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Sports Business and the Theory of Multisided Markets


  • Oliver Budzinski

    () (Philipps-University Marburg)

  • Janina Satzer

    () (Philipps-University Marburg)


Despite still being younger than a decade, the theory of multisided market has offered numerous valuable insights for the analysis of non-ordinary industries in which a supplier serves two distinct customer groups that are indirectly interrelated by externalities. Examples include payment systems, matching agencies, commercial media and software platforms. However, professional sports markets have largely been neglected so far in this kind of research although they possess the characteristics of multisided markets. We contribute to filling this gap by describing the platform elements of professional suppliers of sports events and outlining problems where an application of this theoretical framework is likely to provide valuable insights and to add to the existing knowledge. Among these problems are integrative pricing strategies of sports clubs towards such different customer groups like attendees, broadcasters, sponsors, etc., including their welfare and antitrust implications, design decisions of sports associations in order to promote positive feedback loops among the customer groups as well as strategies to reinforce positive externalities among customer groups and alleviate negative ones.

Suggested Citation

  • Oliver Budzinski & Janina Satzer, 2008. "Sports Business and the Theory of Multisided Markets," MAGKS Papers on Economics 200811, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  • Handle: RePEc:mar:magkse:200811

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    References listed on IDEAS

    1. Kaiser, Ulrich & Wright, Julian, 2006. "Price structure in two-sided markets: Evidence from the magazine industry," International Journal of Industrial Organization, Elsevier, vol. 24(1), pages 1-28, January.
    2. Dewenter, Ralf & Haucap, Justus, 2008. "Wettbewerb als Aufgabe und Problem auf Medienmaerkten: Fallstudien aus Sicht der "Theorie zweiseitiger Maerkte"," Working Paper 78/2008, Helmut Schmidt University, Hamburg.
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    4. Mark Armstrong, 2006. "Competition in two‐sided markets," RAND Journal of Economics, RAND Corporation, vol. 37(3), pages 668-691, September.
    5. Jean-Charles Rochet & Jean Tirole, 2002. "Cooperation Among Competitors: Some Economics Of Payment Card Associations," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 549-570, Winter.
    6. David Evans & Richard Schmalensee, 2007. "The Industrial Organization of Markets with Two-Sided Platforms," CPI Journal, Competition Policy International, vol. 3.
    7. Jean‐Charles Rochet & Jean Tirole, 2006. "Two‐sided markets: a progress report," RAND Journal of Economics, RAND Corporation, vol. 37(3), pages 645-667, September.
    8. Jean-Charles Rochet & Jean Tirole, 2014. "Platform Competition in Two-Sided Markets," CPI Journal, Competition Policy International, vol. 10.
    9. Roger G. Noll, 2007. "Broadcasting And Team Sports," Scottish Journal of Political Economy, Scottish Economic Society, vol. 54(3), pages 400-421, July.
    10. Andrew S. Zimbalist, 2002. "Competitive Balance in Sports Leagues: An Introduction," Journal of Sports Economics, , vol. 3(2), pages 111-121, May.
    11. Caillaud, Bernard & Jullien, Bruno, 2003. " Chicken & Egg: Competition among Intermediation Service Providers," RAND Journal of Economics, The RAND Corporation, vol. 34(2), pages 309-328, Summer.
    12. Simon Rottenberg, 1956. "The Baseball Players' Labor Market," Journal of Political Economy, University of Chicago Press, vol. 64, pages 242-242.
    13. Anderson, Simon P. & Gabszewicz, Jean J., 2006. "The Media and Advertising: A Tale of Two-Sided Markets," Handbook of the Economics of Art and Culture, Elsevier.
    14. Hans Jarle Kind & Tore Nilssen & Lars Sørgard, 2007. "Competition for Viewers and Advertisers in a TV Oligopoly," Journal of Media Economics, Taylor & Francis Journals, vol. 20(3), pages 211-233.
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    Cited by:

    1. Saldsieder Nina & Wentzel Dirk, 2014. "Ordnungsfragen des europäischen Profifußballs: Das Konzept des Financial Fair Play und seine Erfolgsaussichten / The Concept of Financial Fair Play and his prospects of success," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 65(1), pages 229-262, January.

    More about this item


    sports economics; two-sided markets; multisided platforms; professional sports business; pricing strategies; broadcasting rights;

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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