Sunday, April 29, 2007
On the American invasion
Stef Syzmanski, in Sunday's Observer:
What attracts major-league moguls to the Premier League is its popularity, particularly in broadcast markets - the current contracts, including domestic and overseas rights, are worth about £2.7bn over three years, or £45m per club per year. By contrast, the NFL, the world's richest sports league, has broadcast contracts worth $3.1bn per season, or $97m per franchise. At today's exchange rates, these are roughly equivalent sums per club. Even better, the Premier League is enjoying rapid growth from overseas sales, something the NFL is unlikely to do. The Premier League might soon even challenge the NFL's pre-eminence in revenue.There is much, much more to the story, so do go and read it.
Thursday, April 26, 2007
NASCAR, Wrestling, & Managing
In the wake of frustrating performances, Tony Stewart ripped NASCAR officials for manipulating caution flags to generate more competitive races (from SI.com):
Yet, how this balance is achieved may also matter to fans as Stewart is getting at. Adjusting on-the-field rules, officiating standards, or other levers prior to the season or even making small adjustments during the season is one thing. Altering rules or practices from game to game, event to event, or minute by minute can cross a line into "manipulating" outcomes to the point of almost choreographing them. Handicapped horse races explicitly seek competitiveness through means much like NASCAR's car restrictions, but they don't make up the rules on the fly just before or during the race. The Jordan Rules pointed out how the NBA was making officiating decisions in the NBA Finals on a game by game basis in a none-too-veiled attempt to make things more "competitive." Last year's NBA Finals reeked of this kind of mid-stream adjustment. As a fan, I don't like that kind of stuff -- it is too much like pro wrestling. It gets awfully close to putting a lid over one basket for a while to promote a closer outcome.
But, hey, I'm only one fan -- the optimal amount of tweaking isn't based on my preferences. One could hardly argue with NASCAR's success, and they have done a lot of race-to-race tweaking that get's awfully close to pressing a button to make one guy's car slow down. Nonetheless, I do suspect that any sports organization or association needs to be careful about getting too close to "staging" outcomes a la the WWF.
Update: A couple of my B-school colleagues who are close followers of NASCAR agree with Stewart's assessment and note that this sort of thing has been going on for quite a while and is a raw nerve with them and a lot of NASCAR fans. One suggested changing "race" to "smackdown" and incorporating more colorful driver monikers such as "Mad Dog Stewart," "Handsome Harley Johnson," "Stone Cold Earnhardt," "Rowdy Robby Gordon," and "Superstar Jeff Gordon."
"It's like playing God. They can almost dictate the race instead of the drivers doing it. It's happened too many times this year." Stewart went on to say fans are complaining about debris cautions and NASCAR isn't listening. "I guess NASCAR thinks 'Hey, wrestling worked, and it was for the most part staged, so I guess it's going to work in racing, too,"' he said. "I can't understand how long the fans are going to let NASCAR treat them like they're stupid before the fans finally turn on NASCAR. I don't know that they've run a fair race all year."
That's pretty strong stuff. NASCAR first responded with "disappointment" over the comments, highlighting safety as the only concern behind cautions. Later, they issued a real counterpunch saying that if Stewart doesn't like things, there are lots of drivers who would like his spot.
Whether Stewart beefs are legit or not, I haven't paid close enough attention to tell. Beyond the specifics in this situation, the question at issue is a thorny one for sports leagues and organizations. Obviously, sports entities should try to make adjustments in their product to enhance fan interest including trying to get the optimal amount of competitive balance (a multi-sided subject by itself).Yet, how this balance is achieved may also matter to fans as Stewart is getting at. Adjusting on-the-field rules, officiating standards, or other levers prior to the season or even making small adjustments during the season is one thing. Altering rules or practices from game to game, event to event, or minute by minute can cross a line into "manipulating" outcomes to the point of almost choreographing them. Handicapped horse races explicitly seek competitiveness through means much like NASCAR's car restrictions, but they don't make up the rules on the fly just before or during the race. The Jordan Rules pointed out how the NBA was making officiating decisions in the NBA Finals on a game by game basis in a none-too-veiled attempt to make things more "competitive." Last year's NBA Finals reeked of this kind of mid-stream adjustment. As a fan, I don't like that kind of stuff -- it is too much like pro wrestling. It gets awfully close to putting a lid over one basket for a while to promote a closer outcome.
But, hey, I'm only one fan -- the optimal amount of tweaking isn't based on my preferences. One could hardly argue with NASCAR's success, and they have done a lot of race-to-race tweaking that get's awfully close to pressing a button to make one guy's car slow down. Nonetheless, I do suspect that any sports organization or association needs to be careful about getting too close to "staging" outcomes a la the WWF.
Update: A couple of my B-school colleagues who are close followers of NASCAR agree with Stewart's assessment and note that this sort of thing has been going on for quite a while and is a raw nerve with them and a lot of NASCAR fans. One suggested changing "race" to "smackdown" and incorporating more colorful driver monikers such as "Mad Dog Stewart," "Handsome Harley Johnson," "Stone Cold Earnhardt," "Rowdy Robby Gordon," and "Superstar Jeff Gordon."
Wednesday, April 25, 2007
The Eyes Have It
A recent Los Angeles Times has an article on exercises and technology which are helping baseball players see the ball better. A sample:
The device is a high-speed pitching machine that fires specially marked tennis balls at speeds up to 155 mph. Players try to read the markings as the ball flies by, an exercise intended to improve both focus and concentration. The Kansas City Royals, Seattle Mariners, Chicago Cubs, Cleveland Indians and the Olympic champion U.S. women's softball team have experimented with the ocular machine.
Another promising advance is the amber-tinted contact lens. Baltimore's Brian Roberts, Dodgers minor leaguer James Loney and the White Sox's A.J. Pierzynski are among dozens of players who have experimented with the lenses. They are designed to filter out specific wavelengths of light, cutting down on glare and making the ball appear more clearly.
