Kicking the cash in
Question. How do you run a FIFA World Cup? Answer. Very, very expensively. As per Forbes magazine, FIFA will make total payments of $576 million in Brazil to participating member associations, the clubs of participating players and the club protection program. A large chunk of the amount goes to the prize money.
The protection program, as per FIFA guidelines, states that clubs will be compensated up to a certain point if players get injured while representing their country’s senior team for matches listed on FIFA’s international match calendar.
Simply put, let’s say Lionel Messi gets injured while playing for Argentina during the quarterfinals, FIFA then compensates his club FC Barcelona for his salary even though Messi can’t play temporarily for his club while he recuperates from injury when the Primera Liga season starts.
As to Cristiano Ronaldo’s case, he came to the World Cup with an injured knee. Had he aggravated the injury during the group stages, FIFA, to some extent, won’t be compensating Real Madrid FC, Ronaldo’s football club.
FIFA’s bulk of expenditures are for prize money, broken down as follows - all 32 participating national teams are given $1.5m each as participation fees. The sixteen eliminated teams in the group stages further receives $8m each. Those eight eliminated teams in the Round of 16 then gets $9m each. The four teams dropped from the quarter-finals each receive $13.5m.
The money flows for the final four. Fourth place gets $18m, 3rd place with $20m, 2nd place goes home with $25 and this year’s 2014 FIFA World Cup Brazil champion receives $35 million.
To illustrate, supposedly strong teams like England, Portugal and defending champion Spain got eliminated in the Group stages but aside from the $1.5m participation fees, they also got $8m, with a total take-home booty of $9.5m. So not counting the participation fees, FIFA still gives out ridiculous amounts to eliminated teams. Not bad at all. Our Azkals? It probably will take several lifetimes for us to see our boys compete in the world stage considering the level of competition. At least we had improved by leaps and bounds, to honest and fair. $9.5m is a king’s ransom had the Azkals qualified.
FIFA has also set aside $100m in insurance money and $70m for club fees whose players are playing in the World Cup.
Going back to the $576 million expense, we wonder how FIFA gets back its investments. Most of the income will be derived from sales of marketing and television rights. Except for the Olympics, the World Cup generates income for FIFA more than any other sports tournaments.
Major corporate partners willingly say goodbye to their financial resources because for a whole month, matches are closely followed. Companies like Adidas, Coca-Cola, Sony, Hyundai, Emirates and Visa gives FIFA $1.35 billion in marketing rights.
ESPN and ABC bought TV rights to the 2010 and 2014 World Cups for $100 million. Univision on the other hand paid FIFA a $325m package for the Spanish-language US rights to the 2010 and 2014 World Cups and other tournaments. Fox Sports reportedly paid $500m. All in all, television rights gives FIFA an estimated $1.7 billion.
All things considered, Brazil will give FIFA an estimated $4 billion in total gross revenues, 66 percent more than what they earned at the 2010 FIFA World Cup South Africa. Profits are estimated to be in the vicinity of $2 billion. More than half of this will be used, as per reports, in football-related programs worldwide.
I usually wait for the 12 midnight matches to start and then struggle to stay awake for the next succeeding matches. It’s all worth the sleepless nights, this tournament only comes once in four years. And personally, I like the Waka-Waka theme song more than the Ole, Ola. I also miss the beautifully irritating wail of the vuvuzelas.
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