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Coronavirus will cost Premier League clubs £1 billion

The COVID-19 pandemic reportedly costs the EPL a £1 billion reduction in revenues.

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Coronavirus Will Cost £1 Billion To Premier League Clubs

The English Premier League is set to return on June 17 for the first time in over 2 months due to the coronavirus pandemic. The disease costs a £1 billion reduction in revenues to clubs, according to Deloitte’s Football review.

Deloitte Head of Sports Business, Dan Jones says matches played behind closed does will lead to expected revenue reduction and operating losses.

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£500 million if that will come from a reduction in broadcasting through rebates to broadcasters while another £500 million will be deferred for the next season.

” The success of each league’s return and the strength of each other’s relationships with broadcasters and commercial vials partners will have a potentially significant and lasting impact on the financial strength of clubs and leagues, “ Dan Jones said.

READ MORE: Fellaini becomes first player to test positive for Coronavirus in Chinese League

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According to the report, the top 5 leagues in Europe (England, Spain, Italian, Germany, and France) generated combined revenue of £15 billion in 2018/19 which is up 9%.

The Premier League revenues were £5.2 billion in 2018-18, up 7% with pretax losses of £165 million while aggregate operating profits fall 5% to £824 million.

 

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Business News

Cristiano Ronaldo emerges first billionaire footballer ahead of Lionel Messi

Cristiano Ronaldo ranks Number 4 on the 2020 Forbes Celebrity 100 and making him the first soccer player in history to earn $1 billion. 

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Christiano Ronaldo emerges first billionaire footballer ahead of Lionel Messi

Cristiano Ronaldo has been crowned the first soccer billionaire ahead of his top rival in sport, Lionel Messi after earning a massive $105 million before tax and fees in 2019. This was announced by Forbes through its official website.

CR7 as he is popularly called, ranks Number 4 on the 2020 Forbes Celebrity 100, a spot above Lionel Messi, and making him the first soccer player in history to earn $1 billion.

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READ ALSO: Messi emerges highest paid Sportsman on earth; here is how

The 35-year old Juventus attacker is the third athlete to hit the $1 billion mark while still playing following Tiger Woods, who did it in 2009 on the back of his long term endorsement deal with Nike and Floyd Mayweather in 2017, who’s made most of his income from a cut of pay-per-view sales for his boxing matches.

The Portuguese star joined Juventus in 2018 in a deal worth $117.34 million after spending nine years with Real Madrid and within 24 hours of release, Juventus sold 520,000 Cristiano Ronaldo jerseys worth over $60 million.

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READ MORE: Meet Alan Sinfield, New CEO of 9Mobile

He has amassed an ever-growing following of fans over the years. In January he became the first person with 200 million followers on Instagram alongside massive presence on Twitter and Facebook making him the most popular athlete on the planet.

Recall that in 2016, Nike signed Ronaldo to a lifetime deal and pays him upwards of $20 million annually couple with other sources of income including Real Estate, Social media influencing, etc. His 2020 earnings include a salary of $60 million, a slight decline compared to his earnings in 2018 due to a 30% pay cut he agreed to take in April as a result of the COVID-19 pandemic.

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READ ALSO: Polaris Bank’s profit rises to N26.2 billion from N2.8 billion

 

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COVID-19: Shutdown of sports is crippling the world economy – Oma Akatugba

The halt on global sporting activities has impacted the world’s economy massively, as the sports sector and other sectors influenced by sports, account for a total of 2.98% (€300 billion) of the European Gross Value Added,

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Oma-Akatugba, COVID-19: Shutdown of sports is crippling the world economy – Oma Akatugba

As the spread of coronavirus accelerates around the world, the effects of measures taken to curb the pandemic have crippled activities of some businesses across the globe.

The need to lockdown and practise social distancing makes it difficult for certain businesses to thrive, especially those associated with sporting activities, where physical contact is difficult to avoid. Most sporting events have suffered major serbacks since the outbreak, as the organisers are counting their loses.

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With the number of confirmed COVID-19 cases growing astronomically around the world and resumption of sporting activities, which is not near in sight, it is imperative to consider the effect of the pandemic on the industry, Nigerian sporting environment and ways to increase sports productivity locally.

In a tweet chat session organised by Nairametrics with Oma Akatugba, on Thursday, the renowned sports journalist shed light on the effect of the pandemic on the industry, both home and abroad, and possible areas Nigerians could venture into, in order to create wealth from sports.

