ADV 378S Lecture Notes - Lecture 4: Luxury Box, Naming Rights, Profit Sharing
Document Summary
Evolution of activities to maximize revenue and fan interest. Foster competitive balance for long term common good. Allows independent owners to realize gains unavailable unilaterally. Collective strength more important than that of individual teams. An association of supplies that maintain high prices to restrict competition. Centralized league wide negation strategy for labor, media, licensing. Anti trust issues: sherman anti-trust law. No one can limit competition that hurts consumers: unreasonable restraint of trade, two or more , are sports leagues. Multiple members with a single aggregation of economic power. League is less vulnerable to wide variations in management skills by individual owners. Evades application of anti-trust laws in management-labor disputes. Owners don"t own teams, they own stock in the league. Players contract with the league not the teams. Strengths: unilaterally impose salary rules, profit sharing, union negation, competitive parity, teams creation or movement is easier, more creative tv deals, shielded from antitrust issues.
