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Football: a cartel or an oligopoly? Concepts on a distance learning MBA in Saudi Arabia

04-Oct-2017 10:29:47 / by Nabeela D'Sa

Nabeela D'Sa

The results of the first few matches of the European Champions League were depressingly predictable. All the title favorites won and did so by a huge margin with the humiliation of the Celtic Glasgow by the PSG (0-5 in Glasgow on September 12th) a stark reminder of the increasing financial advantage enjoyed by the top 6 clubs in Europe (Real, Barca, the two Manchester, PSG and Bayern).

These 6 mega clubs have come to dominate their respective domestic leagues and the European Champions League due to their vastly superior financial resources which enables them to cream the best players and managers from all the other clubs. In effect, they now constitute a cartel, keeping out their competitors from the top tier of football. 

Other industries have also evolved into oligopolies which is a natural tendency in the evolution of maturing industries. And this sometimes leads to only two firms controlling most of the market, which is then called a duopoly; Pepsi Cola versus Coca Cola is a classic example. These are important topics to learn and understand which can be done on through a distance learning MBA in Saudi Arabia

Worst still, if left unregulated, some industries can consolidate to such an extent as to have only one single dominant provider. This is detrimental to the public and government are compelled to intervene to prevent such an outcome. But in football, the governing body, FIFA which is mired in its own internal trouble, has been slow to intervene to prevent the oligopolistic drift. The result is less and less competition for the title and predictable outcomes for most matches. Does anyone doubt that Celtic Glasgow will win the Scottish Premier League this season, just as it has monopolised it for the past years? Does anyone expect a Spanish club outside the duopoly of Barcelona and Real to win La Liga this season? 

Only the forced redistribution of the revenue from the richest clubs to the poorer ones will allow a wider competition for the title and therefore more entertaining and unpredictable matches for the football fans. This has started to happen in the English Premier League, but not to a sufficient extent as to undermine the six usual contenders (ManU, Man City, Liverpool, Chelsea, Arsenal and Tottenham). The barriers to entry are far too high still for an outsider to establish itself at the top. Leicester FC could not repeat its incredible feat of winning the Premier League and is now back to where the club came from, in or around the relegation zone. 

As any part-time MBA programs would teach you, the level of competition depends on the structure of the industry. In football, it has acquired very clear oligopolistic characteristics and it is high time the football governing body intervenes to keep competition alive and protect the beautiful game from itself.


Learn More

Here is some more reading on education and football:

Topics: MBA

Nabeela D'Sa

Written by Nabeela D'Sa

 

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