Journal of Media Economics

ISSN: 0899-7764 (Print) 1532-7736 (Online) Journal homepage: https://www.tandfonline.com/loi/hmec20

TV Sports Programs—Who is Willing to Pay to

Watch?

Randi Hammervold & Harry Arne Solberg

To cite this article: Randi Hammervold & Harry Arne Solberg (2006) TV Sports Programs—Who
is Willing to Pay to Watch?, Journal of Media Economics, 19:3, 147-162, DOI: 10.1207/
s15327736me1903_1

To link to this article: https://doi.org/10.1207/s15327736me1903_1

Published online: 17 Nov 2009.

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JOURNAL OF MEDIA ECONOMICS, 19(3), 147–162
Copyright © 2006, Lawrence Erlbaum Associates, Inc.

TV Sports Programs—Who is Willing to

Pay to Watch?
Randi Hammervold and Harry Arne Solberg
Trondheim Business School
Sør-Trøndelag University College, Norway

This article investigates the factors that influence the willingness of TV viewers to
pay for watching sports programs. An empirical survey of Norwegian TV viewers re-
vealed that individual winter sports, such as biathlon and cross-country skiing,
headed the popularity list, with soccer coming third. However, it also showed that
soccer fans were significantly more motivated to pay than were fans of other sports.
These results provide some explanations to soccer’s revenue dominance in European
sports rights markets.

The strong price increases for sports rights over the past decades are well known.
An important part of this picture is the enormous difference among sports and be-
tween events and tournaments. Although the most attractive products have become
extremely expensive, the majority of sports do not receive any TV-rights revenues
(Solberg, 2004).
Fierce competition among TV companies involved in sports broadcasting is the
major reason for this development. This rivalry includes not only the growing
number of TV channels but also satellite and cable operators. Some of these are
tangled together in multifirm companies that have ownership interest in producers
at different levels along the sports program value chain.
Acquiring attractive sports rights has been an important strategy behind the
market expansion for many pay-TV channels. Companies such as BSkyB (United
Kingdom), Canal Plus (pan-European, with headquarters in France), Foxtel (Aus-
tralia), and DirecTV (North and South America) have grown considerably by
means of attractive sport programs.
Another reason for this development has been the tendency of the channels to
prioritize the same products. Soccer has turned out to be the most effective income
generator in Europe and thus is the content that commercial broadcasters find most

Correspondence should be addressed to Harry Arne Solberg, Trondheim Business School,

Sør-Trøndelag University College, Jonnsvannsveien 83, N-7004 Trondheim, Norway. E-mail:
harry.solberg@toh.hist.no
148 HAMMERVOLD AND SOLBERG

attractive. This development was launched in 1992 when BSkyB acquired the
English Premier League rights for the first time at a fee of £304 million ($572.6
million). The deal—which also included highlight fees from the British Broadcast-
ing Company—constituted a massive rise in the fees that was almost five times the
value of the deal ITV acquired in 1988 (Horsman, 1998). Since then, BSkyB has
renewed the deal on every occasion the rights have been auctioned. However, to re-
tain the rights, BSkyB has been forced to increase the bids considerably. The ex-
ception was the deal in 2004, in which the prices decreased, both in total and per
match. The reason for this price reversal was lack of competition; for the first time
since 1992, BSkyB did not face any rivals when bidding for the rights.
Several other TV companies across Europe have adopted BSkyB’s strategy, but
with mixed financial success. Although attractive soccer programs have strength-
ened these companies’ market position, some acquisitions have become unprofit-
able. Indeed, a number of companies have been hit by the winner’s curse (i.e., a sit-
uation where the winner of a common-value auction is worse off than those who
did not win because the winner was overly optimistic and, as a consequence, bid
more for the item than it was actually worth; Pindyck & Rubinfeld, 2005) and suf-
fered substantial financial losses from unprofitable deals (see Solberg, 2006, for
details). In some cases the acquisitions may have been part of a loss-leader strat-
egy—with the investments planned to be profitable in the long run—for example,
by forcing rivals out of the market. However, the tendency of prioritizing the same
products has often initiated bidding wars and hence increased rights fees so much
that many acquisitions have become unprofitable.
Despite these problems, European pay-TV platforms still seem willing to invest
heavily in soccer rights. In December 2004, Canal Plus paid a record E1.8 billion
($2.3 billion) for the French Ligue 1 for a period of 3 years. To achieve the rights
exclusively, they had to pay E130 million ($166.3 million; a 60% increase) more
per year than in the former joint deal with TPS.1
The broadcast of live matches from domestic premier leagues has to a great degree
migrated to pay-TV channels, leaving free-to-air channels only with highlight pro-
grams. The broadcast of international tournaments such as Federation Internationale
de Football Association’s World Cup soccer finals, European Championship for na-
tional teams, and the Union of European Football Associations’ Champions League,
has followed a mixed strategy with free-to-air, cable-, and pay-TV channels sharing
such products. Pay-TV channels are also involved in broadcasting sports other than
soccer, such as rugby, skiing, handball, and ice hockey. Unlike soccer, however, the
majority of these sports have been retained on free-to-air channels or cable channels.
This development has also influenced revenue distribution, which is illustrated
in Table 1. Soccer received considerably higher revenues than any other sport, and

