Super bowl markets in ads and gambling (and also a football game)

 Today is a big celebration of advertising.  But the advertisements have to be fitted into pauses in a football game.  That takes some doing.

The NYT has the story:

During N.F.L. Games, Going to Commercial Requires Its Own Playbook
TV advertising is the lifeblood of the league, but knowing when to pause the games is a task undertaken by N.F.L. executives, network producers and on-field officials.  By Ken Belson

"Most games have 18 commercial breaks. A few timeouts, like at the end of the first and third quarters and at the two-minute warnings, are fixed. The league and networks avoid taking breaks if a team’s opening drive of the game ends quickly, because they want fans to settle into the broadcast. If all goes well, the last commercials run at the two-minute warning in the fourth quarter.

"Most commercial breaks, though, are chosen in real time as league executives, network producers and officials on the field look for natural breaks in the action. Finding them is more art than science because every game unfolds differently, with long drives, three-and-outs, injury timeouts and coaches’ challenges.

...

"The logistics of determining when to call television timeouts require an intricate phone tree over a three-hour game. The referee, who controls when a game starts and stops and can overrule a request for a break, communicates with the back judge, who is in constant contact with two sideline officials standing near the 20-yard line. One of them wears a green hat and represents the league. The other has on orange gloves and works for the network."

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Gambling (on apps, during the game, about anything and everything) is still relatively new:

Here's the Guardian:

Americans expected to place record $1.39bn in bets for Super Bowl LIX
The US sports betting industry has boomed since 2018 – with it brings a ‘dark side’ as gambling addiction also rises  by Lauren Aratani 

"Since the supreme court overturned a federal law that made sports betting illegal in 2018, the industry has boomed, with 38 states opting to legalize. Gambling revenue hit $99.4bn in 2022, according to the American Gaming Association (AGA), the industry lobby group.

‘A serious disease’: Congress weighs federal gambling crackdown amid growing concerns

Read more

"Super Bowl Sunday – the biggest sports event of the year – will be no exception. Even as TV networks have struggled to maintain audience numbers, with more people tuning in to video content online, the Super Bowl has continued to grow in viewership. In 2024, a record 123 million viewers tuned into the game, making it the most-watched telecast in history.

"The AGA estimated that $1.39bn worth of legal bets will be placed for Super Bowl LIX. This is the first year the trade association reported estimated bets solely from legal channels. In previous years, AGA relied on surveys that included all betting, including those placed illegally and casually among friends. Last year, research firm Eilers & Krejcik Gaming estimated $1.25bn of legal bets were placed for the Super Bowl last year.

...

"Betting companies have also become more aggressive at advertising. Last year, BetMGM, the sports betting arm of MGM Resorts, aired a star-studded commercial promoting its platform during the Super Bowl. Fong said that it has all contributed to a normalizing of sports betting in American culture."

The ban on paying college athletes is history

 The idea that paying college athletes is wrong has given way to the realities of the sports markets in which they perform.  For many years, college athletes were required to be unpaid amateurs, but that time has passed.

The WSJ has the story.

NCAA Agrees to Share Revenue With Athletes in Landmark $2.8 Billion Settlement. Breaking with more than a century of policy, the NCAA will pay billions in damages to former athletes and allow schools to pay athletes up to $20 million a year    By Laine Higgins  and Jared Diamond

"The National Collegiate Athletic Association and the five most prominent athletic conferences agreed to a $2.77 billion settlement of a class-action lawsuit on Thursday, ushering in a new era of college sports in which schools can pay athletes directly. 

"The move marks a dramatic shift for the NCAA, breaking with its century-old stance that college athletes are amateurs and therefore cannot share in any of the money they generate for their universities.

...

"It also marks the latest rule the NCAA has been forced to change amid an onslaught of legal challenges in recent years. 

"First, the NCAA allowed athletes to receive academic bonuses and profit from their name, image and likeness. Now, the biggest domino of all has fallen: For the first time ever, some players are going to be paid directly by their schools for playing their sports—a seismic shift that will completely reshape the business model for the top end of this billion-dollar industry. 

"The result is the creation of a system that will give Division I schools the ability to distribute roughly $20 million a year to their athletes, said people familiar with the matter. "

The NCAA cartel

The March 2018 issue of the Review of Industrial Organization is devoted to a Symposium: The NCAA Cartel

In the Introduction, Roger Blair begins by noting
"Becker (1987) once characterized the National Collegiate Athletic Association (NCAA) as a “cartel in Sheepskin clothing,” which seems to be an apt description. Under the organizing umbrella of the NCAA, the member institutions collusively exploit both monopolistic and monopsonistic power. "

Here's the table of contents

1. Symposium: The NCAA Cartel—Introduction

   Roger D. BlairPages 179-183
   
2. 

   OriginalPaper

   The National Collegiate Athletic Association Cartel: Why it Exists, How it Works, and What it Does

   Allen R. Sanderson, John J. SiegfriedPages 185-209
   
3. 

   OriginalPaper

   Athlete Pay and Competitive Balance in College Athletics

   Brian Mills, Jason WinfreePages 211-229
   
4. 

   OriginalPaper

   Modeling Competitive Imbalance and Self-Regulation in College Sports

   Rodney FortPages 231-251
   
5. 

