UP404 What is FIFA+? Netflix for Football or Infantino's White Elephant?

FIFA+ is the global football governing bodies own media platform, created in 2020 and launched two years later. It’s one of sports biggest and most ambitious and expensive direct-to-consumer projects, and so brings together many of the threads we talk about often on Unofficial Partner; a debate that runs across the sports industry, as governing bodies, leagues and teams spend billions creating owned and operated channels as a mitigation against volatility in the media rights marketplace and the money made from their content by the big social media platforms.

The conversation is peppered with phrases such as walled gardens, creative tension in the bidding process, owning the customer relationship, long tail audiences, build and they will come. 

FIFA+ is a poster child for these theories. But this is a conversation that goes beyond the mechanics of D2C. It’s about what the leaders of big sports governing bodies want to be and the role they will seek to play over the next decade or more.

Read this week's UP Newsletter for more on FIFA+ HERE
Guests:

Dave Roberts was one of the architects of FIFA+ in the run up to launch and in its early iterations. He’s now CEO of XCel Broadcast. 

Hugo Sharman is CEO of StreamAMG, one of the leading players in video content and distribution for sports rights holders.

Carlo Dimarchis is today known as a business media creator, The Guy with the Scarf but previously led strategy and innovation over a 34 year career at Deltatre. 

Michael Broughton is co-founder of Sports Investment Partners and was an advisor to FIFA on innovation and commercial strategy. 

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Transcript

Unofficial Partner Podcast 404

What is FIFA+? Netflix for Football or Infantino’s White Elephant? 

FIFA+ is the global football governing bodies own media platform, created in 2020 and launched two years later. It’s one of sports biggest and most expensive direct-to-consumer projects, and so brings together many of the threads we talk about often on Unofficial Partner, a debate that runs across the sports industry, as governing bodies, leagues and teams spend billions creating owned and operated channels as a mitigation against volatility in the media rights marketplace and the money made from their content by the big social media platforms.

The conversation is peppered with phrases such as walled gardens, creative tension in the bidding process, owning the customer relationship, long tail audiences, build and they will come. 

FIFA+ is a poster child for these theories. But this is a conversation that goes beyond the mechanics of D2C. It’s about what the leaders of big sports governing bodies want to be and the role they will seek to play over the next decade or more.

Guests:

Dave Roberts was one of the architects of FIFA+ in the run up to launch and in its early iterations. He’s now CEO of XCel Broadcast. 

Hugo Sharman is CEO of StreamAMG, one of the leading players in video content and distribution for sports rights holders.

Carlo Di Marchis is today known as a business media creator, The Guy with the Scarf but previously led strategy and innovation over a 34 year career at Deltatre. 

Michael Broughton is co-founder of Sports Investment Partners and was an advisor to FIFA on innovation and commercial strategy. 

[00:00:00] 

[00:01:28] Michael Broughton: if you

[00:01:36] bring on investors at this kind of money, they will want a return at some point, right? However you want to package that up. And as we've seen with every streamer out there, every direct to consumer product out there, it costs an awful lot of money to keep going. 

[00:01:52] I think the statistic I always found amazing was that if your churn rate is 5%, you lose 50 percent of your audience each year. Right. Now, Disney plus is at 4. 8%. That's insane to me, right? That, the amount that they have to spend, the amount of

[00:02:07] content, the amount of investment that needs to be delivered for a Disney plus to be not decreasing in size each year is phenomenal.

[00:02:15] Netflix is at 2%. That's why they're the standout. I think Paramount Plus is six and a half, 6. 8 percent and they're seen as somebody who's going to get sold because they're a dead man walking. So a single sport, single product, whatever you do around it as an investor coming in, you're sat there going, how do I make the math side up? 

[00:02:34] Richard Gillis Unofficial Partner: Applications are open for the leadership in sport M a 2024 it's designed for sports industry executives to study part-time alongside their careers. Program is co delivered by Lufbery university, London, and the Institute of sports, humanities. 

[00:02:48] IOSH experts in leadership education. Lufbery university is ranked best university in the world for sports related subjects. By the world university rankings to find out more, go to sports, humanities.org. Or contact Tom ran@tomdotrahnradoublenatsportshumanities.org. 

[00:03:12] This is like a sort of shit version of the Brady Bunch. Do you remember the Brady Bunch? We used to have

[00:03:16] Dave Roberts: Here's a

[00:03:16] story about a man named Brady. I know him very well.

[00:03:19] Richard Gillis Unofficial Partner: Right, we'll see how we get on. So we're in different parts of the world and thank you for coming together. I'm going to get you all just to say hello. So we can place your voice. So if we go, if I go around, so Hugo Sharman, welcome

[00:03:33] Hugo Sharman: Hello, nice to see you. 

[00:03:34] Richard Gillis Unofficial Partner: and you and Michael Broughton, 

[00:03:36] Michael Broughton: always good to see you all.

[00:03:37] Richard Gillis Unofficial Partner: you've Dave Roberts. Welcome.

[00:03:39] Dave Roberts: Yes. Greetings from Japan. How are you all?

[00:03:41] Richard Gillis Unofficial Partner: Very good. And Carlo.

[00:03:43] Carlo Di Marchis: Hi, Richard. I'm here from Torino, Italy. 

[00:03:45] Richard Gillis Unofficial Partner: Perfect. Right. I am. We're going to get going. The story I've gathered this group together to talk about is FIFA plus, and I'm just going to read Bloomberg Had the story initially, and it's not really moved on, which is always interesting.

