By Robbie Butler

On the 1st of January 2019 Irish racing was shown for the first time on the newly launched Racing TV (formerly Racing UK). The move ended more than a decade of coverage by Attheraces (now Sky Sports Racing) and effectively placed Irish racing behind a paywall for the first time. 

I should be clear, Attheraces was not free to all Irish television users, but came as part of Sky's "Entertainment" pack – 90 channels that formed part of Sky TV's basic package. Other sports channels in this offering include Eurosport, Sports News and Sky Sports Mix. Up to the end of 2018, Attheraces had provided 100% coverage of all Irish racing. Not a single meeting nor race, at any of the 26 tracks on this island, failed to be covered live.

Some cited their concern, when it was announced last year Irish racing would move to Racing TV until at least 2023, and argued that the packed UK schedule might see Irish racing slide down the list of priorities. A recent piece in the Irish Examiner supports this view and cites a Saturday card at Gowran Park where races were short of lead-in time and lacked information of betting markets. Spilt screens were used during broadcasts, and some races were only joined midway through. The most damning of all was the failure to show any coverage of the last race at Gowran.

In the weeks leading up to it's launch, Racing TV advertised a price of €31 to Irish customers. If my memory is correct, the price was subsequently dropped to €12 for a promotional period, and can currently be purchased for €15 per month for one year. 

Aside from the fact that €31 is more expensive than my Sky Sports subscription, which provides access to many sports, and Irish racing does not get the same coverage as it has done previously, I fear there is a bigger problem for those selling the product. 

Pay-walled sport works because it is the only way to access coverage. Sky Sports has been a spectacular success since its launch in 1992 because it was the only way to watch live Premier League action until 2007. Since then it has been joined by others such as ESPN, BT Sport and soon Amazon; all also subscription channels.

28 days of Irish racing will be shown this year on free-to-air RTÉ. These include the biggest days on the Irish racing calendar and events such as the Irish Grand National and Irish Derby (which must be shown free-to-air),  Punchestown Festival, Galway Festival, Leopardstown and most recently Thyestes Day from Gowran.

Think of this comparison. If BBC or ITV had the right to show the 28 biggest Premier League games each season, how many people would subscribe to Sky Sport or BT Sport? The 28 would include Liverpool vs Man Utd, the North London Derby, the Manchester and Liverpool Derbies, Chelsea vs Arsenal all home and away, and a smattering of other games.

The business model works because this is not the case. Free-to-air customers have to waiting until 10.30pm on Saturday evenings to watch Match of the Day. While some would continue to pay subscription sports channels, I suspect the number of subscribers would collapse dramatically if free-to-air providers could cherry-pick the best games, as happens with Irish racing. 

From the perspective of the Irish racing consumer, long may the cherry-picking continue. 

By Robbie Butler

In the last year or so, I have encountered a number of research papers that focus on the economics of horse racing. This culminated in (what I believe was) the first ever horse racing session at the European Sports Economics Conference at the University of Liverpool last August.

Work in the area is now developing and members of this blog, as well as colleagues in the UK at the University of Lancaster and University of Liverpool are exploring the economics of horse racing. There is really so much to explore (e.g. labour markets, betting tax, efficient markets, government support of the industry, and the impact of Brexit).

Some focus has recently turned to UK’s pending exit from the European Union and the impact on the industry, but this has been limited. The scale of a hard Brexit, which is now becoming more likely by each passing day, has the potential to decimate the industry. Remember, this is an industry that only survives in Ireland thanks to generous Exchequer support each year. More than half of all public monies are then used as prize money at Irish racecourses. 
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I have explored the issue on prize money on a number of occasions in the past. While the biggest prize funds on offer are on the other side of the Irish Sea (see here and here) the average level of prize money across all tracks remains higher in Ireland. This is particularly obvious at lower grade racing and has encouraged English horses to travel to Ireland (see here and here).

