Bringing the FIFA Soccer World Cup to a City

The Advantages and Disadvantages to Bringing the Soccer World Cup to a City

A large number of countries consider applying to host the FIFA World Cup and a significant number actually make a formal bid for this quadrennial tournament. To better understand the advantages and disadvantages to hosting the World Cup, this paper will begin with a brief overview of the FIFA World Cup. This will then be followed with the economic and social advantages to a city that hosts this event, using both literature specifically concerning the World Cup and other quadrennial global sporting events — the Olympics. Lastly, the disadvantages to hosting the World Cup will be explored.

The Advantages and Disadvantages to Bringing the FIFA Soccer World Cup to a City

Soccer is a major sport in countries around the globe; however, the sport simply does not have the same following in the United States. Other sports, in America, are big business. The National Football League (NFL), Major League Baseball (MLB), National Basketball Association (NBA), National Hockey League (NHL), NASCAR Racing, and various collegiate sports all bring in billions of dollars every year for cities that host these sports. Competition for championship events is often fierce. Even global sporting events, such as the Olympics, sees cities clamoring for an opportunity to host these prestigious sporting extravaganzas. However, what are the advantages and disadvantages to bringing the FIFA Soccer World Cup, specifically to a city, in America?

A large number of countries consider applying to host the FIFA World Cup and a significant number actually make a formal bid for this quadrennial tournament. To better understand the advantages and disadvantages to hosting the World Cup, this paper will begin with a brief overview of the FIFA World Cup. This will then be followed with the economic and social advantages to a city that hosts this event, using both literature specifically concerning the World Cup and other quadrennial global sporting events — the Olympics. Lastly, the disadvantages to hosting the World Cup will be explored.

FIFA Soccer World Cup

The Federation Internationale de Football Association (FIFA) Soccer World Cup is the world’s biggest sporting event, second only to the Olympic games. When considering television audience, the World Cup is actually larger than the Olympics (“2010 FIFA,” 2009). The first FIFA World Cup was held in Uruquay, in 1930. The event was developed by a group of French soccer administrators, in the 1920s, led by Jules Rimlet. The idea was simple — bring the world’s strongest soccer teams together to compete for the title of World Champions. The World Cup was a success, but was put to a stop for 12 years, due to the Second World War (“The history,” 2009).

When the FIFA World Cup resumed, in 1950, the event once again captured the world’s attention. From 1958 to 1998, the World Cup was hosted alternately in Europe and the Americas. In May 1996, the Executive Committee broke with tradition and awarded the hosting of the 2002 World Cup to partner countries Korea and Japan (“The history,” 2009).

To date, there have been 16 World Cups held, with seven different winners. The global appeal of the event is evident. More than 37 billion people watched the 1998 World Cup, in France. This includes approximately 1.3 billion that watched the final match. More than 2.7 million people physically attended the 64 matches in the French stadium (“The history,” 2009). Although the World Cup does not have the same level of following in America as it does in other countries, particularly in Europe and South America, there is still a large contingent of American fans.

According to Sandomir (2006) the 2006 Wold Cup final match attracted 16.9 million American viewers. This was a 152% climb from the 2002 Wold Cup hosted in Japan, which was shown in the morning. The 16.9 million viewers figure was 31% better than the 1998 World Cup, when France hosted, and on par with the 1994 World Cup that was hosted in Pasadena, California. Of those 16.9 million viewers, 11.9 million watched the exciting finale on ABC, while 5 million watched on Univision. Looking at how this figure compares with other sports in America, the popularity of soccer in America may be underestimated.

The 2006 World Cup was broadcast at 2 p.m. On a Sunday, and exceeded the four million average audience the month prior, for the NBA finals between the Miami Heat and the Dallas Mavericks. This viewership was also extremely close to the 17.5 million Americans that watched the NCAA men’s basketball champions game, or the 17.1 million viewers that watched the Chicago White Sox play the Houston Astros, for the World Series in 2005, for the MLB. Of course, as Sandomir (2006) notes, these figures pale in comparison to the viewership of the Super Bowl, which in 2006 reached 91 million people. However, clearly there is a significant interest in soccer and the World Cup in America.

Advantages to Hosting the World Cup

Sturgess and Brady (2006) surmise that hosting the FIFA World Cup is a matter of great national prestige. However, despite the prestigiousness that comes along with being chosen for one of the premier sporting events in the world, there are a variety of advantages for cities hosting the World Cup. These advantages include immediate economic benefits, social benefits, and long-term macroeconomic national benefits once the World Cup is over. One only has to look at previous host cities, and the rewards they’ve reaped, as well as South Africa’s planned benefits with the 2010 World Cup, to begin to see some of the advantages a host city may garner.

