Sports have existed since the beginning of humanity. Moreover, sports served as one of humanity’s greatest forms of unwritten entertainment for society to enjoy. Starting over 17,000 years ago, cave paintings from the Sumerian civilizations and Ancient Egyptian civilizations depict wrestling and boxing. On May 2nd, Floyd Mayweather will fight Manny Pacquiao in an event that will provide each fighter a combined $200 million.
What does this say? 17,000 years later humanity is still competing in those same sports but now there are very large amounts of money that these same sports are generating. The question is why? Why will people pay $10,000 for a Super Bowl ticket? Why will people gamble hundreds of thousands of dollars on a boxing match? Why are professional athletes signing multi-million dollar contracts and sponsorship deals? The answer is demand.
People like sports. Sorry, people love sports! It goes back to the element of sports serving as a form of unwritten entertainment, making it unique from movies, plays, television shows … the list goes on. Competition sparks passion; that emotion that stems of one human clashing with another whether its in the ring, on the track, on the field, on the court, or on the ice. That passionate emotion starts with the competitors and emanates to the audience. This very nature of sport is what has turned it into what the sports business market is today. Between the food and memorabilia stands at the stadium, to media rights and sponsorship, the industry has been valued today of upwards of $600 billion dollars.
This number certainly disturbs some people. People ask today why do athletes earn so much money comparatively to other people in society? How do people earn so much money of amateur and college athletes who compete simply for “love of the game?” The answer is demand. And comparatively, to all the other various business industries in the world today, the sports business industry, I would argue, is one of the purest industries there is.