Sports Management Ch 10 – Flashcards
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Five North American major professional men's leagues
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MLB, NFL, NHL, NBA, and MLS
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number of teams at the major league level
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149
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only women's "major" pro league
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WNBA
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Number of North American minor league teams
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800
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First Professional Team
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1869 - Cincinnati Red Stockings
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North America's first professional sport league
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1876 - National League
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National League
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Included bylaws for limits on franchise movement, club territorial rights, and mechanism for expulsion of a club
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Corporate governance model
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Owners act as the board of directors, and the commissioner acts as the chief executive officer
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Leagues are structured as
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an umbrella organization for franchises to cooperate in business while competing on playing field
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League
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handles rule making and rule enforcement
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Trend for emerging leagues to be established as
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single entities to avoid antitrust liability and to create centralized fiscal control (e.g., MLS, WNBA)
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Initially sport team ownership
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a hobby for the wealthy
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Today sport team ownership
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run like a business and not a hobby
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Except for NFL, most ownership
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diversified (several people) because of the costs of purchasing and operating a team
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For NFL ownership
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Family or individual ownership is still the norm because of enhanced degree of revenue sharing
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A growing trend is for owners to challenge league control over
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shared revenue streams
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Examples of owners gaining control of marketing revenue from logos, trademarks and sponsorships
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Cowboys and Yankees
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Example of owner working to maximize revenues
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Boston Red Sox and Fenway Sports Group
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5 Ownership rules
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*Permission to own sports franchise granted by ownership committee of league •League imposes restrictions on ownership, including limit on number of franchise rights granted (number of teams) and restrictions on franchise location •Leagues may also impose eligibility restrictions for franchise ownership -NFL bans corporate and public ownership •Franchise and territorial rights are granted with ownership •Use of team colors, name, and logo are granted with ownership
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First commissioner of a pro sport league
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1920 - MLB Judge Kennesaw Mountain Landis
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commissioner's powers
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Granted authority to investigate and impose penalties when individuals involved with the sport are suspected of acting against the best interests of the game
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Players' associations use collective bargaining
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limit commissioner's powers
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established first players' association in 1885
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John Montgomery Ward
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players association was created to
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Fight reserve system, salary caps, and practice of selling players without the players' receiving a share of profits, Also negotiate with owners.
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200 players organized a revolt that
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led to organization of the Players League
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formed 1952
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MLBPA
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the 1952 MLBPA
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Dominated by management and negotiations limited to pensions and insurance
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In 1966 Marvin Miller
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organized players as true labor union by convincing all players that each of them was essential to game revenues
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In 1957
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NHL tried to unionize
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Labor relations did not play major role in professional sports until
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growing fan interest and increased TV and sponsorship revenues transformed leagues. (1960s)
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Once players unionize
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collective bargaining must occur before league management can change hours, wages, or terms and conditions of employment
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When the collective bargaining process reaches an impasse
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the players can go on strike or owners can "lock out" players
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Strikes and lockouts are far more disruptive in professional sports than in other industries because
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lack of replacement players
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Birth of PGA
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Objectives are to grow golf interest, elevate standards of golf professionals, establish a relief fund, and hold meetings and tournaments (1916)
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PGA tournament players broke away from the larger membership to form
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Tournament Players Division (PGA Tour) - 1960s
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franchise values for major league clubs
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hundreds of millions of dollars
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Franchise free agency
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Team owners threaten to move teams if their demands for new stadiums, renovations to existing stadiums, or better lease agreements are not met
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Example of revenue generation
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Boston Red Sox, who are maximizing revenue potential in every inch of Fenway Park (LA Dodgers also)
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contrast between large and small broadcast markets
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Forcing some teams to focus on efficiency (Oakland A's) and use a system that uses less common statistics, wise drafting, and drafting of players who are "signable"
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All professional sport leagues adopt restrictive practices (drafts, reserve systems, salary caps, free agent restrictions, and free agent compensation)
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to provide financial stability and competitive balance between their teams
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anticompetitive
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league restrictive practices are often challenged under antitrust law
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Representation of minorities in sport management
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should match representation on the field
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2003: All leagues showed lower averages in management and coaching positions
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women
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2003: NBA, NHL, and MLB had improvements in
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race categories
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NBA: First African American majority owner
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Bob Johnson (Charlotte Bobcats)
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MLB: First minority owner was Mexican American
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Arte Moreno (Anaheim Angels)
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WNBA: Representation of women has declined in every category except
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professional administrator and player
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General manager
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In charge of all player personnel decisions; Traditionally former player or coach, but as position has become more complex individuals with graduate degrees have become desirable
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Team Front Office Personnel
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Entry level tends to be in sales, marketing, community relations, and media/public relations with low starting salaries
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Tour Personnel
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positions range from commissioner to marketer to special events coordinator
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Sports Agents
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coordinate business and financial affairs
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Sports Agencies
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marketing, management, finance, accounting, operations, and so on
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Salary Caps
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Intended to create parity among teams by limiting how much a team can spend on its players' salaries
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Caps can also require teams to have spending minimums
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low-revenue teams are prevented from cutting their payrolls to stay competitive
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Professional sports are becoming globalized
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drafting and signing of players from other nations and the movement of marketing efforts into those countries
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NBA seeks to move full force into
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China
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Women's Professional Sport Leagues
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WNBA and NPF