[00:04:00] it's still in its initial state. So , , FIFA has enlisted UBS to raise 2 billion for the expansion of its streaming platform, FIFA Plus Bloomberg Reports. Bloomberg writes that FIFA and UBS will target financial investors for a minority stake in the platform in the U.

[00:04:20] S. and the Middle East. It was launched in 2022, President Gianni Infantino outlining that it was part of his mission to make football global, saying that it, quote, in, it underpins FIFA's core mission of expanding and developing football. Globally, in its first year, the aim was to broadcast more than 40, 000 matches, including more than 25 percent of matches in the women's game.

[00:04:42] Bloomberg reports suggest that FIFA is both accelerating the development of its streaming platform and seeking new revenue streams. Right. Okay. So what I just want. I've got some questions, but I'm just going to throw this out to this illustrious group and you've all, got views of, of what's happening here, Dave, I want to start with you. In my head, I'm just trying to work out. what it was, what, what FIFA, the initial aspiration. For it was what it is now and what we think FIFA wanted to be in the future. And then I'll throw in a couple of other questions that I've got, but that's essentially the arc of the thing. Let's start at the beginning. Give us a bit of background to this for people. People will have heard FIFA plus some of them might have watched it at some point, but just , take us back to the initial sort of. Incarnation and those in early conversations. 

[00:05:38] Dave Roberts: Early conversations. The project started 2020, so just after COVID. Launched April 22 with a soft launch, November 22 was the FIFA Plus hard launch. The platform was designed to be more of a D2C platform for football fans globally, so a lot of live streaming, a lot of VOD content, original content. There were a lot of commissions going out by FIFA at the time to, to enlist the likes of Fullwell73, who are well known for producing sports content, original content. So that that was what the basis of FIFA Plus was. On there also a lot of data was being pulled in a match center where you can follow games all around the world Live pickup results, scorelines, goal scorers, all that kind of stuff. And the whole idea was to pull together a bit of a football ecosystem where fans could go, they could get their dose of news, daily news, data, live games, streaming. A one stop solution was the initial, the initial platform. For football fans and then to be bolted on their things like e commerce would be bolted on etc So it really was designed to be that all singing all dancing land of a football fan Yeah, it was it was a big ask I think the initial targets were 235 million unique users by the time the World Cup came along, that was met. Obviously that was aided massively by the fact that it was Cas R22 and it was the World Cup finals. The platform was always designed to have a multi purpose, so yeah, initially what fans saw was exactly what I'd outlined. But in the background there were always thoughts of pay per view, expanding the platform from an AVOD model, premium content. And that, that was borne out by streaming World Cup 22 Qatar into Brazil live. Which obviously will raise questions about rights, relationships with traditional broadcasters and partners. So that, that in a nutshell is what FIFA Plus was.

[00:07:36] Richard Gillis Unofficial Partner: Thank you. That's great. And Michael, you were around at that time as well. Is that right? On the sort of strategy side of things?

[00:07:44] Michael Broughton: So Dave achieved what we failed to do. That's the honest truth. So 2019, I remember working with a number of parties in the strategy group and we came up with a marketplace D2C broadcast system. And we, a lot of the constraints that they would have had, which is, what, what actual rights do you have?

[00:08:03] How do you go to market? How do you actually bring this to live that people will come to it? I mean, we had a, an interesting moment when we were asked to suddenly stream 24 preliminary CAF qualifiers to the world cup and we had 10 days notice. We ended up using YouTube and my Cujo as our kind of tech stack.

[00:08:24] I mean, you had 10 days. It was literally fly by the seat of your pants kind of thing. And we had a grand vision. I think we were trying to come up with something. where given how episodic sports is and given FIFA at that time didn't own many rights, what are the partnerships you can do to bring the rights in house or at least relicense them back to yourself? And also how do you maybe have some integrations that meant that when there wasn't something episodic, again, we were being told there wasn't a budget for shoulder content and original content. So how do You

[00:09:00] create something where people could come in? And they would stick which we had some thoughts on.

[00:09:07] I think I, when I first met Dave, I think it was at World Football Summit. And, and I think one of the great comments he made was the great thing was that they were external and we were internal. So once they had permission, they could do things. Whereas ours was a political minefield and we, I guess the truth is we didn't navigate it particularly well, so we never got it away. Dave and the team did. Yeah, I mean that, that's kind of the thing. I think that, that, that holistic vision, I think that Dave outlaid was something we had. I think the one thing that we were trying to also do was think, how does it not look like every other VOD system out there? , because to me, I, I see so many and it doesn't matter what you, it always looks the same.

[00:09:50] I can't actually discern the difference. Except for the content between Netflix, Paramount HBO you know, UEFA they look very similar. How did you create Cutthroat and have content on there that was permanent that people would engage with daily? Hard. 

[00:10:06] Richard Gillis Unofficial Partner: want to go around because I want to get a sense of where that let's stay in that initial period for a minute, because we've all got questions that will jump forward and we just want to hold that for a minute just to stop it getting too confusing. But Hugo, just again, go back. To that time, when you saw this emerging, this is your world and, and Carlo, similar sort of question for you. What were your initial thoughts, questions about what was happening?

[00:10:33] Hugo Sharman: I think the standout stat was this 000 live, games of every year. I mean, that is a mind boggling number of live events. I mean, that, that dwarfs any other, live sports, D2C, OTT service that's out there. So that, that was the, that for me was the headline. It's like, my God, there's a lot, there's a hell of a lot of content.

