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MLB.com is NOT a Monopoly

posted by Shawn, on March 8th, 2008 at 01:20 am, in category Uncategorized

Colbert/Stewart If you like movies, here’s something you’ll definitely enjoy. Ebert & Roeper posted their entire video archive (at least all that still exists), going back to the days when Gene Siskel co-hosted the show. There isn’t much from the very early days of the program (most of the clips from 1975-1985 were destroyed), but the collection is impressive nonetheless.

This type of thing is becoming more and more commonplace. The respective websites for the Daily Show with Jon Stewart and the Colbert Report have every second of every episode in each show’s history, and the WB network is actually considering coming back as an internet-only, ad-supported video portal.

As we’ve discussed before, MLB.com has taken a much different approach, remaining closed off in a number of areas and keeping a great deal of content behind a pay-wall. This fits in with most of MLB’s other strategies, leveraging monopoly power to increase prices.

The problem is that MLB.com is only a monopoly when we take an extremely small scale view of their market. Yes, they have a pretty solid monopoly on quality baseball highlights, streaming live games, archived games, condensed games, and historical clips. But in the same sense, Ebert & Roeper have a monopoly on Ebert & Roeper content. Yet they are giving away every piece of footage they have for free.

In reality, MLB.com is only a very small part of an enormous (and rapidly growing) market for online videos. Music, movies, and television shows are all moving toward free digital distribution, albeit at differing rates. These other outlets have all come to grips with this new reality, and done what is necessary to compete. MLB.com, in taking an anti-competitive approach, continues to unknowingly hurt itself.

Feedback? Write a comment, or e-mail the author at shawn(AT)squawkingbaseball.com

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on March 8th at 05:37 pm
DB Cooper said:

How do you feel about MLB’s recent restrictions on live-blogging, photo, and video posting from the press box? Isn’t that an effort to get closer to a truer monopoly?
on March 8th at 07:00 pm
Tommy said:

Shawn, wouldn’t you say that the scope of the market is determined by which other goods are substitutes? If that is the case, I wouldn’t say that the Ebert & Roeper market is Ebert & Roeper content, it’s video movie reviews. In that instance, their best interest is to make sure they are movie reviewing authorities, and perhaps the best way to achieve that is by ensuring their reviews reach the largest audience. In the case of baseball, I’m not sure football/basketball/hockey videos are true substitutes for baseball videos. If they’re not, then mlb.com does in fact have a monopoly. Do you agree?
on March 8th at 08:03 pm
squawkingbaseball said:

DB - I touched on that issue a little bit on Tuesday. The best thing any of these sports leagues could do is spread their media as far and wide as possible. I don’t have a problem with MLB acting as a monopoly, as long as it’s actually helping their business.

Tommy - Just as there are people who watch baseball and don’t care for other sports, I’m sure there are people who will only watch Ebert & Roeper for movie reviews. But in the end, when it comes to the online realm, both are competing with millions of other outlets. People are less and less willing to pay for digital media. It is eyeballs that matter, especially to advertisers, who are almost universally putting more and more money into the web. There may be a small subset of MLB.com users that pay for taped footage, but I would bet the house that they could make far more money by creating an enormous, free video archive and cashing in on advertising.
on March 8th at 08:20 pm
Mark said:

I like the Ebert & Roeper analogy. Every business is a monopoly on its own content/product. If that weren’t the case, capitalism wouldn’t work. MLB may possess the highest quality product in its own market, but that’s capitalism. A monopoly is, by definition, a business that outsells and eliminates all of its competitors in the same market, so for MLB to be a monopoly, there would have to be multiple other pro baseball leagues that couldn’t survive in the market, and unaffiliated leagues do survive. The Can-Am League and the Northern League are examples.
on March 11th at 03:39 pm
Pete Toms said:

MLB.com is so much more than a media company broadcasting video.

MLB.com also sells a ton of tickets ( 26/27 million last season, will increase especially with Stub Hub partnership ), subscriptions, merchandise, web site development, outside management of online digital content…
on March 11th at 04:11 pm
squawkingbaseball said:

Pete - you are exactly right, and that should be MLB.com’s biggest reason to open up in terms of digital media. They have so many other products to sell, all of which are more salable than taped audio and video clips. Their main goal should be driving as many people to their site as possible, and a pay wall prevents this.
on March 12th at 05:35 pm
CM said:

I couldn’t agree more with Squawkingbaseball. I’ve said the same thing for awhile now within my peer group who have watched, played and loved baseball our whole lives. MLB.com is missing two huge opportunities. One is the obvious: expand their fan base by allowing their product/brand (ie. the videos etc.) to reach a wider audience. But the second is a step further: empower the most passionate advocates of your brand (fans like me) by letting them share these products (videos) with their personal network (ie. new customers!). What is more authentic and credible than that in today’s online world where consumers are tuning more and more advertising because we’re innundated with it?
on March 12th at 05:36 pm
CM said:

Ooops… should be “tuning OUT more and more…”