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S. HRG. 113–847 

THE FANS ACT: ARE SPORTS BLACKOUTS 

AND ANTITRUST EXEMPTIONS HARMING FANS, 

CONSUMERS, AND THE GAMES THEMSELVES? 

HEARING 

BEFORE THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

DECEMBER 4, 2014 

Serial No. J–113–75 

Printed for the use of the Committee on the Judiciary 

( 
(II) 

COMMITTEE ON THE JUDICIARY 

PATRICK J. LEAHY, Vermont, Chairman 

DIANNE FEINSTEIN, California 

CHUCK SCHUMER, New York 

DICK DURBIN, Illinois 

SHELDON WHITEHOUSE, Rhode Island 

AMY KLOBUCHAR, Minnesota 

AL FRANKEN, Minnesota 

CHRISTOPHER A. COONS, Delaware 

RICHARD BLUMENTHAL, Connecticut 

MAZIE HIRONO, Hawaii 

CHUCK GRASSLEY, Iowa, Ranking Member 

ORRIN G. HATCH, Utah 

JEFF SESSIONS, Alabama 

LINDSEY GRAHAM, South Carolina 

JOHN CORNYN, Texas 

MICHAEL S. LEE, Utah 

TED CRUZ, Texas 

JEFF FLAKE, Arizona 

KRISTINE LUCIUS, Chief Counsel and Staff Director 

KOLAN DAVIS, Republican Chief Counsel and Staff Director 
(III) 

C O N T E N T S 

DECEMBER 4, 2014, 10:20 A.M. 

STATEMENTS OF COMMITTEE MEMBERS 

Page 

Blumenthal, Hon. Richard, a U.S. Senator from the State of Connecticut ........ 3 

Grassley, Hon. Chuck, a U.S. Senator from the State of Iowa ............................ 5 

Leahy, Hon. Patrick J., a U.S. Senator from the State of Vermont, 

prepared statement .......................................................................................... 54 

Lee, Hon. Michael S., a U.S. Senator from the State of Utah ............................. 6 

WITNESSES 

Witness List ............................................................................................................. 25 

Goodfriend, David R., Chairman, Sports Fans Coalition, Washington, DC ....... 8 

prepared statement .......................................................................................... 30 

Greenberg, Sally, Executive Director, National Consumers League, Washington, DC ............................................................................................................. 10 

prepared statement .......................................................................................... 34 

Lake, William T., Chief, Media Bureau, Federal Communications Commission, Washington, DC .......................................................................................... 7 

prepared statement .......................................................................................... 28 

McCain, Hon. John, a U.S. Senator from the State of Arizona ........................... 1 

prepared statement .......................................................................................... 26 

Waldron, Gerard J., Partner, Covington and Burling, Washington, DC ............ 12 

prepared statement .......................................................................................... 42 

QUESTIONS 

Questions submitted to David R. Goodfriend by Senator Grassley ..................... 57 

Questions submitted to Sally Greenberg by Senator Grassley ............................ 58 

Questions submitted to William T. Lake by Senator Grassley ............................ 59 

Questions submitted to Gerard J. Waldron by: 

Senator Franken ............................................................................................... 56 

Senator Grassley .............................................................................................. 60 

ANSWERS 

Responses of David R. Goodfriend and Sally Greenberg to questions submitted by 

Senator Grassley .................................................................................................. 61 

Responses of William T. Lake to questions submitted by Senator Grassley ...... 64 

Responses of Gerard J. Waldron to questions submitted by Senator Franken 

and Senator Grassley ........................................................................................... 67 

(1) 

THE FANS ACT: ARE SPORTS BLACKOUTS 

AND ANTITRUST EXEMPTIONS HARMING 

FANS, CONSUMERS, AND THE GAMES 

THEMSELVES? 

WEDNESDAY, DECEMBER 4, 2014 

UNITED STATES SENATE, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:20 a.m., in 

Room SD–226, Dirksen Senate Office Building, Hon. Richard 

Blumenthal, presiding. 

Present: Senators Klobuchar, Franken, Blumenthal, Grassley 

and Lee. 

Senator BLUMENTHAL. Senator McCain, I was going to suggest if 

the Ranking Member agrees, that you go first and then we will 

give our opening statements. 

Senator GRASSLEY. Yes, go ahead. 

STATEMENT OF HON. JOHN MCCAIN, 

A U.S. SENATOR FROM THE STATE OF ARIZONA 

Senator MCCAIN. I thank you, Mr. Chairman and Ranking Member Grassley, and I thank you for allowing me to testify and thank 

you to Senator Blumenthal for making this hearing happen. Senator Blumenthal’s commitment to advocating for consumers has 

made him a valuable partner to work with on this issue, an area 

where the rules and regulations far too often leave consumers holding the short end of the stick. I am here this morning to discuss 

sports blackouts and to explain why the continued use of blackout 

rules and policies fail to serve the interests of consumers, in this 

case, loyal sports fans. 

I will truncate my opening statement just to say the simple fact 

is that the rules as they are today only serve to benefit sports 

leagues and their member teams at the expense of the hard-working fans who support them so loyally through their money, time, 

and passion. Just last year during the NFL wildcard playoffs, fans 

of the Cincinnati Bengals, Indianapolis Colts and Green Bay Packers came very close to experiencing blackouts when those games 

had not sold out just days before the kickoff. 

The blackouts in these regions were only averted when, at the 

last-minute, local businesses bought-up tickets to bring the total 

above the NFL’s required threshold. Mr. Chairman, there is something wrong with a situation in which the NFL can say to all of 

those fans who have made the League what it is today, ‘‘you had 
2 

better purchase tickets or else.’’ The NFL and its teams have benefited from myriad public benefits, including an exemption from 

antitrust rules, a specialized tax status, and taxpayer dollars that 

subsidize their multimillion dollar football stadiums. 

These public benefits carry with them a responsibility back to 

the public an obligation to treat their loyal fans with fairness. We 

have been chipping away at these rules for some time, but there 

is still a lot of work to do. This year I am happy, Mr. Chairman, 

to join you and introduce the FANS Act aimed at eliminating the 

various causes of sports blackouts. This legislation would condition 

the NFL and other leagues’ antitrust exemptions on ending blackout practices including in those circumstances when stand-offs during contractual disputes between broadcasters and cable and satellite companies result in blackouts. 

We would strongly prefer that the League take the initiative 

itself and demonstrate leadership by reforming anti-consumer policies and practices. But let us be clear, should the League fail to act, 

we should do everything we can to stand up for consumers by advancing the FANS Act and other initiatives. 

I look forward to hearing from the witnesses on the following 

panel on ways we can work together to finally blow the whistle on 

sports blackouts once and for all. 

I would like to say, again, Mr. Chairman, you come from a State 

where it is huge as far as sports broadcasting is concerned. So I 

particularly admire your courage on this issue. Again, it is just unconscionable to have average fans be deprived of the ability to see 

an activity in a stadium they paid for. So it is a no-brainer in many 

respects and if we are not able to succeed, it is frankly a triumph 

of the special interests over the public interests. 

I want to thank you for your leadership and I want to thank the 

Ranking Member who, as always, I have the greatest admiration 

for and respect. Thank you. 

Senator BLUMENTHAL. Thank you so much Senator McCain. I 

really appreciate you being here. I know it is a busy day in a busy 

time of our closing days of this session and I want to express my 

personal thanks for your leadership and courage in sponsoring this 

bill and working with me on it and I look forward to continuing our 

work together. 

I know that you have another meeting and certainly you should 

feel free at any time to leave despite the powerful and riveting remarks that I am about to give. I know you will find it difficult to 

break away. 

[Laughter.] 

Senator MCCAIN. Thank you. I would also like to invite Senator 

Grassley to come to Arizona for the Super Bowl and join many of 

his constituents who are smart enough to spend the winter with us. 

Thank you. 

[Laughter.] 

Senator BLUMENTHAL. Thank you Senator McCain. We are going 

to give opening remarks and then, unfortunately, we are going to 

have to take a recess because of the votes that are ongoing right 

now. We are going to come back at the end of those votes, we hope 

not too long from now, in a little while to continue the hearing at 

that point with the remainder of the witnesses. 
3 

I will give my opening remarks. Then Senator Grassley will give 

his. 