[00:10:57] And maybe, maybe we'll kick this around a bit more, but almost too much. I mean, where do you start trying to segment, organize, prioritize all of that content? So it's the sheer volume, I think that we should dig into a bit more. I think the other thing was. Just sort of reflecting on Infantino's strategic messaging around this, which, and he talks about FIFA plus helping to democratize football through live streaming, which, of course, that ties back to, the sort of rationale for FIFA and so forth.

[00:11:29] But it's quite an unusual statement, democratizing anything when it comes to DTC. As a strategy, again, not something that you hear in terms of what usually when we talk about DTC, you know, to do whatever you want to call it. It's about, well, we're launching a subscription service. We're ready to make money.

[00:11:48] And, the usual suspects in this world. DAZN and NBAs and all these sorts of people. That's kind of what, why they're in it. That's, that's what they're in it to do it for. So, so that, for me, those are the two takeaways, really. This is a, the kind of rationale is to democratize football.

[00:12:02] Okay, well, that immediately says that you've got 211 voting members of FIFA. You're launching a DTC thing, service, and it, and in some ways it's got to deliver against all of those 211 objectives, which again, I think you've done other pods about governance in football. So it, it, for me, it was a, on one hand, it was a hell of an ask, how, how do you have a clear strategy and delivery strategy when it's, when you've got that voting structure and so on behind the scenes?

[00:12:34] And then, but on the other side, you've got a whole ton of content. I mean, you, you have, you have literally, yeah, as I say, you probably got too much. So you've got to kind of start to break that down.

[00:12:45] Richard Gillis Unofficial Partner: there are supply side questions of tech technology. Can you deliver that? Is it possible? Will it be any good? 

[00:12:51] And 

[00:12:52] then you've got the demand side in terms of whether anyone wants to watch the stuff when it's out there.

[00:12:55] So I can see that that's part of this question. Carlo, let's just round off this initial chance. initial thoughts, 

[00:13:03] Carlo Di Marchis: so for me, and sorry, I don't want to make it look like it's a competition of who thought about it first. I was invited into at the end of 2016. So Infantino was new. There was an innovation pitch, not with Infantino. And so they say, go crazy, show us what you think, blah, blah, blah. So I went there with the concept of FIFA studios, you should create it. And Olympic channel just launched. So I say, you should do the same thing for football on football globally. The bad thing is that in that moment. Infantino came in the room just to say hi and everybody froze. I remember the air conditioning being like 10 degrees less because it was like me just blah, blah, blah, but nothing happened from there. Second, a bit disappointment. I didn't win that project, the initial one. So I was a bit disappointed. And third, a mix, a mix of I think admiration. I would say mostly admiration when they launch with no registration, you could watch video without registration, which for me was one in terms of go to market, direct to consumer, super smart, but also super brave.

[00:14:06] So I was, I always have a bit of empathy for the technical people behind anything that is launched, even if I'm not doing it. And I was, Oh shit, this doesn't collapse. And it didn't. So, I mean, 

[00:14:17] Richard Gillis Unofficial Partner: Just for the layman and IE me, why is that brave? Just to explain what that means.

[00:14:22] Carlo Di Marchis: Because if , if you put a paywall, you get 10 people. If you put a registration, you get a hundred people. If you don't put anything, you could get 1 million people. I don't know. Dave, Dave will, I'm sure Dave has the numbers in his head, but it's super open to everybody and we are still streaming video.

[00:14:40] And we know that, I mean, streaming live sport is not easy. com. So 

[00:14:45] Richard Gillis Unofficial Partner: And one of the, one of the questions that 

[00:14:46] Carlo Di Marchis: I don't know, Dave will have the behind the scenes story, but that was me outside.

[00:14:51] Richard Gillis Unofficial Partner: Yeah. Yeah. and one of the questions was just, I've found that interesting is that one of the conversation points was, well, they're not even getting the customer data. That was the, that was one of the responses to it was actually, if it's a D2C story, part of this is to gather this database of people, football fans globally. And if there isn't any registration, then that's not happening. So there is that Dave, what'd you think I remember that being a bit of a conversation early on, Oh, 

[00:15:22] they're not putting it, there's no, you don't even have to give your email.

[00:15:25] Dave Roberts: the the thought process was we need, we need this to launch and we need eyeballs quickly and the easiest way to do that is not put any hurdles in the way of getting those eyeballs. So exactly what Carlo mentioned, but registration was coming along. So there would be added benefits offered. For at a subsequent date after launch people then supplying us with with contact details so you could, there was a subscription level which would give you not premium content, but would certainly open up other benefits. But yeah, we had to get eyeballs onto FIFA plus as quickly as possible. So zero registration was the only way to go.

[00:16:04] Richard Gillis Unofficial Partner: Okay, so we've, that's the launch. We're going to get to the fun bit, which is the sort of comparing today with the sort of utopian view back then. So you started, you had the aspiration, and we all know, the gaga between strategy and execution, the reality of it, but where are we now? What is it?

[00:16:26] Because we're about to talk about Throw it into the future and say, you know, someone's going to pay 2 billion quid to be part of this. And what are they buying? And we're going to ask all those sorts of questions and where it's going, where they want it to go. But let's just land on now. What's happening now?

[00:16:40] What below the bonnet or just in terms of, is it, do we know anything that's that we can just assess? Okay. Yeah. It's been a, that's good. That's

[00:16:48] not worked or whatever.

[00:16:50] Dave Roberts: I think there was some, there was a lot of learning along the process between launch or even pre launch and, and, and now, and I've, I've got to throw out right now, I'm, I'm no longer involved with FIFA Plus or FIFA, so I don't know exactly what's happening under the bonnet right now, but I was responsible for those 40, 000 games.

