Hey Sports Tech fans,
What a roller coaster of a week for European football.
The soccer (football) world was turned on it’s head as 12 major teams from 3 different leagues announced they were looking to form a break away league, circumventing the Champions League which is controlled by UEFA.
The timing was not a coincidence as UEFA have been working on new proposals for the Champions League that will come into effect for the 2024/25 season.
I am like a broken record here sometimes as the ultimate aim is for control over broadcasting and streaming rights.
The biggest teams want this control so they can monetize their fans directly.
The figures for number of fans a team has is always hard to get 100% accurate but according to Goal.com Real Madrid have 252 million fans around the world.
If they managed to get ownership of rights to go direct to fans, the upside is potentially massive to them.
It goes without saying that their goal would be to convert as many of those fans to a subscription model as possible.
To illustrate the potential lets assume Real Madrid set their per game price at $1 and manage to get 20% of their fan base to subscribe, that would generate $50 million per game!
Extrapolate to that to an entire season and the revenues for 50 games on average and its $2.5 billion from just their streaming rights!
The potential upside is massive and with guaranteed games against other high profile teams every season the fee would likely be larger than $1 per game.
This is not over in my opinion and with UEFA rumoured to be working with an investment firm to increase the money on offer to Champions League teams in a direct response to the JP Morgan financed Super League, it is likely these 12 teams will still benefit long term.
The reason there was such outrage from fans and TV pundits was the distinct lack of competition.
It is ingrained into soccer that you qualify for tournaments based on sporting merit, this removed that and created a closed shop model more akin to the NFL than any soccer tournament.
Its clear to see the motivations for such a break away league and to me at least it is clear that this will be revisited in the future as those motivations will still exist.
Have a great sporting weekend,