Digital revolution in football, the European Super League(ESL) Concept, and changing trends in the live content Industry

The European Football Association (UEFA) was recently faced with a new concept of the European super league(ESL) that guaranteed clubs in the elite league huge annual incomes in an industry that increasingly has many avenues for generating revenues..  It is a concept that was premised on access to a global audience of internet or broadband subscribers and pushing live football content via web, smart phone applications, and other digital channels.

It was vehemently fought by UEFA, Europe's governing body and partner FAs in each country. Many reasons are put forward but the main one in my opinion is that it would dilute the current UEFA Champions League Format.

But faced with revenue pressures, a huge player wage bill and mounting debt, and looking at the opportunity to make serious money by leveraging their premier asset base (the Superstars), this is what Florentino Perez at Real Madrid, Laporta at Barcelona, Agnelli at Juventus, the Glazers at Manchester United or John Henry at Liverpool and others, being smart businessmen, are seeking to exploit. Digital technology offers these executives the perfect solution to fill the revenue Gaps, an alternative that offers a mass market audience, is on-demand and 'pocket friendly'.

Think about this, Global superstars like Cristiano Ronaldo, Lionel Messi, Neymar Jnr, Lewandowski, Kylian Mbappe, Erling Harland, Gareth Bale, Gerard Pique, Paul Pogba, Jadon Sancho et al , employed by these clubs, have a large fan base and a huge social media following. 

Cristiano, Neymar Jnr and Lionel Messi alone have a combined 898 Million social media (Twitter, Facebook, Instagram) following  according to a 2021 post (https://www.888sport.com/blog/football/top-10-most-followed-players-on-social-media-twitter-instagram-facebook).

Aided by the world-wide Broadband penetration, global smart phone subscriptions and instant electronic payments, access to premium content across continents becomes available, in real-time at the touch of a button. At end of 2020, there were 4billion Mobile Internet users, 68%(2.7bn) with Smart phone devices (Source: GSMA data report 'The Mobile Economy 2021'). In this is the same subscriber base that consumes this premium content.

The Entertainment value and therefore income movement is largely determined by the excitement footballs' unpredictability creates, and more so with superstar laden teams facing each other all year round. One Tweet from Messi promising a football spectacle at the Allianz against Ronaldo's' Juventus can create instant demand, and therefore instant subscriptions from a global audience. One match on a Tuesday night, watched say by 10% smart phone users can generate about 270M USD, assuming a USD1 on-demand subscription. And that doesn't include Advertisement revenue during the 90minutes. If they played just 10 matches, this would represent in excess of USD2bn.  In a 20-team League over a season, assuming 38 matches, it would ideally generate a lot more revenue. 

Obviously to avoid player burn-out and to maintain entertain value, a balance has to be struck between in-country local league schedules and the proposed new ESL league format.

And behind the scenes, there has to be an honest dialogue between UEFA and the ESL Special Purpose Vehicle(SPV) to arrive at an ESL Implementation structure that re-jigs the European League calendar, does-not hurt the local football leagues in Europe and delivers a governance framework that guarantees revenue share between  the clubs, UEFA and Investment banks.

What is clear though is that as the number of mobile subscriptions surges, internet penetration increases, so will the digital disruption of football and in General the sports entertainment business models as we know them today. Governing bodies must therefore adapt to remain at the cutting edge of the definitive and changing technology trends.