ADSactly Sports - The sports money machine: Are fans getting left out in the cold?
The sports money machine: Are fans getting left out in the cold?
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Two weeks ago, I attended my first NHL hockey game of the season. I love attending live sporting events and to watch the pros in action is an absolute treat. When you are there you get to see just how fast and skilled the players are and you see the game from a different perspective than you get on television. I was going to the game because my favourite team was in town, the Edmonton Oilers, and they have arguably the best player in the world on their team, Connor McDavid. I had yet to attend a game where he was in town and I was able to find tickets for an extremely cheap price. I got my ticket for $80. This was a great deal because the price of this ticket is usually $235. I mentioned that this was my first game this season but in fact, it was the first game that I had attended in over 3 years. I used to attend professional sporting events as often as I could find time but that has changed as the price of tickets and the whole sporting experience has skyrocketed over the years. I simply can’t afford to go to games anymore. Realistically, not many people can.
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Professional sports has become so much more than just a game being played at an elite level and for fans. Professional sports has become a massive entertainment business. Professional sports has turned into a multi-billion dollar industry that is fueled by enormous media contract and television deals.
The sports market in North America was worth $60.5 billion in 2014. It is expected to reach $73.5 billion by 2019. The biggest reason for such growth is projected increases in revenue derived from media rights deals, which is predicted to surpass gate revenues as the sports industry's largest segment.
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The profits being made on the entertainment side of things have prompted a huge spike in salaries as the players and players unions look to ensure that the people providing the product are getting compensated fairly. This means that high talent players who the fans want to see are getting paid very high salaries because they are what the fans come to see. They are the ones making it possible for team owners and the media companies to make money.
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These are just the average salaries. The most talented players in each of these sports can make a salary that is well beyond the league average. Many of these players can make up to and more than 10 times the league average. Some of the highest paid players in the world are:
| Player | League | Salary |
|---|---|---|
| Connor McDavid | NHL | $12,500,000 |
| Steph Curry | NBA | $32,642,550 |
| Cristiano Ronaldo | UEFA | $58,000,000 |
| Clayton Kershaw | MLB | $35,571,428 |
| Kirk Cousins | NFL | $28,000,000 |
In professional sports, a salary cap (or wage cap) is an agreement or rule that places a limit on the amount of money that a team can spend on players' salaries. It exists as a per-player limit or a total limit for the team's roster, or both.
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As the product has become more valuable and the game becoming more popular there has been a tremendous amount of money being spent on facilities. These teams need arenas and stadiums to play in and there is a demand for the biggest and best when it comes to these things. Owners spend hundreds of millions of dollars to build new facilities for their teams to play in. Some of the newest constructions have cost as much as $1 billion dollars and more. Between salaries, stadium/arena costs and the fixed day to day costs of running a franchise the owners have a lot of money to shell out.
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This has created a vicious cycle of money and profits being shared between players, owners, leagues and media that has left the average fan on the outside looking in. The cost for fans to attend professional sporting events had climbed significantly over the past 10 - 20 years. There is statistical data called the Fan Cost Index (FCI) that calculates the average cost for a family of 4 to attend a sporting event.
The FCI is designed to somewhat mimic what a family of four would pay to take in a sporting event. For each club in a given sport, Team Marketing Report creates the FCI which comprises the prices of four (4) adult average-price tickets, two (2) small draft beers, four (4) small soft drinks, four (4) regular-size hot dogs, parking for one (1) car, two (2) game programs and two (2) least expensive, adult-size adjustable caps.
Below shows the average FCI for each of the major leagues in the most recent season:
- Major League Baseball - $212.46
- National Basketball Association - $326.60
- National Hockey League - $359.17
- National Football League - $459.65
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This has made it very difficult for the average family to attend sporting events these days. It requires a large amount of disposable income in order to be able to afford to pay for these events. It is possible to reduce the cost a little but even just the price of a ticket and parking can be overwhelming. Parking alone can cost upwards of $30 or more. Just to buy a beer at a game at a Canadian Hockey game can cost $11 and a soda can cost up to $5. With prices so high, fans are being forced to choose where they are going to spend their entertainment money more wisely. For me personally, the only reason I was able to attend the game two weeks ago was because I was able to get a great deal on the seats. I could never afford to pay full price for those tickets. The costs above are average costs. A premium ticket can more than double the cost just to get in the door.
