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Anti-siphoning laws and regulations are designed to prevent pay television broadcasters from buying monopoly rights to televise important and culturally significant events before free-to-air television has a chance to bid on them. The theory is that if such a monopoly was allowed, then the poor would be unable to view the important and culturally significant events. Generally the laws allow pay-TV to bid for such monopoly rights only if free-to-air television has declined to bid on them. Anti-siphoning in the United States was introduced by the FCC in 1975 and was soon overturned as unconstitutional. (The National Football League has an anti-siphoning policy.) Australia's Anti-siphoning laws were introduced in 1992 and remain in force to date. They also affect free-to-air digital-only services, and required that certain programmes be simulcast on analogue channels.
In the early days of cable television the Federal Communications Commission refused to regulate it. In 1958 the FCC ruled that cable TV was not a common carrier and thus is not subject to FCC jurisdiction. In 1960 the FCC lobbied against placing cable TV under its jurisdiction, arguing that the administrative burden is inadequate to low perceived threats of unchecked cable development. In 1965 the FCC changed its stance and imposed must-carry rules, requiring cable providers to carry local free-to-air channels, and banned importation of distant channels that duplicated content available on local free-to-air channels.
In the end of the 1960s the public and the government raised concerns that cable operators can outbid free-to-air channels and "siphon" popular content, first of all sports, off the free air. Specific events like the Super Bowl were deemed particularly vulnerable due to greater inelasticity of demand.
In 1975 the FCC imposed anti-siphoning regulations that limited the operations of sports and film channels. Under the regulations, cable channels could not devote more than 90% of their time to film and sports, and could not broadcast films less than three years old. Specific (i.e. annual) sporting events could not be "siphoned off" by cable at all if they had been broadcast on free airwaves during any of the previous five years. Cable coverage of regular season games in popular championships was limited so that only a fraction of all games could be shown on cable. Should sports coverage on free-to-air channels decrease, stipulated the FCC, cable operators had to decrease their sports programming proportionately. Administrative record, however, did not support FCC allegations of "siphoning".[clarification needed]
The Department of Justice and a number of cable providers contested the FCC ruling in courts as unconstitutional. In 1977 the DC Circuit Court consolidated these cases in Home Box Office vs. the FCC and found that the FCC has trespassed over the rights guaranteed by the First Amendment. The court ruled that cable bandwidth is not a scarce resource, thus it is not subject to limitations allowed by the Red Lion vs. the FCC ruling. The court applied the O'Brien test (the FCC failed two of its four "prongs") and found that the degree of limitation of free speech imposed by the FCC was inadequate, "grossly overboard" and thus "arbitrary, capricious and unconstitutional".
In recent years, a growing number of major domestic and international sporting events previously aired by free-to-air channels have migrated to pay-TV outlets such as ESPN; its networks air the majority of bowl games of college football (including the Bowl Championship Series, which moved to Fox to ESPN in 2011; ESPN also holds an interest in and airs all the games of the future College Football Playoff system, along with its subsidiary division owning various other bowl games), three of the Grand Slams of tennis (only the French Open is free-to-air for the finals) are aired exclusively by ESPN, and the majority of local sports telecasts are now shown primarily by regional sports networks (with relatively few or no games broadcast on local free-to-air TV unless it is either nationally televised or only aired over-the-air due to RSN rights conflicts).
Some experts have attributed the decline of professional boxing to the move of boxing from FTA network television to premium pay-television, with boxing matches almost exclusively being shown on HBO, Showtime, or pay-per-view and ownership consolidated to those networks and a few selective promotion organizations.
Ratings for college football's national championship, NASCAR's Sprint Cup championship race, tennis majors, and golf's Open Championship have suffered from the siphoning to ESPN; NASCAR's new 2015-24 television contract with Comcast's NBCUniversal for NBC and their cable network NBC Sports Network during the second half of the season requires the broadcast of the championship race to be on NBC, where in previous years it only aired on ESPN. The same will be in effect in 2017 for The Open Championship, when NBC will carry the final two rounds of the tournament over-the-air, which will mean all four majors will be on network television in men's golf again.
NFL Anti-Siphoning Policies
The National Football League has an anti-siphoning policy written into their television contracts that exists in the local markets of all 32 teams (31 markets; the two East Rutherford, New Jersey teams share one market, as do the two San Francisco Bay Area teams, while the Green Bay Packers have two local markets -- Green Bay and Milwaukee).
- All NFL regular season games, except two games each week, and all NFL playoff games, except one first-round game, are broadcast on network television.
- The two games on cable each week are the league-owned Thursday (Weeks 10-16 excluding Thanksgiving in 2014, plus two Saturday night games) and Disney's Monday night packages, except in Week 1 (two Monday Night games), Thanksgiving (Monday night only), Week 16 (Monday night only), and Week 17 (all games on Sunday).
- On Week 1 and Thanksgiving, the Thursday game is a broadcast network television game (NBC) and not on the NFL Network.
- On Week 1, ESPN has two Monday Night games.
- On Weeks 2-8, the NFL Network game is simulcast on all CBS affiliates.
- On Weeks 9-16, the NFL Network game is simulcast on the CBS affiliates of the primary markets of both home and visiting teams.
- On Week 16, an additional Thursday night game airs on Saturday night. One of the two games will be marked for CBS, the other is an NFL Network game.
- On Week 17, all games air on broadcast network affiliates of Fox, CBS, or NBC.
- The league's anti-siphoning policy states the respective cable channel is blacked out in the market of the two teams playing in the cable games. The NFL sells a syndicated package to local stations within the regions of the teams involved for the Monday night package. The ESPN-aired NFL playoff game in the first round is sold as part of the Monday night package.
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The Ofcom Code on Sports and Other Listed and Designated Events regulates that coverage of certain major sporting events (known as "Category A" events, covering certain major domestic events and major international competitions such as the Olympics and FIFA World Cup) must be broadcast primarily on a free-to-air channel (but can share coverage with pay channels), while certain events known as "Category B" events can be shown on pay channels, but supplemental coverage (such as highlights or a delayed broadcast) must be provided by a free-to-air channel.
- Perrine, p. 21.
- Perrine, p. 22.
- Perrine, p. 23.
- Broadcasting Services Act 1892. Commonwealth Consolidated Acts. Retrieved 2010-05-15.
- Perrine, James B. (2001). Constitutional Challenges to Anti-Siphoning Laws in the United States and Australia. Sports Administration, 2001 vol. 3. pp. 22–31.
- Westfield, Mark (2000). The gatekeepers: the global media battle to control Australia's pay TV. Pluto Press Australia. ISBN 978-1-871204-19-3.