Key facts
- FIFA plans to sell World Cup commercial rights for $4.2 billion to private investors.
- Experts warn that sponsors may face higher costs or reduced value from their FIFA partnerships.
- U.K. Prime Minister Andy Burnham criticized the sale, calling the World Cup 'not a product'.
- UEFA and other European football associations have expressed strong opposition to the plan.
- Thrive Capital, linked to Jared Kushner, is reportedly involved in the proposed deal.
- FIFA states the investment will boost grassroots and women's football.
FIFA's plan to sell commercial rights for its tournaments to private investors for $4.2 billion has drawn criticism from sports marketing experts and football officials, including U.K. Prime Minister Andy Burnham and UEFA.
Experts warn that this move could lead to sponsors paying more or receiving less value for their partnerships. Steve Martin, a founding partner at MSQ Sport and Entertainment, noted that aligning broadcasters, sponsors, and partners within a vehicle to be sold to private equity could increase pressure to create more sponsorship opportunities, potentially diluting the value for existing major partners like Coca-Cola, Visa, and Adidas.
Stuart Pinnington, global head of asset owners at IQ-EQ, suggested that private investment might push FIFA towards a more sophisticated approach to packaging and monetizing commercial rights. However, this could also lead to increased sponsorship fees and the introduction of more commercial inventory, potentially impacting the authenticity and long-term viability of sponsorships.
FIFA states that the investment will spur growth in grassroots and women's football. However, European football associations are reportedly outraged, citing dissatisfaction with FIFA's management of recent tournaments and concerns over FIFA President Gianni Infantino's close ties to political figures. Thrive Capital, an investment firm reportedly linked to Jared Kushner, is said to be heavily involved in the plan.
FIFA has already introduced new revenue streams, such as advertisements during hydration breaks and half-time shows during the recent World Cup, indicating a trend towards increased commercialization.