World Cup on course for EUR 1.1 bn profit

The profit from this past World Cup is on track to reach EUR 1.1 billion, according to sportcal.com's "World Cup 2006: The Commercial Report".

The estimated EUR 1-billion staging costs have been offset by revenues from media rights, sponsorship, merchandise and tickets.

FIFA told the report's authors that the World Cup would generate EUR 1.9 billion in marketing revenue, with the sale of television and new media rights raising EUR 1.2 billion, and the remaining EUR 700 million from sources such as sponsorship and hospitality. The ticketing operation is expected to bring in EUR 200 million.

FIFA's anticipated media rights revenues of EUR 1.2 billion for the 2006 World Cup is a 34-percent increase on the media rights revenues at the 2002 World Cup, held in Japan and South Korea, a less favourable time zone than Germany for most of football's major television markets.

The biggest revenue contribution came from German public-service broadcasters ARD and ZDF, which jointly agreed to pay EUR 170 million for the 2006 television rights. The previous high was EUR 360 million that Brazil's TV Globo paid for the rights for both the 2002 and 2006 tournaments. But the deal was renegotiated in 2004 after a heavy recession in Latin America, with TV Globo estimated to have paid only EUR 65 million for the rights for this year's tournament.

FIFA president Sepp Blatter said in July 2005 that television sales from the European market alone for the 2010 tournament would be worth EUR 1 billion, more than double the fees paid by European broadcasters for this year's World Cup.

For the first time, sales of new media rights made a significant contribution to overall revenues for the World Cup.

Sponsorship revenues for this year's competition included payments of between EUR 25 million and EUR 40 million each from 15 official partners, 11 of which had also sponsored the 2002 tournament. These were joined by six local suppliers, signed up by the organising committee, which paid an average of EUR 10 million each to be associated with the event.

FIFA is restructuring its sponsorship programme, reducing the number of official partners to just six sponsors – coming in at a higher fee – in response to concerns over sponsorship clutter.

A survey conducted by sportcal.com revealed Puma outscored rivals Nike and adidas to lead the table of kit sponsors with 3,870 minutes of playing time exposure, compared with Nike's 2,910 minutes and adidas' 2,670 minutes. In 36 of the tournament's 64 matches, Puma provided the playing kit for at least one of the competing teams.

Source: euFootball.BIZ © Copyright 2006 - All rights reserved.