The Hercules Cup is coming to the Bay Stadium, and the World Cup is in full swing.
The host country, Qatar, invested US$220 billion to build venues and develop infrastructure in the desert, building a modern city of Lusail from scratch.
This huge investment is five times the total expenditure of the past seven World Cups, enough for Russia, the last host country, to hold another 16 World Cups.
Can the hosts get their money back? It’s hard to say in the short term.
FIFA, on the other side, makes a lot of money.
Chairman Infantino announced that this World Cup cycle, FIFA’s commercial revenue reached 7.5 billion U.S. dollars, an increase of nearly 1.1 billion U.S. dollars from the previous cycle, a record high.
Thanks to Infantino’s expansion of the World Cup in the United States, Canada and Mexico, as well as the new financial strategy for women’s football, FIFA’s revenue in the next four years may be close to 10 billion US dollars.
On November 22, the Argentine team led by superstar Lionel Messi ushered in the first match of the World Cup in Qatar. The result was a shocking 1:2 loss to Saudi Arabia.
In addition to the anxious confrontation, the slogan “Hisense China No. 1, World No. 2” appeared on the billboard of the stadium, which attracted the attention of many viewers-it came from the Chinese home appliance brand Hisense.
FIFA divides World Cup sponsors into three levels, with clearly marked prices: 6-8 seats for FIFA partners, with a sponsorship amount starting at US$120 million; 6-8 seats for official World Cup sponsors, starting at US$68 million; regional sponsors, top 5 There are 20 seats in total.
There are 6 Chinese sponsors, including Wanda at the first level, Mengniu, Hisense and vivo at the second level, and BOSS Zhipin and Yadi at the third level.
According to the data released by Global Data, the total sponsorship amount of Chinese companies reached 1.395 billion US dollars, surpassing the 1.1 billion US dollars of American companies, and became the “biggest sponsor” of this World Cup in one fell swoop.
A huge amount went into the pocket of FIFA.
In the last World Cup season, FIFA received a total of US$1.118 billion through seven FIFA partners; five World Cup sponsors and eight regional sponsors contributed US$363 million and US$153 million in revenue respectively.
Although the specific amount of sponsorship has not been disclosed for this World Cup, FIFA has announced on its official website that all three types of sponsor seats are sold out.
Compared with the 2018 World Cup in Russia, Qatar Energy has entered as a new top sponsor; the second-tier sponsors have added cryptocurrency financial platform Crypto.com and Indian online education unicorn Byjus; the number of third-tier sponsors has expanded from 8 to 13 , including newcomers such as Qatar Bank and telecommunications company Ooredoo.
Sponsors are so flocking because they believe in the World Cup’s ability to “bring goods”.
Liu Changhai, deputy general manager of Hisense Russia branch, said that during the countdown to the last World Cup, sales of Hisense TVs increased by 239% compared with the previous week. In the second week of the competition, the sales volume increased by nearly 3 times, which was the highest in a single week.
However, according to CCTV reports, Qatar strictly controls alcohol, and drinking in public is illegal, and tourists can only drink in dozens of licensed hotels and clubs-this has created a problem for FIFA.
On the eve of the opening, FIFA issued a statement that during the World Cup in Qatar, the eight stadiums where the matches will be held will ban the sale of alcoholic beverages. This makes Budweiser, a beer giant that has sponsored FIFA and the World Cup since 1986, very passive.
Budweiser won the exclusive right to sell beer in this World Cup (venues and surrounding areas) for US$75 million. After the release of the “prohibition order”, Budweiser will seek compensation from FIFA by significantly reducing its sponsorship for the 2026 World Cup.
Make money wisely
Brand sponsorship accounts for less than 30% of FIFA’s World Cup revenue.
During the World Cup, FIFA mainly has four parts of income from broadcasting rights, brand sponsorship, ticketing services and IP licensing. The highest proportion is TV broadcasting rights, accounting for half of the total income.
”This year we sold the audio-visual rights for $200 million more than the World Cup in Russia,” said Infantino.
The official media of the host country Qatar alone spent 880 million US dollars to win the broadcast rights in the Middle East.
Compared with another major sports organization, the International Olympic Committee, the biggest difference in the income structure between the two is that the ticket income for the World Cup belongs to FIFA, while most of the ticket income for the Olympic Games belongs to the organizing committee of the host country.
Don’t underestimate the cash cow of ticketing services. In the 2018 World Cup, FIFA sold 2.745 million tickets to fans all over the world, generating a revenue of 541 million US dollars.
Far more than the previous one, about 3 million tickets have been sold for the World Cup in Qatar, with a single ticket price ranging from US$100 to US$1,100.
The last part, brand licensing, can create value for FIFA even after the World Cup has come to an end.
The most famous is the FIFA series of football games of EASPORTS. The game developer pays FIFA $150 million a year for the right to use the “FIFA” name.
This is not a good deal for EASPORTS. In May of this year, the company announced its parting ways with FIFA, and the FIFA series will be renamed “EA SPORTS FC” in 2023.
In terms of expenditure, FIFA does not have to pay for venues and infrastructure, but only bears miscellaneous items such as the expenses of the organizing committee of the host country, game bonuses and team preparations. The total expenditure of this World Cup is planned to be controlled at US$1.7 billion.
The big head is match bonuses.
The Qatar World Cup increased by 40 million US dollars compared with the previous one, reaching 440 million US dollars, the highest in history. The winning team will get 42 million US dollars, and the team that did not qualify in the group stage can also take home 9 million US dollars.
FIFA also plans to spend $326 million to compensate players’ clubs.
For example, the Chinese Super League team Shanghai Shenhua’s foreign aid Bassogo was selected for the Cameroon national team. Shenhua is expected to receive a subsidy of 200,000 US dollars from FIFA.
In addition, $247 million was used to produce TV content, and $207 million was used for personnel costs, etc.
Although it makes a lot of money, FIFA is essentially a non-profit organization.
”This year we (FIFA) will basically get an expected net income of US$1 billion.” Infantino said, “We will invest this money in the next cycle of football development as soon as possible. , to benefit football all over the world.”
With the global influence of the “top class” World Cup, FIFA has become the richest international sports organization. On the other side of the coin, controversies and scandals followed.
In 2010, after Qatar won the right to host the 2022 World Cup, rumors about its “election bribery” were rampant. In 2015, FIFA broke out a complete “anti-corruption storm”.
In May of that year, Swiss prosecutors arrested six FIFA officials on grounds that a U.S. judicial investigation revealed that each of them had accepted millions of dollars in bribes and kickbacks. In December, former FIFA President Blatter and former UEFA President Michel Platini were sacked and were “banned from engaging in football activities” for 8 years.
At the end of the same year, FIFA released an independent investigation report, stating that there was no evidence to prove that there was election bribery in Qatar, and the World Cup in Qatar was preserved. It was not until 2017 that FIFA released a complete investigation report.
In July, a Swiss court acquitted Blatter and Platini of corruption and fraud charges after a seven-year investigative trial.
During the long investigation process, the image of FIFA once fell to the bottom.
”In 2016, Infantino was elected president of FIFA under very difficult circumstances.” He Jiahong, a member of the FIFA Ethics Committee and a law professor at Renmin University of China, told the “21CBR” reporter.
”After taking office, Infantino promoted institutional reforms precisely to improve efficiency and curb corruption.”
First, Infantino changed FIFA’s executive committee to a council, expanding its membership from 25 to 37 . The Council is responsible for formulating guidelines, and the specific implementation is the responsibility of the FIFA Secretariat.
In May 2017, Zhang Jian, executive vice chairman of the Chinese Football Association, became a member of the FIFA Council as an additional representative of the AFC.
Second, streamline the organization. FIFA originally had 27 committees under the General Assembly and the Executive Committee; after the reform, there are only 9 standing committees and 4 independent committees.
Also introduce term limits. The term of office of each FIFA president and members of the council is four years, and the term of office shall not exceed three consecutive terms.