Mr. Huang Yu from the Department of Sports Science at National Tsing Hua University, together with students from the Sports Management and Facilities program, have curated a series of special reports on the World Cup soccer tournament. The series delves into the dimensions of technology, foreign labor, facility construction, sports nationhood, business operations, and environmental sustainability, aiming to shed light on the multiple impacts of the world's premier tournament.
Uncover the unique design of the Kada World Cup stadium!
The World Cup and Environmental Sustainability: A Strongly Connected Tie
Labor Rights Dispute: How FIFA and Qatar Resolved Their Conflict?
Offside technology, virtual reality? New World Cup tech highlights
Becoming a world power through soccer? Qatar's path to power by hosting the World Cup
The 2022 FIFA World Cup soccer extravaganza hosted by Siakada is in full swing, igniting the passion of fans around the globe. According to FIFA's (International Football Association) prediction, more than 5 billion people will watch the World Cup this year. The crowds are business opportunities, and FIFA, as the organizer, has a mountain of riches to show for it.
Founded in 1904, FIFA has been enjoying financial success since the turn of the century. In its 2006 financial report, revenues from 2003 to 2006 were a whopping 3.238 billion Swiss francs (about $3 billion), and the financial report for the 2019-2022 period shows that revenues have soared to $6.4 billion, second only to the International Olympic Committee, making it the second largest of the international sports organizations after the Olympics.
This article will provide insight into FIFA's finances in recent years, the World Cup's business strategy and related commercial activities, and an explanation of the commercial frenzy that has characterized the opening two weeks of the tournament.
According to FIFA's financial reports in recent years, its revenue has doubled since the turn of the century. Among them, media broadcasting rights are its main source of income, accounting for 56%, marketing royalties income is about 13%, and the rest of the income, including tickets, trademark royalties, etc., accounts for about 29%.
On the expenditure side, the most recent four-year cycle included approximately $1.7 billion in tournament staging costs, $1.7 billion in promotion and development, as well as soccer governance systems, administration and marketing and broadcasting.
Table 1: Summary of FIFA's revenue for the last 20 years (in billions of dollars)
Year | Amount | Source
2003-2006 | 26.34 | Team Organizer
2007-2010 | 41.89 | Team Organizer
2011-2014 | 57.18 | Team Organizer
2015-2018 | 64.21 | Team Organizer
2019-2022 | 64.64 | Team Organizing
It's worth noting that a World Cup year is usually a year when the money rolls in, especially from televised royalties and marketing rights. With a surplus of $1.5 billion for the 2022 budget, FIFA's total assets grew by 21% to $5.5 billion at the period-end closing. However, its statutory surplus reserve fell from $2.7 billion in 2018 to $1.8 billion in 2021 due to the new Crown Pneumonia outbreak.
Marketing rights are also one of FIFA's main sources of revenue, amounting to $131 million last year. Most of this revenue ($93 million) came from FIFA's global partnership agreements, while $30 million came from World Cup sponsors.
In addition, FIFA received $5 million from regional sponsors, $2 million from women's soccer partners and $1 million from national sponsors. Last year, FIFA also had $320 million in "other income", which included a $60 million settlement from the U.S. Department of Justice (USDOJ) for the corruption of a former official, and the remaining $260 million from the Club World Cup, liquidated damages, property sales, income from the FIFA Museum, and income from copyrights. Table 2 presents information on key revenues and expenses for 2022.
Table 2: FIFA 2022 Key Revenues and Expenditures (in USD billion)
Category | Project | Amount
Revenue | Media Retransmission Rights | 26.40
| Marketing Rights | 13.53
| VIP Privileges and Ticket Sales | 5.00
| Trademark Licensing | 1.40
| Other | 0.33
| Total | 46.66
Expenses | Contests & Events | 19.38
| Development and Education | 7.14
| Football Governance | 0.44
| FIFA Management and Administration | 2.51
| Marketing & Telecasting | 1.91
| Total | 31.38
Surplus before tax | 15.28
