Introduction- An antitrust violation happens when a professional sports league such as the MLB,NFL,NBA, OR NHL have an agreement to effect such things as raising the price of something, lowering an output, or holding onto an output which effects the customer of the product. When a league controls a market it also controls how the customer will have to purchase the product and how much it will cost. (Ross 2001) Summary of the article – The researcher chose to analyze an area where the monopoly sport leagues hurt a bunch of different groups. They do this by controlling the competitive entry or putting specific holds on to a company through anticompetitive rules. This article uses government theories of antitrust liability to show how it effects sports fans and shows how new legislation could change that. Sports leagues have changed rules to make sure fans in all areas can enjoy everything sports have to offer to them. The different leagues have made agreements with each other to make sure fans get the best and most improved product at all times. (Ross 2001) The researcher Ross goes onto talking about how the leagues have structured their specific leagues to a certain amount of teams and their aren’t allowed to be teams added to their leagues without a vote by the owners and it has to be a majority vote. Because of this leagues have smaller outputs which then have teams having higher prices for things. This causes communities to pay more to have the league want to expand in their area. Teams that are already in that area almost force the community to give them more money or they will relocate with the owner’s approval. Because of the scarcity of teams cities fear the loss of a team so much that they give them whatever they want ... ... middle of paper ... ...s like football and baseball it is very hard for one good player to change a team because the rosters are so big on player can’t really make a big difference unless that player is a quarterback in football. Problem- The problem in this article was about how the draft and contracts affects competiveness which then affects the antitrust laws. This researcher also discussed the reserve system which is something created in 1887 and is still being used today. Significance of the study- the significance was that it taught me a lot more about the reserve system and what it does even though the system has changed over the last one hundred years it is still pretty similar. How this helped- This helped me by teaching me more about the reserve system. Also made me think more about how the draft may not be the most fair way for leagues to get their league more competitive.
Ultimately, there are three exceptionally important criteria for deciding on good candidate for an expansion team. The first criterion is that the stadium must be controlled or owned by the baseball team. The stadium is a crucial aspect because most of the team’s revenue is generated in relation to the stadium. This stadium revenue comprises of ticket sales, parking, merchandise and concessions. Thus, without a stadium, the team will not be able to generate a stable source of revenue. The second criterion is that local ownership must have strong roots within the community. Without ties to the community, fan attendance could decrease. This is because fans could eventually perceive that the owner(s)’s only goal for the MLB franchise was to be profitable. The third criterion is the city must have long-term political support in the community. It is vital to have political support in order to gain financial support throughout the team’s years of existence, especially in tax payer monies. Particularly, this is significant when the team experiences issues or fights that involve the stadium and the land around the stadium. If there is a lack of political support, the expansion teams will not be able to obtain enough for money for stadium renovations, repairs, or to build new stadiums for the same team within the same city. This circumstance was apparent when the New York Yankees used tax revenue generated by New York City to fund the building of their brand new stadium for the 2009 season. Therefore, expansion committees believe it is necessary to confirm that the prospective cities will have enough political support because this political factor will help stabilize and financially support the prosp...
However, if the current rules remain in place and baseball continues without a salary cap, the only hope a small market team may have is to fend for themselves on the big market with financially superior teams. This becomes an exceedingly harder task when one team can afford the salary of two top players while those contracts are equal to the entire payroll of another team’s entire roster. Therefore, the question remains should baseball implement a salary cap, and if they do, how would it come into play. When asking the question regarding the salary cap, four supporting ideas arise for either the implementation of a salary cap or keeping it nonexistent.
Imagine a business that brings in $60 million each year ,and the people fueling that industry receive none of the revenue(Wieberg). These same people work 40 hours in their sport every week, these “people” are college athletes. The NCAA, the governing body for major college sports, is the industry doing this to college athletes(Edelman). This is an issue of exploitation and control by large institutions over primarily poor people, the NCAA is guiding them in directions to make money for everybody while doing everything possible to keep the players out of the money. College Athletes deserve profit because they bring in large revenue into their program, the NCAA, and they invest tons of time into their sport.
Every sports fan hates to admit the fact that sports are simply business, but it is undeniable that sports are one of the most lucrative businesses in the U.S. Right now the market for women's professional sports is growing rapidly. The best way for women's sporting organizations to promote and sell this market is to align with previously established organizations such as the NBA, NCAA and the USOIC. Although joining with men's organizations is a difficult process that involves compromise, merging with these organizations helps to land big television contracts, gives greater publicity, and brings in endorsements, advertisers and investors. The lack of these benefits was among the key factors in the failure of the ABL. Inversely, these are the reasons for the successes of the WNBA and women's sports in the Olympics.
