Inpart 1of this series, I explored the origins of sports dating back to early human civilizations, and the reasons why humans feel so passionate about them – they parallel, and sometimes even replace aspects of religion, warfare, and community. However, our relationship to sports is not static. Human behavior and societal norms are dynamic, constantly changing with new technology, ideology, and regulations. Given the sheer inseparability of sports from human society and serving as a means in which humans express themselves, the sports that we know and love are constantly changing as well. The competitiveness, the rules, the contracts, the media focus – these things all look much different today than they were 10, 20, 30 years ago.
I argue that the main factor contributing to these changes has been what I call the hyper-commercialization of sports. Enormous amounts of money pouring into sports has drastically changed the way in which we interact with them, potentially diluting the meaning and connection that we have historically derived from them. To understand this monumental shift, we first need to understand what the sports industry looks like today.
Landscape of Sports Today
Today, sports are MASSIVE businesses with various leagues each bringing in billions of dollars in annual revenue from broadcast rights, merchandise sales, sponsorships, and ticket & concession sales. In fact, the global sports industry as a whole is estimated to be valued at almosthalf a trillion dollars(that is trillion, with a “t”). The most lucrative sports league in the world, the National Football League (NFL), is estimated to have brought in almost $19 billionin revenue in 2023 with the league’s commissioner, Roger Goodell, aiming to reach $25 billion in annual revenue by 2027. The National Basketball Association (NBA) and Major League Baseball (MLB) are both estimated to have brought in around $11 billion in annual revenue in 2023. And the revenue generated by the top 20 European football (soccer) clubs in 2023 is estimated at around 10.5 billion Euros (~$11.4 billion using today’s exchange rate). The National Hockey League (NHL), Formula 1, Tennis, Golf, and Major League Soccer are also multi-billion-dollar leagues or competitions in their own right.
And there is reason to believe that these leagues and the teams that comprise them will only continue to grow in value. Broadcasting rights make up a majority of revenue, and as people have started to spurn cable television for streaming, the only thing keeping subscribers around is live sports. According to Variety, 44 out of the top 50 live U.S. broadcasts in terms of viewership in 2023 were sports broadcasts (38 were NFL broadcasts). NBC, ABC, CBS, ESPN, and all the other networks realize the value that sports bring to their declining businesses and have responded by offering large sums of money for the broadcast rights of various sports leagues. To add fuel to the fire, streaming services like Amazon Prime, Apple TV, Peaco*ck, and Paramount Plus have joined into the bidding wars for these broadcast rights as they realize it could be a meaningful differentiator to drive more subscribers to their services.
In a world in which a new streaming service seemingly pops up every day, this makes sense – how else is a company going to differentiate themselves from the rest of the pack? I find myself paying for Paramount Plus solely to watch Champions League games. But, who are the winners in this scenario? The sports leagues. Leagues have now found themselves in a beautiful position in which various companies with deep pockets are all racing to get access to a finite source of their sports’ content. Take the NBA for example – last week, it was reported that the league is finalizing a new media deal worth almost $7 billion per year, more than double the amount of their last deal.
Not to mention, leagues like the NFL have recently implemented changes allowing private equity firms and institutional investors to own a minority stake in their teams. Previously, the NFL barred private equity firms from investing in teams given various potential conflicts of interest. However, team valuations are reaching a point where the pool of potential buyers is extremely limited. As a result, the NFL recently created a framework that will allow private equity funds and institutional investors to own a minority percentage of a team. Additionally, the NFL will also allow new buyers to take on up to $1.2 billion in debt to acquire a team, an increase from the current $700 million debt limit.
These new rules will not only expand the pool of potential investors in teams, but will also give current owners more opportunities to free up cash for other uses. To put it plainly, this means more companies with deep pockets are competing with other companies with deep pockets for scarce assets like NFL teams. And the results of these developments have been striking. Take a look at the rise in major U.S. sports teams’ valuations versus the S&P 500 over the past 20 years:
And these are just the leagues and teams. The best and most popular athletes today are some of the most influential people in the world. People like Michael Jordan, Lebron James, Cristiano Ronaldo, and Lionel Messi have the ability to influence hundreds of millions of people worldwide, and they are certainly paid like it:
Top Earning Athletes in 2023. Source: Forbes
It’s apparent that today’s society tremendously values sports leagues, teams, and athletes. However, are there downsides to this hyper-commercialization of sports? I think there are.
