Short-term thinking and the decline of civilization

By DAVID MOON, Moon Capital Management, LLC
January 12, 2014

Attendance at college and pro football games is on the decline. But the athletic directors and team owners scrambling to explain and reverse the trend can’t see past the side effects of declining attendance, rather than its cause.

The problem isn’t high definition television or poor in-stadium Wi-Fi service. It’s not too much canned music or global warming.

The root of the problem is one they can’t solve: the increased prevalence of short-term thinking.

And the administrators lost the ability to even manage the problem when they became addicted to increasing television revenues.

In an age instant gratification, when the average television image stays on the screen a mere seven seconds, people increasingly prefer to watch six games on 30 different ESPN channels rather than watch a single game in that same six hour period.

Placing the blame on HDTVs is like getting mad at the belt when you get a spanking.

Observers point to programs like Tennessee (where average game attendance has dropped more than 10,000 since 2007) and blame declining attendance on poor win-loss records.

Yet national champion Florida State averaged 76,542 in its 2013 home games, compared to 83,149 a decade earlier.

Alabama saw a 32 percent decline in student attendance from 2009 to 2012—a period in which the Crimson Tide won three national championships.

Eleven of the nation’s top 20 attendance leaders experienced declines. Half of all Division 1 programs (I still get FCS, FBS, and PMS confused) experienced attendance declines in each of the past two seasons.

About ten years ago, an ESPN executive told me that a football stadium is simply a stage on which the network produced reality television programs. He correctly predicted that colleges would eventually turn to tiered ticket pricing in an attempt to fill empty seats—a problem large programs had never yet experienced.

“The threat to stadium attendance isn’t HDTV. It’s the remote control. People’s attention spans are too short to do the same intense thing for five hours. When we eventually broadcast ten or twenty games each Saturday, people will be glued to their remote controls.”

He predicted that stadium revenue would become a smaller and smaller piece of the colleges’ revenue stream, shifting all of the power to ESPN.

People who want a super-conference of major athletic programs already have one. It quietly snuck up on them every time ESPN inked a new football contract or created a conference-specific television network. ESPN and the shareholders at ABC, its parent company, serve as commissioner. Nielson ratings now define the success of the super conference, not program wins, hot dog sales or attendance records.

Short-term thinking is now the norm in almost every area of our lives today.

Politicians make policy decisions on the basis of overnight polls. People make investment decisions based on the comments this hour on CNBC. Parents avoid the short-term unpleasantness of discipline. Patients demand pills for everything, assuming they should never experience a day’s unpleasantness.

Success will accrue to those who can resist the trend or take advantage of those who can’t.

David Moon is president of Moon Capital Management, a Knoxville-based investment management firm. This article originally appeared in the News Sentinel (Knoxville, TN).

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