The Federal Communications Commission announced Tuesday that it was repealing its sports blackout rules, which has prohibited cable and satellite operators from airing any sports event that had been blacked out on a local broadcast station.
The action removes Commission protection of the NFL’s current private blackout policy, which requires local broadcast stations to black out a game if a team does not sell a certain percentage of tickets to the game at least 72 hours prior to the game.
The Commission concluded that the sports blackout rules “are no longer justified in light of the significant changes in the sports industry since these rules were first adopted nearly forty years ago. At that time, ticket sales were the primary source of revenue for the NFL and most NFL games failed to sell out. Today, television revenues have replaced ticket sales as the NFL’s main source of revenue, and blackouts of NFL games are increasingly rare. The NFL is the most profitable sports league in the country, with $6 billion in television revenue per year, and only two games were blacked out last season.
The FCC also found that the NFL, “whose current contracts with the broadcast networks extend through 2022 — is unlikely to move its games from free, over-the-air broadcast television to satellite and cable pay TV as a result of elimination of the sports blackout rules. The Order therefore concludes that the sports blackout rules are no longer needed to ensure that sports programming is widely available to television viewers.
“Today’s action may not eliminate all sports blackouts,” the FCC continued, “because the NFL may choose to continue its private blackout policy. However, the NFL will no longer be entitled to the protection of the Commission’s sports blackout rules. Instead, the NFL must rely on the same avenues available to other entities that wish to protect their distribution rights in the private marketplace.”
Sports Lawyer Says Rule Was Obsolete
Irwin A. Kishner, an authority on sports law and the chairman of the Executive Committee at Herrick, didn’t mince words in discussing the FCC’s decision with Sports Litigation Alert.
“The FCC blackout rule was arcane relic from bygone days and frankly should have been dispensed with several years ago,” Kishner said. “While the rule played an important role in the 1970s and perhaps the 1980s by protecting team ticket sales, as the prominence of nationalized television revenues grew in the 90’s through the present, the rule’s purpose became obsolete.
“The FCC should focus on matters of public interest and not concern itself with matters of revenue distribution among team owners.”
