Global Sports Models: What about APAC?

As discussed in my last article, the business model of sports differs significantly across regions, primarily due to cultural, economic, and regulatory differences. The APAC (Asia-Pacific), US, and European regions have distinct models.

So where does APAC fit?

The sports business model in the APAC region is highly diverse and can differ significantly among countries. For example, cricket in India is now following a franchise model like that of the US with the Indian Premier League (IPL). On the other hand, football leagues in Japan and Australia have adopted a system more like the European model but with some variations, such as the lack of relegation.

The government of China holds a significant influence over sports in the country. It invests considerable resources into sports infrastructure and development programs to enhance national prestige. Sports teams usually involve a partnership between government and private enterprises.

One key aspect often unique to the APAC region is the importance of gambling revenue in some areas, particularly in Hong Kong and Australia horse racing.

Additionally, it's crucial to recognise that the APAC region includes different countries with varying levels of sports advancement, cultural backgrounds, and economic circumstances. Therefore, the following analysis offers a very general insight rather than a complete evaluation of each country in the region:

• ?China: Sports significantly boost national prestige, so the government invests heavily in sports infrastructure and development programs. Sports teams usually operate through a combination of government and private enterprise.
• Japan and Australia: Football leagues in these countries have followed a model more akin to the European system, with some variations, such as the absence of a relegation system (for now!)
• India: Cricket has started to follow a model like the US with the Indian Premier League (IPL), which operates on a franchise model with commercialisation proliferating.

E-Sports Dominance: The Asia-Pacific region (APAC), with a particular emphasis on South Korea and China, has made a noteworthy mark in electronic sports (e-sports). This has been made possible due to the significant advancements in technology and digital platforms, resulting in considerable growth in this expanding industry. As a result, investments from traditional sports organisations and tech companies have been in flux. The enthusiastic adoption of e-sports in the APAC region is a testament to its openness to technology-based sports in the future.

Varying Levels of Commercialisation: The level of sports commercialisation in the APAC region differs significantly between countries. Japan and Australia have successful professional leagues in multiple sports that have gained commercial success, but other countries are still working on developing their sports industries and exploring commercial opportunities. This difference impacts the investment in technology and the digital future, as countries at different stages of commercialisation have other priorities and available resources.

Culture and Tradition in APAC

It's important to acknowledge the cultural diversity within the APAC region, as each country has its unique mix of languages, traditions, and beliefs. However, these differences can sometimes pose challenges regarding digital investment. For many APAC countries, tradition and heritage hold great significance, which can sometimes conflict with the rapid advancement of technology. This can especially be seen in fields such as media, where digital platforms may threaten traditional storytelling or content consumption. To ensure the successful integration of technology, digital investors need to deeply understand these cultural nuances and find ways to preserve these traditions while still embracing the benefits that technology can bring.

Diversity of Language

When considering the region's cultural landscape, it is essential to acknowledge the diversity of languages spoken. To effectively accommodate this linguistic variety, it is necessary to tailor digital platforms and services to local languages. This can be a nuanced and resource-intensive endeavour, requiring a comprehensive understanding of local slang, idioms, and cultural references.

Digital Literacy

It's important to consider that digital literacy levels vary throughout the APAC region. While some countries, like South Korea and Singapore, have high digital skills, others may be less advanced. To ensure everyone can access digital services, it's crucial to design them with varying levels of digital skills.

Additionally, it's essential to remember that societal norms and regulations can influence digital investment. What may be acceptable in one culture may not be in another. It may be necessary to make modifications to comply with local norms and laws, such as certain types of content or services. We can work towards a more inclusive digital environment by being mindful of these differences.

Digital investors must deeply understand local customs, practices, and consumer behaviour to succeed in the APAC region. This includes respecting cultural traditions while managing the progress of technology. By integrating these factors into their plans, investors can effectively navigate this diverse and complex market.

Southeast Asia

In Southeast Asia, the management of sports teams and the structure of leagues differ depending on the country and sport. Football (soccer) is the region's most popular sport, with several countries having professional leagues. These leagues often follow the European model of promotion and relegation. However, the infrastructure, financial resources, and degree of professionalisation vary significantly. While some leagues are financially stable and well-established, others need help with funding, governance, and facility-related issues.

The Southeast Asian Games is a biennial sporting event in which athletes from 11 regional countries participate. The Southeast Asian Games Federation regulates this event, while the International Olympic Committee (IOC) and the Olympic Council of Asia supervise it.

Like many other regions worldwide, Southeast Asia is experiencing increased private ownership of sports teams. This trend is driven by wealthy individuals and companies who recognise the benefits of investing in sports teams, including improved facilities, higher player salaries, and more advanced training methods.

Additionally, the popularity of esports is skyrocketing in the region, with Southeast Asia being recognised as a leading market for this burgeoning industry. Vietnam and the Philippines are attracting significant investments in esports teams and infrastructure, indicating a solid commitment to the growth and development of this exciting new field.

In the sports industry, the APAC region is embracing technology and the digital future, but the level of investment and adoption varies among countries. Japan and South Korea are technologically advanced, and e-sports dominate the region, indicating its potential for utilising technology in sports. As the region continues to evolve and integrate digital platforms, there will be more opportunities for investment in technology to drive growth, improve fan experiences, and capitalise on the expanding sports market.

Overall Comparison of Models

In terms of comparison, each model has its strengths and weaknesses. The US model ensures a degree of competitive balance and financial stability. Still, it can also lead to a certain level of homogeneity and, some may say, lacks the excitement of promotion and relegation battles. The European model can create thrilling competitions and allows for the possibility of underdog success stories, but it also risks financial instability. The APAC model is highly adaptable, reflecting the region's diversity, but it can also need help with issues like uneven development and the dominance of certain sports in specific markets.

Data and Analytics

It is worth noting that there is a growing trend in the US and Europe to use data for making informed decisions. Many teams are now hiring analysts and using advanced statistics to improve their strategies. However, this trend is less prevalent in the APAC region. American sports teams are leading the way in using data and analytics for everything from recruiting players to game-day tactics. In contrast, many Australian and European sports teams have primarily focused on using athlete data to prepare athletes rather than for commercial purposes, as seen in the US. English Premier League teams and Australian Rules Football clubs, in particular, are very successfully harnessing tracking and match event data to improve their players' performance during games and in tactical and talent ID programs.

More to come on that next time….