Senators Want Their NFL TV
ALISON STEWART, host:
It's not often that two ranking members of the Senate Judiciary Committee get together and sends somebody a stern letter. All right, take a shot. Who do you think received the missive? Nobody about CIA tapes, not Jaime Lynn Spears' mom. Here's a hint. Many in the constituents of Democrat Patrick Leahy of Vermont and Republican Arlen Specter of Pennsylvania can't watch their hometown football teams, the New England Patriots at the Pittsburgh Steelers.
Why? Because the game is running in the NFL network and that channel is in about, well, only 35 million homes; only carries eight regular season games. So Leahy and Specter threatened to reconsider the league's antitrust exemption. If the games aren't made available to more viewers, and after, well, reading that letter, the NFL commissioner kind of blinked.
Joining us now is someone that BPP listeners may remember. Yesterday's guest host, Bill Wolff, my husband, who also happens to be - I'm going to brag on you in a minute, Bill, okay. You're' ready?
BILL WOLFF: Well, into it.
You are a former ESPN producer for over a decade, so that's the sports angle; you graduated cum laude with a degree in history from Harvard, so that's antitrust stuff; and now you are cable news executive, so that's the TV part of the story.
WOLFF: I'll tell you, on paper, I matter.
(Soundbite of laughter)
PESCA: I think, didn't you placed well in the punt, pass and kick competition?
WOLFF: Wasn't allowed, father was afraid of injury. I water polo instead. And, by the way, it's not clear if Leahy and Specter didn't send a letter to Jamie Lynn Spears' mom.
STEWART: Okay. We don't know that.
PESCA: Well, won't they have a bigger effect to say sent that letter, if they sent it to the NFL Commissioner?
WOLFF: I think, literally, this is what you call a grandstand play.
(Soundbite of laughter)
WOLFF: Honestly, is this the most important thing that two U.S. senators on the Judiciary Committee need to be doing? Frankly, because people in Vermont who love the New England Patriots and people in western Pennsylvania who love the Pittsburgh Steelers, love the Pittsburgh too, this is what they're doing with their time. I think this is the ultimate grandstand play and I think I personally feel like it's a silly threat. I don't think that they will revoke the NFL's antitrust exemption.
STEWART: Let's roll back a little bit. Why is the NFL network still available in so few homes after more than four years of existence?
WOLFF: Because the NFL is in it. It comes down to money, of course. The NFL and the cable operators, Time Warner and Cox and Comcast and Cable Visions and all the different ways that people get cable television, are in a dispute about how much money the NFL will charge consumers to have the product.
The NFL would like to be on basic cable system and would like to get a certain amount of money each month from every subscriber no matter whether or not the subscriber watches the channel, right? You are both familiar with how cable TV works.
STEWART: Why don't you give us, say, in one sentence.
WOLFF: In one sentence, every channel on the cable dial adds into your bill whether or not you watch the channel. If you watch - if you don't watch CNN, it doesn't matter. Some amount of money like a dollar or $2 per month goes from you to CNN…
STEWART: To CNN.
PESCA: Discouraged. And a lot of the channels got a couple of sense, but the NFL wants to charge…
WOLFF: A lot of money like $2 per subscriber no matter whether or not you watch the NFL network. In the case of Time Warner cable, which - who runs the cable in Manhattan for instance, Time Warner cable would like to put the NFL on a pay-per-view basis like HBO or Cinemax or Showtime and charge only those people who want it an extra premium to get it.
So it's a dispute over how much money will the consumer pay to the NFL to get the games and the NFL is negotiations with various cable companies across the country and they're only in, I think, its 30 percent of American cable home. So that's why it's still only on such a few - small number of cable homes the money dispute about the fees.
STEWART: Let me read a line from this letter sent by Specter and Leahy, threatening the antitrust exemption. Now that the NFL is adopting strategies to limit distribution of game programming to their own networks, Congress may need to reexamine the need and desirability of their continued exemption from the nation's antitrust laws.
STEWART: You're reaction.
WOLFF: My reaction is it's just sort of saber-rattling in order to force the NFL into a weaker position in negotiating with the cable companies. And, eventually, the two sides of the NFL and the cable operators get together and make a deal.
And it's not clear to me whether it will be a pay-per-view deal like the cable companies want or if it will or I should say a premium channel of the way the cable companies want or whether it will be on basic cable with the way the NFL wants.
But it's all part of a bigger negotiation and this is just another rattling of the sabers. It's interesting that the senators are on the side of the cable companies. It's not clear to me who the good guy is here. You know, the cable companies are virtual - mention oligopoly, it's not a monopoly. But if you and I, Alison, want cable television in Manhattan…
STEWART: Whether (unintelligible) more. That's it.
WOLFF: …that's it. And if they charges a thousand dollars a month, then we really got a habit. We got to pay the thousand. We can't go to some other…
STEWART: Oh, that would be negotiated between you and me…
(Soundbite of laughter)
STEWART: …if that would happen. Hey, Bill, stick around because there's another shoe to drop in this story. Roger Goodell reached out to Time Warner. Time Warner said, Mm, thanks not so much. I want to get to that issue in just a minute, as well as to the top CDs as voted by NPR listeners on ALL THINGS CONSIDERED. Bob Boilen is going to join us. Hey, Bill, can you sit tight for five minutes?