In general, the short-term and long-term economic benefits a city can expect from hosting the FIFA World Cup, according to Sturgess and Brady (2006) include: increased GDP and increased employment, that can give the host nation an economic boost. For South Africa, it is anticipated that there will be 1 job created for every 12 new tourists that visit the country. According to the South African Tourism board, this could equate to 16,000 new jobs (“Business tourism,” 2008). Previous studies focus on the size of the demand boost that comes from hosting a sporting event like the World Cup. With 3 million visitors coming to South Africa for the 2010 World Cup one can begin to appreciate the demand boost that would come from such an event. Items such as the longer-term impact of investment into improvements of the nation’s sporting facilities and other infrastructure, that typically precedes an event like this, have to be taken into consideration. There is also the positive economic impact that comes from the additional consumer expenditures that are a result of visitors to the sporting event itself, when the World Cup takes place. This economic boon is then used for social development of advantages.

In South Africa, it is estimated that the 2010 World Cup will inject an estimated 21.3 billion rand into the South African economy. 12.7 billion rand of this is direct investment. An anticipated 7.2 billion rand in taxes will be added to the state. This money will be used in a variety of ways, including the transformation infrastructure. The money will also be used to rehabilitate some decaying city areas, as well as develop a variety of legacy facilities centered on sports development and sports tourism. It is hoped that the World Cup will bring in 200,000 new tourists. Many of these new visitors to the country will be on business tourism incentive packages (“Business tourism,” 2008).

This type of investment into a country’s infrastructure and facilities that will continue to serve the country for decades to come, and is a significant social advantage of hosting the World Cup. In South Africa, hosting the 2010 FIFA World Cup is going to see a variety of multi-billion rand infrastructure projects for the country and the City of Cape Town specifically. These include a new stadium, transportation infrastructure improvements, and a variety of other upgrades, including human resource development (“The 2010,” 2006). Five of South Africa’s soccer stadiums will see major renovations, for the 2010 World Cup. Two completely new stadiums will be built — one at Mbombela in Mpumalanga, and one in the Nelson Mandela Metro, in the Eastern Cape. Three others will be rebuilt, with two becoming completely new multi-sport facilities, and the stadium at Green Point receiving a retractable dome (“2010 FIFA,” 2009).

These improvements will make Cape Town, and South Africa, a more desirable business and leisure destination for travelers, investors, and residents, long past the final goal of the 2010 World Cup (“2010 FIFA,” 2008).South Africa will spend 5 billion rand on building and renovating ten World Cup stadiums. More than 5 billion rand will be spent on upgrading the country’s airports. In addition, 3.5 billion rand is earmarked for improvements to South Africa’s road and rail network. This will include a new high-speed rail link, the Gautrain, that will run between Johannesburg, Pretoria and Johannesburg International Airport (“2010 FIFA,” 2009).

Developing a country’s “brand” is one of a variety of intangible advantages that not only will be garnered by South Africa, but for any other nation chosen to host the World Cup as well. An event of this magnitude will build both the image and the identity of the host country. There is also the benefit of publicly displaying, for the world, a country’s capabilities, expertise, and modern infrastructure. This can be a significant aid in attracting other events in the future, whether they be other types of sporting events, or corporation events, or industry-sponsored events — establishing the country as a business tourism destination. For South Africa, and other areas where security is often a concern of travelers, events like the World Cup will serve as an opportunity to not only upgrade safety and security measures, but then also to showcase these measures to the world, enhancing their tourism message (“Business tourism,” 2008). According to Goolam Ballim, Standard Bank economist, for South Africa, hosting the World Cup will help change perceptions foreign investors may have concerning South Africa (cited “2010 FIFA,” 2009). The same holds true for any nation privileged to be chosen as a host. Despite these advantages, there are disadvantages to hosting the FIFA World Cup as well.

Disadvantages to Hosting the World Cup

Sturgess and Brady (2006) note that the literature concerning whether or not it is advantageous to host an international sporting event, like the World Cup, is quite divided. Although many researchers have found a significant economic boost, one of the primary advantages for hosting an event of this magnitude, there are a number of extremely pessimistic pieces of literature, according to Sturgess and Brady, that indicate that hosting an event like the World Cup has only a negligible effect on the economic growth of the host country, and sometimes a negative impact.

There is also the potential disadvantage of the long-lasting effect should the event not go well for a host city. If the enormous capacity of the World Cup event is not well-managed, the host may see not only potential future travelers not making their city a destination, but also regular travelers may look elsewhere to host their future events (“Business tourism,” 2008). This is a significant risk for any city, given the sheer logistics of hosting an event of this scale. For the United States, this risk is especially important.