[00:17:07] That, that, that blew Hugo's mind. And that was calculated quite easily, which is 

[00:17:11] effectively 

[00:17:12] 200 games across the season per member association. When, when we launched at the end of 22

[00:17:18] so that's effectively nine months from the soft launch in April, we had 105. member associations, national associations, FAs, call them what you want, who had signed up and, provided media rights.

[00:17:29] So FIFA plus at the end of 22 was well on the way to achieving the figure of 40, 000 games a year to be streamed live. It did take, it did take a bit of a swerve from, from the intended path. So, what was a purpose built platform, built by the FIFA Plus team with the help of third party vendors, of course, who were doing the building but it was a FIFA driven, a FIFA Plus driven build. That changed, and it it then was accommodated onto a, A vendor platform, I'd like to describe it in more glamorous terms than that. So there was, there was a distinct strategy change. But that build is still there. So FIFA still have the original platform, which could be switched live at any, any moment in time.

[00:18:13] So it was that platform that was used to stream the world cup to some tremendous figures coming out of Brazil when we were streaming the games live and providing shoulder content, wraparound content studio content. Trying something different using influencers instead of seasoned TV presenters. So it did prove itself as a platform to be able to, to shake up the marketplace somewhat. Where it's going to go in the future, it was always designed to carry premium content. I think the ask in terms of finances right now is to fund that war chest. To, and, and, I am restricted in, in, in, in what I can actually say due to obviously confidentiality agreements that I signed with FIFA, but that, that process was already in place and there is a future for premium content, whether that be behind a paywall. Whether that be through subscription models or, or, or any of any of what could be discussed here about being able to monetize a platform like that, that's, that's been there since day one, that seed was planted then, and I'm sure it, it, it will, it will grow and develop very soon.

[00:19:25] Richard Gillis Unofficial Partner: Okay. Hugo, what do you think?

[00:19:27] Hugo Sharman: . I just wanted to pick up on Dave's point around media rise, because I think that's a,

[00:19:32] I think that's the sort of key to where this might go. In my view is, is very closely tied to. If you look at the sort of big investments and sort of private equity where they, I mean, Michael, Michael, no more than me about this whole world, but, it's the betting on future increasing value of media rights that, that seems to be, a lot of the lot, lot, where the investments, coming into sport, nevermind just football, nevermind just, just FIFA.

[00:19:58] And I think. If you look at, there's sort of three examples to look at in terms of how FIFA's sort of found or finding the, the media rights world. I mean, one, for those of us based here in the UK, quite obviously with the Women's World Cup last year, it went right down to the wire. To get, host broadcaster on board or domestic broadcaster on board here.

[00:20:18] And I think that the rights fees that FIFA realized were disappointing in their eyes. You then got what's currently underway is the FIFA Club World Cup rights, which is, there's been a couple of stories about this in, in the press with discussions with Apple and is it going to be a billion?

[00:20:37] Is it going to be four billion or somewhere in the middle in terms of the valuation? So that that's sort of bubbling away nicely in terms of who's going to think first. And then probably the bigger one is, is the upcoming cycle for the next couple of World Cups, which I think. I think all these things, three things are relevant because for me, DTC and and media rights are two sides of the same coin.

[00:21:01] You can never have a conversation about one without the other. And I think, as has been talked about on a number of other pods and conversations that, there's a sort of., if you have a not just something, but a really valuable, dependable, exciting D2C offering, that is a make weight against your, any media rights discussions you might have, because you've got something in your back pocket that you can, whether or not it's a legitimate threat or not.

[00:21:27] But it's, it's something where you can say, well, listen, if I don't get the check that I need, I'm going to go, going to go direct. 

[00:21:32] Richard Gillis Unofficial Partner: Who wants to build on that or challenge that?

[00:21:35] Michael? 

[00:21:35] Michael Broughton: yeah, I mean, I remember working with Nolan Partners in 2009, I think it was, with the FA. And they hired Rob Ray so that they would have an IPTV product. So when they went to market. If they couldn't get the numbers for media rights, they would be able to stream themselves, and I think that, I mean, that's amazing, right?

[00:21:54] 2008, 9, the F. A., we're thinking like that. I think there's going to be a whole host of countries that they won't get the kind of media rights that they want, and therefore having a platform like this is a very clever idea to have. My view on the word of democratization is that's another way of either very nicely wording, we need something that is an advertising play or sponsor play.

[00:22:16] Right. But couch in wonderful language. And if we can get really high volume numbers, that's great. Because that will show that we've justified our sponsorship numbers or we can get advertisers to come on board. I fundamentally have issues with a single sport. Subscription play. I think that will be very challenging for any business. I think there's loads of examples. I think that there are all sorts of complications around what sits behind a paywall, what doesn't. Does a World Cup sit behind it or not? I think the fact that most countries it doesn't sit behind a paywall is a good strategic thing for massive volume. And personally, I think the whole world should be able to watch the World Cup. How do you then monetize a platform? There are a. I'd love to see the presentation that UBS are putting together with FIFA because there are a host of very complicated questions that I, I struggle to answer just from the outside as to even the list I can come up with of well, how do we make the math add up?

[00:23:18] Richard Gillis Unofficial Partner: Carlo?

[00:23:19] Carlo Di Marchis: So, I may be allegedly a creator, not a journalist. So the fact that journalists like Richa always want to have a quick explanation for something that has happened. Sorry, Richa. Like, oh, you launched without 

[00:23:31] Richard Gillis Unofficial Partner: None taken. 

