As a soccer, or shall I say, football fan, I’m more excited than ever before to watch the FIFA World Cup!
Events like this are only held every 4 years so they must be celebrated with a festive spirit, especially at this time of the year around the holidays!
Time really flies by. 4 years ago I graduated HS and now I’m wrapping up my penultimate semester of senior year in college! Time is our most precious commodity after all.
What’s even more unique is that since the last world cup in 2018, I’m now officially a personal finance blogger and avid frugal minimalist. Nothing intrigues me more than unpacking money-making moves across all markets, events, and of course, the multi-billion dollar business of sports.
From sports gambling to video games to apparel and lucrative 7-figure athlete contracts, sports may be the most lucrative activity that brings us all together as a sport in itself! Whenever there’s money on the line with more at stake, people naturally tend to care more.
The global sports industry brought in a collective 354bn in revenue in 2021 and is expected to reach $700bn by 2026! With a CAGR of 40%+, sports is truly unbeatable.
Speaking of sports betting, $1.8 billion is estimated to be gambled on this year’s event in the U.S. by more than 20 million Americans according to the American Gaming Association.
With Argentina’s stunning upset, a team that was expected to win the event altogether, gamblers are slowly dipping their toes out of the murky waters. Sports is really options trading! It’s thrilling but completely unpredictable, even with Messi!
Although I may not be your typical sports fanatic, nor personal finance bro blogger, as a child of Polish immigrants in a household that grew up watching soccer and tennis, this year’s world cup will be thrilling to watch!
As I’m writing this today as of Monday, Nov 21st, the U.S. team made its first appearance in 8 years scheduled to play Wales. The final score turned out to be a tie. No worries if you missed it since penalty kicks and the winner will be decided on Black Friday!
Now the real decision is what to do on Black Friday. With over 114m Americans expected to hit the stores, you’re probably better off watching this exciting soccer match and just hanging around after stuffing yourself on Thanksgiving. You’ll probably regret what you buy on Black Friday anyways since it was on sale!
Speaking of sales and massive savings, since the World Cup is the world’s most viewed sports event with an expected 7 billion global viewers this year, ahead of the Tokyo Olympics and the Superbowl, boatloads of money were spent for this event with years of planning.
2022 World Cup Cost Breakdown
According to Forbes and CNN, Qatar 2022 is the most expensive world cup in history.
One of my favorite aspects about a global sports event such as the Olympics and World Cup that only roll around every few years is that they offer an exclusive chance to peek inside a new host city.
But it all comes at a steep price. It is pricier than ever before to host a massive global event like the World Cup and no matter how small the country of Qatar may be, inflation seems to still be rampant.
According to Qatar’s minister of finance in 2017, $500 million was planned to be spent on the infrastructure alone to build the stadium, nearby hotels, and airport upgrades.
As a relatively small country with a population of 2.9 million with this massive budget, it seems like counties of any size now will spend at this level when networks offer them a chance for dedicated coverage for the event.
This is practically global PR for free across prime stations such as FOX News in the U.S. and ESPN globally when daily coverage and prime-time spots are dedicated to what’s happening around the event. With Superbowl ads costing north of a couple hundred thousand dollars for a few seconds in front of America, I can’t imagine how valuable 3–5 hours daily of showcasing the World Cup is in front of billions of viewers.
This is big business not only for FIFA but the hosting country to boost its economy after this massive spending spree. I wouldn’t be surprised if there’s a massive uptick in travel and ticket sales across the country after any major event like the World Cup. I was eager to book a flight to Tokyo after the Olympics last summer!
Since Qatar was chosen 12 years ago in late 2010 to be 2022’s World Cup host, it has spent around $220 billion in the dozen years, more than any other country, smaller or larger in the past.
This massive budget got me thinking about other enormous price tags for events across the globe from the Tokyo summer Olympics to the yearly Superbowl in the U.S. and how and what is really the deciding factor in the budget? Who gets to say $220bn is the limit?
Overall, the costs are complicated since they range from the bonuses given out to players to expenses around maintaining the stadiums, etc. Here is a rough breakdown of how $220bn is broken down. It gets spent fast!
$1.7bn are costs covered by FIFA for the world cup including prize money, operational expenses and logistics ($322m), and TV ops ($247 million)
$6.5bn — $10bn is estimated to be spent on seven soccer stadiums
~$8bn expected for transport infrastructure along with stadium construction
$220 billion: An estimated cost of what Qatar spent over the past ten years in preparation for the World Cup. Government officials have never confirmed the number, but in 2017, Qatar’s minister of finance said the country was spending $500 million per week on capital projects.
Spending $500m for an event of this caliber can be easily spent, especially with the lack of infrastructure in place only a few years ago. This was a massive project that didn’t come cheap.
With $220bn to be spent, $4.7bn expected to be generated in revenue from this year’s World Cup according to FIFA’s 2022 budget. Although this massive event will result in paper losses, the global PR presence is unbeatable, no pun intended.
Here are additional sources of revenue FIFA can count on:
-Ticket sales + hospitality revenue around $500m
-TV broadcast rights will result in around $3bn
-Marketing rights bringing in almost $1.5bn
Let the games begin!