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These ticket prices have started to have an impact on the attendance at major sporting events as fans are finding different ways to view the games and using their disposable income for other things. With the evolution of television and the extremely high viewing quality, fans can watch the games in the comfort of their own home and not have to spend all the extra money. There are also cable packages that can be purchased for a fraction of the cost of going to an event and they get you access to all the games. Last year, I used a sports streaming cable provider called DAZN get access to every single NFL game and it cost me only $20/mth.
Sports franchises and owners are starting to feel some of the impact of this as the average attendance at sporting events has been declining in recent years.
24/7 Wall St. reviewed 10-year changes in average home game attendance for professional hockey, baseball, basketball, and football teams across North America to identify the teams that are losing the most fans. For 17 teams, average home game attendance declined by more than 10% over the past decade.
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As long as the cost of running teams continues to grow at an exponential rate, I see no way that the ticket prices, parking costs, concession cost and merchandise cost will ever reduce. Watching live sports is becoming an event for those who are considered wealthy or higher middle class. This is an unfortunate shift because watching a game live has a tremendously different feel than watching it on T.V. The emotional connection with the team and the other fans. Being part of special moments. This can be where a young athlete's dreams are born. I am a huge fan of attending live events but I can no longer afford to attend the professional games. I couldn’t just give up attending live sports so I have shifted my live sports viewing to minor leagues and amateur sports. The quality of the games can still be very good and in many of these leagues, the players are fighting to get to the pros. They are giving their best efforts every single night to prove just how good they are. It can be very entertaining product and for a fraction of the cost to attend a professional sporting event. Next time you are itching to attend a sporting event, head out to see some o the amateur talent out there. You won’t regret it.
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Some food for thought
If you sit and look through the numbers and see the amount of money being spent in this industry it will blow you away. These are huge amounts of money being spent by sports teams and being made through player salaries. Billions of dollars plus the money shelled out by media corporations all in the name of entertainment and PROFIT. Not only are these numbers already excessive, it is expected that they will continue to grow over the years to come. These numbers become even more staggering when you compare them to the Gross Domestic Product of some of the poorest countries in the world. If you take the expected value of the entire sports entertainment industry in 2019 as shown above ($73.5 billion) and compare it to GDP rankings of all countries in the world the results are eye-opening. The sports industry would rank in the top 75 in total GDP or revenue per year. With 195 countries in the world, this would have them ranked higher than over 100 other countries. Ahead of countries such as Guatemala, Costa Rica, Croatia and Belarus. The reality of this is stunning.
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Thanks for reading. I would love to hear your thoughts on watching live sports. Do you attend games often? Has the cost become too much for you? What do you think of the amounts of money being paid in player salaries and ticket prices? I look forward to hearing your opinions.
Authored by: @broncofan99
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Sport has become so commercialised that they have literally tried to monetize everything they can get their hands on! Before a fan just paid for his seat and watched the game and bought a jersey to support his team
Now it’s selling naming rights to stadiums, image rights of players, shirt sponsors, training kit sponsors, streaming and pay per view deals, international tv syndication deals, merchandise and memorabilia, stadium tours, team tours, sponsored preseason tournaments and the lists goes on I’m sure there’s more that I’ve missed
Players are still treated like hero’s by fans that relationship hasn’t changed but sports franchises have! They treat players like commodities and the fans the same! They act as if they brought us together and therefore need to be rewarded obscene amounts of money for it! People were watching sports Long before this game along when the players were still part time workers and it wasn’t a viable career
I really feel like there should be more transparency in sport but I’m not really sure how we even get there! Never the less it’s not going to stop me from supporting my teams lol I guess I’m a sucker like that
You are absolutely right. The goal for teams and leagues is to absolutely maximize profits and monetize everything. If they think they can put a dollar value on it then they will. So much of it is advertising and promotional budgets. Between that and the media component, the numbers are unreal. Thank you for the great original comment!!!
can you provide a link to this comment you claim I copied from? Would be interesting and really creepy if it was a word for word match because I swear I didn't copy it from anywhere!
