The NFL proved it was willing to sacrifice ratings (and their fans and player’s health) in the playoffs last season when it placed the Wild Card matchup between the Kansas City Cheifs and Miami Dolphins on the over-the-top streaming service Peacock.
The attorneys representing the plaintiffs in the Sunday Ticket trial argued that the league didn’t care if it had lost some viewers in its regular season distribution model with Direct TV. New England Patriots owner Robert Kraft’s testimony helps to explain why the league would turn some views away with a pricey subscription service.
NBC Sports Mike Florio is spending much of the league’s dead period this month covering the transcript Sunday Ticket trial, which the league ultimately lost. As previously discussed on GH, many prospective jurors voiced their displeasure with the league. One prospective juror took issue with players like Colin Kaepernick taking political stances in games.
Others felt they already had a negative bias against the NFL based on what they knew of Sunday Ticket’s pricing. Anyone who had looked at the pricing knew the cost was steep.
Per Florio, the attorney for the plaintiff, Amanda Bonn, argued in her opening statement that the league colluded with Direct TV, Fox, and CBS to keep the subscription service’s price up. In fact, FOX specifically asked for the price to be set no lower than $293.96 per person per season.
The NFL cared about profiting off all of their choices maximally
Bonn believed the league wanted to maximize revenue from Sunday Ticket while at the same time protecting the agreement they had with Fox and CBS:
[Bonn] quoted from a 1998 presentation to the league’s broadcast committee regarding the DirecTV deal, which included this statement: “‘The agreement gives the league two critical advantages. It enables us to maximize our revenue and income from the subscription business while at the same time protecting the value of our broadcasting agreements through limited distribution to non-broadcast viewers.’”
“They said we’re keeping these games away from you,” Bonn said. “All of these other games being played you can’t watch unless you pay the toll. And they knew what the result was: Most people couldn’t afford it, wouldn’t buy it, would be priced out.”
New England Patriots owner Robert Kraft was worried about value
At one point, Direct TV wanted to drop the price of the service so they could add subscribers. Bonn argued the league wasn’t happy with the plan to drop the price because a lower price would affect ratings in local markets:
Bonn went right into the case from the moment she stood up, addressing DirecTV’s decision on April 20, 2012, to reduce the price of Sunday Ticket by 30 percent — and by explaining the league’s reaction to it. She said that Steve Bornstein (who ran NFL Media at the time) told Brian Rolapp (who runs it now) that Bornstein wished he’d known about it, so that he could have briefed Commissioner Roger Goodell and Patriots owner Robert Kraft, the chairman of the NFL’s broadcasting committee.
She argued that they wouldn’t have been happy about the plan, because the NFL wanted Sunday Ticket to be priced at a level that would deter many from purchasing it, steering them toward the games available in their local markets.
Bonn quoted Kraft’s disposition testimony. Kraft was worried that offering the subscription package at a lower price would “devalue” packages from CBS and FOX, and those networks would cease to pay the league and its teams at the same price.
The NFL was willing to sacrifice fans
The league had to know that pricing out the subscription service would reduce overall viewership. Because of economic changes in recent decades, many fans have moved across the country but have retained loyalty to the teams they grew up watching.
For example, say a Chicago Bears fan moved to Austin, TX. They would want Sunday Ticket to watch the Bears instead of their local market choices of the Houston Texans and Dallas Cowboys. A high price might keep that Bears fan from both subscribing to Sunday Ticket and watching games on the local market.
Local fans might not want to watch meaningless games toward the end of a regular season when their favorite team is unlikely to make the playoffs. A high subscription service would keep them from watching games with playoff interest.
Bonn argued the league didn’t care because keeping their hands in both pots this way gave the league, Direct TV, FOX, and CBS their best chance to maximize revenue.
At the expense of their fans.
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2 Comments
Well, they are. Not to mention losing value.
This is the worst NFL Commissioner the league has ever had. Pete Rozelle was the best. Paul Tagliabue did ok, but began to steer the league toward pay-per-view, then this dipsh*t was installed. Now the greed is out of control.