OPENING STATEMENT OF HON. RICHARD BLUMENTHAL, 

A U.S. SENATOR FROM THE STATE OF CONNECTICUT 

Senator BLUMENTHAL. As Senator McCain said so eloquently, 

Americans really love sports and they deserve to see them on their 

terms, not on the terms that are prescribed by the professional 

sports leagues in blacking out what they think Americans should 

see rather than what Americans want to see on their terms. The 

competitive teams of professional football, baseball, hockey and 

basketball leagues represent a rich and vibrant part of our American culture. They contribute immensely to what makes America 

the greatest country in the history of the world. 

Professional sports leagues generate billions of dollars, thousands 

of jobs and critical economic activity in multiple industries. The 

Super Bowl is, in fact, the highest rated event on television and 

last year the NFL playoffs collectively accounted for the ten mostwatched sporting events of the entire year. 

So these games are a part of what makes America great. Most 

of these games were carried on free over-the-air television and I believe we ought to keep it that way. Sports fans power this media 

and merchandising juggernaut by purchasing tickets and merchandise, watching games on TV and supporting their teams through 

thick and thin. 

These billion-dollar professional sports leagues derive almost half 

of their revenue from licensing TV rights to cable, broadcast and 

regional sports networks. Some estimate those rights cost upwards 

of $17 billion a year. A large bill, a large cost that is increasingly 

passed on to consumers in the form of higher monthly rates for 

cable and pay-TV and we have evidence of it at this very table 

when we have had recent hearings on some of the proposed mergers. 

Sadly, in return, fans and the public are often treated like a fumbled football, sometimes even a kicked football. When places like 

Buffalo, New York fail to sell out its 74,000 person stadium, the 

Bills game is blacked out for local fans. When powerful cable companies and broadcasters failed to reach an agreement, it is often 

the threat of holding sports programming hostage that is used to 

negotiate higher fees. And, by the way, higher rates for consumers. 

Even the Internet cannot escape blackouts. When fans live too 

close to their favorite baseball team, but not close enough to actually watch them on television, they face online blackouts that force 

them to drive to the next city to catch a game. These blackouts are 

loathed by fans and rightly so, hated by consumers and even reviled by most of the industry stakeholders in the business of television. 

The good news is we can do something about it. The NFL, the 

NBA, the MLB and the NHL receive tremendous assistance, huge 

benefits from the Congress in puting their brands, their sport and 

their advertising before the American people. This public assistance takes several forms, but chief among them is the antitrust exemption enjoyed by the four major sports leagues. 
4 

Essentially, every American company is bound by antitrust regulations that prevent coordination and price-fixing. Sports leagues 

are an exception. Almost a unique exception to this antitrust rule. 

In the Sports Broadcasting Act of 1961, Congress granted a special 

exemption from the rules that govern other companies permitting 

professional sports leagues to coordinate and fix prices for negotiating broadcast rights. 

The country affords these teams their special status because of 

their special role in American culture. But that does not give them 

the right to abuse this privilege and the Government certainly 

should not endorse abusive behavior. The public benefits come with 

a public trust. 

The FCC recognized this when they through a flag this September on the NFL’s anti-fan blackout policy. Chairman Wheeler 

of the FCC announced at that meeting, ‘‘Federal Government 

should not be a party to sports teams keeping their fans from viewing the games.’’ 

I am grateful that all five FCC Commissioners joined together in 

a bipartisan vote and repealed their blackout rule as I had called 

for there doing, along with Senator McCain, Senator Brown, Congressman Higgins and many more. But despite the FCC’s actions 

in September, sports leagues and the NFL, in particular, retain the 

power to blackout games through their private contract agreements. 

I believe these blackout policies are anti-fan and anti-consumer 

because they disregard the public trust that the leagues have because of the special benefits and public benefits that they receive 

and because of the trust they have to their fans and the teams. 

Moreover, these policies are an affront to the direct and indirect investment made by Federal and local governments that have provided tax exemptions, enhanced public transportation, infrastructure to stadiums and exemptions as, I have mentioned, from the 

antitrust law. 

That is why I have joined with Senator McCain to introduce S. 

1721 Furthering Access and Networks for Sports Act, the FANS 

Act, and that is why I have joined in seeking support from my colleagues and I believe that support is growing, that we have momentum on our side. This bipartisan bill leverages the antitrust exemptions that leagues enjoy against the elimination of these blackout policies. 

Let me put it very simply. Unless the leagues end blackouts, 

they will no longer be exempt from the Nation’s antitrust laws 

when they negotiate their billion-dollar television contracts. The 

FANS Act would remove language in the law that allows the NFL 

to maintain their local sports blackout policies when stadiums fail 

to sell out. It would require the leagues to instruct anyone carrying 

their games that they can no longer hold sports programming hostage for higher fees and cable rates and it would make more live 

games available on the Internet. 

I want to make one thing clear. This bill does not use the heavy 

hand of government to force the sports leagues to do anything. It 

does not require them to end blackouts with the threat of fines or 

enforcement actions. It does end the blank check from the Govern-
5 

ment to the leagues and it takes away Congress’ implicit endorsement of blackout policies. 

Fundamentally, it represents a bargain to the leagues. They can 

continue enjoying their exemption from existing law if they treat 

fans fairly. If they want to continue their blackout policies, the 

Government will not stop them, but they will no longer get the special public benefits and protection from antitrust enforcement that 

they currently have. 

I want to note, particularly, that this hearing is a fact-finding 

mission. We are obviously not going to pass this bill out of the Senate or Congress this year, but I look forward to a lively debate and 

Senator McCain and I are open and committed to working with all 

of the stakeholders on their ideas for changes and edits before reintroducing this bill again next Congress which we expect to do. 

Thank you very much and I yield to Senator Grassley. 

OPENING STATEMENT OF HON. CHUCK GRASSLEY, 

A U.S. SENATOR FROM THE STATE OF IOWA 

Senator GRASSLEY. I thank you, Mr. Chairman. You have been 

very thorough in your explanation and purpose of the legislation. 

I particularly compliment you for taking on a strong, powerful force 

that you are taking on. That is what has to be done if you are 

going to make changes sometimes. 

I thank the witnesses who are here and look forward to your testimony. I think we can all agree on one fundamental notion, no one 

likes sports blackouts. The sports leagues and their member teams 

do not like them, television providers do not like them and, of 

course, sports fans definitely do not like them. 

A particular issue in Iowa is that we do not have any major 

league teams, so the entire State, one way or another, falls within 

the blackout territory of six different teams: the Cardinals, the 

Royals, the Twins, the Brewers, the Cubs, and the White Sox. I can 

tell you the periodic blackouts are a very frustrating experience for 

the fans of my State. 

So there is no question that blackouts are an exasperating experience and disfavored. The question is how best to minimize blackouts and maximize the benefits to the consumers while also respecting the rights of private parties to negotiate with each other 

at arms length. 

On that note I will add one other comment. As we all know, the 

Federal Communications Commission voted unanimously in September to eliminate its sports blackout. I think as a general matter, the Federal Government should not be in the business of mandating policies that parties are otherwise free to negotiate privately. At the same time, however, I think we need to be mindful 

of the flipside of the same coin. More specifically, as a general rule 

the Federal Government should not be in the business of mandating which provisions should not be included in private contracts. 

Anytime such a step is proposed, we should tread carefully. 

So the Chairman just said he is beginning discussions on this in 

consideration of it and I am happy to join in that dialogue. So I 

thank the witnesses once again and look forward to the hearing as 

a start of that dialogue. 
6 

Senator BLUMENTHAL. Thanks, Senator Grassley, and thanks for 

your excellent remarks. We are going to—I apologize—take a recess 

now. I want to thank the witnesses for your patience. We will be 

back literally as soon as we can and we will take the second panel 

at that time. Again, my thanks and my apologies. We will be right 

back. Thank you. 

[Whereupon, at 10:36 a.m., the hearing was recessed.] 

[Whereupon, at 11:30 a.m., the Committee reconvened.] 

Senator BLUMENTHAL. We will come to order. I am going to recognize Senator Lee for an opening statement and then we will proceed to the second panel of witnesses. 

OPENING STATEMENT OF HON. MICHAEL S. LEE, 

A U.S. SENATOR FROM THE STATE OF UTAH 

Senator LEE. Thank you, Mr. Chairman. First of all I want to 

start by thanking you, Senator Blumenthal and Senator McCain 

for bringing this important matter to the attention of the committee. I think you have raised an important question. 

No one really likes sports blackouts, least of all the public. Yet 

as we all know, Congress has permitted professional sports leagues 

to operate outside of our antitrust laws in order to have them. We 

have done so on the theory that without blackouts fans might stay 

home and watch the game on TV while the ticket sales necessary 

to support the team might dwindle as a result. 

That economic assumption has now been called into question. 

