Sunday 17 June 2012

Sports markets “at capacity”: their rarity?

As I have noted in two previous posts (here and here), a number of sporting markets in the United States and Canada are not able to support the teams they have acquired in major leagues. This has led me to consider how many markets which actually have major league teams are not overextended but still cannot support any more major league franchises.

The striking thing is how few of these there are, as can be seen from the table below only nine non-overextended cities with major league teams cannot support more in theory:
Of these nine, four are NHL-only: the Canadian trio of Ottawa, Edmonton and Calgary, along with Raleigh in North Carolina. These cities are doing all right with the team they have especially in ice hockey-mad Canada, as is Oklahoma City with the possibility of an NBA title as I write. Their challenge is not to be tempted to attract more teams which they cannot support, one which they should have no trouble achieving for cultural reasons.

However, Memphis and Jacksonville are struggling a great deal even though they look viable under this theory because of the less competitive culture in the Deep South, which especially affects the Jaguars, whom many say will relocate to Los Angeles soon.

Baltimore and San Diego, though often criticised for their inability to retain teams, may be a wise example for other overburdened cities, especially those with theoretically enough money to support an MLB franchise. Since MLB has no intention of contracting in the foreseeable future, this will mean overburdened sports markets may need to lose NBA, NFL or NHL franchises if they have teams in all four leagues. San Diego, a market where baseball is king, is especially notable as it has lost NBA teams twice in the past and has thus avoided a burden on city governments and taxpayers in stadium construction. Baltimore, which like San Diego has only MLB and NFL, is similar in not having tried to attract teams. Overburdened metropolises should draw lessons from these seven cities’ experience to see if it reduces cost - something the majority of markets have never tried to do.