Leading sports bodies seek to redefine their calendars to drive revenue

Major live events drive revenue across sports bodies. Events such as the Olympics, for example, are the pinnacle of the IOC calendar and its showcase event. Outside of major tournaments, however, revenue performance is significantly less or even a loss.

The organizations that manage major sports are responsible for governing, promoting and legislating their events at both the elite and grassroots levels. They are primarily governing bodies rather than commercial operations that facilitate and manage their respective sports. While they seek to promote values such as the "Olympic Spirit," they also need to commercialize events to generate revenue to sustain their sport.

➤ Live events are the most significant sources of revenue for sports bodies.

➤ Regional bodies like UEFA command higher revenue consistently due to successful annual club competitions like the Champions League.

➤ Global bodies are looking at opportunities to develop their events and maximize their calendars.

European regional soccer body Union des Associations Européennes de Football (UEFA) stands out with the highest revenue of the sports bodies in our analysis, but the annual events that UEFA organizes are behind these numbers, such as its trio of club competitions, which includes the highly lucrative Champions League. UEFA's own national competition, the European Championships, which took place in the 2015/16 and 2020/21 seasons, also boosted revenue.

It is for this reason that sports bodies are looking to enhance and extend their portfolio of events and create a more balanced revenue stream. The growth and appeal of women's sports is a real opportunity for global sports bodies. The England Lionesses' victory over Germany in UEFA Women's Euro 2022 drew an audience of 17.4 million in the United Kingdom, the highest ever recorded for a women's game in the market.

For Fédération Internationale De Football Association (FIFA), it signals the potential of the Women's World Cup. The next tournament in 2023 could provide a significant boost compared to previous years. FIFA is also looking to expand its Club World Cup competition into a major 32-team tournament to start in 2025. The governing body hopes that this will replicate the success of UEFA's club competitions such as the Champions League.

Elevating other events in a sports body's portfolio would also help to increase and level out revenue generation. Esports and youth tournaments are organized by bodies like the IOC and FIFA and would be other potential events that could increase in prominence.

FIFA

Like most global sports bodies, soccer's global governing body FIFA records its highest revenue in tournament years, when the biggest events occur. For FIFA, this is the World Cup that is held every four years.

FIFA's finances have not been without incident in recent years. Accusations of illegal payments cost ex-Secretary General Sepp Blatter his job, and the FBI investigated how the group's finances were managed. Since then, FIFA has implemented good work programs such as its COVID-19 relief plan valued at $1.5 billion to help the football community deal with the fallout of the pandemic.

Outside of tournament years, marketing and licensing made up 54.4% of FIFA's revenue, but it still accounted for 28.6% of FIFA's revenue even during the 2018 tournament year. The organization's marketing revenue is generated from clients like The Coca-Cola Co., Adidas AG, Hyundai Corp., Wanda Group and Visa Inc. that pay to be associated with the FIFA brand. Licensing revenue has grown substantially in recent years, from $50.4 million in 2015 to $180.2 million in 2021.

A key licensing relationship has been FIFA's relationship with games developer Electronic Arts Inc. (EA), which made the soccer game FIFA 23. EA and FIFA's long relationship is coming to an end this year. EA has been making considerable sums of money from games like FIFA, and this has not gone unnoticed. FIFA now plans to launch its own video game title to try and generate its own revenue stream from the gaming sector.

IOC

The Olympic games are one of the few sporting events that attract global attention. The Tokyo Games held in 2021 had an audience of 3.05 billion people, a reported 139% increase over the viewing for the 2016 Games in Rio. The Tokyo Games generated over $3 billion in TV broadcasting rights revenue with over half coming from the Americas.

Across many markets, the Olympics are free to watch on TV. In Europe, Warner Bros. Discovery Inc. bought the rights to the games from 2018 to 2024 and sublicensed the rights to state broadcasters like the BBC. The event in 2021 was also one of the first games that truly embraced the streaming opportunity with multiple streams allowing coverage of more sports than had been possible previously.

