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6 March 2021

The Future of the Latin American Football Business

Tag(s): Business, Sport
Through my membership of the Anglo-Chilean Society I have associate membership of Canning House. Canning House has been an umbrella organisation for the Anglo-Latin American societies and the wider Latin American community in the UK for many years, creating relationships and understanding between the UK and Latin America. This week I attended a Canning House webinar on the future of the Latin American football business. This was organised by Professor Rory Miller, a business historian with a strong research interest in international business in Latin America. He co-founded the MBA (Football Industries) taught at the University of Liverpool and retains a strong interest in football finance and the sports business both in the UK and Latin America. The 600 graduates of this MBA course include many from Latin America. One of these, Antonio Rosique, a Mexican journalist, led the panel of other experts: Marcela Mora y Araujo, an Argentinian football journalist based in London, Mr Harold Mayne-Nicholls who is currently vice president of Chile’s leading football club: Colo Colo, and Fabio Ritter, the marketing manager of the Brazilian Football Association.

There is no question that football is the most important sport in all of Latin America and that Latin American football teams have contributed as much as any region except possibly Europe to the development of world football. While Europe was slow to develop enthusiasm for the World Cup Uruguay won the first one in 1930. Of 21 World Cup finals held to date no fewer than nine have been won by South American countries.

Though based in London, Marcela is currently in Argentina owing to the pandemic and was there when Diego Maradona died. She was amazed by the reaction right across the country. His funeral, though not an official state funeral, was treated by the public as if it were. The whole country was traumatised by his death showing the importance of football to such a country. She is frankly saddened by the fact that these days most of the best Argentinian players, and indeed this could be said of all Latin American countries, go to other countries, particularly in Europe, for greater earnings and she wants to see how this could be changed, but without frankly offering any realistic alternative. She was saddened to see that in the last World Cup in Russia no Latin American country got beyond the quarter-finals thus demonstrating the degree to which Europe now dominates.

Harold Mayne-Nicholls, who has extensive experience of football administration, believes that Chilean football and indeed several other Latin American countries now have significantly improved and renovated their stadia and their infrastructure but not the administration which he believes is the biggest concern. He shares Marcela’s concern about the drain of so many of the best young players going to Europe and what he also sees is that too many of these do not really get developed to their best potential. They stay in the B or C teams at their new clubs or indeed get loaned out to other clubs in weaker leagues. Many of them return aged around 23 or 24 but are not able to pick up where they left off as potential stars aged 16 or 17.

Fabio Ritter described how the Brazilian national team is still in the top three in the world in terms of revenue. As well as the qualifying games they play in South America, in the past 20 years they have played in 30 other countries in friendly matches for which they earn substantial revenue. (In 2010 I saw Brazil play the Republic of Ireland at Arsenal’s Emirates Stadium. In a game watched by 40,000 people Brazil won 2-0.)

Marcela was asked how the women’s game is developing in Argentina. She thought the development was very slow indeed, but she thinks it reflects society as a whole. Football is not a bubble and the prejudices that exist in society at large have their effect on the development of women’s football.  Harold thought that the situation in Chile was improving. All the women’s players at Colo Colo had 100% professional contracts which did not just reflect wages but also other employment conditions. The women had the same conditions as the men in training and for coaching staff but unfortunately this was not reflected in the gates and the men’s game remains very much better supported.  Antonio said that in Mexico there are a number of successful women’s teams, some of which attract gates of 30,000+. Fabio reported that in Brazil both men and women were paid the same for appearances for the national teams while professional clubs in the top leagues are obliged to develop and promote their women’s teams and TV audiences are substantial.

The panel was asked to what degree was there interest in Latin American football in other regions of the world, particularly in Asia. Marcela again complained about the dominance of Europe in this respect, but Harold explained that the time zones were a major issue and there was not much interest. If Colo Colo kicked off a match at its usual time on Saturday afternoon then this would be very early on Sunday morning in China, but an increasing number of Chilean players do go to Asia and the Middle East to play as well as the usual number who go to Europe. There was no sign of investment interest from this region and most of the investments in Chilean clubs came from within the country or from other parts of Latin America.

The panel was asked what they saw would happen over the next 10 to 15 years. Marcela was optimistic that this most noble of games would stay as a central part of the Argentinian culture but felt that there had been many missed opportunities in the matters of governance. She hoped that the game would open up more for women and children and indeed when she first went to football matches in the 1980s women and children could get in for free. She is concerned about the tribal aspects of Argentinian football with the intense rivalry between Boca Juniors and River Plate often spilling over into violence. While during the pandemic there were no fans in the stadia, before that a rule had been introduced that only home fans could attend to prevent the violence. She hopes that there will be another Maradona or Messi or De Stefano but that the Argentinian people do not devour him. She also hopes there will be much more accountability and transparency in the administration of the game which suffers from corruption and she was interested in the developments that we have seen in England with the impact of players like Marcus Rashford on problems in society as a whole. She would like to think that Argentinian stars, who were even more revered in their country, could have such an impact.

Harold believes that there will be no change in the development of highly skilled footballers as that is deeply rooted in society, but that much better tools were needed in the administration of the game. There needed to be continued progress in the renovation of stadia. Fabio pointed out that the Brazilian currency has been effectively devalued over the past two years by 50% and that while Brazil was number one in international transfers, the income levels of players in rich countries were seven times that of those who stayed at home. He also introduced the concept of e-sports which are developing massively, and which have huge opportunities in football with clubs developing their own games for their very loyal supporters.

Harold thought that social media was not helping the game at all. Agents use social media to promote the players they represented, and he said that Colo Colo as the biggest club in the country might attract 250 CVs of young players in a year and every one of those agents who had submitted the CV would then post that on Facebook suggesting that Colo Colo were going to take that player when in fact Colo Colo might not even have got round to watching that player.

Antonio described the situation in Mexico where individual politicians would sometimes seek to get elected as governors of the state by promising to establish a new football club in that state. Then during their term of office this club would be developed and would get support but then once the governor lost his position that support would drain away and the club would fall into bankruptcy or at least be relegated to the lower leagues.

There was some discussion of the possibility that the satellite model might give way to streaming services like Netflix and Amazon. Netflix have not expressed much interest in sport as they seem to want to develop and control content but Amazon has dabbled a little. My own experience of that has been poor and I commented on this in Chat but my comment was not picked up.  One of my beloved Manchester United games in the Autumn was shown on Amazon Prime but I was out that evening and it is not possible to record Amazon Prime so I missed it. I did watch an international Rugby match on Amazon but the picture quality was so poor that it was as if the players were playing in snow.

While this was something of an eclectic tour of the game in an important region of the world it seemed to me that while much was made of the different levels of income between the major leagues in Europe and those of Latin America that has been the case for a very long time but has increased enormously through the successful development of subscription television. The richest league in the world has been the Premier League in England since Sky and other players like BT established the model for a subscription fee that consumers pay. This has meant that many of the best players in the world wanted to come and play in England where competitive standards are high and where salaries are sky-high. When South American nations seek to qualify for the next World Cup finals, they play in a single group of 10 nations and thus each nation has to play 18 matches in the course of 18 months or so. This means on average the players based in Europe, as most of the top players will be, will have to travel to South America and back on average once a month. This probably means that not only are they suffering more from jet lag than European players who are just travelling around their own continent but also that as teams they will have less time together so will not develop as well and perhaps that explains why South American nations have performed less well in recent World Cups. Although I mentioned that South American nations have won nine of the 21 World Cup finals that have been held so far, the last four were all won by European countries and only on one occasion in that period was a runner-up from Latin America, Argentina in 2014.

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