1Another French pay-TV platform involved in domestic broadcasting.

 SPORTS PROGRAMS 149

TABLE 1
Top Five Earning Sports—Distribution of TV Rights, 1998

Position Germany UK Italy Netherlands Denmark Austria

1 42% Soccer 52% Soccer 65% Soccer 55% Soccer 45% Soccer 32% Soccer
2 7% Tennis 12% Rugby 8% Motor 9% Motor 13% Handball 11% Skiing
racing racing
3 6% Motor 8% Cricket 5% Basketball 7% Tennis 12% Cycling 6% Motor
racing racing
4 4% Boxing 4% Motor 2% Cycling 4% Cycling 4% Motor 4% Tennis
racing racing
5 4% Basketball 2% Tennis 1% Skiing 3% Athletics 3% Boxing 3% Ice Hockey

there are no indications that this pattern has been altered since 1998. Soccer’s dom-
inant position also applies to nations that historically have been more successful in
other sports. Austria, for example, has achieved a large number of Olympic and
World Championship gold medals in Alpine skiing, but never in soccer tourna-
ments. Nevertheless, soccer earned almost three times the revenues of skiing. The
same pattern applies to Denmark, which has won several medals in international
handball tournaments but not in soccer, except from the 1992 European Champi-
onship for national teams.
A similar pattern also applies to Norway, where the empirical data presented
in this article originate. Historically, Norwegian competitors have been suc-
cessful in winter sports. Nevertheless, these sports only earn a fraction of the
TV revenues of soccer. This was highlighted in June 2005 when TV22 and Ca-
nal Digital3 together acquired a 3-year deal for the Norwegian Tippeliga at an
annual fee of NOK200 million ($32.8 million; E25 million). This represented a
threefold increase from the previous deal, and the amount is miles ahead of
other Norwegian sports rights values.4 In comparison, the International
Biathlon Union annually earns E3.2 million ($4.1 million) in TV rights from
their deal with the European Broadcasting Union ending in 2006. The amount
will increase to E7.5 million ($9.6 million) for the deal running from 2006 to
2010 (Hanstad, 2005). This deal covers the worldwide rights and covers all
World Cup competitions, as well as World Championships.
The objective of this article is to provide information that can explain soccer’s
revenue dominance in the European TV sports markets. The main research pur-
pose is to identify the characteristics that distinguish those who were willing to pay
from those who were not. This covers interests in different sports as well as other
background variables.

2A Norwegian commercial public service broadcaster.

3A Norwegian company involved in terrestrial, cable, and satellite transmission.
4Source: TV Sports Markets, 9(11).
150 HAMMERVOLD AND SOLBERG

The next section presents the theoretical context. It first clarifies some aspects
regarding the demand for TV programs and for sports programs in particular, in-
cluding a discussion of how to measure the demand in terms of willingness to pay.
This is followed by an empirical section based on a survey of Norwegian view-
ers. It first describes the method and survey and then the results from the analyses.
The final part discusses what conclusions can be drawn and particularly investi-
gates factors influencing willingness to pay for watching TV sports.

