Hard to say what people would do. The fact is, a lot of live sports are only available on pay TV now, and there's a lot of exclusive deals, such as NFL Sunday ticket. Now, if you don't want to play ball with DirecTV (and I won't!) They'll take their ball and go home.
Here's the crux of the problem as far as sports free OTA is concerned: People have been willing to pay for sports programming for a long time, and therefore a lot of things are no longer available on free TV. (Monday night football, anyone?)
There will come a day when you will only see The World Series and Superbowl on PAY PER VIEW, at about $40 a shot. And sports fanatics will have no one to blame but themselves for it. As long as they are willing to pay ever increasing prices, Pay TV will be more than happy to take their money in ever increasing amounts.
While I could see some of the premiere events going to a pay system, I think sports, itself, really lends itself to carriage on OTA channels. Unlike dramas, product placement in sporting events (banners around the stadium, equipment that athletes and officials use, and video overlays, etc.) can really do a good job making up for loss of revenue due to commercial avoidance and audience fragmentation.