The world of sports was taken by storm when a recent FBI probe led to the arrest of a series of high ranking FIFA officials and the subsequent resignation of Sepp Blatter after winning re-election to a fifth four-year term as president of the organization.
The uproar is understandable; the accusations have been scandalous, their impact has been felt all around the globe and a never-ending series of notable sport controversies appear to be linked to the investigation.
More so, associated football (soccer) is widely perceived as the world’s most popular sport and the World Cup is its pinnacle event. It is revered by athletes, fans, cultural icons and even heads of state as it inspires dreams of glory, both for players and countries. Learning, or rather confirming, that some of those whom were supposed to serve as the guardians of the game, develop football for all and leverage the power of the sport to improve social outcomes have rather tarnished its legacy is disheartening, but it begs the question: What if this is merely one piece in a broader puzzle of illegal activity?
If one goes beyond the prestige associated to the World Cup, it quickly becomes evident that the financial size of FIFA, and its dealings in general, pale in comparison to the rest of organized football.
According to FIFA’s 2014 Financial Report the organization’s global revenue for the 2011-2014 period was 5.2 billion USD which was the highest in its history and 23.9% larger than the revenue for the previous 4-year cycle. However, this is only 41% of the revenues generated by the top 5 football leagues in Europe just in the 2012/2013 season1.
Revenues generated for World Cup hosts don’t hold up much better. While FIFA receives revenues from TV rights, marketing rights, hospitality rights, licensing rights and ticketing, host nations only reap revenues through taxes imposed to economic activities generated by the World Cup. In the case of the 2014 World Cup, the most optimistic estimates put the revenues generated by Brazil for hosting the event at 7.2 billion USD, while more moderate guesses places them at a mere 500 million USD.
More so, when we aggregate the yearly revenues of FIFA, UEFA and other Regional and National Associations and compare them with a broader definition of organized football, we find that they represent less than 15% of the global revenues directly associated with the sport2.
In this light, it becomes evident why the biggest scandal in FIFA history, centered on 151 million USD in kickbacks spanning a 24 year period, may not be as large as initially perceived, at least in financial terms, when compared to broader maladies in football.
For instance, as of 2013, Operation Soga, a tactical operation coordinated by INTERPOL to address illegal football gambling activities in Asia, had resulted in the closure of gambling dens which handled illegal bets worth more than 2 billion USD.
According to the World Lottery Association, an organization of state authorized lotteries, at least 90 billion euros are spent each year in illegitimate football betting, creating incentives for individuals outside the game, overseeing the game and leading the game to partake in a myriad of match fixing schemes. Perhaps even more damaging, these sorts of schemes appear to have been used by criminal organizations to launder 140 billion USD a year, creating a dangerous link between popular sporting activities and organized crime.
These kind of illegal activities represent an epidemic attacking the integrity of the game at its very core. A 2013 INTERPOL report on match-fixing highlighted that in just the period between June 1st 2012 and May 31st 2013 English-language open-source media reported match-fixing incidents in over 70 countries and across 6 continents.
This report also typified the type of matches usually targeted by match-fixers. They stated that despite the fact there may be higher returns to betting on top level competitions, matches in lower or semi-amateur leagues are usually targeted as ‘they are less likely to be monitored.’ Similarly, ‘friendly matches, often international, are particularly vulnerable, as they are less regulated than FIFA-sanctioned competitions.'
Kickbacks on marketing and TV rights, illegitimate betting and match-fixing don’t even encompass the whole array of illegal activity associated with organized football. Allegations of vote-rigging for host city selection and illicit reselling of tickets have also been rampant. Additionally other accusations of more subtle vote manipulation that have come to light, while potentially not illegal, are downright murky.
Public opinion is right to be appalled at the corrupt acts conducted by some at the very top of FIFA. Fans, players, and the history of the game deserve better, but if the concerns of sports fans and citizens in general are to be in the right place, we should interpret this most recent scandal as a symptom of a larger, deeper-rooted issue. The fact is that most of these scandals transcend the categorization of corruption in football, at any level, and truly reflect the pervasiveness of broader corrupt and criminal activities that merely utilize sports as a vehicle.
FIFA reform would be a step in addressing that issue. Yet safeguarding the integrity of the game, promoting healthy citizen engagement with sports and stopping these corrupt activities and criminal endeavors require a stronger and more proactive stance from national organizations, local organizations, and even from us, the spectators.
 In European soccer, a season is played between the fall of one year until the summer of the following year. We use this season as reference because financial data is publicly available for all top 5 leagues for this season and it represents a mid-point for the 4 year period of FIFA. Revenues for these leagues for the 2013/2014 season sat approximately at 15 billion USD.
 We conducted an attempt to reconstruct the annual revenues from organized soccer in different regions of the globe, including supranational organizations like FIFA and UEFA, CONCACAF, and CAF. The estimates for the European top leagues were informed by rigorous data from UEFA, FIFA, and independent studies by the firm Deloitte. Estimates for regions like Africa, Central and South America, Oceania and Asia were not as rigorous, given the lack of any organizations or processes to capture, audit and share data in these regions. Estimates in these cases were based on primary research into regional associations, national leagues, and even clubs, where data are also scarce and difficult to verify. All in all the revenue identified from these different sources of information add up to 33.5 billion dollars annually, 14% of which refers to FIFA, UEFA and other Regional and National Associations. Similarly an AT Kearney study estimates the size of global football at 35.3 billion dollars.
This research is part of an ongoing collaboration with the International Centre for Sport Security (ICSS). This blog highlights some of the findings of this work.