Specter Vows to Lift NFL TV Exemption
By Ted Hearn -- Multichannel News, 12/7/2006 6:10:00 PM
Washington -- A law that allows the National Football League to sign lucrative television contracts on behalf of all 32 teams should be repealed, Sen. Arlen Specter (R-Pa.) said at a Senate hearing Thursday.
Specter said he would introduce a bill in the new Congress that would repeal the NFL’s antitrust exemption under the Sports Broadcasting Act of 1961.
He claimed that he wasn’t afraid to tackle the commercially and politically powerful NFL. “I think I’ll have a lot of company, and that is the football fans of America, who are being gouged,” he added after chairing a hearing on sports-programming issues.
NFL director of communications Brian McCarthy said the status quo was sufficient because the league’s “television practices have been recognized as consistent with the public interest” in that they provide “fans extraordinary amounts of programming” either free-of-charge or at little out-of-pocket expense.
“There is no basis now to repeal statutory provisions that have supported the development of these pro-consumer and pro-fan policies,” he added.
With Democrats taking control of the Senate in January, Specter will have to yield his committee chairmanship to Sen. Patrick Leahy (D-Vt.). Although Leahy has not taken a stand on the NFL issue, he helped to pass legislation that narrowed Major League Baseball’s antitrust exemption, Leahy spokesman David Carle said.
The Sherman Antitrust Act -- passed in 1890 and used as a trust-busting hammer by President Theodore Roosevelt in the early 1900s -- states that “every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”
Enforcement of the Sherman law against the NFL would probably mean that each team would have to cut its own deals, perhaps dealing a blow to the NFL’s vaunted spread-the-wealth ethos designed to promote competitive parity among its teams regardless of market size.
“I think they’d have to negotiate on an individual basis,” Specter said.
Testifying before Specter’s panel, Comcast executive vice president David Cohen -- whose company is in litigation with the NFL over carriage of NFL Network -- did not endorse repeal as advocated by Specter. Instead, Cohen said, the antitrust exemption should be conditioned.
Later to reporters, Cohen said that if a complete repeal caused each team to negotiate a separate TV deal, it could lead to problems arranging postseason coverage. “What do you do for the playoffs? Who has the Super Bowl rights?” Cohen explained.
A possible condition, he suggested, might involve banning the NFL from distributing programming on an exclusive basis, meaning that DirecTV would lose its exclusive rights to NFL Sunday Ticket, the out-of-market game package.
Lastly, Cohen said he wasn’t totally convinced that a federal court would necessarily find that the NFL’s policy on TV rights would violate the Sherman Act.
As a money machine, the NFL has few peers in the world of sports entertainment. The league has long-term deals with NBC, CBS and Fox worth nearly $12 billion, in addition to another $8.8 billion deal with cable sports network ESPN. Meanwhile, for the first time in league history, the NFL has begun to air games exclusively on NFL Network in every market except the home towns of the two teams on the field.
Comcast, Time Warner Cable and other cable operators want to carry NFL Network on sport tiers so that only sports fans shoulder the cost of the programming. The league, by contract, is seeking the widest possible distribution.
The NFL’s cable-carriage demands have upset Specter. "This is the NFL exerting its power … right down to the last nickel,” he said.
