Home Team Isolation in NYC May Spell Trouble for the NFL

Red Zone ChannelToday, everyone is talking about the potential blackouts for some of the playoff teams in the first round of the NFL playoffs, but that’s not my issue. While such an issue could be bad news for the NFL as people in Congress are already grandstanding on the issue, I don’t think it’s a big deal. The team’s in threat of having their games blacked out in their local markets have already gotten an extension to sell enough tickets to avoid the blackouts. And the owners will buy the rest of the tickets if need be. No way these local fan bases don’t get to see their teams play. Won’t happen!

That said, this is not the week of the NFL season that concerns me and my issue with the NFL. It’s every week before this one. From Week 1 to Week 17, me and my New York City brethren, have to sit through crap football with nothing else to watch. Now, I know what you’re saying: “Well, if you’re a fan of the Jets or Giants, you get what you deserve.” This is true. However, I’m not a fan of either or those teams, and quite frankly, nobody was a fan of either of those teams this past season.

But there are two things to really think about. First, New York City is the city with the most fans from other cities. This is an old stat from Wikipedia, but certainly would have had an effect on today’s state of NFL fandom: in a national survey, New York City ranks first among U.S. cities that people would most like to move to. And in 2010, about 252,000 people moved into New York City. That’s a lot of football fans with different team affiliations.

Second, isn’t there something to be said for giving the nation’s biggest market the best games? I’m not trying to sound like a New York City elitist, but “simple math,” albeit perhaps too simple, would suggests that people tuning out of meaningless and Jets and Giants games would mean lower ratings for the networks that broadcast them. Now, maybe the numbers actually do show that if you show the home team, you get a higher rating in the city.

However, the fact that these media companies often “signal” (some might call it colluding, but I wouldn’t do that), and for example, make sure that when a Jets game is on CBS there aren’t any alternative football games being shown on Fox during the same time slot, would suggest to me that they know I am more likely to watch the non-home team game if given another option. But as it stands, the networks probably only get a minor bump in the ratings if they put on a better game than whatever the Jets or Giants are playing in. And in all likelihood, that bump probably isn’t enough to offset the boatloads of money networks make off selling advertisers football exclusivity in the New York DMA via their owned and operated TV stations.

So networks won’t change. CBS and Fox won’t battle it out for New York eyeballs during the day when they can avoid it. In their defense, they don’t do it every Sunday, but in my lazy, football-crazed, perhaps-beverage induced mind, I don’t ever understand the reasoning behind the few times a season they do play another football game opposite the home team.

But things will change. They will change, because people like me actually do have other options. No, I’m not talking about DirecTV. No self-respecting sports fan in New York City has satellite TV (without cable as a backup) because of the crappy rain storms we get here. But Time Warner’s Red Zone channel may make CBS and Fox rethink the way they broadcast games in New York.

For those who don’t already know, the Red Zone channel is a live-look in channel that allows you to watch all of the best moments of the NFL without ever seeing a commercial. In fact, the channel prides itself on not showing any commercials. And in the rare instance there is no game-action to be seen, the Red Zone channel will catch you up on previous scores or go deep into fantasy football updates–something the true football geeks have to have.

Manhattanite’s just got the Red Zone channel in 2012, and they were among the 13 million or so that it became available to when Time Warner Cable struck a deal with the NFL network. And in that first season that the Red Zone was available to New York City and all of Time Warner Cable’s subscribers, the NFL’s ratings dropped by 5% year-over-year. And while a lack of published Red Zone channel ratings prevent me from figuring out how much of an effect the 3.5 million Red Zone subscribers had on that 5% drop in NFL game ratings, my hunch is that it has something to do with the precipitous decline. In fact, word on the street is that despite the 60% increase in fees that CBS and Fox are paying for their latest contracts with the NFL, they were willing to pay more if stricter limits were placed on the Red Zone channel.

Now, it’s entirely possible the NFL is playing the long-game or is just solely betting on the fact that cable bundles will go away one day, and that they will one day make the majority of their money by usurping value from subscription channels like ESPN and Fox Sports 1. And perhaps they are right. Maybe all the Red Zone channel does is increase exposure for the NFL, and they believe they will always be able to monetize that exposure.

But if the NFL isn’t right, and if commercial ad dollars remain the primary way in which they get value for their Sunday games, then this home-team isolation play they are running in New York City, and perhaps other major markets, isn’t going to float for too much longer. If any city in the U.S. has the disposable income to re-up for the Red Zone package and watch the NFL action they want to see, we could continue to see NFL Ratings drop. And then what? Does the NFL respond by canceling the Red Zone channel or upping the price? Maybe. But a move that responsive would come under a lot of scrutiny, and if there’s one thing I know, it’s that the Shield doesn’t like to fight the masses.

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