THE DEMAND FOR TV SPORTS—A

THEORETICAL CONTEXT

According to microeconomic theory, the demand for goods and services will be in-
fluenced by factors such as the direct price, prices on other (related) goods and ser-
vices (complementarities and substitutes), and income. There will also be a num-
ber of individual factors, wherein the influence will vary from one good to another,
depending on the nature of the product.
Although such relationships also exist for TV sports programs, some peculiari-
ties complicate the job of estimating the aggregate market demand. There is a defi-
nition problem regarding how to understand the price of a TV program. Watching a
program on a free-to-air channel or a channel included in an basic cable package is
free of charge, with the exception of license fees to public service broadcasters and
subscription fees charged by the cable operator.
Furthermore, the application of price bundling also complicates the job of iden-
tifying the demand for individual programs. Except for pay-per-view fees, other
fees give admittance to a wide range of programs on several channels.
The fact that the reception of TV signals is an impure public good further com-
plicates the job of measuring the quantity. Such goods are nonrivaling in consump-
tion. If one person watches a program, he or she does not reduce the ability of other
viewers to watch the program. Thus, programming costs will not be influenced by
the number of viewers, a principle that also applies to transmission costs. Hence,
consumption costs are independent of how much a viewer is watching—that is, of
the quantity consumed—with the exception of pay-per-view fees that only give ad-
mittance to specific programs.

Charging From the Consumer Surplus

The revenues of commercial-TV channels develop from different sources. Adver-
tising channels earn their revenues from selling advertising slots. Pay-TV channels
make their revenues from charging the viewers, that is, from the consumer surplus
viewers otherwise would have retained to themselves if the program(s) were
broadcast free of charge.
 SPORTS PROGRAMS 151

Figure 1 presents hypothetical demand curves for two programs. The consumer
surpluses are the areas between the demand curve and the price. Because the pro-
grams are offered free of charge, the price is identical and would be the x-axis
(price = 0). The area shown by A + B represents the consumer surplus with the de-
mand curve D1, and B + C is the consumer surplus in case the demand curve is D2.
In principle, any commercial TV channel can choose whether to charge its viewers
or advertisers. Which alternative is most profitable depends on the position and
slope of the demand curve—in other words, of the program’s price elasticity. A
program for which the demand corresponds to the D1 curve would be more profit-
able to broadcast on pay TV than on advertising channels. A group of viewers have
a high “willingness to pay” for watching, whereas the willingness to pay drops
once the number of viewers approaches Q1. This is different for a demand curve
like D2, which refers to a program that starts lower on the y-axis than the D1 pro-
gram. However, its ability to attract a large audience (Q2 at maximum) would make
it profitable on advertising channels.
TV programs are offered in bundles, and it is the aggregate willingness to pay
for the entire portfolio of programs that decides whether a potential household will
subscribe. Those that subscribe are the households whose aggregate willingness to
pay exceeds subscription fees.
The revenues of pay-TV channels correlate with the number of subscribers.
Most TV households cover more than one individual, but the revenues will not be
influenced by the number of family members who watch the programs. This is dif-
ferent for advertising channels, where revenues correspond to the number of per-
sons (not TV households) that are watching. The revenues of advertising channels

FIGURE 1 Demand curves for two alternative TV sports programs. Note. D1 = De-
mand-Curve Program 1; D2 = Demand-Curve Program 2; A + B = Consumer surplus if Program
1 is broadcast free of charge; B + C = Consumer surplus if Program 2 is broadcast free of charge.
152 HAMMERVOLD AND SOLBERG

correlate with rating figures, not with how much viewers are willing to pay to
watch the programs.
The demand for TV sports programs can be influenced by factors such as the in-
terest for specific sports, teams, or competitors; the uncertainty of outcome (an im-
portant characteristic of sports competitions as commodities); and the quality of
the participants. Solberg & Hammervold (2004) analyzed how quality of matches
and popularity of specific teams influenced rating figures for UEFA’s Champions
League matches. Several articles have analyzed factors that influence attendance at
arenas, particularly in team sports (Baimbridge & Dawson, 1996; Bird, 1982;
Dobson & Goddard, 1992; Forrest & Simmons, 2002; Forrest, Simmons, &
Szymanski, 2004; García & Rodríguez 2002; Jennet, 1984; Schmidt & Berri,
2001). Many of these analyses have given special attention to uncertainty of out-
come and competitive balance. However, this research cannot fully explain the de-
mand for TV sports programs due to differences in the nature of watching a sports
competition on TV and at the arena.
The next section will investigate how specific factors influence the demand for
sports programs on the basis of the empirical survey among Norwegian TV house-
holds. These analyses provide information that can help TV channels with estimat-
ing such demand and give particular insight regarding factors that influence will-
ingness to pay.