Update: one of my first responses was that this is a product of improved technology, but also of free agency as well. But then I remembered Rottenberg's Invariance Hypothesis (see here as well).
The benefits resulting from the performance enhancements would likely exist regardless of whether players had the right to free agency. Fans want to watch play of the highest quality and are willing to pay for higher levels of absolute quality, all else equal. So the performance enhancers create extra quality and, therefore, extra revenue generated by the player. The question is who lays claim to the increased revenue?
Free agency gives players a right over where they play and, indirectly a claim to revenue generated by their play. The reserve rule gives that right and the claim to revenue to teams. So under the reserve rule, teams would end up largely paying for enhancements. Under free agency, players end up paying for them.
Labels: Invariance Hypothesis, Performance Enhancement, Rottenberg
Monday, April 23, 2007
Sponsorship envy
Brian Urlacher was fined $100,000 for wearing a hat bearing the logo of Vitaminwater, a competitor of Gatorade, at the media day for the Super Bowl. He apparently even drank the stuff. It is a violation of NFL rules to promote some product other than those of the NFL's official sponsors. Regular season transgressions cost $10,000, and being a scofflaw at the Pro Bowl would result in a $50,000 fine.
I would wonder if Vitaminwater paid the fine for Urlacher or if he loves the product so much he was willing to put up $100,000 to express that preference. And to top it all off, the Gatorade drinking Colts ran roughshod over the Bears defense.
I would wonder if Vitaminwater paid the fine for Urlacher or if he loves the product so much he was willing to put up $100,000 to express that preference. And to top it all off, the Gatorade drinking Colts ran roughshod over the Bears defense.
Friday, April 20, 2007
Yankee go home!
The wranglings over English Premier League clubs is now beginning to sound like a script from Dallas. Here is a quote from tonight’s London Evening Standard:
American tycoon Stan Kroenke will now remain in the background for Wenger for the rest of the season and into the summer but chairman Peter Hill-Wood made it clear today he did not want any foreign interference. In an amazing attack he claimed Kroenke, who has an 11 per cent shareholding, knows "sweet FA about our football" and insisted "we don't want his sort" at the club. Old Etonian Hill-Wood said: "Call me old fashioned, but we don't need his money and we don't want his sort. To sell for someone to use Arsenal as a lucrative toy to make money is completely unthinkable. I don't know for certain if Kroenke will mount a hostile takeover, but we shall resist it with all our might."
This is all following the resignation of David Dein, who was vice-chairman of the club and owns a 15% stake in the club. It appears Dein favoured the involvement of Kroenke and was given an ultimatum by the rest of the board. However, it is also being said that Dein, who has been a leading figure in the Premier League since it broke away from the Football League in 1992, will be back to launch a hostile takeover. Hill-Wood can probably count on the support of fellow blue-bloods Lady Nina Bracewell-Smith (16%) and Richard Carr (4%). But Danny Fiszman (24%) is a self made millionaire of humbler origins and might well be won over by Dein, with whom he has more in common. Meanwhile with $2 = £1, American investors must have something urgent on their minds to keep pursuing the Premier League clubs. Readers of this blog will know my views on that already, but my main concern now is to find a US sports franchise to buy at these exchange rates: any suggestions?
American tycoon Stan Kroenke will now remain in the background for Wenger for the rest of the season and into the summer but chairman Peter Hill-Wood made it clear today he did not want any foreign interference. In an amazing attack he claimed Kroenke, who has an 11 per cent shareholding, knows "sweet FA about our football" and insisted "we don't want his sort" at the club. Old Etonian Hill-Wood said: "Call me old fashioned, but we don't need his money and we don't want his sort. To sell for someone to use Arsenal as a lucrative toy to make money is completely unthinkable. I don't know for certain if Kroenke will mount a hostile takeover, but we shall resist it with all our might."
This is all following the resignation of David Dein, who was vice-chairman of the club and owns a 15% stake in the club. It appears Dein favoured the involvement of Kroenke and was given an ultimatum by the rest of the board. However, it is also being said that Dein, who has been a leading figure in the Premier League since it broke away from the Football League in 1992, will be back to launch a hostile takeover. Hill-Wood can probably count on the support of fellow blue-bloods Lady Nina Bracewell-Smith (16%) and Richard Carr (4%). But Danny Fiszman (24%) is a self made millionaire of humbler origins and might well be won over by Dein, with whom he has more in common. Meanwhile with $2 = £1, American investors must have something urgent on their minds to keep pursuing the Premier League clubs. Readers of this blog will know my views on that already, but my main concern now is to find a US sports franchise to buy at these exchange rates: any suggestions?
Wednesday, April 18, 2007
UEFA Shocker: Poland/Ukraine over Italy
In a completely unexpected turn of events, UEFA (the Union of European Football Associations) just announced that Poland and Ukraine will co-host the 2012 European Football Championship. The three competing hosts were Italy, Hungary and Croatia, and Poland and Ukraine. European bookmakers made Italy (odds of hosting 1:1.85) the favorite, with the Balkan bid a distant second at 1:3.25 odds and Poland/Ukraine the dark horse at 1:3.75.
It should only be a few moments before some sort of official announcement about the fantastic economic impact of this event on the economies of Poland and Ukraine. We here at the Sports Economist like to stay ahead of the curve. I wrote a paper on the potential economic impact of UEFA 2012 in Poland and Ukraine, along with Szymon Prokopowicz, a Polish graduate student, over a year ago. Here's the abstract:
The transportation infrastructure in Poland and Ukraine is in pretty poor shape. As part of their bid, these two countries plan to increase their spending on roads and rail significantly. Any improvement in the transportation networks in these two countries will clearly help the local economy. But they also plan to build or renovate ten stadiums with capacities of between 30,000 and 77,000. Average attendance at matches in the top professional football league in Poland was just over 5,000 in 2004-2005, and around 7,000 in Ukraine. They also plan to build a large number of new Five Star hotels to host teams and UEFA officials. In the paper we argue that the overall economic impact of a mega sports event in a transition economy will be difficult to determine, but probably not positive.
