The men's football team has become the burden of all talk shows, the women's football team was eliminated in the group stage of the World Cup and did not qualify for the Olympics, the men's basketball team lost the 2023 World Cup and lost the Olympic qualification, the men's volleyball team has no hope at all, and the women's volleyball team still has to rely on the ranking of the World Volleyball League to fight for the Olympic ticket...... On the other hand, Village Super, Village BA, and Village Platoon have almost risen from the ground, becoming popular on short video platforms and becoming a new synonym for Chinese sports.
▂
Text / Su Yi
Ed. / Luo Da
As an observer, the author has participated in various discussions on the above phenomena and topics inside and outside the industry, and deeply feels that some superficial phenomena have been exaggerated, some substantive problems have been distorted, and the key points of the problem have not been grasped - who can start the development engine of China's sports industry? Therefore, we discuss in this article, hoping to find some paths from the development law of modern sports, and find the key points of the future development of Chinese sports.
Modern Sports vs. Professional Sports
The biggest difference between modern sports and traditional sports is that it is both a social and a commercial behavior. Modern sports sprouted in the era of the industrial revolution and grew up in the era of the media revolution, with the wave of globalization and affected the daily life of people around the world, from Messi and Ronaldo to Curry and Durant, its influence far exceeded the scope of sports itself. While we regard reform and opening up and economic development as the first goal, it is inevitable that the wave and impact of globalization and commercialization will be inevitable, and the same is true for sports.
In today's era of anti-globalization ideology, only sports still adhere to the banner of globalization, and reverse globalization seems unlikely, and many sports are placed under the eyes of people around the world to thrive.
At present, there are some trends of thought that want to solve all problems in one go, such as "the national system can do a good job in the three major balls, so return to the sports team and sports school stage, and the results will be better than now", such as "The village super is the World Cup of the Chinese nation, and the future World Cup will be the World Cup for netizens to become sports lovers", etc., the root of it is still one sentence: sports is not really regarded as an industry or industry.
From the global definition of sports, sports are divided into three levels: Major Participation Sports, Amateur Sports, and Professional Sports according to the number of participants and the level of difficulty.
However, although the general term is convenient, it will ignore some details, in the eyes of professionals, Professional actually has two subdivisions of professional sports and professional sports, and these two subdivisions have essential differences, the fundamental difference is where the resources for training athletes come from, if it is from the government, it is professional sports, from the market, it is professional sports.
Professional sports is the crown of modern sports, looking at the world, football, basketball, tennis, golf, plus fighting and racing, can be regarded as a truly global professional sports, and baseball, rugby and ice hockey are still limited to North America, if you add a non-recognition by the traditional sports industry, but the actual operation law is already professional sports e-sports, the world has these ten professional sports, and in these ten sports there are many core event systems have been established, these event systems are called real IP.
The above classification derivation logic must be taken seriously, because this point is often ignored or confused, causing more confusion and misunderstanding. Therefore, this article discusses the "professional sports" that are less mentioned in Chinese sports and are the most common in global sports.
The reason for discussing this direction is, firstly, professional sports have a strong commercial IP value, which can ensure the continuous operation of market participants with the most market-oriented principle, and will not be interfered with and blocked by some non-market factors; secondly, professional sports have a huge driving role in the entire big sports industry, such as Jordan and Messi, both of which were born in the industrialization process of professional sports, and with their worldwide influence and the following of sports fans in vertical sports, they have in turn driven the entire project and industry.
How do you define professional sports?
The simplest definition of professional sports is "a sport in which the relevant entities involved in the sport are all engaged in sports performance to obtain commercial income", so it is normal and reasonable for the subjects involved in professional sports to pursue profits. This includes the leagues, clubs, and athletes, as well as broadcasters, sponsors, venue operators, equipment suppliers, and marketing intermediaries who serve professional sports.
There is also a particularly popular definition here, which is the proportion of people who participate in the sport, that is, the proportion of people who participate in the sport and the number of people who do not participate in the sport. There is no definite value for this ratio, and basically it is considered that more than 1:2 is a sport that can be professionalized. Taking football as an example, the number of participants in the world is about 300 million, but the number of viewers is at least 3 billion, which is a 1:10 ratio, and the number of basketball participants is slightly higher than football, but the number of viewers is about 1.5 billion, which is a 1:5 ratio.
Generally speaking, sports defined as professional sports are highly spectatorial sports, relying on attracting a large number of fans to watch the game and purchasing game-related products and services to obtain commercial benefits, and only in this way can it attract investment institutions to invest.
There are three main bodies in professional sports, namely the League, the Club and the Player, among which the players' union plays a role as a club to a certain extent in individual sports such as tennis and golf, but it is more about the relationship between the league and the players. In the collective program, the American sports federation has more power and branding, while in Europe, the club is relatively independent and more famous. At the same time, in professional sports, players are very capable of attracting money and are core assets, but these core assets have a term, and many leagues and clubs have long-term value, all of which are called top sports IPs and have high commercial value.
