Does Digitalization Accelerate the Winner-Takes-All Effect in the Sports Industry?

Abstract

Today media and sports are indivisible, having a kind of inseparable, mutually influential relationship. Media attracts audiences and generates profit through sports. In its turn, sports content is disseminated, transmitted, and popularized through the media. Thus, theoretically, sports and media exist in symbiosis. However, practically, this relationship is complex and includes many factors. First of all, in recent decades, the process of overall digitalization (and digital transformation) of all fields of life has had a crucial impact on sport, media, and their interrelationship. This paper aims to conceptualize and analyze the possible impact of digitalization on “winner-takes-all” (WTA) (winner-takes-most, WTM) dynamics in the professional sports industry, notably for spectating audiences, and answer the question: “Can digitalization be seen as a driver of ecosystem change and how it should be tested?” This conceptual model paper seeks to construct and develop a theoretical framework that can explain and predict relationships between concepts of digitalization and key sport spectating variables: audience, TV rights, and revenue through a prism of WTA. We found that the technological change in the sports media market and the greater global-orientated strategy of leading sports organizations have re-sorted and compressed many market shares, but the effect of technological disruption has been significantly less pronounced for the most powerful digital leaders in the industry. To this end, we represent digitalization as the main accelerating factor of the WTA effect (along with other auxiliary effects) in the sports industry and propose future research directions and perspectives.

Keywords

• sports
• winner-takes-all
• digitalization
• network effect
• snowball effect