The proponents of the bill argue that there is no evidence to support it. Fans, they say, will attend games if the ticket price is right 

regardless of whether they could also watch the game at home as 

an alternative. 

At the moment, however, I am not yet prepared to support the 

FANS Act without additional study on my part. I am particularly 

concerned that the bill might unsettle some legitimate contractual 

expectations the sports leagues have bargained for with broadcasters without an appropriate phaseout period. I would also like 

to take a closer look at the economic evidence on both sides of this 

issue. 

But I agree that the issue certainly merits the attention of Congress. Professional sports leagues have asked for and have received 

exemptions from the competition laws that most other American 

businesses are required to comply with. Those antitrust laws are 

an important and effective tool for ensuring free markets and protecting low consumer prices. 

As Ranking Member of our Antitrust Subcommittee, I take a 

keen interest in ensuring that our competition laws are functioning 

well and having their desired effect of protecting, competition. For 

that reason, I am certainly open to examining in the future whether the antitrust exemptions enjoyed by professional sports leagues 

in their current forms rest on sound justifications and if not, how 

Congress might act to modify those exemptions. 

Thank you very much Mr. Chairman. 

Senator BLUMENTHAL. Thank you, Senator Lee. I am going to ask 

the next panel to please come forward and take your seats. And actually before you take your seats, why do I not swear you in which 

is, as you know, the custom of this committee. 
7 

Do you affirm that the testimony you are about to give is the 

truth, the whole truth and nothing but the truth so help you God? 

Mr. LAKE. I do. 

Mr. GOODFRIEND. I do. 

Ms. GREENBERG. I do. 

Mr. WALDRON. I do. 

Senator BLUMENTHAL. Thank you. By way of introduction, let me 

give a brief bio of each of the witnesses today. 

William Lake is the Chief of the Media Bureau at the Federal 

Communications Commission. He has served as the DTV Transition Coordinator for the FCC, Counsel to the Administrator at the 

Environmental Protection Agency, and Principal Deputy Legal Advisor at the U.S. Department of State. He was also a partner at 

Wilmer Cutler Pickering Hale and Dorr. 

David Goodfriend is the founder and chairman of the Sports 

Fans Coalition, the largest multi-issue public policy organization 

for fans. He is currently the president of Goodfriend Government 

Affairs and he has served as Deputy Staff Secretary to President 

Clinton and Media Legal Advisor to Commissioner Susan Ness at 

the FCC. He also previously served as vice president of the law and 

public policy at DISH Network. 

Sally Greenberg is the executive director of the National Consumers League. She has testified numerous times before Congress 

on consumer protection issues. From 2001 to 2007 she worked at 

Consumers Union. She served for many years on the Board of Directors of the Alliance for Justice and HALT, an organization that 

focuses on protection of consumer rights in their interaction with 

lawyers and the legal system. 

Gerard Waldron is a partner at Covington and Burling, representing a range of technology companies, online social and media 

companies and communications client before the FCC and Congress. Before joining Covington, Jerry served as the Senior Counsel 

on the House Subcommittee on Telecommunications and worked on 

the committee staff for over 10 years. 

Thank you all for being here today. Let us begin with 

Mr. Lake. 

STATEMENT OF WILLIAM T. LAKE, CHIEF, MEDIA BUREAU, 

FEDERAL COMMUNICATIONS COMMISSION, WASHINGTON, DC 

Mr. LAKE. Good morning Senator Blumenthal and Senator Lee. 

I am Bill Lake, Chief of the Media Bureau at the Federal Communications Commission. I am pleased to appear before you today to 

discuss the recent FCC action to eliminate our sports blackout 

rules. 

A bit of history may provide useful context for our action. Our 

sports blackout rules specifically prohibited cable and satellite operators from airing any sports event that had been blacked out on 

a local broadcast TV station pursuant to a private blackout policy 

adopted by a sports league. 

The Commission adopted a sports blackout rule for cable in 1975, 

finding that the rule was necessary to ensure that cable importation of distant signals would not reduce ticket sales and thus, lead 

sports leagues to refuse to sell the rights to their events to distant 

stations, which could in turn reduce the availability of sports pro-
8 

gramming to TV viewers—which was the principal concern of the 

Commission. We later adopted similar rules for satellite carriers 

and open video systems. 

As you know, the Commission voted unanimously to eliminate 

the sports blackout rules on September 30 of this year finding that 

they were unnecessary and outdated today. The repeal of the rules 

took effect on November 24. 

The Commission’s action followed an open and transparent public process that began in 2011 when the Sports Fans Coalition filed 

a petition for rulemaking with the Commission. After careful review of the comments we received in the proceeding, the Commission found that significant changes in the sports industry since the 

rules were adopted had eliminated the justification for the rules. 

First, for the NFL, the only league for which the Commission’s 

sports blackout rules continued to be relevant, ticket sales are no 

longer the primary source of revenue. The massive popularity of 

pro football means that the primary source of income for the NFL 

has shifted to television, with TV revenues now the NFL’s main 

source of revenue approaching $6 billion this year. Total NFL revenues reportedly exceeded $10 billion in 2013. 

Second, the increased popularity of NFL games has brought fans 

to the stadiums in numbers that make blackouts exceedingly rare. 

In 1975, almost 60 percent of NFL games were blacked out because 

they failed to sell out. Last year only 2 of 256 regular-season NFL 

games, less than 1 percent, were blacked out, and no games have 

been blacked out so far this year. Moreover, in recent years, blackouts have affected only a few NFL markets such as Buffalo, Cincinnati, and San Diego. 

Finally, the Commission determined that the impact on consumers of eliminating its sports blackout rules would be minimal. 

The NFL’s existing contracts with the broadcast networks extend 

through 2022, keeping games on over-the-air stations through at 

least that timeframe. Beyond that, the Commission found it is 

highly unlikely that the NFL would find it more profitable to move 

its games from over-the-air stations to pay-TV in the absence of the 

sports blackout rules. 

In conclusion, I would like to note that I am limiting my testimony to the Commission’s decision and its rationale. Elimination 

of our rules does not prevent the sports leagues from continuing to 

have a sports blackout policy, and the Commission does not take 

a position on whether Congress should eliminate or modify existing 

antitrust exemptions that allow leagues to have such blackout policies in the first place. 

Again, thank you for the opportunity to appear before you today. 

I will be happy to take your questions. 

Senator BLUMENTHAL. Thank you, Mr. Lake. 

Mr. Goodfriend. 

STATEMENT OF DAVID R. GOODFRIEND, CHAIRMAN, 

SPORTS FANS COALITION, WASHINGTON, DC 

Mr. GOODFRIEND. Thank you, Senator—thank you Senator 

Blumenthal and Senator Lee and Senator Klobuchar. Members of 

the committee, we appreciate very much the fact that you have invited Sports Fans Coalition to testify on the FANS Act. 
9 

My name is David Goodfriend and I am the founder and chairman of Sports Fans Coalition, the nations largest multi-issue fan 

advocacy organization in the public policy arena. Founded in 2009, 

we now have tens of thousands of members from across the USA 

and are led by a bipartisan, diverse and seasoned Board of Directors. 

The Government should not subsidize or support anti-fan activities by professional sports leagues. When a sports league receives 

a public benefit, the fan should get a fair return or the subsidy 

should go away. That is why Sports Fans Coalition is proud to have 

lead the successful effort to end the FCC’s sports blackout rule. 

The NFL’s blackout policy prohibits a local broadcaster from televising a game when tickets do not sell out 72 hours before kickoff. 

The FCC rule, as you have just heard, bolstered that anti-fan policy by requiring pay-TV companies, likewise, to impose such blackouts. The efforts of Sports Fans Coalition, National Consumers 

League, and others culminated in a unanimous five to zero vote 

this past September 30, to end the FCC’s 40-year-old anti-fan 

sports blackout rule. And we could not have done it, Senator 

Blumenthal, without support from you, Senator McCain, and others. So thank you for that. 

That was a great moment for fans, but the NFL’s policy remains 

in place. The NFL should end its local blackout policy once and for 

all, effective immediately. Fans hate local blackouts and you know 

this. But just listen to to fans who told the FCC how they feel. 

Denis Steinmiller from North Tonawanda, New York, said, ‘‘I am 

a disabled Vietnam vet. I also suffer from post-traumatic stress disorder. I am unable to attend the Bills games because of my disabilities. Watching the Bills on TV is one thing I look forward to every 

year as well as to help me with my PTSD. Please put all of the 

games on TV for me and the others who gave much of ourselves 

for our country.’’ 