METHOD

Questionnaires and Analyses

The major purpose of this article is to investigate factors that influence viewer’s will-
ingness to pay for watching TV sports. This covers fees beyond license fees paid to
public service broadcasters and general subscription fees to cable operators.
The respondents were asked only for a Yes or No response, not how much they
were willing to pay (if they answered Yes). An alternative to this would have been to
measure their monetary valuation by means of the contingent evaluation. However,
we assumed that many would find it difficult to identify their own individual mone-
tary valuation of specific sports programs, mainly due to the reasons mentioned pre-
viously. In addition, the survey included more questions than generally appear in
such telephone surveys. Fearing that such a phenomenon could reduce the response
rate, we decided to keep the willingness-to-pay question simple and ask only for a
Yes or No. Those who were willing to paywere also asked for their reasons. In this se-
quence the respondents graded their agreement on specific assertions by means of a
scale ranging from 1 (total disagreement) to 10 (total agreement).
The questionnaire also measured the interest for 14 TV sports by means of a
scale ranging from 1 (very uninterested) to 10 (very interested). This covered
 SPORTS PROGRAMS 153

sports that historically have been the most popular among Norwegians. Traditional
background variables such as gender, age, income, and similar variables were also
included in the questionnaire.
In addition to descriptive statistics, we also conducted a logistic regression that
investigated the differences between those who were willing to pay from those
who were not. A logistic regression model estimates regression coefficients that
can be read as the rate of change in the “log odds” as X changes. The calculated
exp(B) is the expected effect of the independent variable on the odds ratio, which is
the probability of the event divided by the probability of the nonevent. For exam-
ple, if exp(B) = 2, then a one-unit change in X would make the event twice as likely
to occur. Exp(B) equal to 1 indicates a 50–50 chance that the event will occur with
a unit change in the independent variable. Negative logistic coefficients (B) lead to
odds ratios less than 1: If exp(B) = 0.5, then a one-unit change in X will reduce the
odds by 50%.
There were 275 missing observations for the variable income. Additionally, 7
observations were removed due to special patterns in values and missing data.

Data Collection and Sample

The survey was conducted during the last 2 weeks in November 2004 by Norfakta
Markedsanalyse, a Norwegian market research institute. The data were collected
by Computer Assisted Telephone Interviewing. The member of each household
with the most recent birthday was selected as the respondent, and a call-back rou-
tine was launched if this person not was present. The sample was drawn randomly
from households in Norway with telephones (in-house or mobile). The share with
mobile users only was set to 15%. The lowest respondent age was set to 15 years.
One thousand respondents were interviewed; the response rate was 19%, which is
lower than what usually is achieved on such surveys (around 25%), mainly be-
cause of the length of the questionnaire. There was a slight overrepresentation
among women and among the age group between 30 and 59 years. However, the
analysis has been corrected for potential biases by means of a weighting matrix for
such variables as gender, age, and geography. We therefore regard this research to
be representative for the Norwegian population older than 15 years.

RESULTS

Table 2 shows that winter sports such as biathlon and skiing headed the popularity
list when ranked by mean values. This was no surprise considering that Norwegian
competitors traditionally have been successful in these sports on an international
level. Soccer shared third place with ski jumping and came second on the men’s list
and sixth on the women’s list. Table 2 also reveals higher interest among men than
154 HAMMERVOLD AND SOLBERG

TABLE 2
Interest for Sports—Mean Values and Standard Errors (Scale From 1–10)

