Thursday, March 06, 2008

More Sports on the Hill

So far this year, Congress has held hearings on baseball (several), Spygate, and, once again, the NFL Network-Cable Operator debate. Yesterday, NFL Commissioner Roger Goodell, ESPN President George Bodenheimer, executives from Time Warner and Directv, and policy analysis from non-profit organizations testified before the Telecommunications subcommittee of the House Energy and Commerce Committee. The topic? "Competition in the Sports Programming Marketplace".

As usual, nothing was resolved. Goodell asked Congress to crack down on cable operators (namely, Time Warner and Comcast) who refuse to carry the NFL Network on a basic sports tier in favor of networks in which they have an equity stake. The cable operators shot back asking Congress to force the NFL Network to offer its Sunday Ticket package to all consumers, not just Directv.

And so it goes. These type of hearings have become commonplace recently in Washington, D.C.
I attended the Sport and Recreation Law Association conference last weekend in Myrtle Beach, S.C. Dr. Mark Nagel of the Univ. of South Carolina and Jennifer Gibbs, a law student at Emory, presented on some of the current regulatory issues facing the cable industry, focusing on the bundling aspect. It's good to see some academic discussion beginning to surface on this issue.

I have come full circle on this. Neither side is right, yet both sides are right. I understand why Goodell wants Congress to breakup the monopoly power that cable companies have in a given market. I understand why cable operators want Congress to dissolve the exclusive arrangement between the NFL and Directv for Sunday Ticket.

But, it strikes me that the carriage issue (topic of yesterday's hearing) is best left to the marketplace to decide. Fans who really want to watch the NFL Network should switch to satellite (if they can. I know a view of the southern sky is required). Fans who cannot switch and cannot receive the NFL Network should press the marketplace to find alternatives, such as Verizon's FIOS, to deliver video content into their homes.

The solution to this problem is not for Congress to step in and regulate. It is for the markets to sort it out. If the NFL Network (or Big Ten Network or any other governing body-owned entity) or the cable operators find they are losing money or customers, they will adjust their business models. It is what markets do. This debate is too young (18 months) for Congress to step in and regulate. The markets have not had a chance to work it out.


Post a Comment

<< Home