[00:23:32] Carlo Di Marchis: So to be honest, I, it obviously was already, this is speculation, a long term play from the beginning.

[00:23:38] I think Dave said that. Yeah. Yeah. Yeah. And it's like, I'm thinking Apple Vision Pro, Apple Vision Pro come out and, Oh, it's too expensive. Hey, Calma. The first iPhone came out without an app store. Well, just to remind people, this is a long play. No. And the fact that they're looking for an investment, I don't think they are the only one.

[00:23:56] Maybe. NFL Network, ESPN, not sure what happened in there. NFL Media announced they were looking for an investment some years ago. I don't remember, at least two years ago, three. It may come from the realization that the moment you're thinking to go direct to consumer, even if you're the smartest sport people in the world, you may need to invest.

[00:24:15] Not only the investment, I don't think the investment is only the money. You may need, and I don't know, maybe it's pure financial investing, which is a bit weird to be honest, or it's getting together with a team of people that know how to do this stuff, right? So NFL and ESPN is not NFL and, BlackRock or some, it's very different, like it's more a strategic investment. So maybe having someone that on a global scale, or maybe with different investment in different regions can bring you to what you. may want to do going forward can be the, can be the real rational, it's pure speculation. So if you look from outside, I would think it's something like that, where you're trying to find partners, not only that puts some money at risk, but also that enable you to do something that in your great organization, hiring the smartest people, you won't be able to improvise, to be honest, even if you're thinking long term. And Dave may disagree because I don't know if he knows the rational behind it. 

[00:25:13] Richard Gillis Unofficial Partner: Go on Dave, you answer that question.

[00:25:14] Dave Roberts: Well, I was just going to come back to what Hugo was saying regarding effectively, is the platform a big stick to beat the traditional broadcasters with? And the word was threat. And. I was central to to that during my time on FIFA Plus one of the first tasks I had to do was we clawed back 122 territories for the women's under 17 and under twenties World Cup. And it really was to broadcast as you use it or lose it. If they weren't going to screen the games live, then we took 'em back for FIFA Plus. So there were 122 territories that came back for that. In terms of the premium event, the World Cup, it was streamed. Let me make no bonds about it. It was streamed live into Brazil because of the Commercial agreement and what was currently standing with Globo and FIFA. And the proof will be in the eating when it comes to the next cycle to see whether there is an exclusive or a non exclusive agreement for the world cup in Brazil. That, that will be the proof in the eating. So the platform is definitely there as a bit of a commercial stalking horse or a stick to beat the existing partners.

[00:26:28] Richard Gillis Unofficial Partner: So the rights. In Brazil is the market that you're looking at closely to your, for the next one, you're saying, right, okay, that's, this is going to give us an early indication of whether this has worked or not in terms of that, the big stick strategy.

[00:26:43] Dave Roberts: In terms of that strategy, yes.

[00:26:44] Richard Gillis Unofficial Partner: Mike.

[00:26:45] Michael Broughton: Yeah, I mean, if you think of the timing Global was having real financial difficulties at the time, right? And I think, As David said, the commercial reality is they were able to stream it. It's a great stalking horse. Globo is in probably a better place now than it was two, three years ago. But again, the numbers that FIFA wants for broadcast rights are pretty punchy numbers from a market like Brazil. Can Globo justify that still going forward when they might be having to make down payments on the new league and what that looks like in Brazil? So I think that, I think it is a very interesting one to watch.

[00:27:23] And I think. The fact that FIFA Plus was so successful with streaming in Brazil was a great indicator of what, this is real, right? We can, in a major market play, we can stream it, people will watch it. Now the question is, how do we, I mean, it, it might be a not for profit, but they need to bring the money in to keep the 211 voters happy. So what's the economic model in Brazil in the future that makes sense for FIFA if Globo isn't and it is on FIFA plus?

[00:27:54] Richard Gillis Unofficial Partner: Hugo.

[00:27:54] Hugo Sharman: Yeah, there's another bit. So, so it's worth mentioning exclusivity, non exclusivity. if the, , if the check shrinks, you can, you know, there's the there's the non exclusive play in Brazil or any other market. But I think that the main thing I wanted to say was that there's a, there's an angle to this, which is.

[00:28:10] If FIFA has a very as I say, an excellent platform and available on a number of different devices and platforms and so on. There's a play to embed that into rights holding broadcast strategic partner ecosystems in a way that basically allows the sort of access to or sharing or at least optionality around first party data.

[00:28:33] So you can imagine that, 

[00:28:34] They do it. They, they don't get the size of the check they want from Globo, but the 

[00:28:38] fifa, if you like, the FIFA Plus app is available and accessible through the, a global ecosystem, which actually works for Globo, it works for fifa. It's a very seamless, nice and easy , access point for the fan.

[00:28:53] So you've already got a global. 

[00:28:55] Registration is a seamless link into the FIFA kind of ecosystem and world and what you're actually watching and how you're watching it is a, is a FIFA product, but it lives in the, in the global ecosystem. That's the sort of trend that it seems to be.

[00:29:09] And what seems to be, is definitely happening more and more where you're sort of getting these, these kind of walls of different entities kind of working and collaborating more closely with one another. I mean, I'm sure that the FIFA commercial team would be rubbing their hands going, well, actually, if we can do all these sub licensing deals.

[00:29:24] Well, there's telcos in different countries that, in Brazil that don't want all the games, but they want, a bit or a slice of the content, happy days that, that's probably 

[00:29:33] the direction that this could go in as well.

