Commentary: The Nba Vs. Aol: You Gotta Pay To Play

This is my tragedy: I live in Brooklyn, but I'm a Houston Rockets fan. Because local TV and radio stations don't broadcast Rockets games, I waste an absurd amount of time trying to find out how my team is doing. This compulsion forces me to stay up late waiting for sports on the evening news, to travel to distant bars equipped with satellite dishes, and even to call certain Houstonians directly in emergency situations.

Recently, America Online Inc. solved my problem with a service that provides real-time game data. (AOL also carries BUSINESS WEEK Online.) It is, to me, a great example of the unique capabilities of the online medium. With a few clicks of the mouse, I can get the score and a summary of player performances.

But, to my dismay, the National Basketball Assn. wants to halt this important cultural advance. On Aug. 28, the league sued AOL in federal court, charging it with misappropriating live-game data. It is seeking an injunction to turn off the service permanently. In a similar case in July, the NBA persuaded a federal judge to pull the plug on a different sports-updating service that Motorola Inc. provided to its pager customers.

STATS OR ASSETS? The issues raised in this case are critical. Like many information merchants, the NBA is scared that a valuable asset is being stolen by a new medium that can broadcast news of an event worldwide in seconds. It argues that the mere fact that AOL reports on its games with new technology doesn't give it any right to violate intellectual-property laws. After all, TV and radio broadcasters pay huge fees for the right to broadcast games live.

AOL says it's exercising its constitutional right to free speech and that the NBA doesn't own the underlying facts about games. It charges that by greedily staking a claim to statistical data, the NBA is harming fans and stalling the march of technology.

So who should win this fight? The NBA--much as it pains me to admit it, as both a journalist and a Rockets fan. Fundamentally, this case is a conflict between two of our most cherished values: free speech and property rights. Neither value is absolute. But here, the court should resolve the conflict by analyzing the precise interests at stake.

The Internet is still too new, and legal scholarship on it too slight, to start creating broad new rules that could have unintended consequences. Yes, the prospect of a sports league being able to suppress the reporting of facts sets off warning bells. But while the Constitution protects a wide range of cultural information, it's hard to argue that Hakeem Olajuwon's rebound total is critical to the future of democracy.

The data, though, is enormously valuable to the NBA. The league has a clear legal right to charge TV networks, cable channels, radio stations, and phone services for real-time information about how Olajuwon is doing, and there is no reason why AOL should get it for free. While AOL's new service is hardly an economic threat to the NBA, it probably would cause some fans to stop attending games, watching NBA telecasts, or listening to league-licensed radio broadcasts--all of which would hurt the NBA.

Surely, the league can't control game information indefinitely. It would have a much weaker claim if AOL only broadcast scores three times a quarter, as wire services do. But the NBA says AOL updates game stats every 15 seconds, and that's going too far. In the NBA's recent case against Motorola (now on appeal), a federal judge ridiculed as "utterly unpersuasive" that company's assertion that its service was "simply another version of the evening news. [The] product crosses the boundary from mere media coverage of NBA games into competing commercial appropriation of these games."

The NBA is hardly fighting this battle alone. The three other major sports leagues jointly filed a supporting brief, and the National Football League has shut down three unauthorized Websites. (Most well-known sports sites, such as ESPN SportsZone, don't offer real-time information.) The New York Stock Exchange has news outlets wait 15 minutes before transmitting share data. Anyone who wants real-time stock quotes off a Web site such as PC Quote has to pay a steep licensing fee.

That's just what America Online should be doing in this case. Since the company is in the business of getting people to pay for information, it is more than a little ironic that it is braying about keeping information free. If AOL wants to profit from real-time NBA game information, the NBA should profit, too.