With salaries of the world’s top athletes rising and the value of some sports franchises going through the roof, sports economics has become a hot topic in the past decade. From stadium naming rights to lucrative television deals, teams and athletes far and wide are cashing in on entertaining sports fans like never before. Below, a look at five lists that detail the profitability of sports.
- Forbes.com: The Most Valuable Teams in Sports. Forbes is quick to point out the rise in the value of sports franchises: in 2004, no team was worth $1 billion dollars; in 2008, a whopping 24 teams’ values top that mark. The No. 1: Manchester United, English Premier League. Value: $1.8 billion. My verdict: Does anyone else find it mildly ironic/hilarious that AIG is this team’s title sponsor?
- Forbes.com: Most Valuable College Football Teams. Despite what some college administrators may want the public to think, amateur collegiate athletics–particularly football and basketball–is big business, bringing millions to universities each season. The No. 1: Notre Dame. Value: $101 million. My verdict: Notre Dame’s exclusive television deal with NBC, and the fact that they aren’t tied to a conference, give them a clear advantage. Nevermind that Forbes.com can’t seem to spell the name of their head coach correctly.
- Sports Business Journal: Top 10 Naming Rights Deals (via The Dallas Morning News). We may be in the midst of a global economic recession, but you wouldn’t know it from recent stadium naming rights deals. The largest two deals in history were signed just within the last year. (And by financial service firms no less!) The No. 1: Tie between Barclays Center in Brooklyn, NY (Brooklyn Nets, NBA) and Citi Field in Queens, NY (New York Mets, MLB). Cost: $400 million (20 years). My verdict: After receiving $50 billion from TARP, I suppose a $20 million annual budget for having your name on a baseball stadium seems cheap for Citigroup.
- Wikipedia: List of Major League Baseball teams by payroll. Of the four major American sports leagues (MLB, NBA, NFL, and NHL), only Major League Baseball is without a salary cap. Therefore the teams at the top of this MLB list have the highest payrolls of all American sports teams. No data is available on wealthy non-American sports leagues, such as the English Premier League, as payrolls in these leagues are not publicly disclosed. The No. 1: New York Yankees, MLB. Payroll in 2008: $209 million. My verdict: The Yankees have had the highest payroll in the big leagues since 1995, but haven’t won a World Series since 2000. I guess money can’t always buy you happiness (or even championships).
- SI.com: The 50 Highest-Earning Athletes in the U.S. Some of these top athletes’ earnings eclipse the national GDPs of a handful of small countries. The No. 1: Tiger Woods. Total Earnings: $127.9 million. My verdict: Tiger’s yearly earnings dwarf that of most major American sports teams’ entire payrolls. In one year, he can afford to purchase one of the world’s most expensive homes in cash, completely debt-free!
Okay, so sports isn’t exactly Wall Street in terms of dollar amounts changing hands. But hey, at least we don’t have to bail these guys out!