[00:29:36] Dave Roberts: And let's not forget the tier arrangement in in Meteorites as well surrounding football and many sports. You've got your Tier 1, which is your domestic marketplace, through to your Tier 3, Meteorites, which is,

[00:29:46] Outside of the region, so international excluding domestic and regional.

[00:29:51] And we, we did build FIFA Plus to drive 

[00:29:56] Media rights. If FIFA Plus only held tier three rights for competitions. So, for example, Liga MX in Mexico, we were carrying that on FIFA Plus, but it couldn't be carried in Mexico. It couldn't be carried in the Americas, but we carried it for the rest of the world. But what we could also do is if people came to FIFA Plus, we could provide them with a direct link straight through to their media rights holders in whichever territory they're in. If we couldn't show that on FIFA Plus. So, Yeah, that, there is that synergy between your traditional broadcasters, media rights holders competitions and, and the platform.

[00:30:30] So this is stuff, games that there is no market for. Most of, the majority of what we're talking about is that this is stuff that's fallen outside of the broad, traditional broadcast rights market. No one wants to pay for this. So FIFA Plus becomes, we can talk about World Cups in Brazil and whatever, but there's a, one question is actually, is it just a compendium of stuff that no one else wanted to pay for?

[00:30:55] Dave Roberts: Yes and no. A lot of the content, you've got to bear in mind, 85 percent of those 211 votes are countries with competitions that would not be considered as premium. However, they can be considered as premium within their own marketplaces. You may not want to watch the Solomon Islands Premier Division in the UK, but certainly in New Zealand, in the Pacific Rim area, there are people who want to see that. Now, because of the, because of the commercials around live production, etc. Some of these games aren't even being produced, but with the help of FIFA Plus and what FIFA were doing with the member associations, these games, which would have been dark anyway, they were bringing them to light, they were putting in production facilities in the stadiums, they were streaming live on FIFA Plus. So suddenly it was, this is all part of the democratisation, democratisation, I can't even say the word, democratisation line of democratising football because it was bringing to light. competitions that would not be seen by anybody else unless you were standing by the side of the pitch. But saying that, who's saying FIFA didn't pay for any media rights? That's just an assumption a lot of people have made.

[00:32:08] Richard Gillis Unofficial Partner: Yeah, that's an assumption I've just made, isn't it?

[00:32:11] Hugo Sharman: I think the point that Dave makes around, dark markets, whenever you think about dark markets is because, yeah, it's the stuff that nobody wants, but somebody somewhere wants it. You know, The Oceana. where, wherever in the world you're talking about some, somebody wants it. And I think there's a, there is a degree of, and it's a struggle again, when you talk about DTC is, is getting people aware, getting your fans to know where to watch and how to watch it and even know that it's, that it's on.

[00:32:36] So it's the whole, the marketing of it and awareness of it, and. Again, this is a very broad distinction to make, but if you look at, someone like Netflix, which again, perhaps this is order of magnitude different, but again, global play, most markets. To, over 2 billion marketing spend a year, if you just try and draw a connection between that and FIFA again, global platform, all markets, albeit not level content to market that adequately for every, for all these 4, 000 events will have many or, great documentaries and so on.

[00:33:15] It's a hell of an ask. So in terms of where that investments coming, the 2 billion that UBS are peddling around, you can spend that comfortably on just that on a kind of marketing play to get people to it. There's all sorts of other ways you could spend it as well on, on tech on. You know, that's why I That's why I think for me, this.

[00:33:35] is, is heading in the direction of more premium content on the platform because that's what people will be. If you're an investor, presumably you're going to be investing in the best stuff that FIFA has available. And at the moment, it's probably not that on FIFA Plus. It's, it's kind of everything else, but it could be, could be better.

[00:33:53] It could be more premiums. Probably not yet.

[00:33:55] Dave Roberts: But saying, but saying that Hugo the Uzbek Superliga was, was on FIFA Plus, Liga MX from Mexico, top men and women's division domestic football was, was on there. The Brasileiro Feminino, A1, A2, A3, so the top three divisions of women's football in Brazil was on FIFA Plus. The Extra Classa from Poland, the top flight in Poland. Danish Premier League all of this content was on FIFA Plus. Yes, it might not have been in local markets, but all of this content just formed a compendium of, of, decent quality product that was placed on the platform as well. And it sat alongside the Solomon Islands, as I mentioned, Aruba, Brunei.

[00:34:35] Yeah, of course, there was all that, that you described as, as, as if you like darker content that people are not seeing that was there as well. But right now, the Kasafa. Which is the African Southern African equivalent of the Euros. The Kasafa competition's being streamed live on FIFA Plus. So there is decent quality content on there, but obviously a lot of it's geo restricted.

[00:34:55] So you might not see that in the UK.

[00:34:57] Richard Gillis Unofficial Partner: okay, I've got a couple more questions because just one is, why not YouTube? Why not put, do a deal, there's a sort of philosophical answer to that. We want to own our own thing. We want to build our own walled garden, Google the enemy, blah, blah, blah. But is this just because they've got the money, they had the money that they wanted to do this at this scale?

[00:35:16] Because it's an enormously expensive venture. Why not just. Do it on YouTube.

[00:35:22] Dave Roberts: It was partially so some of the World Cup content was, in Brazil, was, we utilized YouTube for that to, but that was more of

[00:35:30] the funnel to drive the audience to FIFA Plus. So yes, YouTube was used, other platforms were used, but, but that was nothing more than to build awareness of, of the FIFA Plus platform and what it was carrying at the time.