Oh wait nevermind i see it now!
That dude copied my comment! Not sure how he even got upvotes for it thats weird. I tried to go onto Steemd to see if i could find a time stamp or something to prove that its my comment since the were both posted on 7 hours, guess he copied it immediately when he saw it.
You are right, I was just able to find the time stamp. You were 7 minutes before him. His came first in my cue. I will fix the comment to you. Thanks for the great original comment.
No problem, you're post was really interesting and something no one really speaks about much but its important. Im also passionate about sport so and you know how we sports fans get, always vocal
Sorry for the mix up. Copied comments are so frustrating and it sucks that someone took yours. Gave your comment my full upvote. Cheers
No problem, the first time its ever happened to me and yes it is frustrating! At least we got to the bottom of it in the end
Stunningly good article. Very well written and researched.
I love live sports. I haven't been to an NFL game in 25 years. It's more than that for the NHL. I manage an MLB game about every other year (not counting Spring Training). You can get good tickets AND carry in water and peanuts to NASCAR for $50 so I go at least every other year.
What I do watch today is amateur sports. I love watching HS and AAU softball and baseball and this is a hotbed for it. When I left Spokane I was a season ticket holder for the Junior Hockey team and the A league baseball team. Such fun at a reasonable price.
Fandom has gone from screaming at live events to watching commercials. It's sad, but possibly unavoidable in the current market.
Thanks for a great read. Very nicely done.
I think there is so much to be enjoyed watching amateur sports. These players are often playing for their passion for the game and money isn't part of the equations, at least not yet. The best part is you can take the whole family and not have to worry about how you will pay your mortgage that month. Thanks for your comment.
Oh Tom, great minds think alike. I will add to that anything that is not Div I college sports as well.
Love to watch these young men and women play with such tenacity and love of the sport.
When doctors, teachers, engineers and physicists do their jobs in such an interesting and engaging way that others are willing to pay to watch them do it or emulate them in some way, then they'll earn more money. What makes athletes, actors and public figures interesting? Their talent and the scarecity of comparable talent is what provides leverage and adds value.
Personally, I enjoy baseball as much as anyone. And I do not begrudge the players the money they make.
But I do think it is a sign that our priorities are out of order. Rather than spending an exorbitant amount of time and money at a ballgame to watch other people (albeit the best players in the world) play baseball, fans would have better lives if they spent less time as spectators, and more time as direct participants … in almost any activity they might enjoy.
Living our lives vicariously has reached epidemic proportions in the United States. It is unhealthy, ultimately very unsatisfying, and nothing to brag about.
I think you are spot on with the “living vicariously” statement. We are watching people do the things we wish we could do. People should spend more time out playing the games themselves and enjoying the exercise and fun. You can’t really blame the players for salaries. If people are willing to pay them the money then who are they to say no. It is just sad as you say that our priorities are out of whack. Thanks for the great comment.
The problem is not the players getting paid those salaries. Some of them deserve it because they train hard everyday to stay on the top in order to be the best in their sports. The problem here is society systems that categorize some types of people, ruling for what they worth.
Athletes are paid on performance-based while people in other fields (teachers, doctors, so on) fall wrongly in that unfair categorization. Unless they work on their own, they're going to be treated professionally and economically just like their pairs no matter if some of them stand out from the rest.
And we know that everybody have different skills and capacities. And that's where the unfairness lies on. We can talk about priorities and level of importance regarding to careers or professions. But that's very subjective. We tend to grant importance to those things we feel attach to, which is printed in our personalities.
On the other hand, I totally agree about the excess that surrounds sports, turning it into only business focus. The fans have just been turned into a vehicle to attract contracts like TV rights and other commercial enterprises. And also, some athletes have forgot about the loyalty and respect toward the fans who actually raise them to the status of stars.
Such a fair and true statement. Athletes are paid for performance and each year the amount owners are willing to pay increases. Can you imagine if all professions paid people that way? The wage gap would be huge. I'm so glad you mentioned the way some of these athletes treat fans and how they act. Stay tuned for an upcoming edition.
