| UK | Oct 28, 2019
How is investment from the Middle East affecting a sport worth EUR25.5 billion in Europe alone?
Soccer Football – Champions League Group Stage draw – Grimaldi Forum, Monaco – August 29, 2019 Barcelona’s Lionel Messi with the UEFA Champions League Forward of the Season award and President Aleksander Ceferin REUTERS/Eric Gaillard
Money, it’s a gas
Grab that cash with both hands and make a stash
New car, caviar, four star daydream
Think I’ll buy me a football team
The Best FIFA Football Awards ceremony recently took place (with Lionel Messi taking home his sixth Best FIFA Men’s player award), making now an ideal time to discuss football and the economics surrounding the the Beautiful Game.
The sports industry is now a sector with considerable economic value.
Football is the world’s most popular sport and continues to grow; it is an industry which generates EUR25.5 billion in Europe alone.
According to FIFA’s Big Count survey, there are 265 million male and female players worldwide, meaning nearly 4% of the world’s population are active in football.
It is a huge industry, encompassing finance, management, law, and show business.
The economic impact of football cannot be totally understood without taking understanding the distribution of television rights.
In 1992, Sky TV paid EUR221 million for five years of Premier League television rights.
In 2001, Barclaycard paid EUR55.5 million for naming rights of the league, and in 2007, they paid over EUR78 million to renew the deal.
By 2016-17, Sky & BT Sport were paying EUR5.95 billion for live Premier League TV rights for three seasons.
This increase in costs goes some way to show the exponential growth in the value of advertising in football games.
Essentially, a football team is an entertainment company satisfying fans and the community surrounding them, the majority of whom follow their chosen teams by watching matches on TV.
Indeed, the paramount importance of television in scheduling football games during tournaments has long been obvious.
At the 1986 World Cup, most games were played at noon just for the television.
The German goalkeeper, Harald Schumacher, explained it like this:
“The sun shines straight down on the stadium and strikes us right on the head. We cast no shadows. They say this is good for television.”
The Middle East and football
Gulf countries wanting to diversify their economies have also turned to football.
In 2011, the Emir of Qatar, Sheikh Tamim Bin Hamad Al-Thani bought the Parisian Saint Germain football team.
In addition, Qatar Foundation was the former shirt sponsor of Barcelona from 2010 to 2015. Most recently, the Qatari network beIN Sports paid a small fortune for the broadcast rights of 2018 World Cup.
Meanwhile, Fly Emirates is among the top 50 sponsors of football teams in Europe, followed by Etihad & Qatar Airways who have invested significantly in European football giants such as Real Madrid, Milan, and Arsenal.
Qatar and United Arab Emirates are both emerging countries in the football industry, increasingly using the game and related investment as a form of soft power in the international arena.