It should only be a few moments before some sort of official announcement about the fantastic economic impact of this event on the economies of Poland and Ukraine. We here at the Sports Economist like to stay ahead of the curve. I wrote a paper on the potential economic impact of UEFA 2012 in Poland and Ukraine, along with Szymon Prokopowicz, a Polish graduate student, over a year ago. Here's the abstract:
Developing economies have increasing interest in hosting
sports mega-events. Poland and Ukraine are the finalists
to host the Union of European Football Associations (UEFA)
2012 Football Championship. Although the event will attract
a large number of spectators and television viewers, a
simple cost benefit analysis indicates that the costs of
hosting the event will exceed the direct economic impact
related to increased tourist spending by a wide margin and
the presence of positive benefits depends on benefits from
factors, like improvements in the transportation infrastructure.
Sports mega-events may not be effective regional economic
development vehicles in transition economies.
The transportation infrastructure in Poland and Ukraine is in pretty poor shape. As part of their bid, these two countries plan to increase their spending on roads and rail significantly. Any improvement in the transportation networks in these two countries will clearly help the local economy. But they also plan to build or renovate ten stadiums with capacities of between 30,000 and 77,000. Average attendance at matches in the top professional football league in Poland was just over 5,000 in 2004-2005, and around 7,000 in Ukraine. They also plan to build a large number of new Five Star hotels to host teams and UEFA officials. In the paper we argue that the overall economic impact of a mega sports event in a transition economy will be difficult to determine, but probably not positive.
Tuesday, April 17, 2007
"Fight money"
From David Picker in today's NY Times:
Tom Glavine observes, "My immediate reaction is you’re paying guys extra for what they’re getting paid to do anyway." My hunch is that its the symbolic act of giving that is important.
If Kei Igawa helps the Yankees defeat the Cleveland Indians tomorrow night at Yankee Stadium, Manager Joe Torre will probably offer him a handshake and some words of encouragement. But Igawa, who pitched for the Hanshin Tigers in his native Japan the previous eight seasons, is accustomed to more tangible rewards.The practice varies across teams. The Red Sox' Daisuke Matsuzaka once received a case of coffee after pitching in a victory for the Seibu Lions. One wonders from that example what the purpose of the system really is.
After contributing to a Hanshin victory, Igawa’s manager would frequently hand him an envelope stuffed with yen, usually the equivalent of about $1,000. Igawa was free to spend the money as he liked. He usually saved it and kept the envelope as a souvenir.
The financial exchange, which is separate from a player’s salary, is common in Japanese baseball and known as kantoku shou, which, translated literally, means manager prize. The foreign players in Nippon Professional Baseball commonly refer to it as fight money.
Tom Glavine observes, "My immediate reaction is you’re paying guys extra for what they’re getting paid to do anyway." My hunch is that its the symbolic act of giving that is important.
Monday, April 16, 2007
Unbalanced
Today's news brings two columns from opposite sides of the pond, with different gripes about their sports leagues. Newmark's Door directs us to Bill Simmons' latest screed, in which he argues that the NBA is suffering from too much parity. In the Telegraph, Tony Francis gets in a number of clever lines while ruing the predictable dominance of the big clubs in English soccer. As in "The English game is a duopoly masquerading as a competition."
Francis has plenty of company making that point these days, but even so I think it's a bit overstated. Manchester United were not expected to win the Premier League this year, but their perch at the top makes them the target of the Robin Hood gang. Chelsea's title in 2005 was their first in 50 years, so they can't be viewed as a permanent fixture atop the landscape. Chelsea illustrate the opposite -- that it is possible to progress from also-ran to a title winner with good coaching and um..., a massive budget. For all intents and purposes though, the Premier League title race appears to be a four team competition for the foreseeable future -- a "quadopoly," perhaps.
Simmons apparently wants a return to the days when the Lakers and Celtics played King-of-the-NBA-Hill (mostly the Celtics, in his case). He offers a few quick fixes -- contraction, lottery reform and a new playoff system -- which seem fanciful to me. But Simmons' overall theme is essentially right: the struggle to be the best is an essential element in sports competition. League rules which promote parity at the expense of this struggle are rules which come with a significant cost.
Part of the problem in England right now is that the riches of the Champions League induces Arsenal, Chelsea, Liverpool and Man Utd to stock up on the world's most talented players. They need this talent to compete with the likes of AC Milan, Barcelona et al. Watford and Charlton have no realistic shot at Champions League revenue, and thus no reason to make the incremental investment in talent. So the talent gap between the top and the bottom is spread out, making the domestic competition more predictable and less attractive. But these are market forces at work, and any so-called remedy for the domestic league would curtail the ability of English Clubs to compete in Europe. My short piece from 2004 on "The Scale of Competition" addresses this issue further.
Francis has plenty of company making that point these days, but even so I think it's a bit overstated. Manchester United were not expected to win the Premier League this year, but their perch at the top makes them the target of the Robin Hood gang. Chelsea's title in 2005 was their first in 50 years, so they can't be viewed as a permanent fixture atop the landscape. Chelsea illustrate the opposite -- that it is possible to progress from also-ran to a title winner with good coaching and um..., a massive budget. For all intents and purposes though, the Premier League title race appears to be a four team competition for the foreseeable future -- a "quadopoly," perhaps.
Simmons apparently wants a return to the days when the Lakers and Celtics played King-of-the-NBA-Hill (mostly the Celtics, in his case). He offers a few quick fixes -- contraction, lottery reform and a new playoff system -- which seem fanciful to me. But Simmons' overall theme is essentially right: the struggle to be the best is an essential element in sports competition. League rules which promote parity at the expense of this struggle are rules which come with a significant cost.
