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FCC lifts regulations on local sports blackouts.

Summary: Can’t sell out your stadium? For National Football League (NFL) teams, and other selected sports franchises, the result wouldn’t be simply a loss of revenue. ...

Can't sell out your stadium? For National Football League (NFL) teams, and other selected sports franchises, the result wouldn't be simply a loss of revenue. Thanks to a Federal Communications Commission (FCC) regulation, fans in the stadium's surrounding television market would also not be able to see the game, a practice known as a "blackout."

However, in a 5-0 vote, the FCC voted on Sept 30 to do away with the practice, lifting the restriction barring cable and satellite television providers from carrying games blacked out on local channels. The FCC says that the move is a shift towards less government interference and more accountability for professional sports teams teams.

"It is the leagues that control whether sports fans can watch the games they want to watch. ... For 40 years, these teams have hidden behind a rule of the FCC. No more," said FCC chairman Tom Wheeler in a statement to Reuters. "It's a simple fact, the federal government should not be party to sports teams keeping their fans from viewing the games, period."

The NFL had remained in support of the rule, which has historically been used as an argument in favor of bringing fans to the stadium. The blackouts, the logic says, are a way to cement local fans coming to the stadium, in fear of potentially missing out on the team's game.

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But in recent years, and as football ticket prices have skyrocketed, fans have been outspoken against the rule. Since the start of 2013, only two NFL games -- less than 1 percent -- have been blacked out, although some teams have avoided blackouts through team owners or local businesses buying spare tickets in bulk.

Some are viewing the FCC's ruling as a victory for sports fans. However, blackouts will likely not be completely going away. As Forbes notes, the FCC rule covers only cable and satellite restrictions on local channel blackouts. The sports leagues in question -- most notably the NFL -- govern the actual local channel blackouts themselves. All the FCC regulation did was bar a service provider from providing customers another relevant channel in place of the blacked out channel.

Most service providers, such as Comcast, Time Warner and DirecTV, already have preexisting deals with professional sports leagues. Thus, with no regulation, it's not a stretch to believe that the same sort of deal that was formally in the regulation will be included into contract agreements between the two sides. Ultimately, the final effect of the FCC's decision may not be a victory for consumers (or perhaps only a moral one), but instead a coup for television service providers that now hold slightly more leverage in contract negotiations with professional sports leagues.

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Publication:Inside Counsel
Date:Oct 1, 2014
Words:512
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