The IOC is trying to reinvigorate the Olympic movement by looking at ways to bring the games deeper into the modern, technology-based world and has launched a strategic roadmap called the Olympic Agenda 2020+5. The goal of this 15-point plan is to embed values in the organization based on sustainability, resilience and increased digitalization and solidarity.

Olympic revenues are significant, and the 2020 Tokyo Olympics generated more than $3.1 billion in television revenue. By comparison, FIFA earned $123.1 million in television revenue in 2021 but had over $2.5 billion in television revenue in 2018 when the World Cup took place.

Liberty Media/Formula 1

Liberty Media owns the commercial rights to Formula 1 after buying them from investment group CVC Ltd. in 2017. Since then, the group has added new races and locations to the racing calendar to help widen its appeal, especially in the Middle East, Southeast Asia and the US. There are now 23 races per season compared to 21 in 2019.

Liberty has also agreed to a deal with Amazon-owned AWS to enhance teams' performances through better access to data.

Outside of the track, the sport's appeal has received a significant boost from the success of the Netflix series "Formula 1: Drive To Survive," which has especially appealed to younger and US audiences.

World Rugby

The World Rugby organization's primary role is to grow rugby as a sport by making it more relevant and accessible globally.

Major events in the sport currently drive its growth and revenue, such as the men's and women's world cup tournaments held every four years. It is during the men's world cup that the organization posts its most successful financial results.

What is significant is the growth in revenue in the year that the women's rugby world cup takes place. While the revenue reported in those years was perhaps driven solely by these events, when the women's world cup took place in 2014 in France, World Rugby's total revenue was £6.4 million. In 2017 when the event took place in Ireland, the total revenue reported was £22.6 million. This illustrates the growth and potential of women's sports.

International Cricket Council

The International Cricket Council (ICC), the governing body of world cricket, continues to try to grow the sport and widen its appeal. The ICC has recently announced a new global growth strategy focusing on six key elements: women's cricket, participation, events, the Olympics, new markets and digital.

There is a special focus on new markets, most notably in the US, with a goal of adding 50 million fans by investing in new markets. The ICC is pushing for cricket to be included as an exhibition sport at the 2028 Los Angeles Olympic Games, if not at the 2032 games.

Like most sports, the ICC believes that using digital technology will enable the sport and its teams to engage deeper and more effectively with fans, with a target of 300 million direct relationships by 2032.

UCI

The Union Cycliste Internationale (UCI) organizes and develops cycling in all forms worldwide. The organization manages all 10 forms of professional cycling, including the Olympics and its three grand tours, the most famous of which is the Tour De France. Uniquely, it also promotes recreational cycling and cycling as a form of transport.

During Olympic years, the Games will provide UCI with the biggest share of revenue. The Tokyo Games accounted for 36.4% of its total revenue in 2021. Outside of these years, the main driver of UCI revenues is "hosting fees" earned through events held under the UCI banner.

UEFA

As the managing body of soccer in Europe, UEFA manages not only national team events such as the European Championships, which Italy won in 2021, but also the highly lucrative club competitions: the Champions League, Europa League and the newly established Europa Conference League.

Rights revenue makes up the majority of UEFA's revenue, ranging from 99.1% to 89.8% in the last six soccer seasons. The lowest percentage shares in the 2020/21 and 2015/16 seasons were when national team tournaments took place and UEFA took significantly more money from ticket sales.

UEFA expanded its competitions to encompass gaming and esports when it launched the eEuropean Championships in 2021, which was Europe's largest-ever national team championship. It was played exclusively on Konami's eFootball PES 2021, which ignored the hugely popular EA FIFA 23.

UEFA launched its own over-the-top platform UEFA.tv in 2019, which allows free-to-air access to highlights and delayed coverage of UEFA competitions. This was the first platform owned by a sporting body and potentially creates a broadcasting framework that UEFA might use to show live games and exclusive content to create new revenue streams outside its traditional media rights operations.

Global Multichannel is a service of Kagan, a media research group within S&P Global Market Intelligence's TMT offering.

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.