Thank you so much for this article @broncofan99, I really enjoyed reading this. My eyes almost got out
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when I saw how much money does the companies make with sports, these people are Ultra Rich. I was also amazed how much salary an athlete could make, I so envy them so much, they are paid so high for doing what they love to do, and I could see myselft paid so less for doing what I don't want to do. It's funny but I guess it is just the reality.
Honestly, I have never paid for a game ticket in my whole life. I love sports specially Basketball and Boxing but I have to be contented watching it live on TV.
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Why? Because tickets are so expensive and I'd rather spend it on most important things. I know watching games on court are at different level and it is like taking part of a history and the moment is priceless. But the tickets are out of the budget and also if you will not bring your own food you will be forced to buy the food in the stadium that are 5x higher price than they can be bought at groceries. And it is so true when you mentioned the parking cost, because no way you'll get a space for free.
I guess that every time I get 1 year older is those tickets will increase thousand higher. I don't know if I will ever get a chance to buy a game-ticket of my favorite teams, I will just support them in heart right in front of the tv.
thank you @broncofan99 and @adsactly.
The prices of the extras such as food and parking only further amplify the problem. $30 to park my car? Really? After the ticket already cost over $100. People have to seriously think about if the can afford this luxury before deciding to attend.
Yes exactly, but i guess most people went there bet cash to their favorite team.
First of all, great written post and an interesting topic. I like it!
Secondly, I agree about the prices skyrocketing for the last couple of years. Luckily the prices where I live are still normal and you can go wherever you want. But few years back, I was in London on Emirates Stadium and I paid a ticket that really hurt my pocket :D I enjoyed every second of being there and watching the game, but this was my 2 day trip to London and I could afford 1 ticket for that game. I just imagine how it feels like to a fan who wants to attend all of the games of his loving club. That is a sad reality today...
I was in love about soccer, my life revolved around it, but as money got its grasp all over it, I just lost my interest. Imagine how I felt when I decided not to care that much anymore about football. It's like my whole childhood was a lie.
Sports are losing their way because of the pressure from media and the owners. Because you need to make more money, MOOOAAAR! But what is happening in the meantime, they are losing fans. And I was always told that the games are played for the fans, that is what they taught me. Today, there are fewer fans on stadiums, and people are starting to lose interests... I don't know what are owners thinking about that, but it seems they don't mind it at all, still.
Anyway, I enjoyed the topic and it is the one we need to talk about more. We cannot let this happen anymore, we need to bring back sports to the fans.
Have a great day/night!
It is so true. For the average fan they go to 1 or 2 games a year because the hit on their wallet is so hard. There are more and more fans choosing not to go, here in Ottawa they actually have covered off sections of the stadium with black tarps to hide how many empty seats there are. Watching at home in high definition is much cheaper and still high quality.
Lol what thing they do just to cover their greed... But fans see it and they are getting fed up. I wonder what will future look like, everyone in their house cheering for their teams? Hmmm that's like taking soul out of sport, but ok...
I haven't watched a live sporting event in a very long time. The prices are just too much like you said. When I weigh if I would rather see a concert from a big name band or a sport event I choose the music. But even then our entertainment budget has greatly decreased. Things like E-sports and "virtual tickets" are interesting to me, although I haven't tried it yet. I do watch streaming events with video game competitions sometimes and find that somewhat satisfying. I watched Coachella this year streaming and it was actually decent. I do think there's a lot to miss not going to a live event - all the sensory experience like the sound, smell, weather - it all adds to the experience. I do have to say though I've never liked crowds so being able to see a stream of a live event is kinda nice in that regard. How money plays into that I'm not sure so much other than I know the nature of broadcasting is changing and the kinds of hardware VR/AR etc. to access it. Also the sports stars get a lot of money from sponsors like Nike and all kinds of products. I wonder if this excess is a good example to sport and sportsmanship in general. I was raised to believe that showing excessive wealth was rude and not very classy but I'm just old fashioned I guess.
You make some excellent point. There are many more options than just sports for out disposable income and in many cases, we have less disposable income to go around now. What will be interesting going forward is how leagues attempt to keep millennials coming to the games. Their interests are vastly different and teams are already having to provide a lot of "other" entertainment and engaging activities other than just the game to keep people interested.
