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SBJ/October 8-14, 2012/Marketing and Sponsorship
UEFA deal offers risk, big potential reward for CAA
Firm must build global sales force
Published October 8, 2012, Page 1
The subsidiary, CAA Eleven, was chosen over fellow finalists IMG and Sportfive after an almost eight-month process that was thought to have drawn interest from dozens of companies, said CAA Managing Director Michael Rubel. It is the largest global commercial rights assignment for CAA.
While it is not clear exactly how much the rights are worth, Euro 2012 generated in excess of $1.6 billion in revenue, according to published reports.
UEFA and its 53 member organizations have historically sold the rights for the tournament and qualifying events, but UEFA decided to centralize the rights last year, offered a
|Global soccer is booming: Euro 2012 reportedly generated more than $1.6B in revenue.
CAA began planning to bid for the rights early this year, and during the spring it began conversations with veteran media executives Olivier Guiguet and Stéphane Schindler, who left Lagardère Group-owned Sportfive last year, Rubel said.
Guiguet will serve as CEO and Schindler as COO of CAA Eleven; both are partners with CAA Sports in the new company.
The CAA Eleven board includes Rubel, Guiguet, CAA Sports co-head Howard Nuchow, CAA Managing Partner David O’Connor and two members of UEFA. The company will be based in Nyon, Switzerland, where UEFA is based, and is expected to hire a staff of 40 to 50.
“This will be an exclusively dedicated staff, and they will be managing the broadcast, sponsorship and licensing rights of these tournaments and national teams’ competitions,” Nuchow said.
Initially, the bid process was to include just the qualifying events for Euro 2016, but it was expanded to include the finals. About 40 percent of the 2016 finals was pre-sold as part of Euro 2012, so CAA Eleven will be charged with selling the remaining 60 percent of those commercial rights, including broadcasting, sponsorship and licensing, Rubel said.
Euro 2016 will be expanded from 31 matches to 51 matches. Rubel noted that the 31 matches played this summer over 3 1/2 weeks drew a global television audience the size of the Super Bowl.
“We underestimate in the United States the power of football generally and European football specifically, worldwide,” Rubel said. “These are very, very serious rights.”
Mark Noonan, president of sports marketing firm FocalSport and former executive vice president of MLS, said: “It is a huge coup for CAA. It is one of the biggest properties in the soccer world and one of the crown jewels out there.”
Noonan said CAA partnering with Guiguet and Schindler and getting the rights shows the increasingly global nature of sports business. “The fact that a Hollywood talent agency was able to partner with seasoned executives with deep roots in the game speaks to how global and powerful the game had gotten from a viewership and commercial standpoint,” he said.
UEFA reportedly has guaranteed the 53 federations it governs more than $1 billion as part of the deal with CAA Eleven. UEFA did not respond to requests for comment.
Rubel said CAA made no guarantee as part of the deal. “This is a straight agency relationship,” Rubel said. “The rights weren’t bought and there is no guarantee.”
While he would not provide financial details of the deal, he did say, “There is a financial relationship where we get paid against performance and we service these rights in the way we might service any other client that we might have at the agency.”
Typically, CAA charges clients a percentage fee.
IMG declined to comment for this story.
Sportfive spokeswoman Heidi Farr confirmed by email that the company was a bidder. “We submitted a highly competitive bid that would have provided a low, but acceptable, margin,” Farr said. “However, bearing in mind the tremendous experience of Sportfive in commercializing rights to the European Qualification Matches (currently we represent 37 out of the 53 national associations), working at a loss in this highly volatile and sometimes unpredictable market was never an option for us.”
For CAA, the move is the agency’s strongest bid to be a major player in global soccer commercial sales. It also comes amid news last week that CAA Sports sold its World Football Challenge, a tournament featuring European clubs playing at U.S. venues, to RSE Ventures, a company owned by Miami Dolphins owner Stephen Ross. Veteran soccer executives Charlie Stillitano and Jon Sheiman, who had been at CAA Sports since 2007, joined RSE Ventures as part of that agreement.
The UEFA rights that CAA Eleven will market are among the most significant global rights in sports. Some industry insiders wondered if it was a big risk for CAA, a company that has not had a global sports sales force, to organize and build such an operation from scratch. Rubel, asked why he believed CAA Eleven won the assignment, said, “I think our commitment to devote exclusive resources to UEFA was very important.”