The Club World Cup, FIFA’s latest expansion plan for football, has not generally been well received. But it still fetched $1 billion in broadcast rights. FIFA’s friends in Saudi Arabia may be involved behind the scenes.
The Club World Cup launch was marked by FIFA’s typical pomp and ceremony. Suits and ties, convoluted tournament processes and much talk of “inclusivity” and the historic importance of a rejigged competition that few players, clubs or fans seem to want.
As part of that Miami shindig last week, FIFA boss Gianni Infantino confirmed a new and surprising broadcast deal. Exclusive rights have gone to DAZN, a sports streaming website headquartered in the UK who have been buying up rights packages for sports, mainly in western Europe, for the last few years. They are also losing significant sums of money.
“Through this broadcasting agreement, billions of football fans worldwide can now watch what will be the most widely accessible club football tournament ever – and FOR FREE. Football Unites the World,” Infantino was quoted on FIFA’s website as saying. The capital letters are FIFA’s own.
The promise that all matches will be free-to-air worldwide is eyecatching from an organization who usually chase the money. At FIFA’s Women’s World Cup in Australia in 2023, for example, non-host matches were hidden away on a pay-TV service few were subscribed to. It also narrows the options for DAZN; they can either stream the matches themselves but waive their usual fees or sub-license the 63 matches to free-to-air broadcasters (usually public broadcasters) around the world.
“What surprised me was the the $1 billion (€950 million) fee, which I think is is quite a big shot [gamble] for a competition that hasn’t really proven its value,” Tom Evens, co-author of upcoming book “Sports Media Rights in the Age of Streaming and Platformisation” told DW.
“It’s a new thing. There was limited demand from broadcasters, also not much from the teams themselves. Yes, the big teams that can earn some $40, $50 million, very nice to have it. But it’s another competition. The players don’t like it. The calendar is already so full.”
That fee is about the same as what a whole season of domestic rights for Germany’s top flight, the Bundesliga (306 matches), or La Liga, in Spain (380 matches) cost, though both leagues can sell their international rights separately. The well-established UEFA Champions League, which features all of Europe’s best clubs, and thus the best-supported sides and best-known players in the world, estimated they would get “between €4.6 billion and €4.8 billion” in total for their expanded competition (189 matches) this season.
All of which begs the question: what’s in it for DAZN?
“It’s an opportunity to break in to new territories,” said Evens, who also thinks advertising will play its part. “They’re already fairly big in in Europe, they have some rights in Italy, in Germany, and Spain. So it’s not a way to grow in Europe, but in a certain parts of Latin America, North America, Australia and elsewhere.”
But within the industry, there is a belief that the Saudi Arabian Public Investment Fund (PIF) are lurking off screen. The investment arm of the Saudi government has spent countless billions in sports over the years and there are strong and consistent rumors, despite PIF denials in October, that they are looking to buy a stake in DAZN.
DAZN, whose most recent accounts in 2022 saw them announce operating losses of $1 billion, told DW that they would not comment publicly on the rumors, pointing to the PIF denials. But a company insider added that “the agreement with FIFA has a strong commercial rationale and is funded by DAZN and its shareholders.” PIF did not respond to a request for comment after the latest events.
As well as investment in football, golf, tennis and all sorts of other sports, Saudi Arabia has tried to use state-owned companies like Aramco (oil) to sponsor FIFA events and was awarded the 2034 World Cup unopposed on Wednesday.
“Saudi Arabia is a very important partner for FIFA and is playing an important role in football development,” said Infantino recently while an independent report published by FIFA last month, which was intended to ease concerns about the kingdom’s dire human rights record, was slammed by various human rights organizations.
Evens, who is also a professor at Ghent University in Belgium, said that should the PIF be investing in DAZN, the Club World Cup deal could be considered a “gift to FIFA” and that “$1 billion to the PIF is nothing.”
“As far as I understand it, there was really limited interest in these rights. So if DAZN had not bought them, it would have been tricky to sell them at a premium price. And then the links between Saudi Arabia and FIFA would be instrumental.”
If the PIF are not waiting in the wings for DAZN, it’s a gamble for the company. They have little presence outside of their key markets in Europe, with only the rights for more marginal sports in other parts of the world. They will hope that the inaugural Club World Cup, played in the United States during the break in the European season, might drive some new custom their way.
Evens concludes that whatever happens, FIFA will be the “big winners” out of this deal. They usually are.
Edited by: Chuck Penfold
