As FIFA Reels, UEFA’s Euro 2016 Will Make More Money Than Ever

7 years, 8 months ago - June 10, 2016
UEFA’s Euro 2016 Will Make More Money Than Ever
One year into a sweeping corruption scandal at the highest levels of global soccer, FIFA’s reputation and finances are still under a cloud. Some 150 miles away, though, the forecast is very different for UEFA, the most important regional soccer body under the FIFA umbrella.

When Euro 2016 begins today in France, it will be the biggest in the tournament’s history, with more teams, more games and more host cities. For UEFA, all that adds up to more money. The organization expects to make 2 billion euros ($2.2 billion) in revenue, up from the 1.4 billion euro it made four years ago when Poland and Ukraine were host to 16 teams.

The European Championship has long been second only to the World Cup in popularity and revenue. Now with teams from 24 countries participating, there are more tickets to sell, and television rights for the tournament fetched about 1.05 billion euros, a 25 percent increase over 2012. Sponsorships are up 40 percent, to about 450 million euros, according to Guy-Laurent Epstein, UEFA’s marketing director for the soccer body. Ticket sales make up the rest.

As an economic engine, the European Championship dwarfs soccer’s other regional championships. The media rights to this year’s Copa America Centenario – a 16-nation event featuring teams from across the Americas – were sold for $112.5 million. Asian soccer sold a decade of soccer rights, including two editions of its tournament, for $1 billion, a contract that ends in 2020.

Behind the billion-euro broadcasting revenue is a TV audience of 130 million for the early games, Epstein said in an interview hours before the Champions League final, UEFA’s other big ticket event. The audience will grow to 300 million by the June 10 final at the Stade de France in Paris. In contrast, Super Bowl 50 in February drew about 110 million viewers. “We will deliver 51 Super Bowls in the next month,” said Epstein.

About three-quarters of the television income comes from the Euro zone, though some countries, including Italy and Spain, balked at the high price. Epstein blamed the sluggish economy and said strong gains were made in the U.S., Brazil and the Middle East.

Sales of 2.5 million tickets, a million more than were available in 2012, will make up the rest of Euro 2016 income. Epstein said UEFA expects a sellout, though it has released to the public some of the tickets set aside for companies entertaining clients.

Epstein said he thought tightening regulations on corporate gift-giving and gift-accepting had put a chill on spending for events like these. “It’s more difficult for companies to invite guests because of compliance issues,” he said, adding that the specter of terrorism and planned strikes don’t help either.

Bringing the tournament to one of Europe’s biggest economies for the first time since 1996 has bolstered sponsorships, up 40 percent since 2012. The roster includes usual soccer sponsors like Adidas AG, The Coca-Cola Co. and Carlsberg A/S. The Danish brewer in particular has made the Euro a centerpiece of its summer marketing, spending as much as 80 million euros on the tournament.

For France as a whole, the tournament is a drop in the bucket. Academics at the Centre for the Law and Economics of Sport in Limoges, France, estimate that it will generate an economic impact of 1.3 billion euros, mostly from fan spending. Another 1.7 billion euros has been spent on the stadiums being used for the event.

“Evidence from other countries suggests the lift is likely to be small and short-lived," Bloomberg Intelligence economists Maxime Sabaihi and Jamie Murray wrote in a note published May 25. “Hopefully the country will enjoy some much-needed weeks of partying, but it will take much more than games to improve France’s economic output.”

Text by Bloomberg

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