Since professional sports are for commercial purposes, commercial income is actually the basis for judging whether it is professional sports, that is, commercial sponsorship, broadcast income and matchday income are the three main incomes.
Therefore, a sport with an unclear subject and no ability to generate three revenues at the same time is not considered a professional sport. So under this framework, let's analyze the problems faced by professional sports in China.
Competition in professional sports: sail against the current, or retreat
If you want to talk about professional sports, let's start with football, the first sport, or simply start with Chinese football, which is the most familiar to the public.
It is said that Chinese football has deteriorated and chaos is not as good as it was a few decades ago, but in fact, from the perspective of the whole, rather than saying that we have regressed, the truth of the matter is most likely to be the progress of professional international football, which has led us to fall behind from the perspective of international competitiveness, so we have formed an illusion that it is getting worse and worse. And because of the pandemic, the opportunities for Chinese teams to participate in high-level global competitions have plummeted, resulting in this gap becoming more pronounced in the short term.
At present, the Chinese men's football team has zero players in Europe's top five leagues, while neighbors Japan and South Korea have 200 and more than 100 players in European leagues, and the number of players in Champions League and Europa League clubs is also very large. In the squad for the Asian Cup finals, the number of overseas players from South Korea is 14, and the number of Japanese players is 22.
Look at the women's football team that we used to be proud of. With the professionalization of women's football in Europe, there are only a handful of players in China who currently play for top European professional women's football clubs, while many players from Japan and South Korea have gained a foothold in the top European leagues.
Looking at basketball again, whether it is in the NBA or the European League, there have never been overseas players such as Yao Ming, Wang Zhizhi, and Yi Jianlian in China, and Zhou Qi, who was once the best center in China, has also been lost in the transfer of domestic clubs.
What China's professional sports lack is the ability, courage and perseverance to go global, and the inadequate domestic professional sports market has contributed to this trend, such as deformed domestic player salaries, such as the protection of domestic players' playing places, and so on.
If we turn our perspective to golf and tennis, two professional sports that are basically based on individuals, we will find that the scenery is completely different.
Their model is probably as follows: players usually provide training and competition costs and opportunities by their families or the market, they have the development rights and interests of commercial value, and when the country needs it, they can represent the highest level of the country to go out for the country.
Especially during the epidemic, training and competitions were basically held abroad, so the level of Chinese players has been maintained in a relatively good state, whether it is on the PGA Tour, European Tour, Asian Tour or major tennis opens, Yin Ruoning also briefly became the world's first sister in women's golf in September. In the future, the follow-up talents of these two projects will also emerge in an endless stream, forming a good development path of professional sports.
Although we have organized many world-class competitions in the past decade, this kind of comprehensive competition is not the same as the real development of professional sports. From the actual situation of professional sports, China is lagging behind the development of the world, and due to the inconvenience of communication caused by anti-globalization and the three-year epidemic, China's professional sports has seen a greater regression.
What are the problems encountered by professional sports in China?
With the reform and opening up, China began to participate in the Olympic Games in 1984 and gradually integrated into the world, and China's economy began to develop rapidly. More than 40 years later, China's economy has become an indispensable part of the world, greatly affecting the well-being of the global economy.
Unlike our achievements in the Olympic Games, China is still a "developing country" in terms of professional sports, so how do you view the future development of China's professional sports and find a path of sports development suitable for Chinese characteristics?
Let's take a look at our strategy first: from the perspective of top-level design, we have been working around the "Olympic strategy" for many years, with more investment in Olympic events and less investment in non-Olympic events, and this policy has been extended to the National Games, Provincial Games, and Municipal Games systems, so that the resources of the sports system are allocated by the plan from the top down, and the investment of social resources has no chance to be integrated into the entire system, but can only slowly infiltrate the system from the bottom up.
Every time we talk about the reform of Chinese sports, we will always be stumped by many complex and systemic problems faced by the whole society, including the reform of the education system (integration of sports and education), the reform of the social welfare system (the supervision of legal persons), the reform of news and public opinion supervision (the rice circle of sports stars) and so on.
Let's first review an important theory in the development of China's 40-year reform and opening up market economy: in the early days of China's economic take-off, a British economist who had never been to China at that time, Ronald Coase, mentioned an important "Coase theorem" in his new institutional economic theory, which was later regarded as a benchmark by the Chinese economic circles and influenced the decision-making process of China's reform and opening up to a certain extent.
The general explanation of Coase's theorem is that "as long as the property rights are clear and the transaction costs are zero or small, then no matter who the property rights are given at the beginning, the end result of the market equilibrium is efficient, and the Pareto optimality of resource allocation is achieved." 」
There are two key words in "Coase's theorem" - "clear property rights" and "transaction costs". Looking back at the process of China's domestic economic reform, every turning point in history has been accompanied by two principles: a clearer reform of the property rights system and the reduction of social transaction costs.
