Are FIFA And Infantino Selling The World Cup?

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1:04This is the Football Daily Podcast with Eleanor Oldroyd. Football's governing body FIFA says it wants to unlock billions of pounds of new investment into the game. It plans to create a new commercial company that would allow outside investors to put money into competitions, including the men's and women's World Cups. FIFA says it could increase development funding to more than$10 billion, helping football grow across the world. But critics, including UEFA, say the plans raise serious questions about who ultimately controls football's biggest tournaments and whether investors could begin influencing how they're run.

1:43Joining me are BBC Sports chief football news reporter Simon Stone and football finance expert Professor Kieran Maguire. Simon, let's start with the basics. Lots of people have seen the headlines. They say FIFA, Gianni Infantino want private investments. So what exactly is being proposed? FIFA are arguing that the World Cup that's just gone is the most successful football tournament there's ever been in terms of finance. They feel that it shows the potential for football, let's say. I think probably a lot of people will already be aware of the commercial potential for football. But anyway, that is what they say.

2:21They then say that the money that is being made by football should be distributed worldwide. And in order to do that, they think that if you open the game up to private investment, that is what will create the additional finance you spoke about then,$10 billion FIFA is saying. That inviting private finance in will open the door to that. Now, there's examples of private finance in other sports. There's example of private finance in football. But I think the fact that this is FIFA, this is Gianni Infantino, the FIFA president, this is a subsidiary called FIFA Forward Enterprise, which FIFA say a company called Thrive Eternal is going to be the lead proposed investor group.

3:26Thrive Eternal is owned by Joshua Kushner, who is the brother-in-law of Donald Trump's son-in-law. And that family connection, infantino, private investment is what is leading a lot of people to think this really is not a great idea. So if you look at the World Cup and the idea of selling or monetising it, in inverted commas, even more, is that what they're trying to do? I mean, because where does the money that is currently made by the World Cup go to? Well, FIFA distribute finance to all competing countries. It's got 211 member associations. it's arguing that the amount that it could give it could multiply numerous times if we allowed they allowed speaking on behalf of them allowed private investment to come into the game the counter argument to that is that fifa is already a very rich organization although although it's not for profit so the money that it gets is supposed to be reinvested into football or is reinvested into football and some people argue that there is no kind of adequate method of tracking where the money goes that is given already because it's supposed to be for the development of the game but if it goes to all 211 member associations how do you know that the development of the game is being helped by this money.

5:14And some of these countries may not even spend that amount of money on the game in its entirety as it exists. So it's complicated. It is complicated, but there's been some quite strong reactions already in this country from Prime Minister Andy Burnham, from UEFA as a whole as well. Yeah, UEFA immediately, in fact, it was quite interesting yesterday because this report first started to appear in the Financial Times and the Times. UEFA responded to that report or those reports before FIFA had even released their statement. UEFA said it crossed the line and they've stuck to that. They're not going to change.

6:00They're going to have an emergency meeting tomorrow of all 55 member associations to try and work out next steps. But then FIFA released their statement. And then the interesting thing about that is that numerous statements have been released on the back of that, including one from the FA, saying they knew nothing about that. There are eight FIFA vice presidents. I know of at least three who were not told about this. Then FIFA made it appear as though it was something that had been discussed at a FIFA council meeting just before the World Cup final and that Gianni Infantino had led that. I've spoken to people who are at that council meeting.

6:46They said he didn't say that. He said, we're going to try and unlock greater finance for the game. And that was it. Well, the detail that has been released by FIFA makes you kind of understand that this has been in the ether for a long time because you couldn't have this detail unless you'd already spent a lot of time working on it. So let's bring in Kieran here. I mean, Kieran, these investors that we're hearing about from Simon, when investors put billions into something, they expect a return on their investment, don't they? So where does that return come from? Well, the return will be is that instead of FIFA being in a position to delegate 100 % of the profits that it makes in each tournament to its members, going forwards, that will be reduced to 80%.

7:35And then if we take a look at the tournament that we've just had, we estimate that revenues are around about$15 billion, profits probably in the region of 10 to 12. well the investors will be saying well instead of doing that once every four years why not do that once every two years it makes sense from an investment point of view so that would add to complications in what's an already crowded football calendar but if the if the focus of FIFA is now to be a revenue making organization then that's at odds with its charitable status and that's also at odds with its main focus, which is to spread the game as much as possible.