Or listen to Mary Bash from Masaryktown, Florida, who said, 

‘‘For people like me who are disabled, this blackout rule is discrimination against people with disabilities. I cannot physically attend 

a live game at any arena. I am stuck at my home with only the 

television to bring me to sports or anything else that I enjoy watching. The NFL blackout policy from the 70s does not reflect the 

times of today. Technology has changed. The NFL’s market has 

changed. Where do they think all of that money comes from? It is 

us, the consumer, who buys the products from their advertisers. It 

is us, the taxpayer, who built most of those arenas. It is us, the 

American citizen, who continues to foot the bill.’’ 

Real fans. Real comments submitted to the FCC. But the fans 

are not alone. We saw economists from Stanford, Michigan, and 

other institutions submit detailed declarations to the FCC explaining why the NFL’s blackout policy does not even serve its stated 

purpose of getting more fans into seats. 

Listen to other professional sports leagues. We submitted depositions from the commissioner of baseball and the commissioner of 

hockey who said under oath, we got rid of our blackout policy because it does not work. And the FCC agreed with all of this when 

they got rid of their own sports blackout rule. 
10 

Now the NFL should do the right thing. It should listen to fans, 

economists, other leagues, the commissioners, the FCC, the Members of Congress and end its local blackout policy. But failing that, 

Congress should pass the FANS Act. 

The antitrust statutes currently shield leagues from liability 

when imposing local blackouts and the FANS Act would eliminate 

this ‘‘get out of jail free card.’’ Sports Fans Coalition also believes 

that fans should not be used as pawns during contractual disputes 

between big TV companies. The FANS Act would take care of that 

too. 

Finally, I would like to make clear that Sports Fans Coalition 

fully supports putting as many games as possible on free over-theair broadcast TV. The migration of sports off broadcast TV has created problems. All you have to do is look at Los Angeles where 

Time Warner Cable took over the television rights of the L.A. 

Dodgers and what happened? Seventy percent of L.A. fans could 

not watch their Dodgers play in a great season because they did 

not have Time Warner Cable. 

So when major league baseball and the L.A. Dodgers have received so much public subsidization, fans should have a better access to those games and putting them on broadcast is one way to 

do that. Perhaps a revised FANS Act could require all sports 

leagues to maintain just a certain amount of games on free overthe-air TV so that fans have access to at least some games. 

Thank you and I look forward to answering any questions. 

Senator BLUMENTHAL. Thank you very much, Mr. Goodfriend. 

Ms. Greenberg. 

STATEMENT OF SALLY GREENBERG, EXECUTIVE DIRECTOR, 

NATIONAL CONSUMERS LEAGUE, WASHINGTON, DC 

Ms. GREENBERG. Good morning Senator Blumenthal, Senators 

Lee, Klobuchar and Franken. 

My organization, the National Consumers League, was founded 

in 1899. We are the Nation’s pioneering consumer organization and 

our nonprofit mission is to advocate on behalf of consumers and 

workers in the United States and abroad. We very much appreciate 

your inviting the consumer point of view for this very important 

bill, S. 1721. 

I’m delighted to see my fellow Minnesotans here because I grew 

up going to Minnesota Viking games and Minnesota Twins games. 

I am an avid fan. I love watching professional sports, but like me, 

millions of Americans define themselves, in part, by the teams they 

support. However, the professional sports leagues are also multibillion dollar businesses that benefit from a multitude of public subsidies. 

These take the form of exemptions from Federal antitrust laws, 

tax breaks and public funding for stadiums, infrastructure support 

from municipalities and blackout policies that benefit the leagues 

and their broadcast partners. As the leagues enjoy huge profits, 

taxpayers are right to question what they receive in return for 

these public benefits. 

For example, a Harvard University study recently calculated that 

seventy percent of capital costs of National Football League stadiums have been provided by taxpayers whether they are sports 
11 

fans are not. A 2012 Bloomberg study estimated that tax exemptions on interest paid by municipal bonds issued for sports facilities 

cost the U.S. Treasury $146 million a year. Over the life of the $17 

billion of exempt debt issued to build stadiums since 1986, taxpayer subsidies to bondholders will total $4 billion. 

Lavish public subsidies for stadiums are not the only way that 

taxpayers subsidize professional sports. The rising cost of acquiring 

sports programming is also a significant driver of rising cable bills 

which have gone up at more than three times the rate of inflation 

since 1998. Due to the widespread practice of channel bundling, the 

increasing cost of sports programming are passed along to all cable 

and satellite subscribers regardless of whether they actually watch 

sports. 

Sports programming costs are also a major driver of the fights 

between broadcasters and cable television providers over retransmission fees that have contributed to the increasing number of programming blackouts. In return for the Government largess lavished on sports leagues, consumers are right to be outraged when 

essential services are cut to subsidize unaffordable tickets at publicly funded stadiums. 

Cable and satellite subscribers, fans and nonfans alike are angry 

that their bills go up due to ever higher sports programming costs 

when the games even make it on the air. The game is clearly 

rigged in favor of the professional sports leagues and taxpayers are 

getting the short end of the sick. So it is, indeed, time for Congress 

to step up and began to level the playing field. 

That is why NCL is proud to support the FANS Act. The bill 

would benefit consumers in a number of ways by reigning in cable 

rate hikes, reducing incentives to blackout games and giving consumers access to online game broadcasts. To elaborate, the bill conditions sports leagues antitrust exemptions on the requirement 

that their broadcast partners not blackout games as a result of contractual disputes with cable and satellite companies. 

NCL believes the consumer should not be used as pawns in disputes over retransmission fees. Thus, the bill helps to reduce the 

incentive to use blackouts as a negotiating tactic and promises to 

reduce the frequency of these programming interruptions. 

Second, the bill eliminates the antitrust exemption for local 

sports blackouts in the event that games do not sell out their tickets. This will benefit millions of fans in smaller markets such as 

Buffalo, many of which have larger stadiums but smaller populations and thus, are less likely to sell 85 percent of their seats. 

Third, the bill benefits consumers living in teams’ overlapping 

broadcast territories by conditioning the League’s antitrust exemptions on the provision of alternative platforms like the Internet. 

This would particularly help major-league baseball fans who live in 

States like Arkansas, Connecticut, Nevada, Oklahoma that are 

overlapped by separate clubs in their home television territories 

and thus, subject to local blackouts. 

Finally, the bill corrects a historical anomaly by bringing majorleague baseball under the auspices of the Clayton Antitrust Act in 

the same way as the NFL, NBA and NHL are currently treated. 

In doing so, the statutory conditions placed on existing antitrust 

exemptions by this bill would also apply to MLB. 
12 

In conclusion, I would like to reiterate our strong belief that the 

FANS Act addresses some of the unfair and unbalanced subsidies 

and preferential policies like antitrust exemptions that professional 

sports leagues enjoy at the expense of taxpayers and sports fans 

alike. 

Thank you very much. 

Senator BLUMENTHAL. Thank you very much, Ms. Greenberg. 

Mr. Waldron. 

STATEMENT OF GERARD J. WALDRON, PARTNER, 

COVINGTON AND BURLING, WASHINGTON, DC 

Mr. WALDRON. Good morning, Senator Blumenthal, Senator Lee, 

Senator Klobuchar and Senator Franken and Members of the committee. My name is Jerry Waldron and I am here today in my capacity as outside counsel to the National Football League on television related matters. 

I appreciate the opportunity to discuss the NFL’s commitment 

alone among the professional sports leagues in ensuring that all of 

its games are available across the country via free over-the-air television. For more than five decades, the Sports Broadcasting Act has 

been a key component in this strategy enabling the NFL, major 

league baseball, the NBA, and the NHL to put their games on 

broadcast television. 

In the NFL’s case, the League has agreements to put all 256 regular-season games and all playoff games on free TV. That is a 

claim that no other sports league can make about all of its playoff 

games, let alone all of its regular-season games. Quite simply, the 

sports broadcasting act is working to benefit fans and the public interests. For this reason, the FANS Act which attempts to dictate 

business decisions, would ultimately be harmful to fans. 

For context, the NFL strategy serves three main goals. First, because NFL teams generally play once each week, the League tries 

to make each game a special event and obtain the widest possible 

audience for those games. Second, the League wants to encourage 

strong fan support in each local market. And third, the broadcast 

television agreements generate substantial revenues that are 

shared equally by the 32 NFL clubs. Thus, clubs in Buffalo, Green 

Bay or Minneapolis receive the same amount from TV contracts as 

teams in the New York City and Chicago media markets. 

