Billion Dollar Sports Teams

manu

It is inevitable that anyone who writes regularly on culture will eventually have to deal with sports. To illustrate how important sport is within world culture, sports and sports-related material now make up 2-3% of global GDP.

So, with the UK and European football season underway and the American Football season about to start, I thought it might be interesting to comment on Forbes’ latest rankings of the world’s most valuable sports teams:

1 – Manchester United – $1.870bn (£1.144bn)
2 – Dallas Cowboys – $1.650bn (£1.009bn)
3 – Washington Redskins – $1.550bn (£948m)
4 – New York Yankees – $1.500bn (£918m)
5 – New England Patriots – $1.361bn (£833m)
6 – Real Madrid – $1.353bn (£828m)
7 – Arsenal – $1.200bn (£734m)

8 – New York Giants – $1.183bn (£724m)
9 – New York Jets – $1.170bn (£716m)
10 – Houston Texans – $1.150bn (£704m)

As we can see, the list is dominated by those two aforementioned sports: soccer because of its global appeal, and American football because of its popularity in the lucrative US market. These high prices are chiefly driven by television rights:

Currently, three American terrestrial television networks CBS ($3.73B), NBC ($3.6B) and FOX ($4.27B), as well as cable television’s ESPN ($8.8B) are paying a combined total of $20.4 billion to broadcast NFL games through the 2011 season.

In the NFL, according to Forbes, the news has been positive for the private owners of all the teams in what has been proven to be a recession-proof business:

[B]uying a football team has turned several nine-figure moguls into billionaires, including Jerry Jones (Dallas Cowboys), Bob Kraft (New England Patriots) and Jeffrey Lurie (Philidelphia Eagles). A wave of generous television contracts, lucrative advertising deals and high-margin luxury boxes has pushed the pre-debt value of 19 of the 32 NFL teams over the billion-dollar mark. The Cowboys, Washington Redskins and New England Patriots are all worth more than $1 billion net of debt.

The financial success of the American clubs on the list is not replicated in the soccer teams despite the high value of some of these clubs. While the per game television rights are approximately the same as the NFL, many of the clubs are saddled with stupendous amounts of debt:

The English top four are a prime example. Chelsea, backed by Roman Abramovich, have made steady losses since his 2003 takeover. Manchester United, owned by the Glazer family, are also losing money.

Putting some more precise figures on this debt, Sport.co.uk reported on Friday that: “The debt of Red Football (the ownership of Manchester United) is up to £575 million” and the debt that Real Madrid “now possesses is estimated to be around £800 million.”

This debt, however, did not stop Real Madrid from buying Cristiano Ronaldo recently for £80 million (US$132 million) making him the world’s most expensive soccer player. Here’s an informative graphic giving some context to the amount paid by Real Madrid for Ronaldo by showing what else it could be used for: 

Ronaldo

 

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7 Responses

  1. First F.A. Cup Final I ever watched and bet on ( I was 13 ) was the (at the time) dream final of Man U vs Liverpool. I backed Man U. I lost. Just amazing that some 35 years later this team still dominates the game in a way that I only wish our beloved All Blacks could match.

    • Man U have turned into an absolute juggernaut over the last 15 years. What they’ve done better than any other team is ride the wave of globalisation and marketed players like Beckham to a much greater degree than any rivals.

    • Well, Wass, I think you memory may be a little faulty. The only time that Man U played Liverpool in an FA Cup Final was in 1977. But Man U did in fact win 2-1, not lose as you suggest.

  2. What I like in the above list is the New York Yankees, a baseball team, sitting in fourth place. I reckon they probably sell a billion dollars worth of Yankee caps a year.

  3. Can change parten of formation

  4. Can we change our parten of formation

  5. I love man u. I can die for man u

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