Scientific Assignment about the influence of the new tv contract which has been signed in the British Premier League and the influence on the football market in Europe due to changes in financial power of the respective league.
As we look into the summer of 2016, there´s a huge sports event in Europe upcoming which has a high influence on the economy, especially on the economy of the country France. In July, the European Soccer Championship is taking place in France, a country, which was affected by a situation of terrorism during a match between Germany and France. This tournament has a high international attention and will be watched by millions of people all over Europe and even besides the borders of Europe. During this competition, a lot of famous soccer players have the chance to show them and proof their skills to maybe get hired from a more successful club and get a new contract with a higher income. The situation of hiring players for a very high transfer fee is becoming more and more realistic and usual.
Table of Contents
1. Introduction
1.1 Recap of the current situation
2. The economic factors of markets
2.1 General Information about Supply and Demand
2.2 Differentiations between goods
3. Details and conclusions of The British Premier League TV deal
4. Conclusion
Objectives and Topics
The primary objective of this paper is to examine the economic impact of the new television rights contract signed by the British Premier League on the broader European football market, specifically focusing on how increased club revenues influence player transfer markets and supply-demand dynamics.
- Analysis of fundamental economic concepts (supply, demand, and market equilibrium)
- Examination of the European football market structure and league rankings
- Evaluation of the British Premier League TV deal compared to other major European leagues
- Assessment of future market power imbalances within European football
Excerpt from the Book
3. Details and conclusions of The British Premier League TV deal
After now having an overview about the two major factors supply and demand, those two aspects will be set in context to the new British Premier League TV deal.
In 2015, the British Premier League (BPL) announced the new signing of the TV rights contract for the years 2016 and following. The first season with an impact will be the 2016/2017 season. The amount is expected to be about 13 Billion US$ including the international TV rights. The domestic rights in the BPL will be around 7.9 Billion US$ for a three year period. This results in an annual turnover of around 4.3 Billion US$ (cf. Massive new English Premier League TV Deal; 2015).
According to BBC, the domestic and international rights were auctioned in a highly competitive way to maximize the price. On the domestic market, the matches will be transmitted by two providers, Sky and BT (cf. BBC Article TV rights; 2015).
This is an increase of about 70 percent to the old contract. Comparing to other sport leagues from the US, the BPL TV deal will be the most lucrative TV deal in the world. Comparing with the National Basketball League NBA in the US, the current TV earnings are at a level of around 2.66 Billion US$. This is a good example to show the relation between the most lucrative US TV deal and the new BPL TV deal. The result of this new TV deal is that the income of all BPL clubs will massively increase with the new period.
Summary of Chapters
1. Introduction: Provides an overview of the European football market context and outlines the paper's goal of connecting economic supply and demand theory to professional sports revenue structures.
1.1 Recap of the current situation: Describes the influence of UEFA rankings, club performance, and the significance of centralized versus decentralized TV marketing systems on league competitiveness.
2. The economic factors of markets: Introduces fundamental microeconomic and macroeconomic theories required to analyze market behavior.
2.1 General Information about Supply and Demand: Explains the basic principles of supply and demand curves, their intersection at market equilibrium, and how external factors cause market shifts.
2.2 Differentiations between goods: Categorizes various types of goods such as normal goods, inferior goods, substitutes, and related goods to clarify how consumer demand responds to income changes.
3. Details and conclusions of The British Premier League TV deal: Analyzes the financial scale of the new BPL contract and compares its impact on club turnover with other leagues like the German Bundesliga.
4. Conclusion: Summarizes the long-term implications, suggesting that increased revenues will lead to higher player transfer fees and potentially create significant market power imbalances in European football.
Keywords
British Premier League, TV-contracts, European football market, Supply and Demand, Market Equilibrium, Revenue generation, Transfer market, Microeconomics, Macroeconomics, UEFA rankings, Bundesliga, Sports economics, Broadcasting rights, Financial comparison, Market power.
Frequently Asked Questions
What is the core focus of this research paper?
The paper examines how the significant increase in television broadcasting revenue for the British Premier League affects the economic dynamics of the European football market.
What are the primary thematic areas covered?
The work explores economic theories such as supply and demand, the structure of professional football league financing, and the competitive comparison between the Premier League and other European leagues.
What is the main objective of the study?
The goal is to demonstrate that the massive increase in television income for English clubs will shift market dynamics, leading to higher player costs and potential long-term dominance in the European market.
Which scientific methods are applied in this work?
The author uses a theoretical framework of micro- and macroeconomics to analyze empirical financial data and current market events within the professional football sector.
What topics are discussed in the main body?
The main body covers supply and demand theory, the categorization of goods, an analysis of the specific BPL television deal, and a comparative study of revenue gaps between the BPL and the German Bundesliga.
Which keywords characterize this paper?
Key terms include British Premier League, TV-contracts, Supply and Demand, Market Equilibrium, and Sports Economics.
How does the BPL TV deal impact smaller clubs in the league?
The paper notes that even lower-placed clubs in the Premier League will receive significant annual income from TV rights, which will further increase their turnover beyond traditional sources like sponsorships and ticket sales.
Why is there a focus on the German Bundesliga in the comparison?
The Bundesliga serves as a benchmark to illustrate the substantial financial gap between the English Premier League and other top-tier European leagues, highlighting the scale of the "market power" challenge.
- Quote paper
- Andreas Mehren (Author), 2016, Influence of the British Premier League TV Contract on the Football Market in Europe, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/337253
