Senate Judiciary Committee holds hearing on Higgins' FANS Act

Testimony focuses on sports blackouts, antitrust exemptions and impact on consumers

The U.S. Senate Committee on the Judiciary held a hearing today to examine the Furthering Access and Networks for Sports (FANS) Act introduced in the House of Representatives by Congressman Brian Higgins, D-NY-26, and in the Senate by Sens. Richard Blumenthal and John McCain.

The FANS Act:

•Removes alleged anti-trust exemption that allows the NFL to blackout home games if they don't sell tickets

•Forbids cable companies from using the threat of blackouts in contract negotiations

•Asks leagues to make home games available on the Internet when unavailable on TV 

"Today's hearing provided thoughtful discussion and tough questions about the impact of NFL policies on consumers, taxpayers and fans," said Higgins, who has been outspoken in opposition to the FCC's blackout rule and NFL's blackout policy. "I appreciate Sen. Blumenthal's leadership on this matter and look forward to continuing to work with my colleagues in the push for fan fairness."

Blumenthal presided over the hearing, which included testimony from a number of witnesses. In his questioning, Blumenthal cited the unfair disadvantage in smaller markets, noting for a sellout to occur in Buffalo, 28 percent of the local population must purchase tickets, whereas in Chicago, a sellout represents only 2 percent of the local population.

McCain's testimony pointed out, "2014 has been a good year for those of us advocating an end to sports blackouts. In September, the FCC voted to eliminate its sports blackout rule. That rule prohibited a cable or satellite company from carrying a game that is blacked-out within the local broadcast area, leaving sports fans in the dark. ... However, the FCC's vote was not the final word on sports blackouts, failing to address the root causes for a majority of blackouts. ... This is an issue that must be addressed by the league itself. And, if the NFL fails to show leadership, then through congressional action."

McCain continued, "There is something wrong with a situation in which the NFL can say to all those fans who have made the league what it is today, 'You had better purchase tickets, or else.' The NFL and its teams have benefitted from myriad public benefits, including an exemption from antitrust rules, a specialized tax status, and taxpayer dollars that subsidize their million-dollar football stadiums. These public benefits carry with them a responsibility back to the public - an obligation to treat their loyal fans with fairness."

Federal Communication Commission Media Bureau Chief William Lake noted, "Ticket sales are no longer the primary source of revenue. The massive popularity of that sport 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."

Speaking for the fans, David Goodfriend, founder and chair of the Sports Fans Coalition, said, "The NFL should end its local blackout policy once and for all, effective immediately. Fans hate local blackouts."

Goodfriend backed his point with examples including concerns from a Western New York fan, "Just listen to two fans who told the FCC how they feel: Denis Steinmiller from North Tonawanda, New York, said, "I'm 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 help me deal with PTSD. Please put all the games on TV for me and others who gave much of ourselves for our country."

Sally Greenberg, executive director of the National Consumers League, addressed the impact on consumers. She pointed out, "Harvard University professor Judith Grant Long recently calculated that 70 percent of the capital costs of National Football League stadiums have been provided by taxpayers."

She also noted, "The high price of actually attending a professional game puts them out of reach for many Americans. From 2010‐13 the cost for a family of four to attend a NFL game increased by 8.51 percent to $459."

Speaking on behalf of the NFL, Gerard Waldron, a partner with Covington & Burling, argued the number of blackouts have decreased in recent years and the NFL's practice of televising games on free, over-the-air television meets their responsibility to fans.

The complete testimony of witnesses is available through the Judiciary Committee's website at: http://www.judiciary.senate.gov/.