In the second part of this article, let's talk about the definition of professional sports, in the logic of "commercial interests", to study how the two concepts of "clear property rights" and "transaction costs" can help Chinese professional sports find the key to their true marketization, and to look at the development of professional sports in China according to the theory of market economy, which is the core context of this article.
There is no such thing as a freehold property in China, so whether it is a 50-70 year property right for land or a concession for some public facilities, it is all time-limited, and the market accepts this. However, for short-term management rights or projects without property rights, because there is no long-term contract as a guarantee, its market value is immeasurable, and in this case, neither the government nor the market can do the optimal allocation of resources. This can be seen in the division of professional sports in China.
From the "Hongshankou Conference" to the establishment of substantive and professional heated discussions in Chinese football, to the Chinese Super League "Jinyuan Football" has left a lot of chicken feathers on Chinese football, and the money spent cannot be said to be less, but why is it more and more defeated? Although the top league of the three major balls has established the Chinese Super League and the CBA company, this separation of management and management is not really the independence of property rights or franchises, and the longest CBA authorization period is ten years, and there are only three years left this year, and it is not yet known what the future will look like. Moreover, from the shareholder structure to the organizational operation, it has not yet gotten rid of the shadow of the original planned distribution.
Everyone can see that there are many chaos and strange things in the Chinese Super League and CBA League, in fact, the root cause is that there is no reasonable market-oriented management organization based on the property rights system to achieve "Pareto optimal" resource allocation. In golf and tennis, where individual events are the mainstay, the property rights of the athletes belong to the individual, and the event is completely independent in terms of business, so Chinese athletes can achieve good results and have a lot of room for operation in business.
After talking about property rights, let's talk about "transaction costs".
The high degree of commercialization of professional sports creates a large number of professional divisions of labor, which eventually gives rise to the league, which reduces transaction costs between independent sports clubs and external partners and internally, which is very different from other corporate organizations.
Professional sports leagues should play a role in helping clubs increase their revenues, and at the same time have a strict financial fairness system at the league level to control the unbridled investment of participants and ensure the overall healthy development. The current reality is that each club has its own policy in the Jinyuan football stage, and the league can only control the rewards and punishments in the competition system, rather than the operation mode of a corporate way. In the post-Jin Yuan era, the appeal of the alliance was completely supported by administrative instructions, and it lost its meaning of existence, forming a vicious circle.
Let's take a look at it again, because of the support of the property rights system, the developed leagues of professional sports are all in favor of club transfers, and there are perfect laws and regulations for player transfers, and there is a perfect protection mechanism for the rights and interests of players, which is a core mechanism for the operation of professional sports, and on the other hand, Chinese professional sports, the transfer of Chinese Super League clubs can not leave the city, the contradictions of CBA player transfers are frequent, and the Chinese Super League players are seriously in arrears, and the efficiency of the market on this basis is completely lost, and the transaction cost is extremely high, so naturally there is no capital willing to invest in this industry。
To summarize the author's point of view:
If the IP or long-term operation rights of professional sports are authorized to an independent market-oriented alliance company, the entire league is operated and managed in a market-oriented manner, which should be a rare and scarce asset in the investment field in the capital market, and the clubs, athletes and service organizations based on this property rights reform are dynamic and commercially valuable.
future
The problems encountered by Chinese sports are systemic problems, and we must follow the path of socialist sports development with Chinese characteristics.
1. For the Olympic sports of professional sports, many of them are "some of the items that the people are very concerned about, compared with the international advanced level, we still have a big gap". These projects should follow the business logic of professional sports, promote property rights reform as much as possible and reduce transaction costs, and build a complete professional sports system;
2. For non-professional sports Olympic sports, or non-Olympic sports with a small number of participants, such as diving, weightlifting or unpopular such as biathlon, etc., it is still necessary to maintain the investment in professional sports and the advantages of the national system;
3. For non-Olympic projects with a broad mass base or relatively emerging projects, the management rights should be put down to the market as much as possible, so that the market can stimulate vitality, and at the same time allow social institutions to participate in it, so that marketization and social welfare can play a role at the same time, and the management institutions will intervene less and encourage more, supervise less and help more, and focus on establishing a broader industry standard.
Why is there such a division of so many categories? Because the sports industry does have certain particularities, such as stadiums, national fitness, basic sports training and amateur sports events, etc., all have a strong social and public welfare, if you want to be completely marketized, it will bring great cost input and low returns, small and medium-sized community-based sports venues are a bit like libraries and museums, and cannot be operated purely commercially, so this part is what the government and the whole society need to bear together.
The property rights reform of professional sports described in this article refers to a systematic reform, and the clarification of property rights (franchises) is only the initial step, but it is also the most important step.
Only by deepening the reform of China's sports based on the reform of property rights of professional sports can China truly transform from a sports country to a sports power, can the sports industry become a sunrise industry and a green industry, and gradually develop into a pillar industry of China's economy, can it better display the national image, enhance the international community's sense of identity and affinity with the mainland, and continuously enhance the country's soft power and international influence.