled that you have the right to have a dish on your deck -- what have you -- just as long as you adhere to any rules surrounding how it is mounted. Metal strapping? Check. Drilling into the apartment? Better check with the landlord.
All that minutia aside, there's a larger issue in play which has politicians jumping into the fray. In early December of last year, Sen. Arlen Specter (R-PA) said he would introduce legislation in the next session aimed at eliminating the NFL's freedom from antitrust laws over how NFL Sunday Ticket is only available via DirecTV. If you're scratching your head saying, "I thought only MLB had an antitrust exemption," you're not alone. Specter's bill would repeal the NFL's antitrust exemption under the Sports Broadcasting Act of 1961. Currently, the NFL negotiates the broadcast rights for all of its 32 teams. Specter's bill would repeal that ability and set up a scenario in which teams would negotiate television deals separately. If it were to become law, wave bye-bye to one of the strongest methods for creating parity in the NFL: centralized television revenues. There's a lot at stake here, as the Sports Business Journal reports that there are 2 million Sunday Ticket subscribers and DirecTV pays the NFL about $700 million for a seven-year package beginning in 2007.
As with nearly every instance where Congress gets into the mix, there are other political forces at play. As mentioned, Specter is from Pennsylvania. Where is Comcast headquartered? Philadelphia. Is it possible that Specter is trying to support a large and influential business constituency from his state? You can pretty much bet on it.
Here's something to consider within that political mix: Specter is out as the Chairman of the Senate Judiciary Committee, a very powerful force in Congress. This is due to the November elections, and now the Democrats control the committee. Sen. Patrick Leahy will take his place, but Specter still wields a considerable amount of power. Time will tell if he is simply trying to strong-arm the NFL into making the decision on their own to make Sunday Ticket available on cable.
Here's the thing... at least for one more game you don't have to think about such matters. Happily, Superbowl XLI is on CBS. No dish required.
Maury Brown covers the business of baseball for our partners at Baseball Prospectus and on his own site, The Biz of Baseball. This is a good time to remind everyone that Football Outsiders does publish guest columns, and the off-season is a great time to submit your idea.
142 comments, Last at 02 May 2007, 4:39pm by Travis