x Abu Dhabi, UAEMonday 24 July 2017

Scandals-hit game remains huge money-making machine

Companies including Emirates Airline, Coca-Cola and Visa will continue to want to sponsor events such as the World Cup, adding to the billions earned by Fifa, football's ruling body.

Sepp Blatter, the Fifa president, bottom right, insists there is no crisis at the organisation he heads.
Sepp Blatter, the Fifa president, bottom right, insists there is no crisis at the organisation he heads.

Football might be the beautiful game, but it is also big business.

Despite the bribery scandal at Fifa, the world's governing body will still retain its status as a moneymaking machine.

Last year's World Cup in South Africa attracted hundreds of millions of TV viewers, with an income to match: Fifa reported record revenues of $1.3 billion (Dh4.8bn) in 2010.

Driven by TV rights and advertising, the football organisation reported total revenues of almost $4.2bn between 2007 and 2010.

Bashar Abdulkarim, the managing director of the sports consultancy Relay Mena, whois based in Dubai, said: "Football is a multibillion dollar business. Things should and will change at Fifa, but I don't see any of that value deteriorating."

While the scandal is unlikely to undermine the vast sums of money generated by the game, some of the World Cup's main sponsors voiced concern yesterday over the crisis.

Companies including Emirates Airline, Coca-Cola and Visa contributed to more than $1bn of the 2010 revenues, according to the organisation's annual report.

For example, Emirates Airline paid out $195 million to become a Fifa "partner" from 2007 to 2014, as it looked for worldwide exposure in what is one of the world's most popular sporting events.

The World Cup final in South Africa was thought to have been watched by about 700 million television viewers.

Sports marketing experts forecast that Fifa's income will continue to rise, despite the bribery allegations against Mohamed bin Hammam of Qatar, who, along with other officials, was suspended by Fifa's ethics committee on Sunday.

The corruption investigation comes amid mudslinging among other senior officials, in what Fifa president Sepp Blatter described as a time of "difficulties", rather than crisis, at the organisation. Despite this, the ongoing probe also threatens to cast a shadow over Qatar's successful bid to host the 2022 World Cup.

Yet the scandal was not expected to impact on Fifa's future earnings, said Mr Abdulkarim.

"Fans don't care about Fifa. as long as the game is not affected," he said. "I don't think the sponsorship values are going to be affected."

Mr Abdulkarim, who is based in Dubai, said that he expects Fifa's profits to "keep on rising". The organisation's bottom line rose by 6 per cent to $202m in 2010, according to its annual report.

"I don't think any sponsor will pull out at this stage," he said. "They're not getting a negative upfront association. Right now, the spotlight is on specific individuals [in Fifa]."

The news comes as several sponsors voiced their concern over the ongoing bribery allegations at Fifa.

Emirates Airline says it is "disappointed" by the corruption allegations that have plagued Fifa in recent weeks. "Emirates, like all football fans around the world, is disappointed with the issues that are currently surrounding the administration of this sport," said Boutros Boutros, the senior vice president of corporate communications at Emirates.

Coca-Cola, which also has "partner" status with the governing body, said that the bribery allegations are "distressing and bad for the sport", the Financial Times reported. Another headline sponsor, Adidas, said that the surrounding publicity was "neither good for football nor for Fifa and its partners".

Mr Abdulkarim said that Fifa sponsors such as Adidas and Coca-Cola were likely to raise objections - but not act on them immediately.

"I'm assuming that all of them will be raising questions," he said. "If Fifa cleans up the house, they [the sponsors] will be quiet, if they don't they may take a stance. Definitely, a clean-up act is going to take place. It's only a matter of time."

Brian Greenwood, the managing partner for India and the Middle East at the global sports marketing consultancy Prism, said that bribery claims would have "no impact at all" on Fifa's sponsorship and TV rights.

"The sponsors will express concern and it won't go any further than that," he said.

Emirates Airline said it hoped the issue would be resolved.

"Emirates' sponsorship of all Fifa tournaments, including the World Cup, aims to help promote football and ensure it is accessible to the billions of football fans; something Fifa has managed to do extremely well in recent years," said Mr Boutros. "We hope these issues will be resolved as soon as possible and the outcome will be in the interest of the game and sport in general."

What is important to the sponsors - and to Fifa's revenues - was the relationship between brands and the fans, said Mr Greenwood.

"What happens at Fifa is almost completely separate to what happens on the pitch. The politics of Fifa has always been separate," he said.

"The sponsors are aligning with football, and the teams and fans. What will push sponsors away is if the World Cup fails to deliver on numbers and atmosphere."

Any shake-up of Fifa is likely to be connected to a failure of the next World Cup, rather than the activities of its board. "Fifa is much more likely to make changes if Brazil is not a huge success," Mr Greenwood said.

 

bflanagan@thenational.ae

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