Hundreds of cities around the United States are vying for the attention and business of conventions, trade shows and sporting events. Taking on an event like the FIFA World Cup could either establish an American city as ‘the place’ to host a large event, or have it become infamous for its failure to properly handle event planning. Although security concerns are not the same as those found in South Africa, American cities would also have significant security concerns. From simple pick pocketing to full scale terrorism, crime escalates during an event like this. This one facet could make or break the entire event, and with it the city’s future hopes of attracting other events. In addition, just as there are benefits that a city will enjoy once the World Cup has come and gone, there are also disadvantages too.

As Sturgess and Brady (2006) note, one disadvantage is the cost of maintaining facilities that were built for the event itself. One only has to look at South Africa to see what a significant cost this can be. South Africa is building or majorly renovating ten facilities for the 2010 World Cup. Certainly these facilities will be used during the series of games; however, what about once the World Cup is over. In America, where although soccer has a moderate following, it has nowhere near the following of other national sports — like the NFL — and therefore all of the facilities needed to host such a large, international sporting event are not really needed once the event is over. These venues may sit unused, or only partially used. The city will incur the continuing expenses of these facilities, such as maintenance, and the quantity of future events may not offset the costs of the upkeep. This has happened with Olympic facilities that have not been fully utilized, once the Olympics left town. In other areas of the world where soccer is the sport of choice, new soccer facility creation may be sustainable; however, in the United States, that may not be the case. It is likely that this is one reason why the United States has only hosted one World Cup (“Previous,” 2009).

Conclusion

Although soccer is a globally enjoyed sport, for the United States, it does not have the following that the sport does in some areas of the world. One only has to look at the differences between the 91 million fans that watched the Super Bowl vs. The 17.5 million that watched the World Cup, to see the significant difference in popularity. However, the potential for hosting such a large, international event is an attractive possibility for many cities. Just like hosting any large sporting event, there are both benefits and disadvantages should an American city pursue hosting a FIFA World Cup.

Two primary advantages come to mind immediately when discussing the benefits of hosting the World Cup are prestige and economic reasons. The World Cup is one of the premier sporting events in the world. Being chosen to host the event is an honor and a privilege. There are certainly potential economic benefits as well. Millions of visitors may come to the event. It also offers the host an opportunity to build their brand as a tourist and business destination. For some countries, it can also encourage foreign investment, post-World Cup. New infrastructure, tax revenues, an economic boost to possible areas of decline, all are potential benefits of hosting a World Cup. However, there are disadvantages as well.

The economic benefits may only negligibly outweigh the enormous costs in getting a city ready for a sporting event on the magnitude of the World Cup. In some cases, benefits may not outweigh the costs at all. If the event does not goes as anticipated, it can have a long lasting negative effect on the host city and dissuade potential future events from choosing that location. Maintaining specialized facilities too will be on ongoing cost for the city, long after the event tourists have gone home. Add to these disadvantages the fact that soccer simply does not have the following in the United States that it has elsewhere, and it is an event an American city would really have to consider before putting in a bid to host.

References

2010 FIFA World Cup. (2008). Retrieved December 14, 2009, from http://www.capetown.gov.za/en/2010/Pages/default.aspx.

2010 FIFA World Cup South Africa. (2009). Retrieved December 14, 2009, from http://www.southafrica.info/2010/worldcup-overview.htm.

Business tourism and FIFA 2010 Soccer World Cup. (2008). Retrieved December 14, 2009, from http://www1.southafrica.net/Cultures/en-U.S./bt.southafrica.net/News+and+events/News/Lateral+Thinking+Business+Tourism+and+the+2010+Soccer+World+Cup.htm.

Previous FIFA World Cups. (2009). Retrieved December14, 2009, from http://www.fifa.com/worldcup/archive/index.html.

Sandomir, R. (11 Jul 2006). Cup ratings are up, but fans deserve better. NY Times. Retrieved December 14, 2009, from http://www.nytimes.com/2006/07/11/sports/soccer/11sandomir.html.

Sturgess, B. & Brady, C. (4 Nov 2006). Hosting the FIFA World Cup. World Economics, 7(4). Retrieved December 14, 2009, from Business Source Complete.

The 2010 Soccer World Cup: Africa’s time has come. (18 Aug 2006). Retrieved December 14, 2009, from http://www.exsa.co.za/exsa/exhibitionarticle.aspx?rootid=4&subdirectoryid=1006

The history of the FIFA World Cup. (2009). Retrieved December 14, 2009, from http://www.fifa.com/classicfootball/history/worldcup/index.html.