Broadcast Rights

The NFL is not surprised the Justice Department is opening a probe into its broadcast negotiating practices that, when including streaming services, could be in violation of its antitrust exemption under the Sports Broadcasting Act.That's one reason sources familiar with the NFL's position on the matter say the league, which is expected to cooperate with the DOJ investigation, will have at least a two-pronged approach to keeping and perhaps even solidifying its exemption.Some background: The NFL faces a probe that will, in part, try to determine if the league is pricing out fans from watching their games by moving some of the product to pay streaming services such as Amazon Prime, Netflix and YouTube, which would violate conditions of the antitrust exemption, including protecting consumer access.Some NFL fans have begun to voice displeasure with the fact some games are simply not available over broadcast television because they've been moved to the streaming sites. The Sports Broadcast Act of 1961 only applies to broadcast television and courts have previously ruled it does not apply to cable, satellite or streaming services.So, the NFL has a huge problem.The potential consequences of this probe for the NFL include forfeiting the ability to sell games in a league-wide bundle to cable, satellite, and streaming platforms. The league makes an estimated $5-$6 billion per year selling those rights to ESPN, Amazon Prime, YouTube (red zone) and Netflix.The bigger potential consequence would be the NFL losing its entire antitrust exemption.That could force the NFL to completely change its business model because some teams might decide to negotiate their own TV deals, potentially creating a large disparity between big-market and small-market teams that currently doesn't exist under today's pooled TV rights.Competitive balance could be lost. Professional football could start to look more like Major League Baseball and the Dallas Cowboys might become the NFL version of the Los Angeles Dodgers.The NFL does not want that.So it is prepared to make its case to the DOJ or anyone else."It's funny, it's called the Sports Broadcasting Act, and I'm not sure there's a single content owner, league or otherwise, that hasn't done more to support broadcast television than what we do," NFL executive vice president of media distribution Hans Schroeder said last week in addressing the issue. "Again, every game is on broadcast in the home market, 88 percent [of games] is offered as a primary platform through broadcast. So we're very committed to broadcast. We have always been. I think we'll continue to be. We see it as a tremendous way to reach our fans. And our focus is on reach."But the NFL also wants to make the point that in moving to streaming it is serving other fans. New fans. And those fans, the league contends, are also consumers worthy of protection and service.  "We also have to be on the other platforms where we know our fans are spending their time," Schroeder said. "We look at it, and it's probably 8-to-10 years younger when we're on the streaming platform because we know it's a different type of audience."We are incredibly strong believers in the power of broadcast. We're also incredibly committed to making sure we're going to continue to evolve and be on the screens in places where our fans are spending their time. And we're happy to talk to whoever if they have questions about our model because we think our model speaks for itself about where our commitment is and how we distribute our games."That persuasion as to the value of streaming for segments of the population might be considered the NFL's carrot. The stick is league executive vice president and general counsel Ted Ullyot, who moved into the position last May, succeeding Jeff Pash.Ullyot, a former clerk to Supreme Court Justice Antonin Scalia, a member of the George W. Bush White House staff and chief of staff to Attorney General Alberto Gonzales, will lead the league's team amid the DOJ probe. And this: Part of his argument might be that the 65-year-old Sports Broadcasting Act is outdated as cable, satellite and streaming didn't even exist when it was written. So, Ullyot might contend the Act should be rewritten or eliminated altogether.Ullyot's 2025 selection as NFL general counsel was made, in part, with owners recognizing they had antitrust issues. In 2024, a jury in U.S. District Court in Los Angeles ruled in favor of 2.45 million residential and business pay subscribers to Sunday Ticket on DirecTV in a class-action suit. The jury awarded $4.7 billion in damages.A federal judge overturned the verdict when it was discovered witnesses for the subscribers used flawed methodologies, but the initial verdict was a wake-up call for the NFL and others.Then, last year, the House Judiciary Committee requested briefings from the NFL, NBA, NHL and MLB about whether antitrust exemptions should still be granted for coordinating their broadcast rights.Amid those court and legislative battles, some owners saw Ullyot as the man to have on their side."We’re going to be a target in antitrust, and in a lot of other ways," New England Patriots owner Robert Kraft told the Sports Business Journal last year. "We’re going to need legal representation that knows how to go on the offensive and play defense to protect where we’re going."