8:16And it does a lot of fantastic work around the world. But as Simon pointed out, the distributions of money aren't particularly well audited. There has been evidence on quite a few occasions of money perhaps being misallocated on a local level. And instead of getting$1 to$2 million a year, which can make a huge impact as if you take a look at the bottom of the FIFA rankings, the likes of Seychelles, Turks and Caicos Islands, San Bruno and so on. If they get a big payment of 20, 30, 40 million dollars, what exactly are they going to do with that money? Because they don't really need that much money given the size of some of the smaller members.

8:57So what are the investors actually buying here potentially? I mean, is it a share of the commercial income that's coming into the game? Is it revenue from broadcasting in the future or something else? And how much say would it give a potential investor into how the World Cup's run, how schedules are run and strategy commercially? Well, it would be 20 % of this new company, FFE. FIFA are saying that they would be non-voting shares. So therefore, in theory, the investors would have to accept that all of the decisions are being made by FIFA in the broader interests of football as opposed to the interests of individual investors.

9:38At the same time, there's always going to be meetings between the two parties. And you would imagine the investors' main focus will be that of both revenue and profit creation as opposed to the beautiful game with which we all have fallen in love with. So I think that is the challenge. And we are living in a monetary organisation, a monetary world. And as Simon said, we've got private equity in Formula One. We've got it in rugby. There's now talk about the Bundesliga getting involved, La Liga and so on. And so it's not just FIFA that is being involved. I think it's the secrecy and the lack of transparency.

10:18If the first time that football associations hear about this is from a leaked story which has appeared in the FT and the Times, then that trust that they have towards Infantino is going to evaporate. And Simon, as far as the supporters are concerned, because, you know, you hear private investment and you think, right, OK, that's going to cost us more money. Is that a valid concern? Well, I mean, I don't know how much more money it could cost supporters than the World Cup already cost. I think that the issue, and I spoke to someone yesterday, a very senior person within English football, who said this was a bigger deal, in his opinion, than the European Super League.

11:05And I think I agree with that. And the reason for that is that the Super League felt really close. It was clubs who were in our league. You could see what they were trying to do. Whereas, as Kieran's pointed out, if you have a World Cup every two years and then FIFA also earn a Club World Cup. So if you have a Club World Cup every two years, so FIFA have got tournament every year and there's 64 teams in that and it goes on for how long? Well, where do the European Championships fit into that? Where does the Champions League fit into that Where does the Premier League 38 game Premier League Fit into that Where does the FA Cup The EFL Cup These are all kind of Going down the pyramid almost But they would all effectively Be impacted By a World Cup That was so big So I think We don't know What the impact is going to be You kind of do tend to think this is going to end up costing money, but there's a potential for it to cost quite a lot more in terms of the structure of domestic football, not just in England, but globally.

12:16Do you think this is likely to happen? Well, I think it's more likely to happen than the European Super League was, and that's why I think it's a greater threat. Clearly, there is a nuclear option on behalf of the European, the big European countries, because they could say they refused to compete in the World Cup if the World Cup had not got France and Spain and England in the last iteration. Well, that's three of the semi-finalists or the quarter-finalists, obviously. But I think that's a nuclear option. I don't see that as being the first option, but they're going to have to come up with a plan because at the moment they need to kind of stop this from happening.

12:57And, Kieran, if you were putting money on it, how much would you put on it to make it happen? Presumably not the same amount of money as members of the Kushner family have. I think the strength of the opposition has probably surprised FIFA in exactly the way that the strength of opposition to Super League surprised the owners of the clubs involved. So it could be that Gianni Infantino is playing some form of four-dimensional chess with us. He thought he'd create something which was so abhorrent that there would be pushback against it. He offers some compromises and he gets the tournament or he gets the products that he was looking for in the first place.

13:37So I don't think it will go through in the present form, but I do think the creeping commercialisation of the game, we live in a monetary society, we have to accept that, is likely to continue on the back of this. Kieran, Maguire, thank you very much indeed and thanks to the BBC's Simon Stone as well.

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