The NFL’s main media partners—Fox Corporation, CBS Broadcasting Inc., NBCUniversal Media, LLC, and Disney’s ESPN and ABC —jointly argued in a brief to a federal appeals court that it is essential for Sunday Ticket to remain priced at high levels, as their broadcast deals would otherwise cease to make economic sense.
Last summer, a federal judge overturned a $4.7 billion jury verdict that found the NFL’s out-of-market package violated antitrust laws and the league had conspired to keep Sunday Ticket prices high. The plaintiffs in the case, a group of individuals and commercial establishments, appealed the decision to the Ninth Circuit Court of Appeals, the venue where the media companies filed the friend of the court brief.
“CBS and FOX have agreed to broadcasting contracts with the NFL pursuant to which they would share feeds with DirecTV, but only where the harm to their exclusivity was compensated (i.e., through profit-sharing) or mitigated (i.e., through Sunday Ticket being priced as a complementary product for avid fans),” the companies’ lawyers wrote in the brief. DirecTV had Sunday Ticket during the class period from 2011-2023 although the package is now held by YouTube TV.
It’s notable that Disney and NBC joined the brief as their games are all national and not part of the Sunday Ticket package. They, too, benefit from the current media paradigm and likely view a new system in which out-of-market games are no longer pooled among the 32 clubs as tearing apart the current ecosystem. Amazon Prime, which broadcasts Thursday Night Football, is not part of the group behind the brief.
The trial last year revealed that the NFL had spurned an offer from Apple that would have dramatically lowered the price of Sunday Ticket and expanded subscribers by as much as 10 times to 20 million overall.
“We’re not looking to get lots of people,” New England Patriots owner Bob Kraft said in a deposition that was played at that trial. “We want to keep it as a premium offering.” And commissioner Roger Goodell testified Sunday Ticket is a premium product for avid fans.
Former CBS Sports chairman Sean McManus testified at the trial that CBS did not collude with the NFL to fix the price. But, while the brief filed this week certainly doesn’t contradict that, the media companies make it clear that a wide distribution of Sunday Ticket, as envisioned by the plaintiffs, poses a threat to their NFL rights deals and their business model.
“Amici have a significant interest in this litigation’s outcome because the exclusivity of their production and broadcast rights is a lynchpin of their respective business models,” the media companies’ lawyers wrote (Amici is the term used for filers of friends of the court briefs). “To offset the considerable fees each Amicus paid for these exclusive rights, they must generate revenue from advertising sales and affiliate and distributor retransmission fees. Those revenues in turn largely depend on the exclusivity of the production and broadcast rights, without which viewership would not be high enough to make it economically feasible for Amici to continue broadcasting NFL games.”
The plaintiffs argue that Sunday Ticket should be sold team by team, or at least in smaller packages than the current 32-team take-it-or-leave-it version. But in their brief, the media companies argue they would not share their feeds. They did so with DirecTV (and now YouTube TV) because it is a distributor and prices Sunday Ticket, so it doesn’t attract millions and millions of viewers.
“Broadcasters would never share feeds with direct competitors,” the media companies wrote. According to the plaintiffs, “CBS and FOX would still produce the broadcast feeds for all 10 to 12 Sunday afternoon NFL games. CBS and FOX would then hand over those feeds—which, to reiterate, require substantial investment to produce—to direct competitors like NBC and ABC, which would then broadcast or retransmit the out-of market games to viewers in each local market nationwide, thus competing directly against CBS’s and FOX’s in-market games.”