What best describes a franchise model in professional sports?

• A. A system where privately owned teams are granted the right to operate by the league.
• B. A system where the league owns all teams.
• C. A system where teams are owned by fan clubs.
• D. A system where teams are owned by municipal governments.

Answer: (A)

In a franchise model, professional sports leagues grant exclusive rights to privately owned teams to operate in specific markets. Each team runs as its own business but competes under the league’s umbrella, following its rules, branding, schedules, and revenue-sharing arrangements. Owners pay an upfront franchise fee and ongoing dues and benefit from the league’s national media deals and governing structure to maintain competitive balance and fair play.

This is distinct from systems where the league itself owns all teams or where ownership is in the hands of fan clubs or municipal governments, which are not typical features of the franchise model.