I.P. Blog: Super Bowl Blackout Creates Risk in Value

Super Bowl Blackout Creates Risk in Value
by Mike Pellegrino, Pellegrino & Associates

In the United States, the Super Bowl is the most watched event each year. One of the defining aspects of the Super Bowl is the venue. How well did the venue stack up to previous years? Was it better? Comparable? Did it provide good sound, lights, seating, accommodations, entertainment, and more? Cities scramble at the chance to host the Super Bowl because tens of thousands of people attend each year, and over 100 million watch via television. The Super Bowl gives cities national attention and an economic boost of hundreds of millions of dollars. But what happens when an unforeseen event occurs? Does value go down for that city in regards to the Super Bowl?

New Orleans is among two cities that boast the most hosted Super Bowls. However, New Orleans’ blackout this year may hurt its chances to host another Super Bowl in the near future. The NFL will most likely choose a city with an updated stadium where such incidents are less likely to occur. Many fans may forgive such an incident, but the NFL will search for venues where issues such as a blackout are less likely.

While there is no guarantee that an unforeseen event won’t occur, the length of the blackout was also a defining factor for future chances at hosting the Super Bowl. Because of the length of the blackout, the television network, CBS, had to improvise. Had the blackout continued, the network may have had to broadcast something else. In turn, the network may have requested money back from the NFL for the loss in ratings. While ratings indicate that most viewers remained tuned in during the blackout, ratings are everything to a network. A drop in ratings could be costly to a network, especially during the hottest event of the year. For instance, advertisers might demand money back if another show were to be broadcast to make up for the lull from the blackout. The NFL’s reputation is also at stake when problems arise during the biggest sports event of the year. Fans may become upset and demand money back given the extraordinary price they pay to attend a Super Bowl. These are just a few of the reasons flawless execution of the Super Bowl is critical.

While the world is far from perfect, perception plays a huge role in value. If the NFL and television networks perceive that a particular venue is not capable of hosting an event flawlessly, then that venue holds less value in the eyes of the NFL, the fans, and the networks.

ICLEF • Indiana Continuing Legal Education Forum, Indianapolis, IN 

Leave a Reply