Total Men Women

t Test for Differences

Activity M SE M SE M SE in p Value

Sports in general 5.39 3.093 6.30 3.035 4.51 2.891 .000

Biathlon 6.12 3.127 6.31 2.951 5.93 3.280 .051
Cross-country 5.80 2.954 5.84 2.820 5.75 3.082 .614
Ski jumping 5.23 2.838 5.71 2.694 4.76 2.898 .000
Soccer 5.23 3.302 6.09 3.303 4.39 3.079 .000
Alpine skiing 4.97 2.632 5.20 2.464 4.74 2.769 .060
Handball 4.77 2.872 4.61 2.596 4.93 3.111 .780
Athletics 4.40 2.615 4.75 2.549 4.07 2.638 .000
Skating 3.99 2.632 4.31 2.604 3.68 2.624 .000
Motor sports 3.89 2.828 4.97 2.845 2.85 2.386 .000
Cycling 3.43 2.323 3.84 2.243 3.04 2.334 .000
Snowboarding 2.87 2.257 2.97 2.318 2.77 2.193 .150
Ice hockey 2.57 2.069 3.11 2.172 2.06 1.821 .000
Boxing 2.43 2.297 3.39 2.655 1.50 1.345 .000
Basketball 2.21 1.754 2.36 1.809 2.07 1.688 .010

among women, with the exception of handball and snowboarding, whereas the dif-
ference almost was significant for alpine skiing and biathlon.
It is worth noting that soccer had a higher standard error than any other sport.
This indicated more dispersion in interest, a pattern that corresponded with the fre-
quency tables. Different patterns were observed between men and women. Thirty
percent of men considered themselves very interested in soccer (Category 9 or 10),
whereas the equivalent percentages for biathlon and cross-country skiing were
28.5% and 20.9%. In contrast, 40% of women considered themselves very uninter-
ested in soccer (Category 1 or 2), whereas the equivalent percentages for biathlon
and cross-country skiing were significantly lower, 23% and 21%, respectively. The
survey also revealed that 20% were willing to pay for watching TV sports. Again,
trace of gender differences occurred, with 28% of men being willing to pay and
only 12% of women.
Table 3, which covers only the five most popular sports, reveals the percentages
that were willing to pay among those who considered themselves very interested in
specific sports, that is, belonged to Category 8, 9, or 10. Here, the most interesting
pattern was the differences among sports. The table reveals that many soccer fans
were willing to pay, a pattern that was confirmed by the logistic regression. Forty
percent of those who considered themselves as belonging to Categories 8–10 for
soccer were willing to pay, whereas the percentage for men only was 46%. These
figures were significantly higher than for the two most popular sports, namely
 SPORTS PROGRAMS 155

biathlon (27% of the total and 34% of men) and cross-country skiing (26% of the
total and 32% of men). Indeed, such differences became more evident when the
sample included only Category 10 respondents. As many as 60% of men that be-
longed to this soccer category were willing to pay, whereas the equivalent figures
for biathlon and cross-country skiing were 43% and 34%. Table 3 also confirms
the pattern of men being more motivated to pay then women.
Table 4 presents the motives for why respondents were willing to pay. Most im-
portant was the ability to watch one’s favorite sport, and favorite team was second.
It is worth noting that following national participants in international champion-
ships scored lowest.

Factor Analysis
Table 5 presents the results from a factor analysis that investigated whether there
were groups that shared interest in several sports. The first (and most explanatory)
factor was very comprehensive and covered eight sports. This factor was domi-
nated by individual sports (both winter and summer), with handball the only team
sport. The second factor covered action-oriented sports, that is, motor sports and

TABLE 3
Respondents Willing to Pay (Only Including Categories 8–10)

Total Men

Activity % n % n

Biathlon 27 412 34 210

Cross-country 26 341 32 168
Ski jumping 30 268 36 155
Soccer 40 321 46 213
Alpine skiing 29 192 34 98

TABLE 4
Reasons for Being Willing to Pay—Mean Values and Standard Errors
(Scale From 1–10)

Variable M SE

Favorite sport 8.90 1.732

Favorite team 8.21 2.328
International championships 7.89 2.298
Exciting matches and competitions 7.66 2.191
Sports of good quality 7.61 1.999
Watching together with friends 7.26 2.769
National participants in international competitions 6.89 2.440