WOLFF: But, of course.
STEWART: All right, stay with us. I'm Alison Stewart. That's Mike Pesca. This is THE BRYANT PARK PROJECT from NPR News.
(Soundbite of music)
PESCA: Welcome back to THE BRYANT PARK PROJECT from NPR News. We're on digital ascend satellite now online at npr.org/bryantpark. Some people can pick us up in their feelings, I'm Mike Pesca. We're talking with Alison Stewart's husband, Bill Wolff, the NFL network and their Thursday night games, which almost no one sees Pittsburgh beats St. Louis yesterday, but I had to find that out this morning from ESPN.
Bill, here's my question, the whole thing is about saber-rattling and the antitrust exemption, right?
BILL WOLFF: Yes.
PESCA: If the NFL were to lose the antitrust exemption, would the whole league wither in the XFL suddenly would gain credibility. I mean, would the, would bad things happen if they lost that antitrust exemption?
WOLFF: Well, bad things would happen to the NFL, but good things - you know, every time there's a bad thing that happens. In this world, generally something, it's a good thing for somebody else. It's a zero some games. So, for instance, if they lose the antitrust - one way that this trust works for the NFL is they control the labor market. Where else will a kid go, who wants to play professional football? Nowhere, the NFL is the only place.
So if the NFL says to college football players, we want you to stay in school for three years or you can't come into our league for three years after you graduate from high school. You know, what does a kid going to do? The NFL gets a way with it because they have antitrust exemption.
If the antitrust exemption is lost, then just as in basketball where high school players are allowed to go or used to be allowed to go to professional basketball. You might see an influx of 18-year-old kids in the NFL, which could be bad for the NFL. At this point, the college football system works as a farm system.
STEWART: A theater, yeah.
WOLFF: It is right, a theater. They develop and you know, how much the NFL pays for that?
PESCA: It's pretty cheap.
WOLFF: Oh, yeah. Oh, that would be bad for the NFL. Yeah, they would then maybe have to develop their own farm system, which would cost them money. So I don't think anything - they would still the NFL would still be the NFL. It's still a money-making machine like few others in the history of humanity.
So they'd still be that same money-making machine, but a lot of the conveniences that the NFL enjoys like a basic control of the labor market and also being able to dictate to some degree where their member franchises can move, they would lose all of that.
And you could see a franchise move every single year with no restriction. AT this point, there is some resistance to franchises moving, right? They have to apply to the league. Or, they have to go to the courts and say we want to move and then the courts have to say, you can move and it's a process. If the antitrust exemption were lost, the league would simply lose control over some of the things on the edges that they now control.
PESCA: I don't think it would cost the XFL to spring up. Again, I don't think it will be a competitive league, but it would simply make it a little bit more inconvenient, a little left in the (unintelligible) I should say for the NFL to do business. At this point, it's great to be the NFL.
STEWART: Okay, one more question before we let you go. The NFL Commissioner Roger Goodell who gets this letter from Leahy, these two senators who were saying, hey, you might take away your antitrust exemption. And he writes to the head of Time Warner cable. Goodell, though, saying, okay, let's get involved in some sort of an arbitration that I'll change access to the network's games if you will engage in this kind of arbitration. And then Time Warner says no, we're not that interested.
STEWART: What was the motivation the time Goodell reaching out like that and then what will be Time Warner's motivation to say no?
WOLFF: I think Goodell's motivation is, first of all, there's a big, big game coming up next Thursday night. It's the New England Patriots who, as we've discussed on the show haven't lost yet. And so there, it will be a very, very attractive game for NFL fans. Everybody wants to see if the Patriots will go through an entire season not get beaten.
So this is a grandstand played by Roger Goodell. Hey, fans, I want to give you this game. NFL network is your friend…
STEWART: I want to work with you.
WOLFF: I want to work with you. I'm reaching out to you and I want to get this done. And, by the way, it's in the NFL's interest to get this done. They're not in any homes. It would be great. They would make more money if they were in more homes.
So I think Goodell is making a grandstand play, and I think he wants to get it done. I think he wants to see the NFL network in more homes. But the driver is this New England Patriots games, which is conceivably a very lucrative proposition for the league…
STEWART: Which is next Saturday, by the way, the 29th.
WOLFF: And - exactly. So that's part one on the other side of it, you know Time Warner cable is extremely powerful. They own a giant - they own many giant markets, including New York City and they aren't - every other channel they have, Fox News Channel and The History Channel and MSNBC and every other channel they've got, they've reached terms, they've come to terms with those channels without binding arbitration so why would they leave the fate of all of this money in the hands of some neutral third party who might rule against them?
STEWART: Bill Wolff, thanks for walking us through it.
WOLFF: You got it.
STEWART: I'll talk to you later. I have things to discuss with you. Christmas parties and such.
WOLFF: Oh, I can't wait.
STEWART: Okay. Bye.
PESCA: That's how I was going to end my interview.
(Soundbite of laughter)
PESCA: How about some news?
STEWART: From Rachel Martin right now.
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