Sports Broadcasting News
There is no doubt that advances in technology have caused an increase in the rise of different media flat forms that deliver entertainment. One form of entertainment that has drastically changed with technology is sports broadcasting, as it is broadcast through high-speed internet sources. These advances have assisted in satisfying consumers of sport entertainment. However, this has created stiff competition in the media following a rise in the demand for the rights to broadcast sports. The result of this demand is a change in the sports broadcasting business model, as competitors seek to gain from the high sport revenues. The result of this competition is a continued change in the manner in which consumers receive sports and the price they pay for the sports. The fact that technology is transforming the broadcasting of sports and consequently affecting viewers of sports, there is a call for a change in regulation.
The need for regulation of this sector recognizes that technology is proving an advantage for both the sports broadcaster and the consumer, in the sense it eases transmission, and it still creates issues in the industry. This is because the broadcasts are creating large amounts of revenue for televisions and media centers (Noll, 2007). However, the broadcasts threaten the attendance of professional and spectator sports. This has driven the need for rights to create pay-TV in order to capture revenues lost to funs that do not attend the live sporting events. According to Maxcy Joel, during high sporting periods, live broadcasts are subjected to bottlenecks that reduce the quality of broadcast as the number of users increase. This creates a challenge for the government since, public goods are not non-rival and non-excludable. Therefore, this creates a problem for the consumer of sports as they seek to have quality and high-speed connection to view major league games. The fact that technology has made a public good like spectator sports to have rivalry and excludability, calls for the government to create a policy. This is necessary given that currently, most American homes have high speed- internet connection from fiber-optic networks that delivery fast and reliable internet services and high definition video Maxcy Joel. The need to regulate a policy on ownership and distribution of rights to broadcast sports arises from the ability of the broadband internet connection to support the delivery of live sports broadcasts. In addition, the increase in broadcasting of sports to mobile phones and mobile electronic devices like computers and personal digital assistants (PDAs) through Wi-Fi technology calls for regulation. Technologies like Over-The-Top (OTT) make it possible for a consumer to connect their television sets to public internet and receive voice, data, and video products. Therefore, since advances of technology has infinitely made it possible for the consumer to receive live sport broadcasts from anywhere and at any time, there is a need for policies to control rights. Technology from this perspective is altering the delivery of sports as a non-rival and non-excludable public good. This is further complicated by the fact that technology is changing the programming of sport content, delivery, and value of live sport events.
Moreover, even when the consumer is willing to pay to watch a live spectator or professional sporting event, the issue arises of who has the power to collect these rights. The dilemma involves the creation of a policy for the rights of broadcasting sporting events by the teams or by an individual buyer. The lack of consensus among policy makers has led to different professional leagues having different practices and policies across the globe on the sale of broadcast rights and distribution of revenues (Noll, 2007). These differences in the end, affect the outcome of sports media to consumers as it determines the delivery and payment of the good. This is situation is aggravated by the fact that traditional broadcasting has been heavily regulated, making it difficult for policy makers to draw lines on rights issue. There is a need for the government to intervene in the regulation of broadcasting policies. This is because with the internet, access to sporting events increases, but with it comes the problem of who owns the right to broadcast and deliver the events. The stiff competition between media houses and league teams over the rights to distribute sports events calls for the governments intervention. This is because, traditionally, the government has the primary role of providing, and allocating infrastructure and resources that support communication sources like the radio and internet. The goal of financing and regulating these infrastructures is the fact that they provide public goods. However, regulation is not on the restriction of internet and broadcasting infrastructure, but should be on addressing the rights of distribution. This is because, creating policies to regulate the internet and broadcasting media, will make the market too restrictive. In the process, will causes excessive monopolization and market failure as sports becomes high priced and as consumers get fewer choices.
Noll (2007) identifies that the need for policies to regulate rights over the broadcast of sports arises from the changes in the broadcast industry that are affecting both individual and team sports. Policy makers need to realize that need for regulation stems from the growth in demand and revenues from right fees of both team sports and individual sports like tennis and golf. However, for effective regulation of rights issue over distribution and broadcasting of sports requires the harmonization of the broadcast sources. This is because sport program content varies, according to the broadcaster’s source of revenue, strategies, and objectives. For this reason, the broadcast of sports no longer becomes a public good since there are different buyers with different strategies, objectives, and outcomes. This is because in the sporting field, buyers are like profit firms like television and channel firms. Secondly, buyers are non-profit like the government. Thirdly, buyers differ depending on how they reach viewers. For example, there are terrestrial, broadcasters, direct-to-home broadcasters, and over-the-air broadcasters. Moreover, sport events even within the samefield are differentiated products since they do not have perfect substitution among the buyers.
In the end, the goal of regulation should focus on the issuance of rights over the distribution and broadcasting of sport events. This is because, a policy at the national level on control of technology will lead to the entrant of competitors. This will cause restriction of satellite and terrestrial broadcasts, which will hasten the growth of digital broadcasts. Therefore, the goal should be to centralize the sale of rights of broadcasting to overcoming new entrants due to technology. Centralization will also overcome the challenge of different broadcasters with different sources of revenues from sport events. In the end, the centralization will create harmony and thereby make sports a public good that is non-rival and non-excludable.