Great points @adsactly, the cost is that eventually it as a form of mass entertainment will take a sudden drop in interest, tv ratings, and people will start to do other things and newer pastimes will be born. The Baltimore Orioles employed a bonus program giving a ticket package to a box seat holder of two free 9 and under entrants to upper deck seating on a later date to draw more family participation in their games. That is a start. In my opinion I think the sports craze is beginning to peak actually, as NFL ratings are starting to fall and attendance is slowly dropping in these major sports, as it has been blamed on many things like politics and other things. I think the cold hard truth is after a while the fans are finally speaking up and telling their beloved franchises, "Ok, you have crossed the line for me to support you financially in even the more indirect ways," like watching the team on cable or even free tv. Maybe this has some correlation with the massive amounts of people that post their outdoor photos on steemit? Just kidding, nice post @adsactly.
You are so right! There has to be a breaking point where the majority of fans just say enough! There are other ways to watch sports and there are other options for entertainment.
Your post is always different i follow your blog everytime,your post is so helpful.I always inspire of your post on my steem work.Thank you for sharing @adsactly
By chance, are you a fan of the Broncos? Haha
That's a great perspective on the big picture of sports; watching it live is facing steeper competition from say watching on television. For me, I've never seen a game live... I don't like loud noises, and I loathe being stuck in traffic, so the convenience (and close up shots!) from viewing on TV is hard to beat. But as you say, watching live is a unique experience of its own so I should try some time... Maybe the decreasing crowds over time might help encourage me! Haha until I look at the latest prices...
Watching say college sports is an interesting alternative, especially if you happen to have roots with that college. Although I guess college sports are also becoming more expensive as well? :(
Yes, I am a huge Bronco fan and thanks for noticing. I personally enjoy watching on television as well. There is so much more added to the game and you get the analysis and commentary as well. That being said, there is this feeling of being at a stadium filled with 50,000 screaming fans that is exhilarating.
Former St Louis Rams fan here. I acknowledge the bottom line is $$$ for every pro franchise but the disgusting greed of the NFL has turned me off completely and I can't be alone in this sentiment. The last year of NFL in St Louis polarized this city in ways I couldn't imagine.
If you aren't familiar with the St Louis metro area the city of St Louis and St Louis County are two separate, independent entities. The hangup in the city was public funding of a new stadium. I live in the city and like most city residents opposed financing a stadium that the vast majority of the city residents could never afford to enjoy themselves despite paying millions to help build.
The middle class and wealthier communities are in St Louis County. Because of the rediculous separation of city and county the majority of fans that could afford tickets to Rams games wouldn't share that tax burden.
This was a nasty fight. Add the emotion of losing your team that you love to the mix created a perfect storm.
Personally the most insulting part of the public funding debate is the fact that the man who owns the Rams, billionare Stan Kroenke, is one of the wealthiest people in America.
And the saga doesn't end here. As if we learned nothing from the Rams stadium fight the CEOs of US Soccer, World Wide Technology, a Bain Capital exec, and a investment fund tycoon all straight faced asked the city to fund an MLS stadium not a year after the NFL skipped town.
The greed killed it for me. Fuck the NFL.
St Louis residents still owe 10s of millions of dollars for an empty building our NFL team used to play in.
Your comment speaks volumes to what is going on in this industry every single day. I must admit that I am a huge NFL fan but I am frustrated with the way things are right now. You had to experience some of the worst of this issue first hand. Professional sports are a business for profit and that is just the harsh reality now. Fans and cities are held hostage and reap very little return for their invested dollar. It was a damn shame what happened in St.Louis. I see it happening all the time. Right now there is a fight in Calgary about who is going to pay for the "must have" new arena. Here in Ottawa the owner of the Sens is toying with the city about the new arena project and who suffers in the end? FANS. Thanks for the great comment.
We just lost a court battle with the Blues over public funding for arena upgrades. The frustrating part for me is the division. Many passionate fans think opposing a tax to fund these projects makes one anti-your team. Which is hardly the case. I loved the Rams. Second time in my life we actually went through this. I was young but generations before me had to go through losing the Cardinals to Arizona.
Relevant to our conversation, my first NFL game ever was in Denver. Got to see Elway play.