Note. N = 190.
156 HAMMERVOLD AND SOLBERG

TABLE 5
Rotated Component Matrix

Component

Activity 1 2 3 4

Biathlon .873 .029 .140 –.071

Cross-country skiing .898 .012 .069 –.044
Ski jumping .832 .229 .128 –.008
Skating .788 .069 .114 .043
Alpine skiing .753 .293 .049 .203
Athletics .703 –.053 .239 .277
Handball .581 –.160 .380 .218
Cycling .595 .159 .316 .262
Motor sports .179 .816 .097 .168
Boxing –.014 .709 .379 .165
Ice hockey .138 .307 .703 .251
Soccer .347 .170 .739 .056
Basketball .047 .093 .302 .822
Snowboarding .130 .453 –.007 .730
Cumulative variance 34.39% 46.69% 58.30% 69.62%

Note. Extraction method: principal component analysis; rotation method: varimax with Kaiser
normalization; rotation converged in six iterations.

boxing, and soccer and ice hockey belonged to the third factor. The fourth factor
included basketball and snowboarding, and these two sports particularly were pop-
ular among younger respondents. The most popular sports were found in Factors 1
and 3, whereas those belonging to Factors 2 and 4 were far down the popularity
ladder. It is worth noting that the interests of soccer fans were narrower than those
of fans of biathlon and cross-country skiing, the two most popular sports. Al-
though fans of the two winter sports also were interested in many other sports, soc-
cer fans were only interested in ice hockey.
We found the initial analysis that only included factors with Eigenvalues greater
than 1 too comprehensive, with too many variables. We therefore conducted several
experimental analyses, varying the number of factors. We found the one that included
four factors the most interesting. This was also the analysis that best corresponded
with our expectations. By increasing the number of factors from four to five, handball
became a factor of its own, so that the first factor only consisted of individual sports.
With that exception, the pattern presented on Table 5 remained unchanged.

Logistic Regression
Table 6 presents the results from the logistic regression analysis. Willingness to
pay was the dependent variable; Yes answers were coded 1 and No answers coded
 SPORTS PROGRAMS 157

TABLE 6
Logistic Regression

Variable B SE Wald p Exp(B)

Age –0.019 .008 5.831 .016 0.981

Gender 0.125 .266 0.219 .640 1.133
Income 0.002 .001 10.547 .001 1.002
Sports interest 0.280 .070 15.933 .000 1.324
Soccer interest 0.141 .058 5.882 .015 1.152
Ice hockey interest 0.139 .057 5.961 .015 1.149
Affective loyalty 0.387 .078 24.536 .000 1.472
Match importance –0.098 .047 4.351 .037 0.907
Constant –6.240 .716 75.943 .000 0.002

Note. Model summary: –2 log likelihood = 450.271; Cox and Snell R2 = 0.294; Nagelkerke R2 =
0.466; Hosmer and Lemeshow test: df = 8; p = .586; χ2 = 6.547.

0. The right-hand variables include those that influenced significantly on willing-

ness to pay (or almost influenced), with the exception of gender.
The positive relationship between interest for sports and willingness to pay ap-
pears obvious. Who should be motivated to pay if not sports fans? Nevertheless,
the relationship was not so obvious regarding specific sports, with the exception of
soccer and ice hockey. This applied to biathlon and cross-country skiing, which
headed the popularity list. Although ordinary t tests revealed that those who were
willing to pay were significantly more interested in these two sports than those
who were unwilling to pay, the logistic regression raised doubts regarding the
causal relationship. Neither of these variables influenced willingness to pay when
the interest for sport also was included among the right-hand variables. The same
result appeared when either interest for biathlon or interest for cross-country ski-
ing was removed, that is, when only one of them was included. Interest for
cross-country skiing became significant when the interest for sport was removed,
but the same pattern did not apply to interest for biathlon. Table 7 reveals a strong
correlation between interest for cross-country skiing and interest for biathlon,
which indicated multicollinearity. Thus, it was no surprise that either of them in-
fluenced willingness to pay when both were included.
The influence of interest for soccer and interest for ice hockey on willingness to
pay, however, was considerably more convincing than for the two individual win-
ter sports. The logistic regression presented in Table 6, as well as all other experi-
mental regressions, clearly confirmed that those who were very interested in these
two sports also were more motivated to pay. Such a pattern corresponds with the
results presented in Table 3.
Although Table 7 reveals positive correlation between interest for biathlon and
interest for sport, as well as between interest for cross-country skiing and interest
for sports, these correlations are weaker than the correlation between interest for
158 HAMMERVOLD AND SOLBERG

TABLE 7
Correlation

Interest: Interest: Interest: Interest: Interest:

Variable Gender Sports Soccer Ice Hockey Cross-Country Skiing Biathlon

Gender
r 1 .289* .258* .254* .016 .062
p .000 .000 .000 .614 .051
n 992 992 992 990 992 992
Interest: sports
r .289* 1 .726* .419* .566* .607*
p .000 .000 .000 .000 .000
n 992 992 992 990 992 992
Interest: soccer
r .258* .726* 1 .451* .348* .392*
p .000 .000 .000 .000 .000
n 992 992 992 990 992 992
Interest: ice hockey
r .254* .419* .451* 1 .194* .220*
p .000 .000 .000 .000 .000
n 990 990 990 990 990 990
Interest: cross-country
skiing
r .016 .566* .348* .194* 1 .828*
p .614 .000 .000 .000 .000
n 992 992 992 990 992 992
Interest: biathlon
r .062 .607* .392* .220* .828* 1
p .051 .000 .000 .000 .000
n 992 992 992 990 992 992

*p = .01 (two-tailed).

soccer and interest for sports. Hence, the influence that interest for soccer has on
willingness to pay seems quite robust.
Table 6 also shows that affectionate loyalty toward favorite teams was another
variable that positively influenced willingness to pay. These respondents admitted
being emotionally involved in their teams, and they regularly spent time on keep-
ing themselves updated on the latest development in the clubs.
The regression did not reveal any significant gender differences with regard to
willingness to pay, a surprise considering the results in Table 3. This, however, was
due to correlations between interest for sports (in general), interest for soccer, in-
terest for ice hockey, and gender. Men were significantly more interested in sports,
soccer, and ice hockey than were women. Furthermore, the survey also revealed
that a higher proportion of those who were extremely interested in these variables
were more willing to pay than others. We also ran alternative experimental regres-
 SPORTS PROGRAMS 159

sions, varying the right-hand variables. These regressions revealed that men were
significantly more motivated to pay when the interest for sport, soccer, and ice
hockey were removed. These experimental regressions indicated some degree of
multicollinearity between these variables. Table 7 includes variables that were in-
cluded in the regression presented in Table 6 (interest for sport, soccer, and ice
hockey). In addition, it includes cross-country skiing and biathlon, the sports high-
est on the popularity ladder.
The importance of a match—for example, whether it influences the chance of
winning a championship or avoids relegation—did not influence willingness to
pay according to the logistic regression. Indeed, the analyses revealed a nearly neg-
ative influence. This must be regarded as a surprise, considering the enormous at-
tention that has been given to uncertainty of outcome and competitive balance in
sports economics literature.
These latter results indicate that emotional attraction toward favorite teams is
more important than the competition aspect, with regard to whether viewers are
willing to pay.
Finally, the regression also indicated that age influenced willingness to pay sig-
nificantly, with younger people more willing to pay than older.

CONCLUSION

The analyses presented in this article provide information that explains soccer’s
revenue dominance in European sports rights markets. Although soccer only
placed third on the popularity ladder, the survey clearly revealed that soccer fans
were more motivated to pay for watching TV sports than were fans of other sports.
This pattern was confirmed by frequency tables as well as by logistic regression
analysis. The difference particularly applied to those who were extremely inter-
ested. Sixty percent of men who considered themselves extremely interested in
soccer (Category 10) were willing to pay, a proportion that was considerably
higher than for any other sport.
Frequency tables and standard errors also revealed that the interest for soccer
was more dispersed than for other sports. To a great extent, the dispersion followed
the gender dimension. As many as 40% of women were very uninterested (Catego-
ries 1 and 2). This, however, was compensated by a higher proportion of men at the
other end of the scale who were extremely interested.
In principle, it is up to any commercial TV channel to decide whether to charge its
viewers or advertisers. Many European channels that have invested heavily in domes-
tic premier league rights have tried to finance these investments by charging viewers
instead of advertisers. The data presented in this article indicate that this has been a
clever strategy. Such a conclusion, however, assumes that Norwegian TV viewers are
representative of viewers across Europe. Several factors indicate that such similarities
160 HAMMERVOLD AND SOLBERG

