In Los Angeles, the NFL is in the midst of an expected three-week trial to determine whether it allowed DirectTV, from 2012 to 2022, to sell the broadcasts to out-of-market games via its “Sunday Ticket” package at inflated rates.
The class-action lawsuit, which represents nearly 2.5 million customers, including individuals and bar owners, argues that the NFL violated antitrust laws restricting competition in an effort to protect its lucrative deals with Fox and CBS for Sunday afternoon games. It seeks $7.1 billion in damages which could be tripled to over $21 billion.
DirectTV was the exclusive home of the “NFL Sunday Ticket” from the 1994 season until 2022. YouTubeTV took over in 2023. It costs an additional $349 a season above the YouTubeTV rate ($72.99 per month).
Plaintiffs argue that the NFL made the cost of Sunday Ticket artificially high in order to cash in on desperate, hardcore fans willing to pay whatever to see their favorite team or specific out-of-market games, as well as bars that needed to attract customers.
Yet in doing so, the league priced out most fans, thus forcing them to watch whatever game was on local television, the lawsuit contends. That offered protection for the NFL’s local broadcasting deals with Fox and CBS, who pay the league billions.
Additionally, by making Sunday Ticket an exclusive offering of DirectTV, which has just 13 million subscribers and required the installation of a satellite dish, rather than a far more available basic cable or even streaming option, they purposely limited the number of potential customers.
The NFL has argued it was a premium service and thus came at a premium price.
“The case is about choice,” NFL attorney Beth Wilkinson said to the jury, according to the Associated Press. “This is a valuable, premium product. Think about all the choices available to fans? We want as many people as possible to watch the free broadcasts.”
Additionally, the league has argued at different times over the nine years of this suit — it has been winding its way through the legal process since 2015 — that it is protected under antitrust exemptions, meaning if it did what it is accused of doing, it is allowed to do it. Even if the league loses this trial, expect appeals all the way to the Supreme Court.
So, we’ll see.
The money is enormous, even for a sports league that generated $18.6 billion in revenue in 2022 and whose team owners are among the wealthiest people in the world. Presumably customers might get some money back.
Perhaps more notable, though, is whether this lawsuit could — just possibly — change the way out-of-market games are offered to consumers, not to mention the price.
Whether legal or not, the current system is cumbersome and lacks choice and cost efficiency for many fans.
AppleTV, for example, proposed making the Sunday Ticket part of its offerings at no additional charge. And according to CourthouseNews.com, an email presented into evidence showed ESPN wanted to charge just $70 for the entire season and offer the option of buying the games of just one team.
The NFL balked at both of those proposals. While other sports leagues — the NBA’s “League Pass” or the NHL’s “Center Ice” for example — are available via multiple providers, the NFL preferred to make DirectTV (and later YouTubeTV) pay to be the exclusive provider of Sunday Ticket and thus limit the number of fans who used it.
“We’re not looking to get lots of people,” New England Patriots owner Robert Kraft said in a deposition presented at trial, according to CourthouseNews.com. “We want to keep it as a premium offering.”
The NFL is a cash machine and this may have served the franchise owners’ bottom line well. For fans, though, the possibility of more access to the product, especially at a lower price point and with a la carte ordering, would be preferable.
A Philadelphia fan who lives in Chicago, for example, currently has to subscribe to YouTubeTV for $72.99 a month and then buy access to every game played on Sunday afternoons via the Sunday Ticket ($349) even if he or she may be interested in watching only the Eagles.
Worse, 12 of Philly’s 17 games in 2024 are currently scheduled to kick off on Sunday afternoon (and thus part of the Sunday Ticket windows) and it is likely some of them — namely the two against Dallas — will be broadcast nationally and thus in Chicago anyway.
It’s possible that Eagles fans will pay $349 for as few as seven or eight games — potentially $50 per broadcast. This does not include the season opener against the Packers, which will air exclusively on Peacock — thus another cost.
The best offering would be if fans could buy individual games (say $5.99 or $9.99) on any television provider they already have. If they want to watch, they pay to watch. If they can’t or don’t want to buy it, they won’t.
Access would jump exponentially. This would be pro-consumer.
Sunday Ticket was set up to either make the offering unavailable or too pricey for fans while offering a plethora of games that most aren’t interested in watching, so a fan would just watch whatever their local affiliate is showing. This was done to protect the NFL’s broadcasters — CBS and Fox — and, more precisely, what the NFL could charge its broadcast partners.
A jury may find that to be problematic. If so, the question isn’t how much the NFL might have to pay out, but how much it might have to reform its product for football fans everywhere.