To promote these goals, the NFL has long maintained a blackout 

policy which is incorporated into the League’s contracts with the 

broadcast networks. The hallmarks of NFL games are full stadiums, excited crowds and competitive games. Sold-out games improve the experience both for fans in the stadium and for those 

watching on television. Increased attendance at games also helps 

to support local jobs, businesses and taxes. 

The League’s business judgment is that it serves these objectives 

well. While some may disagree with the League’s television policy, 

strong television ratings matched with high attendance demonstrates that the policy is working. 

The debate about blackouts of NFL games should be seen in context. NFL game blackouts are at an all-time low. Last season only 

two games were blacked out across the League. This season there 

have been no blackouts. So over the past season and two thirds, 
13 

with almost 450 NFL games played, there have been just two 

blackouts. This reduction reflects adjustments in the NFL’s blackout policy that the League has made over the years to promote 

both game attendance and viewership. 

The sports broadcasting act encourages broad-based game 

viewership. Congress passed a law in 1961 to enable league agreements with broadcast networks and a sharing of revenues. Under 

the SBA, the NFL has created the most proconsumer television 

plan in sports today. The NFL has maintained its commitment to 

broadcast television even in extending its contracts to 2022 with its 

broadcast partners despite the dramatic change in the broadcast 

industry and, frankly, trends by the other sports leagues off of free 

TV and toward paid television. 

The FANS Act proposes changes to the SBA that would ultimately harm fans by creating uncertainty around the future of 

sports on free television. A possible result would be to migrate popular sports programming from free broadcast television to pay-TV. 

This committee has long cautioned against such a move. The 

FANS Act proposes untenable conditions on the SBA’s antitrust 

provisions. The bill would deny a sports league the antitrust provision if third-parties, such as a television station and a cable or satellite company, have a contract dispute. 

Yet, the NFL is not a party to those contracts and has absolutely 

no control over the outcome of these disputes. No business can plan 

its operation under laws that could change at a moments notice 

due entirely to the actions of third parties. 

In conclusion, NFL television policies made possible by the SBA 

bring fans across the country a wide range of outstanding television content each week. The NFL and the other sports leagues 

practice of televising games on free over-the-air television is made 

possible by the SBA. These arrangements benefit fans and are in 

the public interest thus, the underlined policies should not be altered. 

Thank you and I will take any questions. 

Senator BLUMENTHAL. Thank you, Mr. Waldron. I have some 

questions that I am going to pose to you and then yield to my colleagues. I particularly am grateful to Senator Klobuchar, the head 

of the Antitrust Subcommittee of the Judiciary Committee, for 

being here today. 

You mentioned the uncertainty of fans. The reason for their uncertainty right now is the potential deprivation they suffer from 

blackouts. There may have been few this year, but the potential for 

blackouts is what creates their apprehension that they may be deprived of access to these games. 

So I wonder whether you have additional evidence that was not 

presented to the FCC that you have to present to this committee 

or whether it is your contention that the FCC failed to consider the 

evidence that you presented in reaching its conclusion. 

Mr. WALDRON. Senator, I have sort of two comments. One, it was 

mentioned that a sports economist provided a study. Actually, Dr. 

Hal Singer also provided a study on the sports economists saying 

that an important reason why the NFL keeps games on broadcast 

television is because it is able to control its product. So there was 
14 

conflicting evidence before the FCC. I respect what Mr. Lake said, 

that the FCC made one conclusion. 

The NFL’s business judgment is that this is very important. But 

I think it misses sort of a larger point. Senator, with respect to 

your constituents, they have seen every Giants game this year, last 

year, the year before, the year before that, all the way back to the 

early 1990s. 

If you look at the Knicks games, all of those Knicks games are on cable television. They have to pay $80 a month to get their 

Knicks games, to get their Rangers games and to get almost all of 

their Yankees games. But they have seen every one of their Giants 

games and I daresay every one of the Jets games going back for 

that same timeframe. 

So I recognize that there are blackouts of NFL games. They are 

few and far between, but the NFL’s commitment to broadcast television, actually, I think stands out among the other sports leagues. 

Senator BLUMENTHAL. But the threat continues to exist in Connecticut and around the country that they will be deprived of access to those games. And if the reality is that they are seeing the 

games anyway, why continue with the threat of blacking them out? 

It seems to me that your contention is that the blackout policy 

is essential to your business policy. In fact, it is the antitrust exemption that is essential to your business policy. Without the antitrust exemption you would not be able to negotiate the enormously 

lucrative broadcast agreements that you have and the revenuesharing pacts that you enjoy and as a condition for receiving that 

very public and unique benefit, why not eliminate the threat to 

Connecticut consumers and others around the country, fans across 

the United States that simply because of a failure beyond their 

control of big business interests to reach an agreement, they may 

be deprived of access? 

Mr. WALDRON. I recognize that the Sports Broadcasting Act gave 

an exemption to all of the sports leagues. In our view, the NFL has 

used that exemption very responsibly by putting overwhelmingly 

its games on television. But to be clear, major league baseball testified last year before the Senate Judiciary Committee, the only reason why the World Series is on Fox television is because of the 

Sports Broadcasting Act. 

So it ensures that broadcasters—and I would say, if you look at 

the NFL in comparison to the other leagues, I think the League 

has used its antitrust exemption very responsibly by putting so 

many of its games, all of its regular-season games and all of its 

playoff games on free television. I acknowledge that there is—last 

year there were two. This year there have been none so far, that 

they are few and far between, but the overwhelming number of 

games are on television and we think that is a responsible use of 

the SBA provision. 

Senator BLUMENTHAL. And the overwhelming number of games 

also are sold out in the stadiums. Are they not? 

Mr. WALDRON. Yes, that is correct. Yes. 

Senator BLUMENTHAL. So why the blackout policy? 

Mr. WALDRON. Because we think over the long term it has served 

to promote that benefit. It is easy to—remember that in the late 

1990s, 25 percent of games actually were still being blacked out. 
15 

Senator BLUMENTHAL. In fact, are there not other actions that 

the teams regularly take? During the 2012 season, the Miami Dolphins bought tickets to prevent a blackout for seven of its eight 

home games. The Jacksonville Jaguars have covered approximately 

10,000 seats at EverBank Field with tarps since 2005, reducing 

their stadium capacity from 76,000 to 67,000. 

The teams regularly take actions to fill their stadium, giving 

away tickets, selling them for less than face value so as to avoid 

blackouts. Why not just eliminate the blackouts? 

Mr. WALDRON. Well, Senator, I view that activity as very pro-fan. 

I think it is evidence that the clubs actually understand. Look, the 

NFL does not want blackouts. The clubs do not want blackouts. 

Senator Lee and Senator Grassley both made that point in their 

opening statements. No one likes blackouts and that includes the 

NFL. 

So I think the examples that you have shown are clubs trying 

to respond and the League has adjusted its policy to be more responsive. We think over the long term it has served and it is in 

the business judgment of the League that it has served it, but as 

that shows, clubs take extraordinary examples to avoid them. 

Senator BLUMENTHAL. I am going to continue this conversation 

with you and the other witnesses, but I now turn to Senator 

Klobuchar. 

Senator KLOBUCHAR. Thank you very much Senator Blumenthal. 

Thank you to all of the witnesses. 

I thought I would start with you, Mr. Waldron. The blackout rule 

was put in place in 1961. Is that right? 

Mr. WALDRON. The Sports Broadcasting Act was adopted in 

1961. The FCC’s rule was put in place in 1975. 

Senator KLOBUCHAR. All right. Good. Well, most of the money 

made by sports tickets—it has been pointed out in the testimony— 

from that time came from ticket sales. But today NFL games are 

consistently among the most popular television programs, certainly 

in my State where we are proud of the Vikings. With that, comes 

a significant increase in revenue—as has been pointed out by the 

other witnesses—for the League. 

The cost of tickets has also significantly increased. It is a big expense. Do sports teams need blackout rules the same way they did 

half a century ago? If not, why do we still have the same rule? 

Mr. WALDRON. No question that those facts are all right. I will 

say—and this is in the record—it may surprise people that as much 

as a quarter of the revenue of the NFL still comes from ticket 

sales. So ticket sales still sort of remain important. 

The NFL has a balance. They want to have popular games on television and they want to have a stadium that is full. You can imagine a scenario in which—the other sports, they play 162 games or 

82 games. So every game is not a special event. 

In the NFL they work hard to make every game a special event. 