The difference in funding may be set to grow further. Last week Arena Racing Company which owns and operates 16 racecourses in Great Britain, announced that it would be reducing prize-money by £3 million as a direct response to the British government's recent decision on Fixed Odds Betting Terminal (FOBT) stakes. Leading trainer Mark Johnston’s response to this decision was:

“The prize-money is quite ridiculous and the whole situation of Arc cutting prize-money in anticipation of a potential cut in the number of betting shops and funding due to the FOBT reduction, which is hypothetical at the moment, is out of order. It gets to a point where it’s just not viable to take a horse all the way to Lingfield for that sort of money”. 

Others have responded in a similar fashion to ARC's decision. This resulted in a reduced card at Lingfield on Saturday, and one race on the card not attracting a single entry! The solution to the problem may be reduced cards in the short run, but in the long run trainers may need to look elsewhere. Independently owned Chelmsford City Racecourse is being used as an exemplar to demonstrate the type of money that should be put on offer, at lower grade races, to attract entries. 

Of course, another solution is for more horses to travel from the UK to Ireland to compete. Generally, horses and labour flow one way and not the other. A glance at prize money on offer last Friday night at Dundalk (Ireland) and Lingfield (England) demonstrates the difference. 

Dundalk's 8 race card had an average prize fund of €8,543.75 per race. Lingfield's 6 race card reports a figure of just €3,839.75. 

The total amount of money on offer at the Irish race course was €68,350, which is some €45,000 more than the €23,039 on offer at the English track. 

​All things equal, this should incentivise trainers in the UK to send more horses across the Irish Sea to race at venues such as Dundalk.

However, the extent to which this may now happen will largely not be decided to prize money on offer at Irish courses, nor reduced stakes at FOBTs in the UK, but rather events in Westminster over the coming weeks.

By Stephen Brosnan

Previously, I have written about the effect of star players on team performance in the Premier League. The piece identifies the usefulness of Collis and Montgomery’s resource-based view of the firm (RBV) in explaining the impact of ‘star’ players on team competitiveness. RBV explains how a firm’s resources drive its performance in a dynamic competitive environment. In a sporting context, team performance may be driven by a key resource e.g. star player. However, given the risk of injury, suspension, fatigue and loss of form over the course of the season, the over reliance of a team on the contribution of one ‘star’ player can significantly impact their long-term competitiveness.

Table 1 highlights the contribution of each Premier League clubs ‘star’ player during the current season. The players selected have amassed the highest number of Fantasy Premier League (FPL) points for their respective clubs. The analysis considers the percentage of team’s goals in which the player was involved in, the points lost in the absence of this contribution and the players contribution to the team’s Premier League points total. 

Three team’s leading FPL points scorer are their goalkeepers: Neil Etheridge (Cardiff), Jonas Lössl (Huddersfield) and Martin Dubravka (Newcastle). Given the reliance on goals and assists to determine the contribution of star players to team performance, this analysis is limited to outfield players only. Therefore, these players have been replaced with highest outfield FPL points scorer for this analysis.

Aleksandar Mitrovic has the highest overall contribution to his team’s outcomes, both in terms of contribution to goals scored and contribution to points accumulated. Mitrovic has been involved in over half of all Fulham’s goals (52%) and has contributed to 76% of all their points earned. Fulham’s (over)reliance on their talisman may be summed up by their failure to win any game in which Mitrovic has not scored and he has had to score two goals in three of these games to ensure victory: Burnley 4 – 2 (2 goals, 1 assist), Southampton 3 – 2 (2 goals), Huddersfield 1-0 (1 goal) and Brighton 4-2 (2 goals).

However, it appears not all goals are created equal as Glenn Murray has been involved in 35% of Brighton’s goals this season with these goals contributing to 41% of the team’s overall points. Meanwhile, Everton’s Gylfi Sigurdsson has been involved in a similar number of Everton’s goals (33%) but these goals have only contributed to 12% of the team’s overall points.
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In the Premier League title race, Liverpool appear to be more reliant on their star man, Mo Salah, compared with rivals Man City and Tottenham. Salah has contributed to 31% of Liverpool’s points while Man City and Tottenham have been less reliant on their star players Sterling and Son (18%). Both these teams have already shown their ability to succeed with numerous injury problems e.g. Spurs winning every game since Harry Kane’s injury. Liverpool have yet to have significant injury setback and their ability to deal with potential injury or loss of form to Salah may go a long way to deciding the outcome of this season’s Premier League.

