Events

“A Tale of Two Audiences: Gate Attendance and Broadcast Demand in European Football”

The Business of Sport – Seminar Series

Room G01 – Clore Management Centre, Birkbeck College, Torrington Square, London WC1 7HX

Wednesday 30 April 2008 at 6pm
(For directions click here)

“A Tale of Two Audiences: Gate Attendance and Broadcast Demand in European Football”

Given by:

Dr Rob Simmons

Synopsis:

Policy makers and League administrators have long voiced concerns that telecasts of football matches can reduce gate attendance. This partly explains why the sale of broadcast rights in the English Premier League is restricted with less than one third of games being shown live on TV. This seminar will explore empirical evidence on gate attendance and television audience data in the English Premier League and Spain’s Primera Liga.

The seminar will report several research findings based on work by Dr Rob Simmons and Dr Tunde Buraimo on English and Spanish football:

  • Broadcasting of matches live on TV does reduce gate attendance, but not to an extent that club revenues are damaged.
  • However, televised matches that have lower gate attendance also have smaller television audiences, a form of complementarity that has not received sufficient recognition in discussion of broadcasting policy.
  • Most importantly, our research finds that gate attendance responds negatively to outcome uncertainty of a match, defined as difference in pre-match probabilities of the teams winning; fans inside the stadium dislike the prospect of a close game, other things equal. Yet sports economists have argued that fans prefer close contests. Empirical evidence defeats this conventional wisdom.
  • On the other hand, our research shows that television viewers respond positively to close contests. Since television viewers are inherently more fickle than supporters inside the stadium this is not surprising.

As revenues from sale of broadcast rights continue to grow, eventually surpassing revenues from gate receipts, these are important findings for clubs and League administrators. The seminar will close with a discussion of appropriate policies regarding interventions to reduce inequality of player talent across teams: should leagues increase the extent of revenue-sharing or introduce salary caps to reduce team inequality and increase uncertainty of outcome so as to raise television audience interest in games?

Reading:

  • D. Forrest, R.Simmons and S. Szymanski (2004) ‘Broadcasting, attendance and the inefficiency of cartels’, Review of Industrial Organization, 24, 243-265.
  • D. Forrest, R. Simmons and B. Buraimo (2005) ‘Outcome uncertainty and the couch potato audience’, Scottish Journal of Political Economy, 52, 641-661.
  • B. Buraimo and R. Simmons (2007) ‘A tale of two audiences: spectators, television viewers and outcome uncertainty in Spanish football’, Lancaster University Management School.

Biography:

Dr Rob Simmons is a lecturer in economics at the University of Lancaster and has an international reputation as a sports economist with a labour market focus. He has published pioneering papers on attendance demand in football using a travel cost methodology, on football transfer markets using a sample selection model and on salary determination in Italian football using a rarely published data set. He is currently working on the economic analysis of sports broadcasting, the labour market for players in the US National Football League and further analysis of earnings in European football. Dr Simmons is a member of the editorial boards of International Journal of Sport Finance and Journal of Sports Economics.

Dr. Babatunde Buraimo is a Senior Lecturer in Sports Management and Sports Economics at the Lancashire Business School, University of Central Lancashire. His doctoral thesis, An Econometric Analysis of Market Size and Audience Demand in Football, was an empirical analysis of the fundamental conjectures and theories of sports economics, which included the effects of market size in professional team sports and the uncertainty of outcome hypothesis. He is currently researching television audience demand for sport, the impact of televised sport on stadium attendance and wage discrimination in male and female sports.

For further details on this Seminar Series contact:

Sean Hamil
Department of Management
Birkbeck College
Malet Street
London
WC1E 7HX

Email: s.hamil@bbk.ac.uk or Tel: 020-7631 6763

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