READ MORE: Kobe Bryant: What Nigerian athletes, business owners must learn

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According to Oma, the halt on global sporting activities has impacted the world’s economy massively. He explained that the sports sector and other sectors influenced by sports, account for a total of 2.98% (€300 billion) of the European Gross Value Added, also contributing 2.12% to the total employment numbers in Europe, representing about 4.5 million employees.

But with the rise in COVID-19 cases around the world, most leagues have been suspended indefinitely, consequently affecting revenues generated from TV rights, jersey sales, ticket sales, and endorsements. This, according to him, has forced some athletes around the world to take pay cuts.

He spoke further on the effect of the outbreak on sports content creators like him.

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“All my interview appointments have been called off, major sporting events where I already got accredited were all postponed indefinitely. The last time I received a message from the sporting director of one of the Bundesliga clubs, he said they do not have any need now because of the pandemic, and cannot talk about the budget for players,” He said.

READ MORE: Is Nigeria’s appropriation bill a scam?

On the Nigeria Premier League, Oma believes that it has not been able to live up to expectations, despite having a handful of Nigerian born football stars making it in Europe and other parts of the world.

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Oma said, “Honestly, Nigeria is not taking any strategic step to make sports an active economic driver, like other parts of the world.” He made comparisons with other parts of the world where sports business spins in large income. “In Germany, for example, 56,081 people were employed either directly or indirectly in the Bundesliga or Bundesliga 2 in the 2018/2019 season,” he added.

According to him, people who run sporting events in these places are not just passionate about the game, but businessmen and women that understand the dynamics of business and how to turn any activity into a big money-spinner.

Business opportunities in sports for Nigeria
It is important that Nigeria bolsters its sporting activities to increase its contribution to the country’s economic growth, and Akatugba advises on major steps to take in order to grab the opportunities that sporting activities present.

READ MORE: 5 practical things small businesses can do during this pandemic lockdown

In his words, “the key steps to take is to read global trends in sports business as well as research on key events and happenings in the business globally while studying the Nigerian terrain, then find an area you can latch unto.”

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He cited jersey making and kits-making as very good ventures in the sporting business. Till date, there is no company making the highly demanded fabrics for jerseys in Nigeria. Anyone can venture into this area of business.

Other areas filled with opportunities, as suggested by Oma, include merchandising, players management, sports marketing, or event creation and promotion.

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Around the World

EPL clubs to be fined £37 million each over suspension of matches

The EPL clubs might be fined £37 million each by broadcasters if the 2019/2020 season is cancelled following the suspension of matches due to the spread of coronavirus in the UK.

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EPL clubs to be fined £37 million each if 2019/2020 season is cancelled due to Coronavirus

The English Premier League (EPL) clubs might be fined £37 million each by broadcasters if the 2019/2020 season is cancelled following the suspension of matches due to the spread of coronavirus in the United Kingdom (UK).

According to a report, the deal between the Premier League and broadcasting channels like Sky Sports and BT Sport states that both broadcasters will televise 128 games and 52 games respectively. However, with the suspension of the league until at least April 30, 2020, Premier League will not fulfil its TV commitments before July 31.

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There are reports that Sky Sports and BT Sport are weighing legal actions to ensure their investment into televising the cancelled matches doesn’t waste. The Premier League’s current UK broadcasting deal is worth £5 billion. It was learnt that if the broadcasters succeed in their demand, the 20 Premier League clubs will cough out a total of £750 million.

Clubs are not willing to make payment: The EPL clubs are not willing to pay such fine as the suspension was caused by an epidemic beyond control. But the Premier League also intends to ease the tension in order not to damage relationships with broadcasters ahead of the next rights cycle in two years’ time.

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[READ MORE: BMW shuts down European factories over Coronavirus)

Aside from the topflight EPL, the lower division leagues in England are also affected by the suspension of League matches across the UK. This is because the lower divisions earn lesser broadcasting revenue, while their major revenue source comes from matchday earnings.

It was reported that the 47 League One and League Two clubs stand to lose a combined £50 million in gate receipts, sponsorship and season tickets if the campaign cannot restart before the summer. This could lead to the clubs going out of business, so to prevent that, there are suggestions that the EFL, the Premier League and other soccer organisations should financially contribute.

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