This could mark the end of the league’s salary cap era, among other changes.
The NFL has been battling a major lawsuit over the past several months, one that involves their out-of-market game package: NFL Sunday Ticket. The argument was that the NFL violated antitrust laws with the package, due to the nature of out-of-market games being exclusively shown on Sunday Ticket.
On Thursday, a jury ordered the NFL to pay $96 million in damages to the commercial class, which includes the 48,000 businesses that paid for NFL Sunday Ticket from 2011 to 2022, and $4 billion to the residential class, which covers the 2.4 million residential subscribers of the package over the same period.
Because this was a federal antitrust case, $4 billion is allowed to balloon to $12 billion. For reference, the plaintiffs were asking for $21 billion in this case, so they could receive north of half of their requested number. Per Sportico , the NFL’s revenue last season was $19 billion, which means that if the $12 billion number sticks after a presumed series of appeals, it will almost certainly impact the league’s salary cap — at the very least.
Recently, Dallas Cowboys owner Jerry Jones stated that he would actually be against a salary cap if teams were allowed to sell their individual out-of-market rights — which is almost assured to be part of the fallout of the NFL Sunday Ticket package. Get ready to hear a lot of that in the coming weeks, months and years, as owners of richer teams will likely try to make up the losses they’re taking in this lawsuit by blocking other clubs from revenue sharing.
Essentially, this case boiled down to whether the NFL’s antitrust exemptions for their broadcast applied to paid television, rather than just over-the-air broadcasts. Ultimately, the jury found in favor of the plaintiffs.
The league’s current television broadcast agreements run through 2033, but the NFL would likely have to renegotiate with FOX and CBS, their early and late game Sunday partners, if the structure of out-of-market broadcasts does change. For perspective, those two partners pay $4.3 million billion a year for their games while YouTube TV is dishing out $2 billion a year for NFL Sunday Ticket. To say the least, this will have a significant financial impact on the league.
Per a league memo that the Associated Press reported on , the NFL once looked at putting out-of-market Sunday games on cable television with FS1, ESPN, ESPN2, TBS, TNT, NFL Network and CBS Sports Network being landing spots. Under that structure, cable networks would have broadcast games at $9 million per game while FOX and CBS would have paid $10 million less per game.
So placing out-of-market games on cable would have been close to a break-even point with the league’s afternoon slate contracts, but it would have completely wiped out the $2 billion per year they currently receive for the NFL Sunday Ticket package. That is where individual teams selling their own out-of-market packages comes into play, along with Jerry Jones’ line of thought about how if there’s no revenue sharing with these out-of-market packages then there’s no incentive to have a salary cap in the league moving forward.
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Justis Mosqueda wrote: