Football Economics: Why the NFL's blackout policy is outdated

by FSBlueApocalypse on Jun 1, 2009 2:57 PM EDT in Meta-Jaguars Comment 32 comments

The Jaguars-Lions game was blacked out in Detroit this past season.

In part two of this series, I'm going to look at the NFL's blackout policy. It seems that a prerequisite to being a Jaguars fan is knowing the blackout policy by heart so I won't bother explaining it. What I am going to look at , however, is it's intended affect and what really happens due to the blackout policy.

Intended affect

The blackout policy that has been in place since the 1970's is supposed to act as that extra "nudge" to get fans to buy tickets. If the general bowl isn't sold out, no game on TV. The idea is that if ticket sales are lagging, the blackout will hopefully shock enough people into buying tickets that the next home game will be sold out.

Why the Rams and Raiders left Los Angeles

A case study of the NFL's blackout policy can be used with it's last two LA teams. The Raiders and Rams both played in the LA Coliseum at various points. They both left due to it's huge blackout number. Because the Coliseum lacked any "Club" seats, it's blackout number was approximately 100,000. Needless to say, home games in the LA area were blacked out more often than not. The blackout situation and the constant red tape surrounding stadium projects are what eventually led the teams out of LA following the 1994 season.

How this applies to the Jaguars

Vic Ketchman has his position on blackouts quite clear. Even if one ticket if left unsold, then the game doesn't go on TV. That kind of thinking would only hasten the Jaguars heading to London, LA, Mexico City, or where ever else the national media thinks would grab headlines.

In economics, there exists the term externality. An externality is an external affect that can be positive or negative that results from actions a firm takes. In this case, the firm is the Jaguars. and the externality is the affect of fan support resulting from the games being on TV.

When dealing with a positive externatily, you can break things down into three areas, marginal cost, marginal private benefit, and marginal social benefit. The marginal cost is the operating expenses the Jaguars have to cover. This includes player and coaches salaries, hiring security, popcorn guys, etc. The marginal private benefit would be game day related income. Tickets, concessions, parking, etc.

Marginal social benefit is a different thing entirely. The social benefit is what the city of Jacksonville gets out of the deal. When the Jaguars are on TV, not only are grills going around the stadium, but I guarantee they're going all over the city. People all over the city make plans around the game. Around town, everyone is buying hot dogs, burgers, beer, etc and the entire town gets a nice boost ten times out of the year.

That wouldn't happen if the game is blacked out. As much as I love Brian Sexton, in this day and age, if it isn't in full color no one cares. '

Not only that, but in the area between the marginal benefit and marginal social benefit is where the Jaguars can get even more potential ticket buyers. The graph below is intended to give you a visualization of the concept. The numbers aren't that important (I copied and pasted it from an old economics assignment) but it does the job.

The question is, how do the Jaguars then benefit at all from allowing their games on TV even if the game isn't sold out. Simple, the Jaguars have to get their brand out there to be seen. Like it or not, the Jaguars are in competition with the Buccaneers, Dolphins, Gators, Seminoles, Bulldogs, and every other team that has some presence in North Florida. If the Jaguars game isn't on CBS, I can simply turn the dial to FOX and watch the Tampa Bay-Atlanta game. Or even better, I can go watch either the Noles or Gators on Saturday. Simply put, if the Jaguars game isn't show on TV, they suffer.

I'm sure we've all been to a party and watched a home game on TV. Think of all the people you see wearing a Jaguar polo or jersey. If the game isn't on TV, they reduce their chances of convincing someone to buy that.

In addition, putting the games on TV will get the team to sell more tickets. I'll wait a minute for those people who's socks just blew off after that statement.

The Jaguars have to make their product known and worth a minimum of $400 per seat per year. You don't do that by with holding it from the general public. The games on TV are the best free advertisement the Jaguars can get for selling season tickets. The more people who watch at home, the more chances you have of someone saying, "Hey, it would be a lot of fun to go down there next year."

An outdated policy that needs to be revised

I have four tabs open right now on my browser. One is obviously the story editor, the other three are various articles on the current state of General Motors and what it can do to get out of bankruptcy. The entire economy is in the tank, and may stay there for awhile. When a heritage franchise like the Lions can't see out their games, things are in trouble.

The NFL is no longer baseball's ugly stepsister. It's the most powerful professional sports organization in America. The blackout policy was put in place to make sure tickets would be sold, as the demand for football wasn't as great as it is today. Today, football is king. The NFL can afford to allow all of it's games to go on TV.

-Jonathan Loesche

Poll

Do you believe the NFL should change it's blackout policy?

Yes

147 votes

No

55 votes

202 votes | Poll has closed

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Comments

I Say

Get rid of blackouts altogether.

If hip hop is dead, then it happened the day that Dilla died.
-Akrobatik

by Bestjagfan on Jun 1, 2009 3:25 PM EDT reply actions 0 recs

agree

the stadium is like a store. stores go on tv to promote themselves. they dont threaten the consumers by playing less commercials, they increase wen less people come to the stores.the jaguars are a product and to sell a product, the more exposure, the better

by jags2732 on Jun 1, 2009 3:39 PM EDT reply actions 0 recs

Buy the freaking tickets already.

I have heard the hundreds of lame excuses why people wont buy tickets, and not enough reasons why people buy tickets. I fork out the cash to watch the Jaguars on NFL ticket. If lived in Jax, I would buy tickets. People in Jacksonville dont need to be sold on the fact that the Jaguars are there. Advertising is not the key. Besides the game is blacked out locally, not in other states. I watch the games here in Indiana when they are blacked out in Jax. Seriously, just buy the tickets already. Its a sure fire way to keep the team in town and keep its presence known.

by indianajagfan on Jun 1, 2009 3:44 PM EDT reply actions 0 recs

I'm with you

I live in Virginia, and I pay to listen to the games online. I usually try to buy tickets to a few games each season and then fly down to the games. Quit complaining people and buy tickets.

by acedarney on Jun 2, 2009 10:02 AM EDT up reply actions 0 recs

If not teal, go black

In your post, you ignored the fact that the team has to share TV revenue with all the other teams. If people in Jacksonville do not go to games, we will lose the team. It is that simple. Do you want the team to go bankrupt??
Also, there is no evidence to suggest TV viewing will increase attendance. Maybe in a lab. But there certainly is evidence to prove that blackouts sell tickets. All you have to do is observe the ticket counter outside the stadium a couple of days before the game.
Just buy tickets should be the message, leave the blackouts alone.. WE need them. Not the NFL. The NFL would not care one bit, they are loving their TV revenues.

by keepitreal on Jun 1, 2009 5:10 PM EDT reply actions 0 recs

It's a short term fix for a long term problem

Sure, if a game is blacked out once or twice it will help, but not constantly. Look at the worst period for the Jags ticket sales. Between 2000-2003, the Jags would be lucky to get more than 2 games on local TV. That doesn’t help a team at all try to sell it’s product.

"The worst kind of non-smokers are the ones that come up to you and cough. That's pretty cruel isn't it? Do you go up to cripples and dance too?"-Bill Hicks
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by FSBlueApocalypse on Jun 1, 2009 5:50 PM EDT up reply actions 0 recs

TV is NOT a solution

I understand your point about how important it is to be on TV for the fan base to grow. Why do you think Mr. Weaver has allowed this to happen and lost money in the process? So it makes sense to make sure the games are on TV like you have pointed out.
However, getting rid of or easing blackouts is a formula for disaster for small market teams. That’s what shocks me to see this posted on OUR website. We need to get people out to the games, short term AND long term.
What you have ignored in your analysis is the scenario that tickets are sold out AND the game is on TV. That is obviously the best case scenario. And in order to get there we need fans to realize they will not see the game if they don’t pay up.

by keepitreal on Jun 2, 2009 9:56 AM EDT up reply actions 0 recs

cosign...

The End Is Nigh... www.infowars.com

by silencecs on Jun 2, 2009 1:34 PM EDT up reply actions 0 recs

One real solution to this.

I see your points, but you have to realize the way the Jags have been doing it the past couple years hasn’t helped. They’ve shown their product on TV and seats are still empty. The Jags fans don’t believe there is a real risk of the games being blacked out because it hasn’t happened in a while.

I’m with Vic on this. Let a game go blacked out and show these people it’s serious. Hopefully the Jags win that game and people become bummed they missed it. Next week: they buy the tickets.

I’m so sick of all the complaining and bickering and excuses that people can’t afford tickets. It’s heinous.

If you love the Jaguars, you will buy tickets. It’s that simple. I live in damn California. I don’t make much money at all. I’m lower class all the way. I still find a way to purchase 2 season tickets every year, even though I only make it back home for two games at the most.

I guarantee these people who complain about not having the money to buy tickets also make monthly car payments on brand new cars, go out and drink every weekend, smoke cigarettes, drink coffee in the morning, and do all kinds of other fun stuff that costs money but isn’t necessary to their life.

If you love the Jags, you make a sacrifice and you buy tickets. Drive a used car. Give up a bad habit. Cut down on something you don’t absolutely need and save that money. If you say you can’t, you’re just weakling and you suck. It’ll be your fault if the Jaguars eventually leave and I personally hate you for it.

by jimbrophoto on Jun 1, 2009 9:21 PM EDT reply actions 0 recs

Anyone who was a Jags fan earlier this decade in Jacksonville raises hand knows it's serious

However, not showing the team, even a bad team, doesn’t help matters. And just to be clear, I’m hoping by the end of the week I get a call about a job I’m dying to have. If I get that call, at the least I’m going to order two sets of Black Pack tickets, maybe season tickets.

However, this also ties into the first article I did. The Jaguars need to show why people need to invest $400 a year to see them. During the Del Rio era, the Jaguars have always been on the cusp of reclaiming the late 90’s magic, but then let it slip away.

by FSBlueApocalypse on Jun 1, 2009 9:37 PM EDT up reply actions 0 recs

$400?

Investing $400 per year to see an NFL team in your hometown? That’s nothing. The Jags have shown year after year why they are worth going to see. Last year sucked, we all know that. But that was an outlier year. In Ask Vic today he gave the statistic that we’re the 9th most competitive team in the past 5 years, and also in the whole history since the franchise was started in ’95.

To any real Jaguars fan that should be worth $400 per year. And if you really can’t afford that. The Black or Teal packs are pretty damn good options. Everyone needs to shut up with the excuses. You look like a bunch of pansies and you make us who aren’t, still look like pansies by association.

by jimbrophoto on Jun 1, 2009 10:23 PM EDT up reply actions 0 recs

Year after year?

Since Del Rio took over
2003-5-11
2004-9-7
2005-11-5(playoffs)
2006-8-8
200711-5 (playoffs)
2008-5-11

by FSBlueApocalypse on Jun 1, 2009 10:43 PM EDT up reply actions 0 recs

2005-12-4(playoffs)

If hip hop is dead, then it happened the day that Dilla died.
-Akrobatik

by Bestjagfan on Jun 1, 2009 11:25 PM EDT up reply actions 0 recs

ok

So those 6 seasons, 4 of them the Jags were plenty competitive. That 8-8 year the defense was just about spectacular. Pretty damn good. The 2003 season was Del Rio’s first and nothing was expected.

One crap season, one let down season, four good ones, and I’d argue that the 2007 season was actually great. Even though we lost to the Pats, that season was the most fun I ever had watching NFL football. Even more than 1999 (cause that just ended so horribly).

by jimbrophoto on Jun 1, 2009 11:39 PM EDT up reply actions 0 recs

I Agree Completely

The Jags have put a quality product on the field. 9th in winning percentage speaks for itself.

If hip hop is dead, then it happened the day that Dilla died.
-Akrobatik

by Bestjagfan on Jun 2, 2009 11:12 AM EDT up reply actions 0 recs

$400? A steal

I spend more than $400 a year on cable. I’d gladly get rid of HBO in order to finance my Jag tickets (too bad I live in West Texas)…

Ignore the hype; look at the results.

by harperslaw on Jun 2, 2009 6:15 AM EDT up reply actions 0 recs

Jimbrophoto... I like your thinking...

give up one addiction for another… Cuffs and me could probably buy up the rest of the unsold tickets if that was the case…. ;)~

The End Is Nigh... www.infowars.com

by silencecs on Jun 2, 2009 1:36 PM EDT up reply actions 0 recs

Winning sells tickets more than anything.

Your point about tha Jags having to scrap it out with UF and FSU is well taken. Unfortunately, Jville is not a very sophisticted city from a Professional sports point of view. Sad, but that’s the reality of the situation. Winning and increase in population (especially from large market areas) will eventually help. Until the fans buy the tickets, black out baby. Support your freaking team already.

by OGN on Jun 1, 2009 10:16 PM EDT reply actions 0 recs

Passionate fans sell more tickets than anything

I’d like to see a list of blacked out games. In ‘04 the Jags had to beat the Texans in Jacksonville to get in the playoffs if my memory serves me right. Wasn’t that game blacked out?

Pre-Brett Farve the Pack wasn’t that great, and they still had a waiting list for their tickets. The Jags need some time, a lot of love, and if Wayne can hold out I think in the end the average fans will wake up.

Ignore the hype; look at the results.

by harperslaw on Jun 2, 2009 6:19 AM EDT up reply actions 0 recs

Tired of excuses

I am tired of the amazing number of excuses I have heard over the years for the reasons why people don’t buy season tickets. It is crazy. We have some of the lowest ticket prices in the league. The Jaguars are the only professional team around. There is absolutely no reason that the true jaguars fans cannot buy tickets to the games. I absolutely agree with the blackout rules and I really believe they should go back to the old days and blackout all of the home games. It should have nothing to do with wins or losses; fans should support their team regardless. Seriously, we have the 9th most winning record since entering the league; by that account that would mean that 23 other teams cannot sell tickets and that is not the case. Suck it up and buy tickets. I myself have 4 tickets for 2 people but I am convinced this team will make it big and I want to ensure my spot in the stadium while I can. If the Jaguars fans do not get out and buy tickets and forget about watching this team on TV the Jaguars will be doomed. Everyone needs to realize how lucky we are. There are no PSLs to hinder or bind sales. Go buy the cheap seats for like $350 and add to the numbers. Our situation is completely unneccessary and avoidable by buying reasonably priced tickets. No more excuses; the time is now or never.

by q1432 on Jun 2, 2009 12:27 AM EDT reply actions 0 recs

I'm not making excuses

Every year we have the same ole “Why I can’t make it vs Just buy tickets” arguements that get us nowhere. The purposes of these articles is to show HOW the Jaguars can get their season tickets up, and in this case, show how NFL policy may be detrimental to teams with ticket sale issues.

by FSBlueApocalypse on Jun 2, 2009 7:08 AM EDT up reply actions 0 recs

no more excuses

Jaguars games on TV are not an infomercial. People that watch on TV aren’t going to buy tickets for the next home game because they like the product they see on TV. Just buy the damn tickets or fans in another city will – just like the Colts fans in Indy do because the Colts fans in Baltimore didn’t. Nothing disgusts me more than when I see those ugly tarps covering the seats when I drive over the Hart bridge or when I’m sitting in the stadium on Sundays and see all the seats covered that used to be filled with screaming fans in the early years. I think downsizing the stadium had the reverse effect of what they intended it to do. The Jags thought it would make it easier for the games to sellout but instead it has given more fans an excuse not to buy tickets and watch for free.

by jagsrealist on Jun 2, 2009 9:03 AM EDT reply actions 0 recs

Blackouts

The reason that blackouts exist is to allow the home team to still make money when the games were forced onto television. Back in the day, the games weren’t shown in the home market. When the NFL was forced to put it on television, they wanted to ensure that they weren’t giving away their product for free. The blackout was created to ensure that the game would only be shown in the home market if the stadium was full. The blackout is not there just to boost ticket sales last minute. It’s there to ensure that the owners aren’t giving away their product.

Also, you say that lifting blackouts will increase the revenue at grocery stores so that people can tailgate. Why would those tailgaters pay the extra money to go into the stadium if it’s always being played on TV? Getting rid of blackouts will not increase the ticket sales. Everyone who cares about football that lives in Jacksonville knows about the Jaguars. All it will do is make people more complacent and fewer people will buy tickets.

by acedarney on Jun 2, 2009 10:14 AM EDT reply actions 0 recs

This article was

quoted and responded to on Ask Vic today.

by JagHack on Jun 2, 2009 10:39 AM EDT reply actions 0 recs

So much effort. So little accomplished.

Gentlemen, the treadmill nature of this article provides the perfect grounds for my following statement:

With a slice of lemon between the teeth and a dash of salt tossed over the shoudler, I hereby hibernate from participation on Big Cat Country until preseason begins.

In the meantime, enjoy the sweets. And remember to brush.

The Teal and Black are comin' back!

by arthardie on Jun 2, 2009 11:08 AM EDT reply actions 0 recs

See you in August Artie... you better make a big splash when you return...

The End Is Nigh... www.infowars.com

by silencecs on Jun 2, 2009 1:39 PM EDT up reply actions 0 recs

See Yah Artie

I wonder if Blair is doing the same thing. Haven’t heard from him on here in like three weeks…

If hip hop is dead, then it happened the day that Dilla died.
-Akrobatik

by Bestjagfan on Jun 2, 2009 5:13 PM EDT up reply actions 0 recs

Congrats to

Those of you who pointed out that we just need to stop whining and buy tickets. Also to those comments that recognize the blackout policy was enacted in the early 70’s. I have 2 issues with the article. I would also like to, while taking exception to several points in the article, say how much I love this site, and the passion in the contributors to this site. I am new here and have enjoyed every article and post, no matter weather I agree or not.
The existing blackout policy was forced on the NFL by Congress in the early 70’s to help enable games to be shown on local TV, not to push more people to buy tickets. Prior to that legislation, NO HOME GAMES were locally televised. As with any legislation passed by Congress, it would take another act of Congress to change it.
Second, I think it important to note that we don’t have to “sellout”. We have to sell 50k General Bowl tickets. It does not include boxes and Club seats. The Jags recognized that the stadium was built too big and took a serious step to help the games get televised. The tarps helped to lower the required number to where it is today. I can’t think of any reason why anyone should have a problem with the tarps. When everyone gets off their duffs and buys tickets on a regular basis, we will create a waiting list. When that waiting list number regularly exceeds the number of seats covered by the tarps, the Jags can request to remove them.
$40 per game……$400 per year…..$33.33 per month….$1.10 per day!
It’s not up to the Jags or the NFL or Congress to do any more for us.
Come on Jax!! Let’s get this done!!!

by JagTank on Jun 2, 2009 12:33 PM EDT reply actions 0 recs

BCC owns Ask Vic...

Curt from Jacksonville
Do you think the blackout policy is outdated? I agree with these comments: The NFL is no longer baseball’s ugly stepsister. It’s the most powerful professional sports organization in America. The blackout policy was put in place to make sure tickets would be sold, as the demand for football wasn’t as great as it is today. Today, football is king. The NFL can afford to allow all of its games to go on TV.
Vic: I don’t know who said that but they are way off base. The blackout policy by which the league continues to abide was established by an Act of Congress in 1973. The blackout policy wasn’t put in place to make sure tickets were sold. It was put into place to get games on TV. Duh! The 1972 playoffs were the impetus to Congress’ action. On Dec. 23, 1972, the one o’clock game was the "Immaculate Reception" and the four o’clock game was Dallas’ furious fourth-quarter rally to beat San Francisco. They are two of the greatest playoff games in NFL history, yet, nobody in Pittsburgh or San Francisco saw those games unless they were at the games because all home games were blacked out in those days. The following day, Christmas Eve, the Redskins hosted a playoff game and congressmen living the D.C. area were incensed that they couldn’t see the game on TV, even though it was sold out, as were the games in Pittsburgh and San Francisco. That’s why the rule is the way it is. Congress tailored it that way, according to the situation that existed in the 1972 playoffs. Curt, professional football was very popular back then. The NFL’s popularity is not a new phenomenon.

The End Is Nigh... www.infowars.com

by silencecs on Jun 2, 2009 1:41 PM EDT reply actions 0 recs

As I was making my Jaguars sites rounds

I was going to comment something similar to what Vic wrote about the true origin of the blackout policy, but I read Ask Vic first and saw he has it under control.

You’d think it’d be easier to buy tickets than try to come up with new and elaborate excuses.

by MoveThoseChains on Jun 2, 2009 3:24 PM EDT up reply actions 0 recs

As an outsider and a Titans fan...

I have to say I would kill for season tickets to 1) Actually be F***ing available and 2) Be only $400. The PSL’s alone cost more than that. For those not aware (I’m sure most are) a PSL is a license giving you permission to purchase season tickets, and THEN you have to buy the season tickets! PSL’s run from $995 to $15,000 (depending on seating area), and the tickets themselves also cost tons. I don’t mean this to brag, I really don’t. I guess what I am trying to say is if it’s only $400, that’s an AMAZING bargain. Unbelievable, really. If I lived in Jacksonville, I’d freakin buy season tickets just to see good football (as a rival, it may pain me to say it, but most years you guys are pretty good and entertaining). I think at a cost of $400, it’s not unreasonable for blackouts. I mean, you guys have a top 3rd product in the Number One Sports League in the USA, possibly the world. That’s pretty damn impressive, and for $400 that’s unbelievable.

www.tracsposse.com - A bomb-diggity blog on the Titans.

by T--Rac's Posse on Jun 3, 2009 12:26 AM EDT reply actions 1 recs