Part of the problem in England right now is that the riches of the Champions League induces Arsenal, Chelsea, Liverpool and Man Utd to stock up on the world's most talented players. They need this talent to compete with the likes of AC Milan, Barcelona et al. Watford and Charlton have no realistic shot at Champions League revenue, and thus no reason to make the incremental investment in talent. So the talent gap between the top and the bottom is spread out, making the domestic competition more predictable and less attractive. But these are market forces at work, and any so-called remedy for the domestic league would curtail the ability of English Clubs to compete in Europe. My short piece from 2004 on "The Scale of Competition" addresses this issue further.
Thursday, April 12, 2007
The European Parliament’s vision for football
The European Parliament has now adopted a resolution on the future of football in Europe. The underlying text is worth a read, if you are interested in how sport and politics mix. Some of my favourite phrases included
• “the European Football Model, characterised by open sporting competitions within a pyramidal structure in which many amateur clubs form the basis for the top professional clubs, is the result of longstanding democratic tradition” (I guess this is not referring to Franco’s control of Spanish football, the use of football by Mussolini and the subordination of German football to the Nazi Party)
• “whereas football plays an important social and educational role, it is an efficient instrument for social inclusion and multicultural dialogue” (oh, maybe they were referring to fascist football…)
• “the current trend of clubs going to the stock market is one step closer to the US model. It can be questioned whether the two goals (winning the game and maximising shareholders’ profits) can be combined within the traditional open European model” (where does one begin with this incoherent hogwash?)
The basic point of the document is to give the football governing bodies broad freedom to control clubs in the name of political ends. Fortunately the parliament does not have the final say, which will require the agreement of the Commission and, crucially, the member states. However, there seems to be some momentum behind this kind of reform. We still await the Commission white paper, which is the final proposal for action at the EU level.
I found the documents through the World Sports Law Blog, which is worth a visit.
• “the European Football Model, characterised by open sporting competitions within a pyramidal structure in which many amateur clubs form the basis for the top professional clubs, is the result of longstanding democratic tradition” (I guess this is not referring to Franco’s control of Spanish football, the use of football by Mussolini and the subordination of German football to the Nazi Party)
• “whereas football plays an important social and educational role, it is an efficient instrument for social inclusion and multicultural dialogue” (oh, maybe they were referring to fascist football…)
• “the current trend of clubs going to the stock market is one step closer to the US model. It can be questioned whether the two goals (winning the game and maximising shareholders’ profits) can be combined within the traditional open European model” (where does one begin with this incoherent hogwash?)
The basic point of the document is to give the football governing bodies broad freedom to control clubs in the name of political ends. Fortunately the parliament does not have the final say, which will require the agreement of the Commission and, crucially, the member states. However, there seems to be some momentum behind this kind of reform. We still await the Commission white paper, which is the final proposal for action at the EU level.
I found the documents through the World Sports Law Blog, which is worth a visit.
Monday, April 09, 2007
The Same Forces Apply in College Sports
The coaching carousel that has enveloped the Big XII underscores a particular fact: the economic forces that shape competitive balance in the for-profit professional sports world are the same forces that shape competitive balance in the "not-for-profit" world of collegiate sports programs. Rottenberg would agree with me, I'm sure: coaches will end up where they are valued the most. Kentucky was able to lure Billy Gillespie away from Texas A&M because Kentucky is, for all intents and purposes, a "large market" team in the world of college basketball.
Jeff Bzdelik's move from Air Force to Colorado is another move from small market to larger market. To a lesser extent, fan preferences played less of a role in the luring of Bob Huggins back to the mountains of West Virginia. Still, coaches will go where their expected economic surplus is highest.
We can certainly argue whether college officials run athletic programs collectively without an eye towards profits. Football and men's basketball are different beasts. These programs foot the bills not only for themselves, but also for the myriad non-revenue sports, so college officials make decisions with an eye towards profits in those programs.
But it's not always about funding the non-revenues. Athletic directors and coaches know the profit motive is the reason for the season in these sports, so to the extent that future profits can be foreseen, these expected "profits" become part of the overall compensation package of these officials. We'll call them "salaries" so we don't run afoul of tax law.
Tom Kirkendall has more here.
Saturday, April 07, 2007
"On Any Given Day..."
...in defence of curling's page playoff system
There is a cliche in sports that on any given day, any given team can beat any other given team. This cliche represents a basic understanding of probabilities applied to binomial outcomes (you win or you lose -- forget about ties in championship tournaments). It also helps explain why playoffs in most sports (baseball, basketball, hockey) involve the best x out of y games (and probably would in football if the players could play 3 or 4 games in a week).
Another example might be that on any given toss, I could roll two fair dice and get a twelve. The odds of my doing so would be low, but it might happen (on average one out of every 36 times I tried it). Analogously, on any given day a team with a low probability of winning might defeat a team that most of us would expect to win, more often than not. And while the mediots might search for explanations for the loss, it could simply have been due to randomness.
I think that is what happened in the Canada - USA curling game during the round-robing game at the 2007 Men's World Curling championships last Wednesday. As I wrote before, the USA curled MUCH better than expected; and even though Canada curled well (curling 91% to 90% for the US), they missed a few key shots and ended up losing the only game they have lost so far in the entire tournament. I was, quite frankly, surprised by the performance of the US, having seen them get off to a 2 - 3 start in the round robin and, in one game carried via the internet on CurlTV, struggle mightily against France (see my comments here).
The question in many people's minds was what might happen when the two teams met again in the playoffs. Many of us wondered whether the US defeat of Canada had been a fluke ("...any given team on any given day...") or whether Team USA would once again give Canada a run for its money.
I don't think we got a clear answer last night.
The game between Canada and the US was conceded by the US, who gave up 3 in the 7th end and trailed Canada 7 -1 (but they had to pretend to play the 8th end because of a tv contract -- funny but dumb). Once again, Team Canada was in good form, curling 89%; but this time Team USA curled only 79%, with their skip, Todd Birr, curling only 53% (vs 91% in their earlier matchup).