By John Considine

There are three teams in the last-16 of the Champions League that have not featured in the last five editions of Deloitte Football Money League.  Ajax, Lyon and Porto have not featured amongst the Top-20 revenue generating clubs.  The table below shows that the first two of these three clubs face two of the financial and footballing giants of the game.

Ajax are 2-1 down to Real Madrid after playing the first-leg at home.  Madrid were 1st in the Deloitte Football Money League (DFML) in three of the last five editions.  They are number 1 in the latest edition of DFML with revenues of €750.9m (47% of which came from Commercial revenues including the sale of Ronaldo).  During the last five years they have also collected the Champions League trophy a few times.  Is it any surprise that Sergio Ramos might have decided to serve a suspension during the second-leg (rather than play in it)?

Lyon held Barcelona to a scoreless draw and will now head to Barcelona.  They may only need a score draw to progress but it seems a tall order.  Barcelona have been 2nd three times in the last five editions of the DFML.  DFML shows that Barcelona have total revenues of €690m and a similar distribution of revenues to Real Madrid (i.e. Commercial, Broadcast, and Matchday).  In the case of Barcelona, they benefitted from a new four-year deal with Rakuten (there was a time when they spun a different story about shirt sponsorship).

Porto are the third club not to have featured in the Top-20 revenue generating clubs in the DFML.  Porto lost 2-1 away to Roma.  The gap between the two clubs is narrower than in the other two cases.  There opponents, Roma, have only broke into the Top-20 on three occasions (twice at 15th and once at 16th).

Tonight Schalke 04 host Manchester City in one game and Atletico host Juventus in the other game.  The away sides have better revenue generating records.  It may count for little on a given night.  However, it would be natural to expect those with the deeper pockets to advance.

By David Butler

As a follow up to Robbie's post below - the chart below shows the attendance for round one of the LOI for four clubs  that played at home both this season and last.

Waterford, St. Pats and Dundalk all saw increased attendances last Friday night compared to last year while Bohs  recorded a lower figure.

The average attendance on the opening day last season was 2,892. This increased to 3,558 this season. This is good news for the LOI but the challenge will be retaining fans for the second home game - attendance last season saw a significant fall off for each clubs second round of home fixtures.

By Robbie Butler

The 2019 SSE Airtricity League Of Ireland Premier Division kicks off tonight with reigning champions Dundalk's game at home to Sligo Rovers broadcast on free-to-air television. State broadcaster RTE have so far announced plans to screen 18 live games from the domestic league, with further games inevitable as the season progresses. 

As the national league recommences, talk turns to which teams are likely to be successful. The currently stability within the Premier Division is something this has never happened before in the near 100 year history of the league. Many are predicting that Dundalk will continue their dominance at domestic level, which has been broken just once since 2014. The current champions are odds on to retain their crown in 2019.

Whether the reduction in competition witnessed over the past 5 seasons (thanks to the success of Dundalk and Cork City), has caused a negative impact on interest is debateable. In fact, some may argue the opposite. 

Since the emergence of the Dundalk-Cork "duopoly" in 2014 demand for attendance at games does not seem to have been dramatically effected. Figures from last season (2018) show attendance levels of almost 36%, relative to stadium capacity. This is higher than any of the four season previous.

​The figure below chart this, and also presents total ticket sales, as a fraction of stadium capacity, for the six clubs that have appeared constantly in the Premier Division from 2014 to 2019. 

Total attendance as a percentage of total stadium capacity (thick black line) has risen from 28.5% in 2014 to 35.7%.

