An Absence of Competition The Sustained Competitive Advantage of the Monopoly Sports Leagues

By many measures, the four major pro sports leagues in the U.S. – the National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), and Major League Baseball (MLB) – are now some of the most successful business entities in the country.

This book takes a multi-disciplinary approach to analyzing the nature of “competition” and “competitive advantage” within the U.S. pro sport industry. By many measures, the four major pro sports leagues in the U.S.–the National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), and Major League Baseball (MLB)–are now some of the most successful business entities in the country. Not coincidental to this success is the fact that all four of these leagues currently operate as monopolies. While all have faced rival leagues at some point or another in their existence, all were able to successfully dispense with these rivals. Because of the inability of any rival leagues to survive as a long-term force, it has been monopoly, and not competition, that has been the prevailing market structure in the industry. In fact, in recent decades, the monopoly position of the Big Four appears increasingly impenetrable–none have faced a credible threat from a rival league since the demise of the United States Football League (USFL) in the mid-1980s.

Within this context, the book seeks to explore the nature of the competitive advantage that these leagues apparently possess. The book takes an evolutionary approach, in that it argues that the monopoly position of each of the four leagues today cannot be explained in an insular, static, manner, but is the culmination of many dynamic processes through many decades. Today’s monopoly market structures are what could be termed path-dependent–they did not simply “happen,” but are instead a complex function of everything that has occurred up to this point.

A key contribution of the book is that it analyzes these issues from three alternate theoretical perspectives–the traditional economics approach, the public choice approach, and the strategic management approach. It argues that no single conceptual approachcan, in itself, adequately explain the full richness of the issue, and that these various approaches should be viewed as complements, rather than as being mutually exclusive. The multi-disciplinary nature of the issue should make the book of interest to scholars in a number of fields, including strategic management, sport management, and economics. It can serve as an effective teaching tool in both graduate and upper-level undergraduate courses for students in these fields, and is particularly useful for faculties seeking to emphasize to their students the importance of a multi-disciplinary, integrative, approach when analyzing business and management issues. The book may also be of interest to leaders within the sport industry itself, and will help to provide insight and perspective as leagues seek to enhance their competitive advantage in the marketplace.