So they try to balance that, maximizing the full stadium capacity 

with the engaging of the fans on television. It is a balance and they 

have, frankly, adjusted that balance over the years. So we do think 

that the blackout policy sort of strikes that balance correctly by encouraging fan attendance and also encouraging fan engagement 

over television. 
16 

Senator KLOBUCHAR. Thank you. Mr. Lake, the FCC unanimously voted to repeal its sports blackout rules which prevented 

cable and satellite operators from airing sports events blacked out 

on a local station. What prompted the FCC to change its stance 

and is there anything preventing the NFL or other sports leagues 

from negotiating blackout rules directly with cable and satellite operators now? 

Mr. LAKE. What prompted the Commission’s action was the 

change in the sports industry since 1975 when we adopted our rule. 

Principally, the two facts that the Senator has noted, in 1975, the 

principal source of revenue for the NFL was ticket sales, and over 

60 percent of the games failed to sell out. Now those facts are both 

reversed. TV revenue is the principal source of revenue for the 

NFL and most games are sold out. 

What the Commission concluded from that was that there was 

very little risk that elimination of the FCC’s rule would lead the 

NFL to move its games from broadcast television to pay-TV. The 

objective of our rule from the outset was not to maximize the revenues of the sports leagues or the broadcasters, but to try to protect 

the right of viewers to see games. 

At the time the rule was adopted, it was thought that the rule 

would help to keep games on broadcast TV by eliminating the risk 

that if a cable operator, for example, imported a distant station, 

this might lead the leagues to fail to sell the games to that distant 

station and more viewers would lose the right to see the games. We 

concluded that because of the changes in the industry, the risk no 

longer existed and therefore the rule was outdated. 

I should note though that, to your last question, the Commission’s action simply eliminates the support for the private blackout 

policies that was previously in the Commission’s rules. That action 

does not prevent the leagues from continuing to implement their 

blackout policies as a private matter without FCC support. Although as I say today, blackouts are increasingly uncommon, the 

risk of blackouts continues. 

Senator KLOBUCHAR. All right. Thank you. Does anyone want to 

add anything to that, any of our witnesses? 

Mr. Goodfriend. 

Mr. GOODFRIEND. Thank you Senator. I think this discussion 

would be helped by understanding how we got the law in the first 

place. We are talking a lot about the antitrust exemption as though 

it has always been there. Let us talk about how we got here. 

In 1953, the United States Department of Justice Antitrust Division succeeded in litigation with the NFL on antitrust. 

Are you commenting on the Packers tie? 

Senator KLOBUCHAR. Yes. We are commenting on that. We just 

noticed it and it might not have been your smartest move given 

that half of the Senators here are from Minnesota right now. 

[Laughter.] 

Mr. GOODFRIEND. I was realizing that as I started talking. But 

we gave you Brett Favre. 

Senator KLOBUCHAR. I mean we are not at all distracted. Are we 

Senator Franken? 

[Laughter.] 
17 

Senator FRANKEN. I was just thinking of Senators Feingold and 

Kohl. 

[Laughter.] 

Senator KLOBUCHAR. They used to be—— 

Senator FRANKEN. How they would have enjoyed that. 

Senator KLOBUCHAR. But we are on here now. 

Mr. GOODFRIEND. Yes, you are. 

Senator KLOBUCHAR. Continue on answering. 

Mr. GOODFRIEND. I love the color purple. I am wearing a purple—— 

Senator KLOBUCHAR. All right. Yes, yes, yes. 

Mr. GOODFRIEND. So 1953, U.S. v. NFL, the Department of Justice won a judgment against the NFL for violating antitrust laws. 

Why? Well, there were four things that the court spelled out. 

Number one, the League restricted the broadcasts of games locally during a home game. Number two, the League restricted the 

broadcast of an away game in the home market. Number three, 

same restrictions with respect to radio and number four, a kind of 

blanket power given to the NFL commissioner to restrict broadcast 

overall. 

The court said no. Three of those four violate antitrust laws. 

One, the restriction of broadcasting games locally during a home 

game, the judge allowed to stand. That was 1953. 

In 1960, a new football league, the American Football League 

came along and did a deal with the ABC television network whereby it pooled all of the teams’ broadcast rights and did one nationwide deal. So the NFL tried to do the same thing. It entered the 

same type of deal with CBS. 

No, said the court. That violates our 1953 order. So what did the 

NFL do? It came right here to this committee, the U.S. Congress, 

and it said we need your help. How can it be fair that the AFL gets 

to pool its broadcast rights, but we do not? That is not fair. Congress agreed, and the Sports Broadcasting Act of 1961 was expressly designed to overturn the 1953 Eastern District of Pennsylvania decision while at the same time preserving that court’s decision to allow local blackouts. 

That is how we got here. It was to overturn a case brought by 

the United States Department of Justice during the Eisenhower 

Administration. So what does that mean for today’s discussion? 

The court in 1953 and Congress in 1961 both premised their decision on the importance of local ticket sales, on the importance of 

maintaining the economics of the League. That was over a half-century ago. It is perfectly legitimate for this committee to revisit the 

statute from 1961 and ask whether the same economic principles 

apply today. 

We at Sports Fans Coalition believe they do not. Moreover, we 

think that anytime the Government gives a gift to a professional 

sports league, it is perfectly legitimate to ask, should any conditions be attached to that gift? Does the gift still make sense? It is, 

after all, a gift from the American people to a private multibillion 

dollar organization to get an antitrust exemption for your type of 

business practice. 

Senator KLOBUCHAR. Thank you very much. My time has expired. 
18 

Senator BLUMENTHAL. Senator Franken. 

Senator FRANKEN. Mr. Goodfriend, the threat of blackouts during 

retransmission contract disputes is especially concerning to me because that could potentially affect fans of any major sports league. 

Such contract negotiations seem to be growing increasingly contentious each year. 

Last year, for example, negotiations between Time Warner Cable 

and CBS led to a month-long blackout of programming that affected millions of consumers. As you know, Comcast’s proposed acquisition of Time Warner Cable is currently being reviewed by the 

FCC and the Department of Justice. 

It is a deal that would unite the two largest cable operators in 

the country, and in my view—as I have made very public—it 

should be rejected. I think it is simply a bad deal for consumers. 

I do not believe it would improve service or choice and I believe 

that it will result in higher prices. 

A combined Comcast-Time Warner Cable company would exert 

particular power in the sports programming market. Mr. 

Goodfriend, you have noticed that both companies have long track 

records of trying to prevent individuals who do not subscribe to 

cable from viewing games. Can you explain what that means and 

tell us what you think the implications of the proposed acquisition 

deal would be for sports fans? 

Mr. GOODFRIEND. Thank you, Senator Franken. Let me just note 

that Sports Fans Coalition is on record opposing the Comcast-Time 

Warner Cable merger and filed a petition to deny at the FCC to 

that effect. 

Your question regarding the effect on sports—my learned friend 

from Covington and Burling mentioned Hal Singer, the economist 

who opposed us in the sports blackout proceeding. Interesting to 

note, Mr. Singer also authored a paper that we cited extensively in 

our pleading that said when a cable company owns a regional 

sports network, the tendency is for fans who do not subscribe to 

that cable company to not be able to see the game. That is the 

trend. As opposed to, let us say, an independent regional sports 

network that is carried more widely on other providers. 

Mr. Singer and his colleagues went on to conclude that the bigger the local cable company, the worse the problem gets. And that 

just makes sense intuitively. If I am going to give up some revenue 

by not sharing my sports with you, the smaller you are, the bigger 

I am, the less of a loss it is to me. So that was the conclusion of 

Singer et al. 

Now, in the context of the proposed merger between Comcast and 

Time Warner Cable, take a market like Los Angeles. Los Angeles 

today has Time Warner Cable and as I mentioned earlier, Time 

Warner Cable owns a regional sports network. The merged entity 

would acquire roughly a quarter of a million new subscribers from 

Charter. 

So what does that mean? The local cable company is getting bigger. As a result, the trend we already see today, when Time Warner Cable owns Dodgers games and will not televise those games 

to most fans, it is just going to get worse if the cable footprint gets 

bigger. So that is why Sports Fans Coalition has chosen to oppose 

the merger. 
19 

Senator FRANKEN. Thank you. I am going to get on a little bit 

of a different subject, but I think—Mr. Waldron, this is addressed 

to you. We have spoken a lot today about the significant taxpayer 

support and public benefits that sports leagues, including the NFL, 

enjoy. I think that as a country we provide such enthusiastic support for professional competitive teams, at least in part, because we 

recognize all of the ways in which they can enrich our culture. 

