A winner’s curse in the bidding process for broadcasting rights in football? The cases of the French and UK markets

Feuillet, Antoine, Scelles, Nicolas ORCID: https://orcid.org/0000-0002-6177-5307 and Durand, Christophe (2019) A winner’s curse in the bidding process for broadcasting rights in football? The cases of the French and UK markets. Sport in Society, 22 (7). pp. 1198-1224. ISSN 1743-0445

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Abstract

The winner’s curse is a well-known phenomenon in the auction theory. The main aim of this article is to verify its existence in football broadcasting rights. The underlying objective is to assess whether some indices of this situation are verified and can cause a winner’s curse. The methodology is based on the application of Andreff (2014 Andreff, Wladimir. 2014. “The Winner’s Curse in Sports Economics.” Contemporary Research in Sports Economics 14: 177–205. [Google Scholar])’s six indices and a seventh index (disappointment) to the domestic markets for broadcasting rights of the French and English football leagues. These two markets have seen an increase in the number of packages offered to broadcasters, with the possibility of several ‘winners’. The article shows that the winner of the major packages in the auction is not cursed. The curse is more likely to happen for the second mover. As such, the article suggests a practical recommendation for broadcasters interested in football rights: win the best package or keep away.