I think you have misunderstood something. The term "diminishing returns" means that the last seats are less valuable than the first. But this doesn't mean it is a bad investment. In some seasons even though it would be alot, they would benefit from there large arenas.
"Diminishing returns" in this context means that if you have a 20,000 seat arena, and you build 5,000 seats, and your opponent in the same division has a 10,000 seat arena and builds 5,000 seats, while your costs will be identical he is going to see a better return for his money because he can sell 15,000 seats, but you'll have difficulty selling 25,000. You may still get some return, but it won't be as efficient a transaction.
In any case, as you concede, owners who built large arenas have already received the benefit for which they paid. If they spent money to put 2,000 extra seats on a stadium when they knew they were only likely to sell 1,000, the bargain they made was to receive the return for 1,000 sold seats at the cost of building 2,000. That's exactly what they got. Why should they receive anything more?
The point about that we have to foresee what changes the BBs might add to the game engine is bad. It is a game this has its limitations. One might say that it was possible to foresee these changes and how the BBs dealt with them, then you should have built more seats in your arena and then sold them.
I agree that this is a little tenuous, but my basic point is that you can't count on the situation remaining completely static. Everyone knew there was a point at which building more seats was a waste of money because no matter how good your team was, you couldn't sell all the seats. The cutoff point will just be a little bit lower from now on than everyone assumed it was. The owners who have already built lots of seats, and are now preparing to sell them, are actually in the position you describe, only without having had to plan for anything.
But even if this change was totally unforeseeable, you still haven't addressed the fact that the owners who built seats have already received the revenue they expected to from them -- and if they haven't, my proposal would return the cost of the seats. You also haven't addressed the fact that the new TV contracts may very well replace any revenue lost through arena downsizing.
Last edited by crimedevil at 6/17/2009 9:35:33 PM