[00:35:45] Richard Gillis Unofficial Partner: Okay. , this is the dreaded lessons part of

[00:35:47] the podcast where we're looking at, well, what is it that other people will learn from this? What are they going to copy and steal from this?

[00:35:54] Is it just FIFA in the IOC and NFL can do this type of thing? Blah, blah, blah. Carlo.

[00:36:01] Carlo Di Marchis: Well, I think that the first reaction I had, to be honest, before going into what does this mean for Meteorize is that I was, I'm always very happy to see this kind of developments because I know I don't need to invest my money by the way. So, yeah, I'm excited. Because we, it will tell, which is basically your question.

[00:36:19] It will tell everybody how this can develop. So clearly one thing is a small federation doing it. I don't think this will evolve the market. A big federation, we don't know. I like asking for an investment in something that seems a direct to consumer play. I mean, with, with some subscription behind or on any other form of direct monetization we'll assume. I think that's something super important for the market because it's something we were, we have been talking in, I don't know, 10, 12 years that everybody said this will never happen. Now it's happening and it's crucial to see how it develops. Because it may be somewhere where, okay, we tried, it doesn't work, go back to square one.

[00:37:02] And, or it will maybe even evolve in different ways that we don't expect today. So I think it's crucial that someone in the market does these things because otherwise, I mean, we don't innovate because things like that, like the Apple MLS deal, these things have potential for innovation because they're in a different, space, I think.

[00:37:22] Hugo Sharman: I think as well, I would assume that those, the folks at FIFA kind of acknowledging what they're good at and where they need help. And I mean, there's another example, if you look at, if you look at very different commercial model completely, but the NBA are often held up as the kind of gold standard when it comes to, D to C.

[00:37:41] Streaming and of course what they do is they, they wrap a whole load of other stuff around. It's not just watching. It's lots of innovation in other tech and editorially. I mean, they, work very closely with their 

[00:37:54] broadcast partners. So, so a lot of the sort of on air talent. TNT or Warner Brothers at the moment are kind of very much involved in that sort of editorial sheen, if you like, before the content goes out.

[00:38:05] So, and that's a bit really the, and it's no disrespect to what, where FIFA Plus is now. It's just, it's just, there's a sort of editorial bit, a sort of curation bit, a storytelling bit to it. The, maybe that's where the investment will come. Maybe it's that that 

[00:38:21] Richard Gillis Unofficial Partner: Well, it's, it.

[00:38:22] yeah, it's a really interesting point because I remember we had we, we were talking, when we talked to DAZN on here, their challenge, and this is, a while ago, but it might still be the challenge. He's, and Mike mentioned it earlier, stickiness, getting people, it's fine getting people to come.

[00:38:35] You've got a game that's interesting. I might go and have a look at it. Getting me to stay. poses a whole set of other questions. And so, and I, in my head, I'm thinking, is FIFA the right, can they do so? You would go to news, for example, Sky Sports News is a product which keeps people engaged with the, with the ecosystem on a, regular basis. So I would, my head goes, when you say sticky and engagement, I get in sport, I think news and betting. Both of those, from FIFA's perspective, are tricky territory. I don't,

[00:39:08] unless I, yes, and we can go to the WWE, shoulder programming and they've been fantastic over a generation of, of doing it and showing you that it can be done.

[00:39:17] But it's again, that's, that's at a different bit of the jungle. What do we think, Mike? I mean, you mentioned sticking. I don't know how you get beyond that, but if it's just a, if FIFA plus is just a provider of games, it's, it's always going to be. Up and down the demand.

[00:39:34] Michael Broughton: I, I wouldn't, I would never narrow it down to just a provider of games for one. And I, I mean, to me, what I will hate is if in five years, it's missed the opportunity that Dave and others on here have all had of that view of this. This really could be a really cool marketplace. That content is a part of a true direct to consumer product. My experience with FIFA is that's unlikely to end up being where it ends up. Hopefully I'm wrong. I think on the stickiness. I mean, it's. It's already been said on this, this like, people forget that Sky is routinely one of the biggest three advertisers every single new year in the UK. Selling its primary product, which is the Premier League, which is one of the most premium products. Okay. It's behind the subscription wall. If you want to drive audience and you want to keep them, it costs money. Even if you have premium content, right? The zone has spent hundreds of millions, billions of on rights, but also on advertising. And ultimately, the way I think of them nowadays is they're back to being what they were as before. They're a betting company, in my view, partly because the CEO is from the betting world, and their watch and play kind of product is their, how they make their money again. I think this makes far more sense nowadays.

[00:40:50] If FIFA could accept gambling as part of its raison d'etre, and I honestly, I think it's not a bad idea because you could wrap it around betting is happening on all this product anyway, we should make sure it's safe that it runs through us and at least the money goes back into game. I think that's personally the best way for them to do it, because all these games people will be betting on. 

[00:41:12] Richard Gillis Unofficial Partner: That point is embedded in the, in the private equity worldview of sport going forward in the next 10 years, betting and convergence of betting in, in many different forms in different bits of the world is sort of mitigation against the decline of traditional linear media rights valuation.

[00:41:29] So I, but I don't see FIFA doing that. I mean, I, I, that's a wall of pain. I mean, I don't know you, you've been inside there, but.

[00:41:39] Michael Broughton: They may not have a choice. At some point, they may not have the choice, right? Which is, again, if you

[00:41:44] bring on investors at this kind of money, they will want a return at some point, right? However you want to package that up. And as we've seen with every streamer out there, every direct to consumer product out there, it costs an awful lot of money to keep going. 

