Twice in the past two years (August 2021 and this week), former ESPN president John Skipper suggested that the Super Bowl eventually will become a pay-per-view event. Twice in response, we pointed out on Twitter that this potential shift comes with one major risk.
If/when the NFL ever removes the Super Bowl from free, over-the-air TV, Congress may immediately strip the NFL of its critically important broadcast antitrust exemption.
Here’s how it works. The NFL, as underscored by the American Needle decision from the Supreme Court in 2010, consists of 32 distinct businesses. The league cannot engage in collective business practices and strategies, such as fixing prices or setting non-player compensation.
The NFL enjoys two important antitrust exemptions. First, the federal labor laws allow these 32 businesses to use one set of employment rules for players because it operates as what’s known as a “multi-employer bargaining unit.” Second, a specific act of Congress from the early 1960s created an exemption for the NFL from the prohibition on selling broadcast rights to its games as a group.
Without the broadcast antitrust exemption, the league couldn’t say to the networks, “You buy a package of our games and we decide which games you get.” Instead, the networks would do business directly with the teams, like NBC does with Notre Dame.
There would be a Cowboys package and, at the other end of the spectrum, a package for the least interesting team. It would potentially result in fewer total dollars, and it would test the limits of the willingness of the owners to continue to share revenues.
If/when the NFL were to decide to take the Super Bowl away from the people, why wouldn’t Congress react by stripping the NFL of its broadcast antitrust exemption?
There’s another reason for the NFL to shy away from chasing PPV dollars. If the league charges $100 or whatever to watch the Super Bowl, there’s no way 100 million people will tune in. And that’s huge for the NFL. It justifies a large chunk of the billions the networks pay.
That said, the NFL for the first time has sent a major prime-time package to, essentially, a PPV platform, with Thursday Night Football on Amazon Prime. And if only 25 million people pay $100 each for the Super Bowl, that’s $2.5 billion in revenue. From one game.
At a certain point, the revenue outweighs the consequences. At a certain point, a league obsessed with making as much money as possible will have to at least consider the pros and cons of making the ultimate direct-to-consumer cash grab.
Maybe if they did, the playing surface for the Super Bowl wouldn’t be as shitty as it was five days ago.
