It was only a few decades ago that the world of sport
looked completely different. Following a team required a lot of work. Watching
a game required you to head to the stadium in person and pay the entrance
For a long time, athletes were semi-professional,
working other jobs at the same time as being paid to play for a team or compete
in events. In the early years of the English Football Association, players were
forbidden from being professional, as those in charge felt a professional sport
would damage the game.
The Beginning of
Although some sports, like Formula 1, saw limited
sponsorship deals in the late 1960s, the change really began around the 1970s
and 1980s when sports teams began to sell sponsorship opportunities to businesses.
The first English football club to do this practice was Kettering Town FC in
1976, with most following suit shortly after. Nowadays, these sponsorships are
worth 10s of millions per year, with Arsenal receiving £40 million per year for
its Fly Emirates sponsorship.
A Drop in the
Ocean Compared to TV
Although these sponsorship deals bring in large sums of
money for the teams, it is a drop in the ocean compared to the money derived
from TV rights. The rights to Premier League matches generate nearly
£5 billion over 3 years in revenue, while the NBA has a
nine-year deal for TV rights that is worth $24 billion – enough to cover the
salaries of all players in the league.
Even more is generated through TV rights for the NBA though, as local TV contracts that allow for the broadcasting of games not covered by other rights deals can raise around $150 million more each year.
While it is mostly only the top-flight professional
leagues that can command these large sums of money, there are some
American football is the most valuable sport in the
United States. While foreigners will think of the NFL, Americans will also
think of college football. In most countries, sporting competitions at
university and college level are given almost no consideration by anyone
outside of their leagues. But in America, college football is a widely covered
College games are played in large stadiums that many
professional sports teams would be envious of. Fans are often able to follow
along at home thanks to extensive TV coverage, and sports bookmakers give
college games almost as much attention as professional leagues. For example,
Oddschecker provides its customers with college football picks ahead of games, just
like it does for the NFL.
Effect of TV
The value that comes from TV rights deals is not limited
to just the cash that is paid by the networks. The reach that these TV
broadcasts create helps to bring in more money for the teams and leagues.
For example, the sale of TV rights helps to reach new
fans. These fans begin supporting a team and decide to buy merchandise, join
the supporters’ association, or attend games in person.
Furthermore, the TV rights deals mean that millions of
people are tuning in to watch games. For example, 100 million people watch the
Super Bowl on TV, while Formula 1 has a global TV audience of more than 1 billion people. This attracts more
advertisers, who will pay to place their branding around the stadiums. While
sponsorship like this exists in non-televised sport, TV broadcasts
exponentially increase their value.
In a quest to increase these numbers further, sports
leagues are looking for ways to spread internationally and use the internet to
increase their reach. Examples of this can be seen in Formula 1’s F1 TV Pro,
the NBA’s work to spread its brand in China, and the NFL’s international
Nearly all stakeholders win from this commercialised
setup in sport. League owners and teams win from the increase in their
revenues, players win from eye-wateringly large salaries, TV networks win from
selling ads during games, sponsors win from getting brand exposure to millions
of eyeballs, and fans win from being able to access more of their favourite
However, this dramatic commercialisation of sport could
come at a cost to the lower leagues of the sport, by taking attention away from
the game to focus on sponsors. An example of the former is the recent bankruptcy of Bury Football Club.