Events

Broadcasting, attendance and the inefficiency of cartels

Broadcasting, attendance and the inefficiency of cartels

A seminar at the Room 2-3,
Clore Management Centre,
Birkbeck,
University of London,
Malet Street,
London WC1E 7HX

6 – 8pm, Monday 19th May 2003

Given by:

Professor Stefan Szymanski, The Business School, Imperial College London

Synopsis

The English Premier League is a cartel of soccer teams that collectively sells the rights to broadcast its matches. Despite considerable demand for their product from broadcasters, the clubs agree to sell only a small fraction of the broadcast rights (60 out of 380 matches played each season). The clubs have explained this reluctance by claiming that increased broadcasting would reduce attendance at matches and therefore reduce cartel income. However, this paper produces detailed econometric evidence to show that broadcasting has a negligible effect on attendance and that additional broadcast fees would be likely to exceed any plausible opportunity cost.

The paper concludes that a more plausible explanation for the reluctance to market their rights is the failure of the cartel to reach agreement on compensation for individual teams.

Further Reading

  • Baimbridge M., Cameron S. and Dawson P. (1996) “Satellite television and the demand for football: a whole new ball game” Scottish Journal of Political Economy, 43, 3, 317-33
  • N.C.A.A. v. BOARD OF REGENTS OF UNIVERSITY OF OKLAHOMA, 468 U. S. 85 (1984)
  • Netherlands Competition Authority (2002) Re: Eredivisie N.V. – Method of Trading Rights to Live Broadcasts of Premier League Football Matches.
  • Putsis W. and Sen S. (2000) “Should NFL Blackouts be banned?” Applied Economics, 32, 12, 1495-1507
  • Ross S. and Szymanski S. (2000) “Necessary Restraints and Inefficient Monopoly Sports Leagues” International Sports Law Review, 1, 1, 27-28.
  • Szymanski, S. (2000) “Hearts and minds and Restrictive Practices Court case” in Football in the Digital Age edited by S. Hamil, J. Michie, C. Oughton and S.Warby. Mainstream.

For further details contact: more seminars or Sean Hamil.

E.mail: s.hamil@bbk.ac.uk

Tel: 020-7631 6763

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