Competitive Decline
With more money funneling into sports leagues, the value of player contracts has closely followed the trajectory of league and team valuations. At first glance, this is not a bad thing – athletes are the ones who make us fall in love with the game and the ones who have turned sports into such a large industry. They deserve to reap the rewards of what they sow. However, looking under the surface, what if all this money is diluting the competitiveness of regular season games? For example, players who sign a $40+ million per year contract are suddenly not as incentivized to play every single regular season game, push the limits of their athletic abilities, and therefore risk injury for “meaningless” regular season games. And don’t get me wrong, I get it. A player with a massive contract is now considered an asset for the team paying their salary, and they will do anything to ensure they get the most out of that asset when it matters most -- the playoffs.
However, this disproportionately affects the average fan who spends their hard-earned money to attend these regular season games in person. Imagine saving your hard-earned money to be able to afford a ticket to see your favorite player in person, and they are inactive, not because of injury, but because they decided to take the day off for rest. NBA superstar Kawhi Leonard serves as a prime example of this problem – over two seasons from 2019 to 2021, Leonard missed a total of 35 games mainly due to rest on a set of back-to-back games. Certain leagues like the NBA have noticed this issue in recent years and are implementing rules to prevent “load management” by requiring players to play in at least 65 of 82 games in a season to be eligible for certain awards.
While we will have to wait to see if this rule incentivizes superstars to play more games, the fact remains that there has been a decline in the competitiveness of regular season games as money takes a more central role in these leagues. Fans can no longer be guaranteed that they will see athletes put everything on the line day in and day out in the name of competition – there is now a balancing act, a cost-benefit analysis between exerting maximum effort in a specific game and maximizing the value of the “asset” (player) over its “useful life” (contract length).
With so much money up for grabs, it begs the question of whether an athlete’s primary goal should be to win a trophy at all costs, or to make as much money as possible. And I think we have started to see this conflict play out more frequently today with players of championship-caliber teams leaving their respective teams in search of higher-paying contracts. It’s interesting because you hear about teams winning a championship (or coming just short) and not being able to re-sign some of their key players because they “cannot afford them.” These players then sign massive contracts with other teams who do not even come close to contending for a trophy.
And contracts are likely to continue rising. So, the question becomes – is competing at the highest levels and winning championships the ultimate goal for athletes in a world where $20, $30, $40, $50 million per year contracts are up for grabs? To me, it seems that the pursuit of money has replaced the pursuit of glory for most athletes, and in the process, the competitive nature of sports that humans innately connect with will continue to decline.
Sanctity of the Game
In 2018, the U.S. Supreme Court struck down the Amateur Sports Protection Act, paving the way for individual states to legalize sports betting. Since then, thirty-eight states, including Puerto Rico and Washington D.C. have legalized sports betting in one form or another. And with this, we have seen companies like FanDuel, DraftKings, and BetMGM pour billions of dollars into marketing and advertising in an effort to gain a slice of this lucrative new market. Sensing the opportunity for more revenue, leagues, teams, arenas, and even college athletic programs have started to accept sponsorships from, and form partnerships with, sports betting companies. Networks like ESPN and TNT have started to lean into sports betting with dedicated airtime to things like “Chuck [Barkley]’s parlay of the day.”