The following is a case study analysis on SPORTPLAY. The case involves a man by the name of Chis who is the Executive Director of the Provincial Arts Board (PAB). Until recently PAB was receiving government funding but when PAB failed to satisfy three of the five standards for government funding, PAB fell victim to government funding cutbacks. These cutbacks led Executive Director Chris to begin searching for non-traditional types of funding. Chris ultimately came up with the idea to connect with sports communities that he knew were always in the need of financial assistance. His initial thought was that if he could legalize gambling on sporting events that he could alleviate both parties’ financial issues. With some luck and after four months of hard work Chris was able to get roughly 33 associations that consisted of sport and art. Even several politicians jumped around this idea because saw the potential in replacing all government support for elite sports and the art community (INSERT CITATION).
Noll, Roger, and Zimbalist, Andrew. Sports, Jobs, and Taxes: The Economic Impact of Sports Teams and Stadiums. Brooking institutions press, Summer 1997. Vol. 15 No. 3.
New entrants into this industry are unusual since NBA League approval and a sharp franchise fee stand in the way of potential new team owners. Moreover, attempting to deceive the NBA would put the following difficulties into an entrepreneur’s path are: massive capital costs, lack of brand reputation, lack of TV revenue, and steep competition for talent. Extension teams occasionally do get approval, like the Charlotte Bobcats founded in 2004. Though, the competition that so many different industries face from new entrants is practically non-existent in professional basketball.
Culture difference, stereotyping American sports and insurering space in a country’s market for a new sports franchise are just a few factors that prohibits U.S sports franchises abroad. And the effects of governent tariffs on imports to protect our industries from underpriced products and to promote job economy growth in times of hardship also impedes expansion.
One layer of this onion is how upset it makes the NBA's television partners. That part can be understood. ESPN/ABC and TNT pay a lot of money to broadcast NBA games. The current deal the NBA has with its partners adds up to nearly $3 billion. Multiple games are broadcast per week on both ESPN/ABC, TNT, and to a lesser extent NBA
Goal of creating a fair playing field among big and small market teams has led to too many regulations.
Sports are one of the most profitable industries in the world. Everyone wants to get their hands on a piece of the action. Those individuals and industries that spend hundreds of millions of dollars on these sports teams are hoping to make a profit, but it may be an indirect profit. It could be a profit for the sports club, or it could be a promotion for another organization (i.e. Rupert Murdoch, FOX). The economics involved with sports have drastically changed over the last ten years.
In NHL v. Pepsi Cola, Canada, Pepsi was held liable for Ambush Marketing, as it was not the official sponsor of the event. However, Pepsi was let off as there was no product similarity between NHL and Pepsi, nor was there any IP infringement, like passing off. In the New Zealand Olympic and Commonwealth Games Ass’n, Inc. v.Telecom New Zealand, the event organizer alleged a Telecom advertisement constituted unfair trading and passing off. The event...
Sports have been around for thousands of years. The history of sports in United States began back in the 1840s. United States is a very unique country when we look at its sports, just like every country has a different structure of sports so does US. This paper will be taking about the Sports Organizations and Governance, the sports industry, sports organizations, and Structure of sports in the United States. It will also cover the Sport in the United States vs. Other Western Democracies by taking a look at the State Political, historical context, team objectives, and sports organizations. It will also cover the uniqueness of American sport as well as cover the mass participation and give recommendations on how to increase participation and success.
If rivalry among firms in an industry is low, the industry is considered to be disciplined. This discipline may result from the industry's history of competition, the role of a leading firm, or informal compliance with a generally understood code of conduct. Explicit collusion generally is illegal and not an option; in low-rivalry industries competitive moves must be constrained informally. However, a maverick firm seeking a competitive advantage can displace the otherwise disciplined market.
While sports for the spectators are merely entertainment, the economics of the industry are what drives businesses to become involved. Sports have become more of a business entity rather than an entertainment industry due to the strong economic perception of the over all industry. There are several instances in which economics may contribute to the effect on the sports industry, such as: the success of a team, the price of a ticket, the amount of money an athlete will make, and the amount of profit a team will make. The success of an...