It is interesting to observe the drop in 2016 to 25.04%. What might be causing this? It seems to be largely driven be declines in attendance demand at the top clubs; Dundalk, Cork City and Shamrock Rovers.

​There are a number of possible explanations. The first is that Dundalk's domination was viewed as a reason not to go to games. The club won their third league title in a row in 2016. The Louth club also performed remarkably well in the Europa League that season, reaching the group stages. Maybe supporters became less attracted to the domestic game after being treated to Maccabi Tel Aviv, Zenit Saint Petersburg and AZ Alkmaar in Oriel Park?

​The upside is that demand has risen in 2017 and again in 2018. Let's hope interest in the domestic game can continue to build . This can only be good news for Irish football and its domestic clubs. 

By Robbie Butler

In August last year, Sky Sports lost the right to screen live La Liga matches in the UK and Ireland. I wrote above this here. It was a blow to subscribers of the sports channel, as games were regularly shown live on Friday, Saturday and Sunday evening. Along with this, Sky Sports News regularly showed highlights of games from Spain's top division.

There may be an upside however. With the Champions League returning to our screens this week and next, it is the first opportunity to watch the likes of Lionel Messi, Antoine Griezmann and Luka Modric, crowned both "The Best FIFA Men's Player" and " Ballon d'Or" winner in 2018, since the World Cup in Russia last July. In the case of Gareth Bale, many have not watched him play since his Man of the Match performance in the 2018 Champions League Final last May. 

Before we were saturated with the best players in the world through the broadcasting deal Sky had secured. The loss of La Liga has reversed this trend.This brings me back to my childhood, and memories of watching many of the best players rather infrequently. It wasn't that I didn't want to watch these players, but rather that games were not broadcast and access was not available.

The UEFA European Championships and FIFA World Cup provided a rare chance to watch some of the best players in the world. In the case of top European talent, there would be a chance to see these players every two years at international competitions or maybe on a Sunday morning highlights reel. The top South American talent, particularly those playing in Brazil and Argentina, only appeared on our screens every four years. 

I often wonder how much I suffered from an availability bias - to only use salient examples that come readily to mind to make judgments - and representativeness  - drawing conclusions from very small and biased samples. Did this play a part in our evaluation of  all of these players were rarely encountered. For example, Brazilian players were held in awe. We couldn't watch these players on a regular basis and footage that did arrive on our screens was always showcasing the best talent.

For example, Denílson de Oliveira Araújo became the most expensive player in the world in 1998, when Spanish club Real Betis paid São Paulo £21.5 million for his services. At the time I had heard about his remarkable step-over routine. I built a narrative around this. Whilst he was a player of talent, that came on in the 2002 World Cup Final, he was not the player I expected him to be, having watched him at length. In fact, many of the international players that were showcased as being far better than the players we watched on a regular basis, were in fact no better. 

As broadcasting of all players across the world has become more readily available, I wonder to what extent the diminished mystery of those coming from places that were once largely unknown to everyone but scouts (Brazil and Argentina come to mind) has impacted upon their chances of success at global football tournaments?

17/23 and 19/23 players from the 2018 World Cup squads for Argentina and Brazil played with a UEFA affiliated league. European opponents at the 2018 World Cup would have been very much aware of their strengths and weakness. The 1970 World Cup winning squad from Brazil didn't have a single European based player. Argentina had just 6 European based players in their 1986 winning squad, only 3 of whom started the Final. Even the most recent South American winners, the 2002 Brazil squad, had a majority home-based squad with just 10 UEFA based players.

The rise of broadcasting, of not just domestic players, but all players globally, has coincided with a decline in success of teams outside of Europe at the World Cup. Maybe this is coincidence. Maybe not - perhaps the dissemination of information plays a greater role?. Regardless, I am looking forward to watching players that I have not seen in months, live on television over the coming weeks. 

By David Butler

For those who are not familiar with the game, the Premier League runs an official ‘fantasy football’ competition online.  Laypeople can pick a team each week, accumulate points and pit their knowledge of the Premier League against other fans from around the world. The game is one of strategy and luck; fans have a limited budget and must select which players to back.