   OriginalPaper

   Rent Sharing and the Compensation of Head Coaches in Power Five College Football

   Michael A. Leeds, Eva Marikova Leeds, Aaron HarrisPages 253-267
   
6. 

   OriginalPaper

   State of Play: How Do College Football Programs Compete for Student Athletes?

   Jill S. HarrisPages 269-281
   
7. 

   OriginalPaper

   Strategic Interaction in a Repeated Game: Evidence from NCAA Football Recruiting

   Brad R. Humphreys, Jane E. RuseskiPages 283-303
   
8. 

   OriginalPaper

   The Role of Broadcasting in National Collegiate Athletic Association Sports

   Allen R. Sanderson, John J. SiegfriedPages 305-321
   
9. 

   OriginalPaper

   The NCAA and the Rule of Reason

   Herbert HovenkampPages 323-335
   
10. 

    OriginalPaper

    Whither the NCAA: Reforming the System

    Andrew ZimbalistPages 337-350
    
11. 

    OriginalPaper

    The NCAA Cartel and Antitrust Policy

    Roger D. Blair, Wenche WangPages 351-368
    

Super bowl thought by Kim Krawiec: football players are paid, why not kidney donors?

While checking up on the super bowl, I'm reminded that Kim Krawiec posted this:
 Super Bowl Week OpEd

"As the Super Bowl approaches, Phil Cook and I have an OpEd running in the Raleigh News & Observer and a few other publications:

Why ban payment to kidney donors but not football players?

BY PHILIP J. COOK AND KIMBERLY D. KRAWIEC 

February 01, 2018 01:06 PM

Super Bowl week rivets national attention on America’s most popular and lucrative sport, professional football. If stories of concussion and permanent injury to players make some fans uneasy, there is always the reassuring fact that the players volunteer for the job and are well compensated – so well compensated that there are untold thousands of young men who would gladly take their place.

Football is so ingrained in our culture that we generally accept this situation without much scrutiny. However, our research got us thinking about the stark contrast with another risky but valuable activity – kidney donation.

About 6,000 people per year donate one of their two kidneys. This selfless act has some risk to the donor, both from the surgery and years later when there is a chance the remaining kidney will fail. In return, kidney donors are rewarded with the knowledge they helped save the life of a loved one. They receive nothing tangible. Indeed, federal law bans compensation for kidney donors, as do the laws of all other countries except Iran (really).

So, why do we pay football players to entertain the public, but are unwilling to pay kidney donors to save lives?

The stakes in both cases are high, but much higher in kidney donation. The total value of NFL teams is about $60 billion. If, in some unlikely future, the risk of serious permanent injury to players led to a ban on professional play, that value would be destroyed.

Meanwhile, the ban on compensation for living kidney donation currently costs thousands of lives and billions of dollars in taxpayer money every year. The waiting list for a kidney now includes 100,000 patients, who for the most part are kept alive by renal dialysis at federal government expense. If they survive long enough, typically more than five years, in this debilitated state, they may hope to rise to the top of the list and receive a kidney from a deceased donor.

Deceased donors are a limited resource: few people die under conditions that permit donation and the United States already procures a large percentage of healthy kidneys from deceased donors. What is needed are many more living donors. Current estimates suggest an offer of $50,000 per living donation would be adequate to recruit sufficient numbers to meet the needs of all transplant-eligible renal patients. This would eliminate the waiting list and prevent thousands of unnecessary deaths and years of unnecessary disability. Given standard value-of-life estimates, the present value of the public benefit of converting to a system of compensated donation would exceed $1 trillion – many times the value of professional football.

It should be noted that the alternative to the current ban on compensation is not a laissez-faire free market. Rather, the current system for regulating the allocation of available kidneys could be readily expanded. A nonprofit or government organization could offer a fixed payment to living donors who were screened to be physically and mentally sound, and then fully informed of the risks. To avoid “impulse” donations, there could be a mandatory waiting period.

And it should be noted that the medical risks to kidney donors are far less than the risks of a football career; most donors lead normal lives, while most NFL veterans are, to some degree, disabled.

Inevitably the chance to sell a kidney for $50,000 would be most attractive to people who are struggling financially. Some ethicists opine that a compensated system would exploit the poor. Yet, more than a few NFL players also come from poor homes and 70 percent are black, causing many to view the concussion crisis as another example of racial inequality. In our view, the risk of exploitation is not a legitimate reason for forbidding compensation to kidney donors, thus denying the poor full use of one of their potential assets.

Millions of Americans, not just NFL players, work in occupations that have a substantial risk ofserious injury. Loggers, fishermen and others accept these risks in exchange for compensation. Extending that list to include kidney donors is just common sense.

PHILIP COOK IS TERRY SANFORD PROFESSOR EMERITUS OF PUBLIC POLICY AND PROFESSOR OF ECONOMICS AND SOCIOLOGY AT DUKE UNIVERSITY’S SANFORD SCHOOL OF PUBLIC POLICY. KIMBERLY KRAWIEC IS THE KATHRINE ROBINSON EVERETT PROFESSOR OF LAW AT DUKE LAW SCHOOL."