Yet, we have a team in the NFL that continues to call themselves by an offensive name, a racial slur. The use of the name is 

hurtful and insulting to so many people in our country, including 

in my home State of Minnesota where we have a large and vibrant 

Native American community. I have heard from Tribal leadership 

in my State who understandably find this name offensive and 

harmful, as do I. A simple step would be for the NFL to address 

the need for a name change. What is the League considering doing 

at this time? 

Mr. WALDRON. Senator, I recognize the importance of your question. I am not in a position to answer it. I advise the League on 

television matters, but I will consult with them and get back to you 

with an answer. 

Senator FRANKEN. I would appreciate that. Thank you. 

Mr. Chairman. 

Senator BLUMENTHAL. Thank you, Senator Franken. 

Just to continue with some of what we were discussing and I 

think Mr. Lake addressed part of this issue. 

Mr. Waldron, I guess it is your contention that the FCC failed 

to consider certain evidence and therefore reached the wrong conclusion by a 5–0 vote? 

Mr. WALDRON. Sure. I am not embarrassed to say that. I think 

it is an assessment of uncertainties and Mr. Lake cannot prove 

that he is right any more than I can prove that Mr. Lake is wrong 

when he said the FCC’s prediction was changing the sports blackout rule will have no effect on what the NFL does with respect to 

it. 

Their judgment in looking at the evidence and looking at the 

sports economists study and the Dr. Singer study that Mr. 

Goodfriend cited, they said no. That was their judgment looking at 

the evidence. The NFL has been at this for 50 years. It actually 

wants to maximize the number of people in the stadiums. 

Senator BLUMENTHAL. But things have changed over that 50 

years. 

Mr. WALDRON. I understand that and they watch this every 

week. I assure you the NFL watches this every week. 

Senator BLUMENTHAL. Is not the present policy in effect to the 

disadvantage of certain cities over others, certain fans over others? 

For example, the Ralph Wilson Stadium in Buffalo represents 28 

percent of the population in that city. That stadium can hold 28 

percent of the population compared to the capacity of Soldier Field 

in Chicago which represents 2 percent of the population of that 

city. The stadiums in the New York area, probably even a smaller 

percent which may be the reason that they are regularly filled. 

But the threat is there for all fans, New York, Connecticut— 

maybe it falls more heavily on Buffalo, Cincinnati, San Diego, 

Tampa Bay where economic recession population trends may have 
20 

made the markets less robust. Is there not a discriminatory aspect 

here? Also, insofar as it, frankly, hits the elderly, disabled and 

folks who cannot attend because of the price? 

Mr. WALDRON. Two parts to that answer—the first is I think the 

League has recognized that different stadiums and different clubs 

are in different situations which is why it has adopted and adjusted its policy and adopted more flexibility. Frankly, the flexibility that was adopted in—I believe it was 2011 or 2012, frankly, 

it has benefited the very clubs that you mentioned, sort of Tampa 

and San Diego and Cincinnati. That is one of the reasons why we 

have not seen. 

To the point about the elderly—and we have all seen the studies. 

It may surprise people, but—— 

Senator BLUMENTHAL. If I may—and I will let you finish on the 

elderly and disabled and people of modest means who may not be 

able to afford tickets right now. If you are worried about filling the 

stadiums, why not just lower the ticket price? That is the way the 

market normally works. 

You have the immense benefit of an exemption from normal market forces in the antitrust exemption. Why be greedy about it? The 

antitrust exemption are the keys to the kingdom. They are the gold 

mine for you and it seems to me you continue to take a step too 

far. Is it not in your own enlightened self-interest to eliminate the 

blackout rules—step to legislation? 

Mr. WALDRON. Well, I will say all of the sports leagues enjoy that 

exemption. Congress passed it to actually benefit the public by putting sports on free television. That was the judgment when Congress passed it in 1961. But yes, it has been a benefit to the 

League. I do not want to suggest otherwise, Senator. We recognize 

that. But I think it also has been a sort of benefit to the public in 

that regard. 

The Dr. Singer study that was cited earlier, he actually found 

that it actually does have a downward pressure on prices for the 

very reasons that you cite which is that if you want to put people 

in the seats, then you are going to lower your prices and you actually have an incentive. Because of the blackout policy, clubs have 

that incentive that you sort of point at. 

But I do not want to lose sight of your very important comment 

about the elderly and Latinos. Many of those same people actually 

cannot afford cable. And yet to watch every Sabres game they are 

going to have to pay $80-$100 a month to watch every Sabres game 

and that is for 6 months of the season. To watch their Bills—everyone wishes they would watch all of their games, but they certainly 

watch all of their away games. Every Buffalo Bills away game is 

on free, over-the-air television in Buffalo and as many as are sold 

out. 

So we think that the League has actually used its benefits under 

the SBA responsibly and to benefit the public. 

Senator BLUMENTHAL. I am going to ask some of the other witnesses to respond to the points that you have made very well, Mr. 

Waldron. 

Mr. Lake, in essence, I think you have heard Mr. Waldron say 

that the FCC could and should have adopted a contrary conclusion. 

What would you say to that? 
21 

Mr. LAKE. We held a public proceeding in which we received extensive comments from a wide variety of parties, including conflicting presentations by economists. The conclusion of the five 

unanimous Commissioners was that based on that record, elimination of our sports blackout rule would not be likely to lead the 

League to move their games off of over-the-air television and on to 

pay-TV. 

We also noted, the Commission noted that the contracts today 

extend through 2022, so that ensures that they will remain on 

over-the-air television until at least within that period. 

Senator BLUMENTHAL. So the FCC, in essence, to put it from the 

fan’s perspective, found no uncertainty as to what would happen to 

broadcasts? 

Mr. LAKE. They certainly concluded that the very likely result is 

that this would not take games off of over-the-air television. 

Senator BLUMENTHAL. Mr. Goodfriend, do you agree with that 

conclusion and particularly as it affects the smaller cities and fans 

in those cities and the threat to fans in larger cities as well? 

Mr. GOODFRIEND. Well, Senator, you will note from our prior conversation, I am wearing a Green Bay Packers tie, so I care about 

small market teams very much. And I think it is a little bit of a 

red herring to argue that all this is made possible solely by the beneficence of the U.S. Congress in granting the antitrust exemption. 

The NFL is not running a charity. They are a highly profitable 

multibillion dollar organization. They put their games on television 

because that is where the money is. They put their games on 

broadcast because that is where the audience is. The day that 

Pepsi and Budweiser and GM stop paying top dollar for top ratings 

on broadcasts, we will see a change. But until that day comes, the 

NFL is maximizing its revenues as any rational business actor 

would. 

Now, Professor Rod Fort at the University of Michigan, in the 

submission that he made to the FCC, pointed out that even under 

the most exotic assumptions, the threat of a local blackout might 

put a few thousand more people in seats on any given Sunday. 

Contrast that with the loss of revenues from taking a game off 

broadcast. It would be in the millions, perhaps tens of millions. 

So, Professor Fort concluded the rational economic actor would 

say, I am not going to give up all of that money on the broadcast 

TV side just to put a few thousand more people in seats. That is 

why, intuitively, you could say there really is not going to be too 

much of a connection between putting games on broadcasts and 

having a local blackout policy or an antitrust exemption that sustains it. 

Rather, the League will make money. That is what it does best. 

And if it thinks it is going to make more money putting games on 

broadcasts, then it will do so. If it thinks it is going to make more 

money putting it on ESPN, as we saw with Monday Night Football, 

or putting games on Thursday night on the NFL Network, it will 

do so. It already has. 

So I think it is important to differentiate between what the 

League gets from its local blackout policy and broadcast TV. I 

think it is a red herring to threaten taking games off broadcasts 
22 

unless we get this antitrust exemption for local blackouts. The 

numbers just do not add up. 

Senator BLUMENTHAL. Ms. Greenberg, what does this mean for 

ordinary consumers and fans? How are they impacted? 

Ms. GREENBERG. Well, there is a problem with fans being able 

to afford to go to games. Our figures are that from 2010 to 2013 

the cost for a family of four to attend an NFL game increased by 

8 percent to $459. 

So that is out of the—pun intended—the league of many, many 

families. So, of course, they turn to free broadcasts to get access to 

their games. 

I am curious about something that Mr. Waldron has said on several occasions, that the NFL has evidenced a lot of flexibility about 

the blackout rule and wonder what evidence there is of that. I 

think what we are really talking about, as David has just pointed 

out, it is enormously profitable, not an act of charity on the part 

of the NFL. It is enormously profitable for the League to have 

games on broadcast television and that is why they do it, not because they are so flexible. 