Recently it came to my attention that Magnus Carlsen, Norwegian chess grandmaster and the current World Chess Champion, was placed 111th in the fantasy football premier league. According to The Fédération Internationale des Échecs (FIDE), Magnus Carlsen is the best male chess player in the world as of February 1st. At the time of writing his position in fantasy football’ had dropped slightly to 224. This is remains an exceptional performance, particularly as he competes against over six million others.

Maybe I am wrong to think luck has a major role in this game? Perhaps strategic competency plays a greater part.  In this case perhaps Carlsen’s strategic genius, when it comes to chess, spills over into other domains?

This reminds me of a paper by Palacios-Huerta and Volij from 2009 published in the American Economic Review called Field Centipedes. Their paper considers the psychologically difficult process of backward induction between laypeople and chess players. The latter group habitually practice the art of thinking multiple steps ahead and reasoning backwards.  In this game two players take turns deciding whether to earn a marginally greater share of a growing pot of money, or to pass the money over to their counterpart. The equilibrium prediction is that defection should occur on the first round – the game unravels from every other stage back to the first. The major finding of the Palacios-Huerta and Volij study is that expert chess players play this game quite differently from students. 69 percent of chess players show signs of sophisticated strategic reasoning and stop immediately, mirroring the predictions of game theory. All Grandmasters in the experiment stopped at the first round.

I don’t know how many other grandmasters play fantasy football but perhaps they should be the source of advice for all things Premier League!

By John Eakins

If there was ever evidence of the importance that sport plays in our everyday lives it must be the recently released list of the top 50 viewed TV programmes for 2018 (here). Sport dominates the list with 26 of the top 50 programmes comprising of live sporting events. Three sports are represented in this list, Football, Rugby and GAA with 14, 9 and 3 events respectively. The fact that Football and Rugby were particularly prevalent is not entirely surprising given that the FIFA Football World Cup took place last year and also given the success of the Ireland rugby team in winning the Grand Slam and Six Nations tournament and attaining a clean sweep of wins in the Autumn internationals including a win over the World Champions, New Zealand.

It is perhaps difficult to capture the relative popularities of the different sports using the data we have. If we take a simple measure of the most watched programme for each sport, Rugby had the most viewers (Six Nations: England V Ireland, 975,600) followed by Football (2018 FIFA World Cup: Croatia V England, 924,400) and then the GAA (All Ireland Hurling Final: Galway V Limerick, 854,400). But if we take (albeit rather crude) measures of the average rank and average viewership for the top 3 programmes for each sport, the GAA fairs a little better with a higher average viewership of its top 3 programmes in comparison to the top 3 programmes in Football. Both sports still lag behind Rugby on both counts however (Rugby: Average Rank of Top 3, 4.7, Average Viewership of Top 3, 877,200; Football: Average Rank of Top 3, 12.3, Average Viewership of Top 3, 739,133; GAA: Average Rank of Top 3, 13.3, Average Viewership of Top 3, 747,900).

An examination of these figures over time can provide some additional insights. I collected equivalent data for the top 20 viewed TV programmes from 2012 to 2018. The first graph below shows the number of sporting events in the top 20 across these years and a breakdown by sport. The first observation is that the number of sporting events with high viewership figures is generally increasing over time with 5 sporting events in the top 20 in 2012 and 2013, 12 in 2015 and 2016 and 10 in 2018. Rugby and Football figure prominently with these figures, being boosted by Ireland’s involvement in the 2015 Rugby World Cup and EURO 2016. But even in Non-World Cup years such as 2017 the figures hold up well with a relatively even distribution across the three sports.

By Robbie Butler

Our 5th annual gathering will take place on Friday 24th of May 2019 at University College Cork.

This year’s workshop will focus on demand issues in sport. 

The event this year is co-funded by the Department of Economics, Cork University Business School and College of Business and Law at University College Cork.

More information relating to the event can be found here.