Are You Ready for Some Football? How Antitrust Laws Can Be Used to Break Up DirecTV's Exclusive Right to Telecast NFL's Sunday Ticket Package

By Bublick, Ariel Y. | Federal Communications Law Journal, December 2011 | Go to article overview

Are You Ready for Some Football? How Antitrust Laws Can Be Used to Break Up DirecTV's Exclusive Right to Telecast NFL's Sunday Ticket Package


Bublick, Ariel Y., Federal Communications Law Journal


I.   INTRODUCTION

II.  ANTITRUST BACKGROUND
     A. Antitrust and Section One of the Sherman Act
     B. Rule of Reason Analysis
     C. The Single Entity Defense and its Application to the
         NFL

III. FOOTBALL ON TELEVISION
     A. The Origins of the NFL on Broadcast Television
     B. The Sports Broadcasting Act of 1961
     C. Football on Television Today
     D. DirecTV's Sunday Ticket Package

IV.  ANALYSIS: WHY SUNDAY TICKET SHOULD BE FOUND TO
     VIOLATE ANTITRUST LAWS
     A. Sunday Ticket Is Not Exempt Under the Sports
        Broadcasting Act
     B. The NFL as a Single Entity for the Sale of Television
        Rights
     C. Rule of Reason
     D. The Current Sunday Ticket Structure Hurts Consumers
        and Dissolution of the Exclusive Arrangement Can
        Help

V. CONCLUSION

I. INTRODUCTION

Vince Lombardi, one of the National Football League's ("NFL") most famous and well-respected coaches, once said that "football is a game for mad men." (1) For those that ascribe to Lombardi's theory, Sunday is a day for both enjoyment and analysis. Sunday is the day when most of the NFL's games are telecast on broadcast television. Football fans love rooting for their teams, cheering against division rivals, and viewing other games to see league-wide developments as they occur in real time. To provide fans with the opportunity to watch all games being played, instead of just the ones being locally broadcast, the NFL has granted to DirecTV the exclusive right to offer a package known as the Sunday Ticket. Sunday Ticket allows subscribers to view any NFL game occurring at that time. Although ingenious on the surface, underneath lies potential antitrust violations by NFL franchise owners. Sunday Ticket is only available to DirecTV subscribers at a high premium. The NFL is granted several antitrust privileges by Congress, as discussed below, but Sunday Ticket should not fall within these exemptions.

Part II of this Note offers a background on antitrust law and how the subject relates to the NFL. Part III provides a history of the NFL, its beginnings on television, and its current arrangements with broadcast and cable television, as well as with DirecTV. Finally, Part IV discusses the antitrust implications of Sunday Ticket and how the package's exclusive arrangement with the NFL is hurting consumers.

II. ANTITRUST BACKGROUND

A. Antitrust and Section One of the Sherman Act

Antitrust laws were created to ensure a marketplace that fosters and encourages competition. (2) The Sherman Antitrust Act (3) forms the basis for most antitrust litigation pursued by the United States government. The Sherman Act's main purpose is to "preserv[e] free and unfettered competition...." (4) Of the many sections of the Sherman Act, Section One has plagued the NFL the most. (5)

Section One of the Sherman Antitrust Act ("Section One") states, "[e]very contract, combination ..., or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal." (6) This language was first analyzed in Standard Oil Co. v. United States. (7) Because the scope of Section One was so broad by its plain meaning, the Court was hesitant to accept the Government's argument that "the language of the statute embraces every contract, combination, etc., in restraint of trade, and hence its text leaves no room for the exercise of judgment, but simply imposes the plain duty of applying its prohibitions to every case within Its internal language." (8) Since nearly every contract is a restraint of trade by its very existence, the Court formulated a new standard: an agreement is in violation of Section One if the "contracts or acts ... were unreasonably restrictive of competitive conditions...." (9) Section One's main purpose is to "prevent competitors from combining their economic power in ways that unduly impair competition or harm consumers, be it in terms of increased prices, diminished quality, limited choices, or impaired technological progress. …

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