Beyond the World Cup: Expanding sports coverage boosts both subscription rates and advertising revenues

Qatar’s winning bid to host the 2022 FIFA World Cup was part of a broader government strategy to transform the country into a centre for sporting events in the region. Simultaneously drawing from and feeding into this strategy, the media has also tapped into a vast appetite for sports coverage domestically and the broader region. Al Jazeera has led the sector, targeting sports channels as a means of widening the viewer base and generating revenue growth.

AL JAZEERA SPORTS: Al Jazeera Sports airs a total of 10 sports channels, most of which focus on football leagues in Europe. Recent deals with Arab Radio and Television have made Al Jazeera the leading sports broadcaster in the region, opening a very large market for subscriptions, advertising, and other related content. Flexing its considerable financial resources, the network has also invested heavily in buying broadcasting rights for major global sporting events. The network recently won the rights to screen UEFA Champions League matches in France for three years, beating the French Canal Plus network.

This appears to align with other investments by the country, such as the recent purchase of a 70% stake in the French Ligue 1 football club, Paris St-Germain, by the Qatar Investment Authority. The purchase came on the heels of a massive $82.5m investment by Qatar Sports Investment (QSI) into FC Barcelona, the Spanish La Liga football powerhouse. Highlighting the importance of the deal, Qatar Foundation replaced UNICEF on FC Barcelona’s team shirts and training wear, pushing the organisation and the country further into the global limelight.

The foray into the French sportscasting market positions Al Jazeera for potential bids in other markets too. The Barclays Premier League, for example, would be a huge win for the network and Qatar more broadly, as the top clubs in the league have significant viewership across the globe. Sky TV and Disney’s ESPN channel pay a total of $2.7bn to screen 138 top-flight live games per year. Their deal comes to an end in May 2013, presenting an opportunity for Al Jazeera to enter a competitive bid.

SPORTS CONTENT WORLDWIDE: The recent expansion of Qatar’s sports coverage, especially in light of the 2010 World Cup and broadcasting rights for the 2014 tournament has peaked global interest, meaning advertising numbers will likely surge in the coming years. Already, the boom in print, radio, online and mobile media has been driving corresponding growth in ad revenues. The Pan Arab Research Centre found that advertising expenditure in the Middle East reached $13.7bn in 2010, a 24% increase over the previous year.

The market in Qatar grew by 16% from $402m to $467m in the same period.

Thanks to its international audience and broadcasting rights for high-profile sporting events, Al Jazeera can command premium rates for advertising.

A 30-second ad broadcast during primetime television programming on Al Jazeera English, for example, costs $5175, state-owned media house q.media has reported, as compared to QR3105 ($853) for a comparable slot on Qatar TV’s English news channel.

Following the broader trend in the sector, sports channels have the largest number of viewers and therefore attract the highest rates. Peak rates on Al Jazeera’s sports channels during regular scheduling can be up to $7000, but the price jumps as high as $35,000 during premium events such as the UEFA Champions League matches.

GLOBAL BRANDING: While Al Jazeera will continue to dominate the broadcasting market for sports locally and in the region at large, the network’s investments should help bolster Qatar as a global brand, opening new opportunities for investment by local companies. Digital media content developers, for example, will have access to a much larger market through the network’s global broadcasting services. Related investments that would help drive innovation and promote education will also create new opportunities in the country to leverage this infrastructure in the future.