exist. The distribution of sports rights in Norway is similar to the pattern found in most
other European nations, with soccer receiving the lion’s share of the revenues. The
most valuable assets in Norway, as well as in the rest of Europe, have been domestic
premier leagues. Since 1999, English Premier League matches have been broadcast
entirely on pay-TV channels in the Norwegian market. Since 2002, the majority of
matches in the Norwegian Premier League have also been broadcast on pay TV.
However, there is also a risk of creating bidding wars if too many channels com-
pete for the same products. Such competitions can make the acquisitions unprofit-
able, which indeed several channels have experienced in recent years. Pay chan-
nels involved in sports broadcasting offer their viewers quite narrow menus of
programs, often with soccer as the major product. Such a strategy can be risky, be-
cause rights fees could increase so much that channels could then no longer afford
to acquire the programs that have brought them success. Some years ago, BSkyB’s
own surveys revealed that it would risk losing more than 50% of its subscribers
without the English Premier League (Solberg, 2002).
This article has revealed that fans of the most popular sports were less motivated
to pay than fans of soccer and ice hockey. To some degree, it also leaves an impres-
sion of team sports fans as more motivated to pay than fans of individual sports. This
impression is strengthened by the pattern of those willing to pay being driven by af-
fectionate relationships toward their favorite club and sport, which for many was
soccer. These respondents expressed a high degree of loyalty to their favorite team
and kept themselves updated on the team through newspapers, the Internet, TV, and
other sources. Supporters of national teams do not have the same abilityto follow and
cultivate their teams as do supporters of clubs. Whereas clubs have a match or two per
week during the season, national team matches find place more rarely. This pattern is
also reflected in the number of matches being broadcast. However, the surveyalso re-
vealed that fans of basketball and handball were not more motivated to pay than oth-
ers. Hence, whether people are willing to pay is not only a matter of whether they are
interested in team sports or individual sports.
Factor analyses revealed that soccer fans had fewer substitutes than fans of
biathlon and cross-country skiing, which represents another reason for why soccer
fits better on pay TV. It is well known from microeconomic theory that the fewer
substitutes consumers are offered, the more inelastic demand will be.
European pay-TV channels have concentrated their efforts mainly on acquiring
the rights for domestic soccer leagues. They have not shown the same interest in in-
ternational tournaments such as the Olympic Games and international champion-
ships. One reason for this is that these latter tournaments take place every other (or
fourth) year, which reduces the ability to attract subscribers. For example, BSkyB
did not bid on the 2002 World Cup soccer finals.
Frequency tables combined with t tests showed different results than the logistic
regression analysis with regard to gender differences in willingness to pay. Although
the former indicated that males were more willing to pay, such a pattern was not con-
 SPORTS PROGRAMS 161

firmed by logistic regression. This, however, was due to multicollinearity between

interest for sports, interest for soccer, interest for ice hockey, and gender. Males were
significantly more interested in these three sports than were women. However, the
fact that those who particularly were interested in these sports also were more moti-
vated to pay than others makes it difficult to decide the causal relationship. The re-
gression with the highest r-square included interest for sport, soccer, and ice hockey,
but not gender, as right-hand variables. However, this does not convince us whether it
is the gender dimension or interest for these three sports that decides willingness to
pay. Indeed, we regard this as an illustration of the chicken-or-egg phenomenon,
where a more thorough understanding requires analyses from multidisciplinary per-
spectives, for example, from psychology and sociology.
Strict European regulation of advertising channels (first and foremost of public
service broadcasters) has reduced these channels’ ability to make a profit from
sports broadcasting. This also represents a competitive advantage for pay-TV
channels. Hence, to maximize sports broadcasting revenues, these channels have
been forced to prioritize content for which viewers are willing to pay. This article
illustrates that soccer is the most effective sport to meet this objective in Europe.
Watching national competitors in international championships and sports of
good quality plays a moderate role as a motivator to pay. Hence, programs from
such tournaments probably fit better on advertising channels than on pay-TV
channels. Several statistics have documented that these events can attract very
high rating figures.
This article provides explanations for why soccer has become the most attrac-
tive sport for pay-TV channels. However, the fact that this knowledge already has
been discovered by a number of channels has created a rat race, resulting in bid-
ding wars and extremely expensive rights fees. This illustrates that an idea can be
brilliant, as long you are the only one who discovers it. If too many others also dis-
cover it, then the idea is not brilliant any more.

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