Predictably, there’s been a wave of athletes, coaches, and team employees getting suspended (and even banned) for betting violations. Arizona Cardinals player Josh Shaw was suspended by the NFL in 2019 for betting against his own team. NFL wide receiver Calvin Ridley was suspended for one year for placing multi-legged parlay bets that included his team at the time, the Atlanta Falcons. University of Alabama head baseball coach Brad Bohannon was fired after federal prosecutors found links between Bohannon and an Indiana businessman involving bets against his own team. Jacksonville Jaguars employee Amit Patel was sentenced to six and a half years in prison for stealing $22 million from the team to place sports bets. NBA player Jontay Porter was banned for life from the NBA after evidence emerged that he was placing prop bets on himself, taking the “under” on his own stats and then proceeding to fake an injury. And most recently, the MLB permanently banned infielder Tucupita Marcano for placing hundreds of bets on baseball including wagers on games involving his own team. These are just several examples of a longer list of betting violations involving people within the sports ecosystem.
The most beautiful thing about sports is their unpredictable nature. The feeling of hope, anxiety, and anticipation that you feel as you watch a game – the feeling that anything is possible and that you can’t possibly guess what’s going to happen next. With betting scandals like these, where players or coaches are caught betting on games that they are directly involved with, the entire sanctity of the game comes into question. And as leagues, organizations, and broadcasting companies become more intertwined with sports betting in the name of increasing revenue, we will almost certainly continue to see more of these scandals. While sports betting is not something new, these scandals bring attention to a darker side of sports that we probably never really thought of – is the game we are watching authentic? Is there not some ulterior motive dictating the outcome of the game?
Sports betting has also dramatically changed fan engagement and the overall viewing experience. Rather than watching for the love of the game, many viewers are now fixated on the outcomes of specific plays that have no bearing on the overall game but that carry major financial implications for themselves. As a result, there is less appreciation for the process, strategy, and athletic feats involved in the game — fans become completely outcome — driven, which often detracts from the pure enjoyment of the sport. In the process, the viewing experience turns into a stressful endeavor, overshadowing the communal and leisurely aspects that have traditionally made sports so enjoyable.
Individualization
Sport is the great equalizer. Whether you are playing a sport or rooting for a team, people of different ages, upbringings, and socioeconomic status can all come together under a shared goal — to win. However, as I already mentioned previously, the more money that pours into sports, the more that this shared goal of winning is put at risk as athletes can no longer be sure of their fellow teammates’ intentions. Do they want to win, or do they want to enrich themselves? Are they playing for the love of competition, or is this solely a career choice?
This breakdown of community has also extended to sports fans. I talked about this inpart 1, but being a fan of a sports team has always provided people with a sense of local community – you feel camaraderie for a fellow stranger when they root for the same team as you. And while this still holds true today, I think there are an increasing number of people whose allegiance lies with individual players rather than hometown teams. People are ready to ditch their “favorite” teams as soon as their favorite player leaves to join another team. Lebron James is a player that immediately comes to mind — he is the biggest basketball star since Michael Jordan and has left multiple teams throughout his career. And guess what? Every time he has left a team, people who you thought were Cavaliers fans (or Heat fans) suddenly become “fans” of the team that he decided to join. As a Lakers fan, I have experienced this firsthand — when Lebron joined the Lakers in 2018, I was surprised to find that there were a lot more “Lakers fans” than I remembered. Why is this happening more and more nowadays? Well, there are a couple of factors at play.
First, I think the way in which the media covers sports today is partially to blame. As global sport becomes ever more popular throughout society, media coverage unsurprisingly follows. However, sports media coverage used to include insightful and in-depth analysis of the games from certified experts who had experience in the domain in which they were talking. Today, media coverage is largely comprised of surface-level takes from fake TV personalities in order to maximize viewership and accommodate the lowest common denominator of sports fans. And the best way to accommodate this lowest common denominator is to talk about the mega-stars, the Lebron James’ of the world at every possible moment. That is how you maximize viewership.
If you turn on ESPN or FS1, you are likely to see Stephen A. Smith or Skip Bayless, two people who are by no means accomplished athletes or experts inanysport, debating whether Michael Jordan or Lebron James is the greatest basketball player of all-time or asking, “how does x affect Lebron’s legacy?” To put it plainly, media coverage around sports has largely turned into meaningless, uninformative discussions about the biggest superstars in the world, all for show.