As people at curling clubs like to say, "That's the way it goes sometimes. Sometimes you're on, sometimes you're not." No attempt to explain the deeper, inner causes for the US's poor curling last night -- just, "That's the way it goes sometimes." In other words, shot-making in curling is in large part skill, but also the result of randomness. Curlers who are really, really good manage to have fewer down times and rarely, if ever, have such poor outings at Todd Birr had last night; and this ability to control both the mean AND the variance of their performances is what keeps them at the top of the game. Curlers with high game-to-game variance in their performances are less likely to be able to persist with top performances through an entire round robin and the playoff system in curling; .... but they might.
Today the US meets Germany in the bronze metal game. The loser of this game gets the bronze metal and the winner gets to play Canada tomorrow (Easter Sunday) for the championship. This means that the US, if they defeat Germany today, will get yet another shot at the Canadians on Sunday. Curling is the only sport I know of (though I expect there are others) that uses this "page playoff" system. Here is how it works:
At the end of the round robin (ignoring tie-breaker games), the teams that finish 1st and 2nd play each other, and the teams that finish 3rd and 4th play each other. The winner of the 1-2 game gets a bye until the final championship game, and the loser of the 1-2 game plays the winner of the 3-4 game. The winner of that game then plays for the championship. This way, a team that finishes 1st or 2nd during the round robin gets a second chance, creating an incentive to finish 1st or 2nd during the round robin. Also, it means that if one of the top two teams has an "on any given day..." poor performance (e.g., the US last night), they are not automatically eliminated. Given the vagaries of the ice in some tournaments, and given the variabilities in performances sometimes, I must say I love the page playoff system. It has a tendency to remove some of the randomness from determining an overall champion. For more on the page playoff system, see this.
Overall during the round robin, Canada curled 91% to lead the field, and the US was tied for 2nd at 84%, a substantial difference in performances. But never did Todd Birr, US skip, ever curl worse than 75% during the round robin. In fact after a cursory look through the stats for all the players, I could find only three other games in which curlers did worse than 53%, two from the Korean skip (Korea won only one game in the tournament) and the other from the Danish skip, who had the second lowest curling percentage of all the skips in the tournament.
So was last night's performance truly random and horrible? Probably. At the same time, the performance of Team USA against Canada during the round robin was also an outlier in the other direction. Given the potential variabilities and the randomness, you gotta love the way the tournament is set up with the round robin and the page playoff system.
I know this post is getting too long, but here's more, on a personal basis. My own curling percentages, self-assessed, over this past season have varied from 10% up to maybe as high as 50%. Others at the club level tend to have similar variances but with higher means. Given such huge variances, it is clear, at the club level, that "on any given day...."
Another example might be that on any given toss, I could roll two fair dice and get a twelve. The odds of my doing so would be low, but it might happen (on average one out of every 36 times I tried it). Analogously, on any given day a team with a low probability of winning might defeat a team that most of us would expect to win, more often than not. And while the mediots might search for explanations for the loss, it could simply have been due to randomness.
I think that is what happened in the Canada - USA curling game during the round-robing game at the 2007 Men's World Curling championships last Wednesday. As I wrote before, the USA curled MUCH better than expected; and even though Canada curled well (curling 91% to 90% for the US), they missed a few key shots and ended up losing the only game they have lost so far in the entire tournament. I was, quite frankly, surprised by the performance of the US, having seen them get off to a 2 - 3 start in the round robin and, in one game carried via the internet on CurlTV, struggle mightily against France (see my comments here).
The question in many people's minds was what might happen when the two teams met again in the playoffs. Many of us wondered whether the US defeat of Canada had been a fluke ("...any given team on any given day...") or whether Team USA would once again give Canada a run for its money.
I don't think we got a clear answer last night.
The game between Canada and the US was conceded by the US, who gave up 3 in the 7th end and trailed Canada 7 -1 (but they had to pretend to play the 8th end because of a tv contract -- funny but dumb). Once again, Team Canada was in good form, curling 89%; but this time Team USA curled only 79%, with their skip, Todd Birr, curling only 53% (vs 91% in their earlier matchup).
As people at curling clubs like to say, "That's the way it goes sometimes. Sometimes you're on, sometimes you're not." No attempt to explain the deeper, inner causes for the US's poor curling last night -- just, "That's the way it goes sometimes." In other words, shot-making in curling is in large part skill, but also the result of randomness. Curlers who are really, really good manage to have fewer down times and rarely, if ever, have such poor outings at Todd Birr had last night; and this ability to control both the mean AND the variance of their performances is what keeps them at the top of the game. Curlers with high game-to-game variance in their performances are less likely to be able to persist with top performances through an entire round robin and the playoff system in curling; .... but they might.
Today the US meets Germany in the bronze metal game. The loser of this game gets the bronze metal and the winner gets to play Canada tomorrow (Easter Sunday) for the championship. This means that the US, if they defeat Germany today, will get yet another shot at the Canadians on Sunday. Curling is the only sport I know of (though I expect there are others) that uses this "page playoff" system. Here is how it works:
At the end of the round robin (ignoring tie-breaker games), the teams that finish 1st and 2nd play each other, and the teams that finish 3rd and 4th play each other. The winner of the 1-2 game gets a bye until the final championship game, and the loser of the 1-2 game plays the winner of the 3-4 game. The winner of that game then plays for the championship. This way, a team that finishes 1st or 2nd during the round robin gets a second chance, creating an incentive to finish 1st or 2nd during the round robin. Also, it means that if one of the top two teams has an "on any given day..." poor performance (e.g., the US last night), they are not automatically eliminated. Given the vagaries of the ice in some tournaments, and given the variabilities in performances sometimes, I must say I love the page playoff system. It has a tendency to remove some of the randomness from determining an overall champion. For more on the page playoff system, see this.
