The Perforated Ball: Football, Geographic Politics, and Post-Covid-19 Scenarios

Why does a nation organise a huge football event? What are the most profitable leagues? What role does football play in geographic politics? Why hasn’t football completely stopped – but on the contrary continued to inspire people – during such an unprecedented global crisis? What will the effects of the COVID-19 health emergency be on the entire football business in the coming years? Answers to these questions are covered by the Rome Business School’s latest Report, just published by Valerio Mancini, Director of the Research Center of our partners at Rome Business School and Alessio Postiglione, Co-ordinator of the Master in Political Marketing and Communication at the Rome Business School.

Football has now effectively become the new protagonist of the international geographic political discussions. FIFA with its 211 national federations spread throughout 6 continental confederations, possess more members that the United nations (193). The assignment of the World Football Cup has effects on geographic strategies leading to staggering investments or debts depending on each single country’s economic and political management.  

Over the last 10 years, the fast-growing turnover of the main world and European top clubs has been a consequence of various mergers with developing countries in full economic growth. We have witnessed since 2010 the rise in terms of numbers of teams such as Paris Saint-Germain (+ 672% in revenues) and Manchester City (+ 297%) since 2010. The UEFA Champions League has gained more and more weight in terms of revenue, achieving more than other leagues today, with the exception of the Premier League; tournament revenues have gone from 1.3 to 3.2 billion euros in 10 years (+ 150%), allowing Champions prizes to go from 764 million in 2009/10 to 2.04 billion in 2019/20 (+ 166.9%) and those of the Europa League from 147 to 510 million (+ 246.9%). The recent acquisition of Rome, transferred to the American tycoon Dan Friedkin, with a financial move of 591 million euros, re-directs the not so unveiled and still current geographic political debate between USA and China back to the center.

The English Premier League leads the ranking with a total value of 5.9 billion, while football generates revenues of approximately 4.7 billion; 12% of the GDP of world football is produced in our country: it offers work to 40 thousand people and a tax contribution of 1.2 billion. The “big five”, the 5 main European championships are, in order of commercial power, the English, German, Spanish, Italian and French teams have produced a record of € 15.6 billion in 2017/18, with an increase in 6% compared to the previous year.

The analysis of the Rome Business School Report shows that Italian football is constantly growing, recording national revenues of €4.7 billion, this figure from the FIGC budget, which is amounting to 12% of GDP of the worldwide football. This generates 1.2 billion euros in revenues for the national tax authorities. In total, the five largest Italian clubs (Juventus, Inter, Rome, Milan and Naples) are worth €1.5 billion in revenues net of capital gains: that is, alone, they collect 57.6% of the entire Serie A, also ranking among the top 22 positions of the most valuable European clubs. The economic weight of football television rights is also significant, which in the 54 major European professional leagues rose from 2.8 to 20.1 billion euros. In addition, remaining in Italy, we can notice a significant discrepancy between Serie A and the minor leagues. If we look, for example, at the case of the Lazio region, we see that the total value of the two main protagonists of Rome’s city football clubs is respectively 355.15 million for the Yellow & Red team and 304.80 million for the White & Blue cousins. Going down even just one category, we notice a significant difference with the total value of Frosinone, in B Series, 9.11 million, third team in the junior series after Benevento and Empoli. In series C we then have the Viterbese (2.60 million) and the Rieti (450 thousand euros); while in Series D Latina football (1.03 million).

In 2020, Covid-19 has drastically slowed down the economic rise of football, decreasing its values by 20-25%. The interruption of the 2019/20 season will reduce the revenues of clubs in the Premier League alone by around 1.1 billion euros. Globally, it is estimated that losses for 2020 should reach 4.5 billion euros and 6.3 billion in 2021, considering that about 64% of expenditure is destined for salaries. According to the Report, a return to normality will have to wait until 2025.

The attention is now focused on a future model of post-Covid 19 European football, which foresees limitations in terms of wages and the cost of player transfers and acquisitions. There will be a lot of focus on revenue from the main online platforms (Dazn, Eurosport, Live now etc.).  There will also be companies willing to invest to reach, even with football, the widest possible audience especially through social channels.  All this while attending the news expected for 2023, which could drastically change the scenario.  

This report was generated by our partners at the Rome Business School. To learn more about RBS, visit their website.

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