Nothing calibrates the overwhelming global popularity of football like the sums of money involved, the multi-million dollar transfers and salaries for its superstars or the billion-dollar broadcast deals. But for all the breath-taking amounts being dropped on the game, none of it compares with the seismic $25 billion FIFA's president Gianni Infantino told the FIFA Council he has been offered by investors interested in the FIFA Club World Cup rights.
These suggestions, first revealed in the New York Times last month, corroborated by several senior voices in football and eventually admitted to by FIFA, would potentially be transformative for the organisation's finances.
In the current World Cup cycle, from 2015 to 2018, FIFA budgeted for less than $1.8bn of expenditure on football development, education and governance. The opportunity to raise 14 times that sum at a stroke is understandably attractive to Infantino, who will be standing for re-election in 2019.
As such, this is surely a good thing, right? Well, FIFA's most senior decision-makers -- the Council -- were far from convinced and gave him short shrift. So Infantino turned instead to a different group of stakeholders. He invited all members of the FIFA Bureau, the presidents of the six continental confederations, to discuss next steps in Zurich on Monday. It is perhaps telling that reportedly only one, Alejandro Dominguez, president of the South American confederation CONMEBOL, turned up. The others delegated the detail to executives instead.
So why haven't they jumped at the chance?
First there are questions around process. While conveying his suitors' anxiety for a swift response to their offer -- he claimed they had given him 60 days for an answer -- Infantino refused to divulge their identities, telling the FIFA Council he is bound by confidentiality agreements. This is a little alarming: good governance dictates that the head of any organization should first consult with his senior stakeholders before making any commitments to third parties, whether around disclosure or otherwise. Binding himself to them while withholding information from his executive board is very poor form.
There are also questions of motive. Why would anyone pay $25bn for a competition that has raised $22 million or less in each of the past five years for FIFA, a revenue multiple of 1,000 times?
Although the Financial Times has reported that Softbank, the deep-pocketed, tech-investing Japanese bank, is among the entities in the consortium Infantino is talking to, the Club World Cup would never provide anything approaching a return on investment under its current structure. When Softbank paid $34.6bn for ARM holdings, a smartphone chipmaker, in 2017, it was buying a business with annual revenues of $85bn: that investment was worth not 1,000 times current revenues but 0.4 times. Understandably, Softbank has chosen not to comment on the FIFA reports.
There are undoubtedly certain properties on the world football landscape that would justify enormous valuations. UEFA generated $5.6bn from its Euro 2016, Champions League and Europa League competitions in 2016. In 2017, the Premier League's total revenues were $4.4bn. But the Club World Cup is a football and financial irrelevance by comparison.
If successful serial investors like Softbank are attracted to it, it is not because they like what they see but because they like what it might become. And that means a wholesale restructuring of the world football landscape, one that would put FIFA's club competition at the very apex of the pyramid. At least this is what we must assume, because FIFA has been very light on details so far.
It said in a statement on Monday: "Today's discussion took place in a friendly and positive environment with a decision being taken to task a working group to analyse further the relevance and feasibility of staging both competitions. The working group will be composed of the general secretaries of the six confederations and FIFA."
Perhaps Infantino believes the confederations and their general secretaries to be more malleable than the FIFA Council, which had initially been somewhat hostile to his proposal. Indeed, the greatest hostility emanated from the Europeans on the Council: under Infantino's plan, UEFA's Champions League competition risks being superseded as the world's preeminent club competition. Yet as a former general secretary of UEFA himself, Infantino can count on one friendly face at UEFA. His former deputy, Theodore Theodoridis, who masterminded Infantino's election to the FIFA presidency, will be the loudest voice among the general secretaries on the new working group.
Understandably, the European clubs that would have most to lose have expressed profound concerns about the direction FIFA is taking football. Richard Scudamore, the Premier League's executive chairman and chairman of the World Football Leagues lobby group, has already put his misgivings in writing to FIFA. It is extremely rare for Scudamore to be exercised about anything that does not directly affect his competition, so it does feel like there is a lot at stake here and the reason for that is the perverse structure of the world football economy.
Any economic landscape has three basic elements, or factors of production: land, labor and capital. In football, the labor element consists of the players, the capital comes from broadcasters and sponsors while the land resides in the clubs and their stadiums. All well and good. Except that in football there is also a fourth major element: the regulator, FIFA. And at the same time as being the regulator, FIFA is also an economic actor.
For four weeks every four years, FIFA prevents most organized club football taking place and takes the best of the labor element contracted to clubs, using them for its own commercial ends in the FIFA World Cup. This is akin to the Federal Communications Commission closing down all media channels in the U.S. for a month every four years while cherry-picking the best shows from Netflix, HBO, NBC and wherever else it fancied and broadcasting them entirely for its own commercial gain. We all love the World Cup, of course, but from the standpoint of economics, that's what is going on.
What if that regulator were to intervene in the football economy to act not in its own interests as, ostensibly at least, the not-for-profit custodian of global football development, but in the interests of commercial third parties? What would that mean for the integrity of the game?
These are big questions. If savvy investors are offering FIFA $25bn for what is currently little more than a sporting irrelevance, it is because they believe in the power of FIFA as regulator to shift football's tectonic plates in its own favor. And should it start down that path, there will be some almighty earthquakes along the way.