Overall during the round robin, Canada curled 91% to lead the field, and the US was tied for 2nd at 84%, a substantial difference in performances. But never did Todd Birr, US skip, ever curl worse than 75% during the round robin. In fact after a cursory look through the stats for all the players, I could find only three other games in which curlers did worse than 53%, two from the Korean skip (Korea won only one game in the tournament) and the other from the Danish skip, who had the second lowest curling percentage of all the skips in the tournament.
So was last night's performance truly random and horrible? Probably. At the same time, the performance of Team USA against Canada during the round robin was also an outlier in the other direction. Given the potential variabilities and the randomness, you gotta love the way the tournament is set up with the round robin and the page playoff system.
I know this post is getting too long, but here's more, on a personal basis. My own curling percentages, self-assessed, over this past season have varied from 10% up to maybe as high as 50%. Others at the club level tend to have similar variances but with higher means. Given such huge variances, it is clear, at the club level, that "on any given day...."
Labels: men's world curling championship, playoff systems, randomness
Thursday, April 05, 2007
NFLPA v. MLBPA
A couple of weeks ago, the NFL Players Association re-elected Gene Upshaw as executive director (see AP story). Bryant Gumbel's dissing of him notwithstanding, NFL players seem to like the combination of labor-management peace and rising salaries. The story also references Upshaw's stance on player conduct, a stance echoed by many veteran players:
Maybe fans don't care as much about the steroid issue. How much they care about either is debatable, but the reaction to Barry Bonds these days suggests that they care some. Right now, fan spending doesn't seem much influenced by either issue. Upshaw, however, is taking a preemptive stance to head off future problems and leading players are backing him.
The answer that I find most compelling is the likely difference in the number of players involved. Among NFL players, only a small minority engage in off-the-field criminal behavior (unless you're talking about the Bengals!). Among MLB players, Ken Caminiti estimated 50 percent used illicit drug enhancers while Jose Canseco put the figure much higher. Jason Grimsley's statements to investigators (see affidavit) implicates a lot of former teammates. If these figures and statements are anywhere near the truth, then the difference in player views on these two different issues may be as simple as statements of the farmer versus the foxes guarding the hen house.
The stance of Upshaw and leading players on this public relations issue stands in contrast to the foot dragging and hemhawing by Donald Fehr and many MLB player reps on the steroid issue. In that case, player reps like Tom Glavine went so far as to blast players such as Turk Wendell for negative comments about steroid use. What explains the difference?Upshaw's primary concern recently has been misbehavior off the field by players. He addressed the growing problem before the Super Bowl.
"The last thing I tell every team when I visit is that the only thing that can mess up the collective bargaining agreement is the players themselves," Upshaw said. "We're very concerned about that."
Upshaw has had extensive talks with NFL commissioner Roger Goodell about player behavior and has encouraged the league to strength[en] its player conduct policy.
Maybe fans don't care as much about the steroid issue. How much they care about either is debatable, but the reaction to Barry Bonds these days suggests that they care some. Right now, fan spending doesn't seem much influenced by either issue. Upshaw, however, is taking a preemptive stance to head off future problems and leading players are backing him.
The answer that I find most compelling is the likely difference in the number of players involved. Among NFL players, only a small minority engage in off-the-field criminal behavior (unless you're talking about the Bengals!). Among MLB players, Ken Caminiti estimated 50 percent used illicit drug enhancers while Jose Canseco put the figure much higher. Jason Grimsley's statements to investigators (see affidavit) implicates a lot of former teammates. If these figures and statements are anywhere near the truth, then the difference in player views on these two different issues may be as simple as statements of the farmer versus the foxes guarding the hen house.
Wednesday, April 04, 2007
Solving the Coaching Pay Problem
This last weekend Adrian Wojnarowski penned a column examining the salaries of college coaches. In this column is the following statement: “NCAA president Myles Brand threw up his hands this week and said that the NCAA could do nothing to stop the runaway salaries (of coaches) in his sport.”
Certainly, with a bit of thought, I think we can figure out how to solve Brand’s problem. Let me start by noting that in many states the highest paid state employee is a college basketball or football coach. It’s now unsurprising to find a college coach making 5 to 10 times (or more) what a university president makes. What is surprising is that college coaches are now being paid salaries similar to what the pros pay.
Why is this surprising? In discussing the salary Nick Saban is scheduled to be paid by the University of Alabama, Andrew Zimbalist observed the following: “The average I-A football team earns about $15 million a year in revenue; the average N.F.L. team earns about $160 million. How can a college coach create as much value as an N.F.L. coach?”
Where does the money come from to pay the college coach? The salary cap in the N.F.L. has now passed $100 million. An average N.B.A. team pays more than $60 million to its players. This gives us some idea how much a professional team incurs in labor costs. An NCAA football or basketball team, though, does not have this cost. Consequently, although the revenues are less, because colleges are not fully compensating their workers, these institutions are able to pay coaches a salary that compares with what the pros pay.
So what can the NCAA do? The NCAA made an effort to restrict salaries for assistant coaches only to learn that this is illegal. One suspects that similar restrictions on the pay to head coaches would also be challenged in court.
Given that the NCAA cannot pass a rule to restrict salaries, they must look elsewhere for a solution. And looking around, the answer should suddenly be obvious. It’s time to pay the players. The research of Robert Brown and Todd Jewell indicates that a future NBA first round draft choice will generate more than $1 million in revenue each year in college (and this was based on data from 1996, so the $1 million figure understates the revenue generation occurring today). Clearly this sum greatly exceeds the cost of a scholarship. Because the NCAA does not compensate the players for the money being generated, this money has to go elsewhere. It seems reasonable that much of this money is currently flowing into the pockets of the coaches. But if the players were paid, the money would not be available to the coaches, and consequently wages paid to coaches would decrease.