I do not understand, as you pointed out, fighting this blackout 

rule issue when it does not seem to be a problem for them and they 

could be part of the solution instead of being part of the problem. 

So for fans, it is obviously critically important for those fans who 

cannot make it to the game—for physical disabilities, because the 

costs are too high, because they have kids at home—I am puzzled 

by why the NFL is fighting your very, I think, sensible proposal. 

Senator BLUMENTHAL. Mr. Waldron, has any consideration been 

given within the NFL—I know you cannot speak for other 

leagues—but within the NFL to changing the blackout rule? 

Mr. WALDRON. After the FCC repealed its rule in late December, 

Commissioner Goodell said that he was going to study it and my 

understanding is that the owners’ committee is studying this issue. 

Senator BLUMENTHAL. And is there a time line for it possibly, actually, reversing the rule? 

Mr. WALDRON. I am not aware of any time line for that, Senator. 

I can get back to you. I am not aware of any time line. 

Senator BLUMENTHAL. If you could let us know whether there is 

any time line for the committee reaching a conclusion, I would appreciate it. 

Mr. WALDRON. All right. 

Senator BLUMENTHAL. What will be the determining factors in 

the consideration that the owners and they are the ones who decide? Am I right? 

Mr. WALDRON. Yes. 

Senator BLUMENTHAL. What will be the determining factor in 

their decision? 

Mr. WALDRON. Well, it is a really good question and I will come 

back to a comment that was just made. My colleague, Mr. 

Goodfriend, referred to an economist’s study that said blackouts actually increase ticket sales by 4,000. That is actually the League’s 

contention and so that is the balance that the League has faced 

which is we want to have fans in attendance and we want to have 

games on television. That is the balance that we face and it has 

been adjusted over the years in order to, frankly, take care of some 
23 

of the large stadiums that were out there and lots of sort of consequences. 

So that is the consequence which is the incentive for fans to attend as well as maximizing broadcast television because we do not 

like blackouts. No one likes blackouts, but they sort of look for that 

balance. So that is exactly what the owners’ committee is looking 

at. 

Senator BLUMENTHAL. I would strongly encourage them to do the 

right thing on their own. I think they would become heroes rather 

than the opposite which they are now. It is an outdated really outmoded obsolete rule which in many respects, to be very blunt, the 

owners seem to work hard to avoid imposing as a matter of practice. That is why they issue free tickets or low-priced tickets or fictionalize their attendance in other ways. I do not mean fictionalized in the sense of any fraudulent activity, but—— 

Mr. WALDRON. I understand. 

Senator BLUMENTHAL. They go through the pretense of filling a 

stadium so as to avoid a blackout, which is against their interests 

and the threat of the blackout gives them a black eye no matter 

what they do. So I look forward to hearing more. 

Mr. WALDRON. I will share that perspective. Thank you, Senator. 

Senator BLUMENTHAL. Ms. Greenberg, I hear about cable rates 

all of the time. You have raised the issue very appropriately. When 

we talk to cable companies, they point to the costs of sports as driving, in many respects, these rates skyward. Is it fair to blackout 

games after driving up those costs to the fans of, in effect, buying 

the cable services? Mr. Waldron has raised this consideration as 

well. 

Ms. GREENBERG. Absolutely not and consumers are right to be 

furious about the fact that they are paying these very high rates 

and may not even have access to the sports programming that they 

are paying for. Not to mention, all of the other subsidies that taxpayers and consumers provide to sports teams. No, it is patently 

unfair and that is one of the reasons why we are so strongly supportive of this legislation. We think consumers are angry about it 

and they have a right to get access to the programming that they 

paid for. 

Senator BLUMENTHAL. And when you go back to your client 

whom you have represented well here today, Mr. Waldron, I hope 

you will remind them that we are acutely aware of those other public benefits that the League enjoys and not just your league, again. 

It is not meant to put the focus only on the NFL, but those benefits 

and subsidies, and infrastructure whether it is transportation or 

stadiums or other kinds of public benefits that professional sports 

enjoys and we have chosen to single out one, which is the antitrust 

exemption, but these public trusts really demand a public trust 

from the League itself. Special public benefits, in my view, demand 

a recognition of that public trust from the League. 

Do any of the other witnesses—Mr. Goodfriend. 

Mr. GOODFRIEND. Senator Blumenthal, there is one category of 

Americans here who has not been mentioned and is harmed by the 

local blackout policy. I just want to make sure this goes on the 

record. Local broadcasters, local grocery stores, local business peo-
24 

ple often scramble at the last minute to buy up blocks of tickets 

in order to avoid a blackout. 

Now if ever there was an example of a tax being imposed on 

business people, that is it. And it is a tax imposed on them by virtue of this protection, the antitrust exemption, allowing the League 

to threaten a blackout. 

Now I will point out that Sports Fans Coalition in our reply comments described allegations provided to us by an executive who 

wished to remain anonymous. This person said that the reason why 

those three playoff games that you alluded to in your opening 

statement in Green Bay, Indianapolis, and Cincinnati, the reason 

why those threatened blackouts did not occur, it was alleged, was 

because the NFL pressured broadcast networks to buy up unsold 

tickets in order to avoid the blackout. 

Now let us just assume for a moment that that allegation is true. 

Let me get this straight. The U.S. Government gives the NFL an 

antitrust exemption. The NFL takes that antitrust exemption and 

exerts power on other third parties to get them to buy something 

from the NFL at full value. 

Now the NFL had every opportunity to turn around to me, the 

Sports Fans Coalition, and say that the allegation is blatantly 

false. How dare you make such allegations? Instead they said nothing—nothing—for weeks, nothing. 

When it was their turn to file at the FCC, the best they could 

come up with was if Sports Fans Coalition really purports to speak 

for fans, we should not care how we avoid local blackouts. In my 

opinion, Senator, that is a tacit admission. 

So do we allow the League to avoid blackouts by coercing others 

into buying blocks of tickets? They talked about how few blackouts 

there are. Yes, that is true, but how did we get there? Do we allow 

the League to avoid blackouts under its own policy by coercing others, allegedly, to purchase tickets? Or do we just say enough is 

enough? You do not get the gift anymore. You do not get to have 

your antitrust exemption for local blackouts. There would be a loud 

cheer not just among fans, but in my opinion, local broadcasters, 

local grocery stores, and local business people, if we did that. 

Senator BLUMENTHAL. Thank you. I might point out with respect 

to those local businesses and grocery stores and broadcasters, if 

they got together the way that the clubs or teams do in collaboration to maximize their bargaining power, they would be seeing 

their State Attorney General or United States Attorney Geneneral 

and they would be in court defending against an antitrust prosecution, civil or criminal. So this exemption is really very special, very 

unique, and very undeserved if the leagues, in my view, fail to recognize their special public trust because of that unique exemption. 

So I would invite any other comments. If there are none, we are 

going to keep the record open for 1 week and I will adjourn the 

hearing. Thank you. 

[Whereupon, at 12:30 p.m., the hearing was adjourned.] 

[Additional material submitted for the record follows.] 
(25) 

A P P E N D I X 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD
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PREPARED STATEMENT OF SENATOR JOHN MCCAIN
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PREPARED STATEMENT OF WILLIAM T. LAKE
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PREPARED STATEMENT OF DAVID R. GOODFRIEND
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PREPARED STATEMENT OF SALLY GREENBERG
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PREPARED STATEMENT OF GERARD J. WALDRON
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PREPARED STATEMENT OF CHAIRMAN PATRICK J. LEAHY
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QUESTIONS SUBMITTED TO GERARD J. WALDRON BY SENATOR FRANKEN
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QUESTIONS SUBMITTED TO DAVID R. GOODFRIEND BY SENATOR GRASSLEY
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QUESTIONS SUBMITTED TO SALLY GREENBERG BY SENATOR GRASSLEY
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QUESTIONS SUBMITTED TO WILLIAM T. LAKE BY SENATOR GRASSLEY
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QUESTIONS SUBMITTED TO GERARD J. WALDRON BY SENATOR GRASSLEY
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RESPONSES OF DAVID R. GOODFRIEND AND SALLY GREENBERG

TO QUESTIONS SUBMITTED BY SENATOR GRASSLEY
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RESPONSES OF WILLIAM T. LAKE TO QUESTIONS SUBMITTED

BY SENATOR GRASSLEY
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RESPONSES OF GERARD J. WALDRON TO QUESTIONS SUBMITTED

BY SENATOR FRANKEN AND SENATOR GRASSLEY
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