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Sports Business and the Theory of Multisided Markets

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Author Info
Oliver Budzinski () (Faculty of Business Administration and Economics, Philipps Universitaet Marburg)
Janina Satzer () (Faculty of Business Administration and Economics, Philipps Universitaet Marburg)

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Abstract

Despite still being younger than a decade, the theory of multisided market has offered numerous valuable insights for the analysis of non-ordinary industries in which a supplier serves two distinct customer groups that are indirectly interrelated by externalities. Examples include payment systems, matching agencies, commercial media and software platforms. However, professional sports markets have largely been neglected so far in this kind of research although they possess the characteristics of multisided markets. We contribute to filling this gap by describing the platform elements of professional suppliers of sports events and outlining problems where an application of this theoretical framework is likely to provide valuable insights and to add to the existing knowledge. Among these problems are integrative pricing strategies of sports clubs towards such different customer groups like attendees, broadcasters, sponsors, etc., including their welfare and antitrust implications, design decisions of sports associations in order to promote positive feedback loops among the customer groups as well as strategies to reinforce positive externalities among customer groups and alleviate negative ones.

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File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/11-2008_Budzinski.pdf
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Publisher Info
Paper provided by Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung) in its series MAGKS Papers on Economics with number 200811.

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Length: 21 pages
Date of creation: 2008
Date of revision:
Publication status: Forthcoming in
Handle: RePEc:mar:magkse:200811

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Related research
Keywords: sports economics; two-sided markets; multisided platforms; professional sports business; pricing strategies; broadcasting rights;

Other versions of this item:

Find related papers by JEL classification:
L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Recreation; Tourism
L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
M21 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics - - - Business Economics

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References listed on IDEAS
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  1. Jean-Charles Rochet Author-Email: rochet@cict.fr Author-Workplace-Name: IDEI, University of Toulouse & Jean Tirole Author-Email: tirole@cict.fr Author-Workplace-Name: IDEI, University of Toulouse, 2006. "Two-Sided Markets: A Progress Report," RAND Journal of Economics, The RAND Corporation, vol. 37(3), pages 645-667, Autumn.
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  2. Kaiser, Ulrich & Wright, Julian, 2006. "Price structure in two-sided markets: Evidence from the magazine industry," International Journal of Industrial Organization, Elsevier, vol. 24(1), pages 1-28, January. [Downloadable!] (restricted)
    Other versions:
  3. Mark Armstrong Author-Email: mark.armstrong@ucl.ac.uk, 2006. "Competition in Two-Sided Markets," RAND Journal of Economics, The RAND Corporation, vol. 37(3), pages 668-691, Autumn.
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  4. Roberto Roson, 2005. "Two-Sided Markets: A Tentative Survey," Review of Network Economics, Concept Economics, vol. 4(2), pages 142-160, June. [Downloadable!]
  5. Rochet, Jean-Charles & Tirole, Jean, 2003. "Platform Competition in Two-Sided Markets," IDEI Working Papers 152, Institut d'Économie Industrielle (IDEI), Toulouse. [Downloadable!]
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  6. Peter J. Sloane, 2006. "Rottenberg and the Economics of Sport after 50 Years: An Evaluation," IZA Discussion Papers 2175, Institute for the Study of Labor (IZA). [Downloadable!]
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  7. ANDERSON, Simon P. & GABSZEWICZ, Jean J., 2005. "The media and advertising : a tale of two-sided markets," CORE Discussion Papers 2005088, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE). [Downloadable!]
    Other versions:
  8. Schmalensee, Richard, 2002. "Payment Systems and Interchange Fees," Journal of Industrial Economics, Blackwell Publishing, vol. 50(2), pages 103-22, June. [Downloadable!] (restricted)
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  9. Simon Rottenberg, 1956. "The Baseball Players' Labor Market," Journal of Political Economy, University of Chicago Press, vol. 64, pages 242. [Downloadable!] (restricted)
  10. Jean-Charles Rochet & Jean Tirole, 2002. "Cooperation Among Competitors: Some Economics Of Payment Card Associations," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 549-570, Winter.
  11. Thomas Hoehn & Stefan Szymanski, 1999. "The Americanization of European football," Economic Policy, CEPR, CES, MSH, vol. 14(28), pages 203-240, 04. [Downloadable!] (restricted)
  12. Roger G. Noll, 2007. "Broadcasting And Team Sports," Scottish Journal of Political Economy, Scottish Economic Society, vol. 54(3), pages 400-421, 07. [Downloadable!] (restricted)
  13. Hans Jarle Kind & Tore Nilssen & Lars Sørgard, 2006. "Competition for Viewers and Advertisers in a TV Oligopoly," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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