FIFA World Cup 2022: The Business Model of FIFA – Facts and Stats

In order to regulate, organize, and publicize the growing number of international football (soccer) competitions, FIFA World Cup, also known as the International Federation of Association Football, was founded in 1904. Because it is played in more than 200 countries, the sport may have the largest fan base of any in the world. FIFA World Cup is “Modernizing football to make it accessible, inclusive and a worldwide sport. Everywhere, not just on one or two continents,” according to the organization’s official website.

FIFA is a non-profit with significant revenue potential that invests the majority of its earnings in the growth of the game. The majority of these revenues come from the Men’s and Women’s World Cups, which are the most well-known international athletic events.

The Business Model of FIFA

The World Cup not only ranks among the biggest sporting occasions in history, but it also contributes significantly to FIFA’s revenue. FIFA earns large earnings from this and other events through the sale of television rights, marketing rights, licensing rights, and money from ticket sales. Apart from that, FIFA has cheap costs, which enable it to put as much money as possible into the development of sport.

The World Cup’s Economic Impact

FIFA is the only organization tasked with running both the World Cup and the Women’s World Cup, and as such, it gets to keep all the money. These events frequently bring in billions of dollars in income. Through a competitive bidding procedure, the World Cup host nation is selected.

The United States, Canada, and Mexico have been selected to host the World Cup for its 23rd edition in 2026, while Qatar will host the event in 2022.

Expenses

With so many nations competing to host the World Cup, FIFA naturally gains a significant negotiating advantage and gets away with imposing the majority of the conditions. Infrastructure built for the Cup is entirely the responsibility of the host country; FIFA makes no investments in such infrastructure. FIFA compensates the regional organizing group for planning and running the World Cup.

Additionally, it covers staff and match officials’ expenses, player travel and lodging, and prize money for the participating nations. Additionally, it creates a FIFA World Cup legacy fund that the host nation can use in the future to advance the sport there.

Television Rights for FIFA World Cup

49%, or nearly $3.13 billion, of FIFA’s $6.4 billion in revenue between 2015 and 2018 comes from television rights.

FIFA grants broadcasting companies and television stations the ability to broadcast football games and related events in particular geographical areas by way of license rights. Because of how well-liked football is all across the world, broadcasters may compete fiercely for license rights.

Key Obstacles

FIFA has occasionally been accused of poor administration and malpractice in relation to the World Cup bidding process. On suspicion of corruption, the president and other executives who were mentioned in the 2015 controversy were detained.

Only nine people have held the organization’s top positions across its 118-year history, raising concerns about transparency and sound governance. Even though the organization successfully hosted the 2018 World Cup, concerns about potential future or ongoing corruption persist.

Conclusion

The World Cup, the biggest athletic event on the planet, is the centrepiece of FIFA’s successful commercial model. FIFA is the organization that governs football (or soccer as it is called in the U.S.). It generates billions of dollars, mostly from TV and marketing rights, without having to invest in or assume the financial risk of constructing competition infrastructure. And since it is a non-profit, the majority of this money is put back into the game.

FIFA has several advantages for the world economy and the sport it oversees, despite some controversy.

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