It’s important to remember that we were not watching the coaches during the Final Four. The Final Four was about players like Greg Oden and Joakim Noah. Yet if these players stay in school, the revenue they generate will continue to go to their coaches and universities. (Well, in Noah’s case, it might not c0ntinue to go to his coach. Billy Donovan may indeed be going himself, to a program like Kentucky – where the grass may be greener and the piles of money just a bit higher.)
The NCAA needs to stop pretending that the revenue sports like football and basketball are primarily about education. Coaches do not get fired because the education of their players is suffering. And Billy Donovan is not being recruited by Kentucky because of his impact on graduation rates. Coaches are hired and fired because of wins. And these wins, and the corresponding revenue wins generate, come from the players. If the NCAA simply did what every other business has to do – i.e. pay its workers – the salaries of coaches would fall, the players would keep the money they generate, and the NCAA’s futile quest to enforce rules that everyone has an incentive to break could be ended.
Certainly, with a bit of thought, I think we can figure out how to solve Brand’s problem. Let me start by noting that in many states the highest paid state employee is a college basketball or football coach. It’s now unsurprising to find a college coach making 5 to 10 times (or more) what a university president makes. What is surprising is that college coaches are now being paid salaries similar to what the pros pay.
Why is this surprising? In discussing the salary Nick Saban is scheduled to be paid by the University of Alabama, Andrew Zimbalist observed the following: “The average I-A football team earns about $15 million a year in revenue; the average N.F.L. team earns about $160 million. How can a college coach create as much value as an N.F.L. coach?”
Where does the money come from to pay the college coach? The salary cap in the N.F.L. has now passed $100 million. An average N.B.A. team pays more than $60 million to its players. This gives us some idea how much a professional team incurs in labor costs. An NCAA football or basketball team, though, does not have this cost. Consequently, although the revenues are less, because colleges are not fully compensating their workers, these institutions are able to pay coaches a salary that compares with what the pros pay.
So what can the NCAA do? The NCAA made an effort to restrict salaries for assistant coaches only to learn that this is illegal. One suspects that similar restrictions on the pay to head coaches would also be challenged in court.
Given that the NCAA cannot pass a rule to restrict salaries, they must look elsewhere for a solution. And looking around, the answer should suddenly be obvious. It’s time to pay the players. The research of Robert Brown and Todd Jewell indicates that a future NBA first round draft choice will generate more than $1 million in revenue each year in college (and this was based on data from 1996, so the $1 million figure understates the revenue generation occurring today). Clearly this sum greatly exceeds the cost of a scholarship. Because the NCAA does not compensate the players for the money being generated, this money has to go elsewhere. It seems reasonable that much of this money is currently flowing into the pockets of the coaches. But if the players were paid, the money would not be available to the coaches, and consequently wages paid to coaches would decrease.
It’s important to remember that we were not watching the coaches during the Final Four. The Final Four was about players like Greg Oden and Joakim Noah. Yet if these players stay in school, the revenue they generate will continue to go to their coaches and universities. (Well, in Noah’s case, it might not c0ntinue to go to his coach. Billy Donovan may indeed be going himself, to a program like Kentucky – where the grass may be greener and the piles of money just a bit higher.)
The NCAA needs to stop pretending that the revenue sports like football and basketball are primarily about education. Coaches do not get fired because the education of their players is suffering. And Billy Donovan is not being recruited by Kentucky because of his impact on graduation rates. Coaches are hired and fired because of wins. And these wins, and the corresponding revenue wins generate, come from the players. If the NCAA simply did what every other business has to do – i.e. pay its workers – the salaries of coaches would fall, the players would keep the money they generate, and the NCAA’s futile quest to enforce rules that everyone has an incentive to break could be ended.
Tuesday, April 03, 2007
The kids are alright
It’s easy to think that baseball and cricket and football and soccer have nothing in common, but two stories from the past two days illustrate the basic idea that sports leagues conform to the rules of supply and demand in much the same way as pork bellies and crude oil.
I have posted several comments on this blog about the threatened tightening of regulation of European soccer by the governing bodies (led by UEFA) with the support of the European Commission. UEFA proposals include restrictive nationality regulations for players and a salary cap. These rules are likely to hurt the bigger clubs, that buy all of the top players and pay huge salaries (out of their huge revenues). Not surprisingly, this threat has finally pushed the clubs into wheeling out their nuclear weapons, in the form of a breakaway Superleague. As with previous such threats it probably won’t happen, but the threat should enough to water down the UEFA proposals.
The second story comes from India, where Zee TV is proposing to run a club league made up of six teams using a mix of Indian stars, international stars and up-and-coming Indian players. The players would probably face some kind of sanction from the cricket authorities in their own countries, since the tournament would not be authorised, but similar attempts to restrain players participating in an Australian rebel cricket competition in the 1970s failed in the courts. It may be that the tournament will never materialise, but it will be a useful bargaining chip for Zee TV when negotiating rights and possibly for the underpaid players (see my blog on cricket from last week).
What unites these two stories is the fact that these threats to start new leagues are only credible in the face of unsatisfied demand. Demand is unsatisfied because governing bodies insist on retaining traditional formats even when consumers have moved on. The reason that consumers move on is simply fashion- I never wanted the things my parents wanted, and my children don’t want the same things that I did. I can tell you, woe betide the administrator who fails to give my kids what they want.
I have posted several comments on this blog about the threatened tightening of regulation of European soccer by the governing bodies (led by UEFA) with the support of the European Commission. UEFA proposals include restrictive nationality regulations for players and a salary cap. These rules are likely to hurt the bigger clubs, that buy all of the top players and pay huge salaries (out of their huge revenues). Not surprisingly, this threat has finally pushed the clubs into wheeling out their nuclear weapons, in the form of a breakaway Superleague. As with previous such threats it probably won’t happen, but the threat should enough to water down the UEFA proposals.