Second, the rise of things like fantasy sports and PrizePicks has also largely contributed to a shift away from team-based fandom. One’s success in fantasy or PrizePicks is measured by the performances of individual athletes, rather than teams. Especially for younger fans who grow up in this world of fantasy sports and gambling on player props, it is easy to see how people could be conflicted about whether to root for their hometown team or for the players on their fantasy team or PrizePicks slip, especially when money is involved. Going a step further, in the near future, the way in which allegiance to a team or player develops may no longer be tied to one’s hometown or an in-person experience at a sporting event, but through their monetary success and failure in sports betting or money-games.
Rules of the Game
With the seemingly never-ending flow of money through things like larger broadcasting rights, leagues have decided to change rules to make the game seem more “exciting.” I put the word in quotes because these rule changes generally do not actually make the game more exciting — they just make the game seem more appealing to casual fans to maximize viewership. And, these rule changes have unintended consequences.
A good example of this is basketball. Over the years, the NBA has implemented rules such as removing the defensive hand-check rule and implementing a defensive three-second rule in an effort to prioritize more scoring. To put this in perspective, the 2023-24 Detroit Pistons, one of the worst teams in NBA history, averaged 109.9 points this season. The 2014-15 Golden State Warriors, who won 67 games in the regular season and went on to win the NBA championship, averaged 110.0 points that season and were the highest scoring offense by a wide margin. On the surface, it seems like more scoring should translate to more exciting games and higher viewership. However, this has not been the case.
Instead, there has been a surge in blow-out games, with one team absolutely dominating the other and winning by a wide margin. Free-throw attempts have also surged, with players like Joel Embiid and James Harden flopping and utilizing moves where it doesn’t even seem like they are trying to score, but rather just trying to draw a foul. And guess what? NBA viewership has actually declined in recent years. It turns out that people don’t want to see blow-outs and free throws.
Let’s look at baseball. I must admit, I am not a huge fan of baseball – at least not regular season baseball. In an effort to combat declining viewership and appeal to casuals like myself, the MLB has implemented different rules and changes to the game, the most notable one in recent times being the implementation of a pitch clock to speed up games. Another example is changing the type of balls used in the game to increase scoring, although for a time the MLB declined that they made any such changes.
So shorter games and more scoring – this should be a good thing for a sport in which long games and a lack of scoring have been the main complaints from people who don’t regularly watch the MLB, right? Well, as I said before, these changes have unintended consequences. The MLB has recently seen a major increase in the injuries of star pitchers, and while there are likely many different factors contributing to this problem, you can’t help but wonder if these two changes are part of the reason. Don’t take my word for it – here is a recent clip from Houston Astros Pitcher Justin Verlander, a 3-time Cy Young winner, on the recent “pandemic” (his words, not mine) of pitcher injuries:
Conclusion
The landscape of sports today is nearly unrecognizable compared to a few decades ago. Ultimately, our avid love for sports is a double-edged sword. Hyper-commercialization has brought unprecedented revenue streams and increased global popularity, but this comes with significant trade-offs. The vast sums of money now involved in sports have altered the dynamics of competition, potentially diluting the passion and purity that once defined athletic contests. The rise of sports betting further complicates this picture, introducing ethical concerns and questions about the integrity of the games we love. Moreover, the focus on individual star power over team allegiance and the media’s sensationalist coverage have reshaped fan engagement.
While sports remain a powerful unifier that connects people across diverse backgrounds, the communal aspect has weakened as financial incentives increasingly drive both players' and fans' behavior. Rule changes aimed at making games more exciting have often had mixed results, sometimes detracting from the authenticity and strategic complexity that purists cherish. As sports continue to evolve under the pressure of commercialization, it is crucial to find a balance that preserves the essence of competition, community, and purity. Only by addressing these challenges can we ensure that sports remain a meaningful and enriching part of human culture, reflecting our deepest values and aspirations.
As we look to the future, it's important for all parties – leagues, teams, athletes, and fans – to critically assess the impact of these changes. By understanding the ways in which sports continue to change, we can hope to navigate this complex landscape and maintain the intrinsic joy and camaraderie that sports have historically provided all of us.
The Clock strikes 12…
JS
Share