The second story comes from India, where Zee TV is proposing to run a club league made up of six teams using a mix of Indian stars, international stars and up-and-coming Indian players. The players would probably face some kind of sanction from the cricket authorities in their own countries, since the tournament would not be authorised, but similar attempts to restrain players participating in an Australian rebel cricket competition in the 1970s failed in the courts. It may be that the tournament will never materialise, but it will be a useful bargaining chip for Zee TV when negotiating rights and possibly for the underpaid players (see my blog on cricket from last week).
What unites these two stories is the fact that these threats to start new leagues are only credible in the face of unsatisfied demand. Demand is unsatisfied because governing bodies insist on retaining traditional formats even when consumers have moved on. The reason that consumers move on is simply fashion- I never wanted the things my parents wanted, and my children don’t want the same things that I did. I can tell you, woe betide the administrator who fails to give my kids what they want.
More on Toeldo
Proud partisans at the University are "stunned" that a point shaving scandal could happen on their campus. I was surprised too, but for different reasons. The idea that an operator could get $100k down on a Toledo game without the line adjusting or being taken off the board -- one of you betting hounds can check the data on that -- suggests to me that online sportsbooks may have added a lot of liquidity to the point spread market in recent years.
The other interesting news today is that the perpetrators are being chased down on the basis of a tip to the FBI by Las Vegas Sports Consultants. These are the people who make the initial lines for the Vegas sports books. One thing they do is pore over the betting action, seeing which teams are developing a "following." Or something slightly different in the case of point shaving. It is intriguing that Vegas now runs to the FBI rather than a kneecapping hoodlum to keep the market straight these days.
The other interesting news today is that the perpetrators are being chased down on the basis of a tip to the FBI by Las Vegas Sports Consultants. These are the people who make the initial lines for the Vegas sports books. One thing they do is pore over the betting action, seeing which teams are developing a "following." Or something slightly different in the case of point shaving. It is intriguing that Vegas now runs to the FBI rather than a kneecapping hoodlum to keep the market straight these days.
Labels: college football, NCAA, point shaving
Monday, April 02, 2007
John Kerry and the MLB monopoly
It was reported last week that MLB was on the verge of signing a deal with DirecTV to make its Extra Innings package the exclusive property of the satellite broadcaster. Enter Senator John Kerry. The Baltimore Sun reports Kerry said he is "concerned about exclusive carriage deals in the sports industry". Kerry says he is sure there are business advantages, but asks, "what is the impact on fans?"
Perhaps the good Senator needs a staffer with a background in principles of microeconomics on his staff who can explain the consequences of monopoly. Actually, I shouldn't be so hard on Senator Kerry. So far as I have seen, he is the only legislator to have expressed concerns about the deal. The rest are probably all hoping to get box seats for the Washington Nationals' home games.
But of course, MLB broadcasts are not monopolized by DirecTV. Some wiley fans know what to do when they face an increased price or reduced supply of some good. That's right, they substitute to a competing product. So it is no surprise that some fans have also expressed concern about the DirecTV deal and have decided they may subscribe to MLBs online broadcast package. Now won't that fix that greedy MLB!?
Perhaps the good Senator needs a staffer with a background in principles of microeconomics on his staff who can explain the consequences of monopoly. Actually, I shouldn't be so hard on Senator Kerry. So far as I have seen, he is the only legislator to have expressed concerns about the deal. The rest are probably all hoping to get box seats for the Washington Nationals' home games.
But of course, MLB broadcasts are not monopolized by DirecTV. Some wiley fans know what to do when they face an increased price or reduced supply of some good. That's right, they substitute to a competing product. So it is no surprise that some fans have also expressed concern about the DirecTV deal and have decided they may subscribe to MLBs online broadcast package. Now won't that fix that greedy MLB!?
Controlling the message
When the Pan American Games start in Brazil in July, thousands of top athletes will run, wrestle and leap, but they will not be able to indulge in one popular daily exercise: blogging.That's from the New York Times. I believe there are different legal interpretations in the U.S. and Europe. MLB recently tried to privatize statistics like Albert Pujols' batting average, with the aim of requiring that news outlets obtain permission to publish them. Fortunately that effort was a failure. In England however, the Football League et al actually do collect for the right to publish the "fixture list." If I were to print it, they might send their bad boys after me.
Neither will their doctors, coaches or massage therapists, in a blanket ban affecting some 7,000 people during two weeks of competition ending July 29 in Rio de Janeiro.
The rule reflects a spreading trend among international sports institutions to impose vigorous controls over the online use of game information and photographs.
In February, a dispute broke out between the International Rugby Board and the World Association of Newspapers over restrictions that will be imposed during the Rugby World Cup, which starts in Paris in September.
In return for Rugby Cup press credentials, the rugby board is limiting the number of game photos that can be published in online news sites during competition. It is also demanding that headlines not be superimposed over photographs, a rule aimed at protecting corporate sponsors like Heineken and Toshiba.
By and large, the demand for sports is greatly enhanced by the free flow of information. Charging for every byte that is written or produced about a sport is not only bad PR, it limits the future scale of the market.
Sunday, April 01, 2007
Point shaving at the University of Toledo?
From the Detroit Free Press.
A running back for the University of Toledo Rockets has been charged with recruiting fellow athletes to shave points and fix games on behalf of a Macomb County gambler.Toledo? I didn't think the betting market was thick enough for crooks to fool with mid-level programs.
A criminal complaint filed in U.S. District Court in Detroit said the player, Harvey "Scooter" McDougle Jr., 22, a senior, recruited football and basketball players to participate in the scheme spearheaded by a Sterling Heights man identified only as "Gary."
Gary’s recruitment of players allegedly included inviting the athletes to gamble and dine at Greektown Casino in Detroit.
The complaint said one player was offered $10,000 to sit out a football game. Other players received cash, groceries, merchandise and other gifts, the complaint said.
McDougle told the FBI that he received a car, telephone and other things of value from Gary, but insisted that he never changed the way he played to affect the outcome of games.
Labels: college football, NCAA, point shaving