[00:42:01] I think the statistic I always found amazing was that if your churn rate is 5%, you lose 50 percent of your audience each year. Right. Now, Disney plus is at 4. 8%. That's insane to me, right? That, the amount that they have to spend, the amount of

[00:42:16] content, the amount of investment that needs to be delivered for a Disney plus to be not decreasing in size each year is phenomenal.

[00:42:25] Netflix is at 2%. That's why they're the standout. I think Paramount Plus is six and a half, 6. 8 percent and they're seen as somebody who's going to get sold because they're a dead man walking. So a single sport, single product, whatever you do around it as an investor coming in, you're sat there going, well, how do I make the math side up?

[00:42:44] Hugo Sharman: I think, I agree with that, but I think there's a way, and it's, we're not there yet, but one of the ways that people are anticipating solving this content discovery headache is the role that generative AI will play in that. And, and I think what, again, coming back to the NBA, what was interesting there was the other, the other part, party to that.

[00:43:05] is the Microsoft relationship and I think you've always got a little bit, a little bit skeptical about how much input or tech a lot of these sponsorships are actually delivering into the, what actually happens. But there's a lot of talk in that when the partnership is discussed publicly about the role of generative AI will play in, in just underpinning that entire platform.

[00:43:27] And you think about some of the things 

[00:43:28] Richard Gillis Unofficial Partner: Do you mean as a creator of content, Hugo?

[00:43:30] Hugo Sharman: I mean, well, yes, there's an angle to that. I was talking more specifically about marketing of it and the driving awareness of it. So if you think about One of the challenges, again, this global nature of FIFA Plus, lots and lots of content, lots of markets.

[00:43:46] If you can hyper localize it, if you can personalize it, really do it unbelievably well, your best bet to do that is going to be involving, without a shadow of a doubt, generative AI. To do that at scale and automate it in a way that you're not paying for people to do it. That is, that's the sort of you Nirvana almost where this could be in a few years time and a lot of us are speculating as to what role generative AI could have, but that is one play.

[00:44:14] So, so in terms of, again, where that investment could come from, it could be someone like a, tech business again, not putting a check down, but basically saying we're going to bring our tech to the party and it properly gonna, this is really going to deliver. So there may be no commercial transaction whatsoever.

[00:44:29] Richard Gillis Unofficial Partner: Carlo.

[00:44:30] Carlo Di Marchis: To stay in the same area, if you want, because of my background, obviously, I spent five years with the NFL managing or trying to grow and succeed in growing a platform, direct to consumer, OTT, globally, except US, Canada, and China. And having paying customers. It's won an amazing journey. You learn a lot.

[00:44:52] It's a very different game, both in terms of tech stack. So you definitely need a tech stack that can sustain the complexity, the scale, et cetera. So that's a crucial addition. I don't know if, the current one is a good, or you need to add something on the other changes a lot of the rational for the decision making. In terms of content, in terms of features of the platform, you have paid, you won't only have paying customers. So it's now with this hybrid world, it becomes super sophisticated. I think it's a super fascinating challenge or, whatever you want to call your project. If you, if 

[00:45:29] Dave Roberts: And I still truly believe it's a wonderful opportunity for fifa, this platform. For one reason and one reason only, and we're talking football here, is they are the only global football player on this planet, in terms of Access in terms of memberships, in terms of eyeballs, they have access to 211 football playing nations who are in 24 different time zones. So there is all this football being played just to touch on the betting side of things. The betting market is flooded and go to 365, talk to somebody there, they'll tell you. They have so many games falling out of their ears between 2pm and 6 or 7pm on a Saturday and a Sunday. But what about those dark times? And what about these dark markets where football's being played all around the globe in every time zone? There is an opportunity there for somebody and, and I think the platform has a wonderful opportunity.

[00:46:27] Richard Gillis Unofficial Partner: It's fascinating and I'm conscious of your time. I'm just going to sort of draw us to a close, but I keep coming back to, in my head, what we want the big governing bodies to be. There's a sort of big FIFA and small FIFA. There's a sort of quasi, government question there, there's a whole different podcast, but What this does to the marketplace, I find interesting in terms of this expansion.

[00:46:51] If FIFA is going to fill this space, what happens to the one footballs, the zones, the companies that have been created to try and meet some of this demand, I don't see that football is undersupplied in the marketplace. It's a really weird conversation in my head that FIFA is, is looking at this.

[00:47:09] And I can, again, I hear the arguments and I get them, but should it, there's a sort of. It can because the text there, but should it be doing this? Anyone with a 

[00:47:19] final point on that? 

[00:47:20] Dave Roberts: I was just going to, I was just going to, I was just going to add there. There are two sides to, to being able to answer that question. There is the big FIFA answer, which obviously is all about democratization of football, giving your much lesser sized. Member associations, the opportunity to showcase its product. And that is a direct responsibility of a governing body to be able to provide that assistance. But I get what you're saying is the other side of the equation is, should a governing body now be stepping into a marketplace, a commercial marketplace where there are media rights at stake where there are huge financial amounts benefits to be made. By somebody, is it right for an organization to be stepping into that? And that's where the politics comes in.

[00:48:06] Hugo Sharman: I think it was a bold step to begin with all that years ago when you guys were involved. I a bold step. Then I think it's a great step or much more confident step now. So, yeah, we're going to get we're going again. We're going to we want the investment. We're going again because whether you like it or not, the size of the investment comes with the size of the ambition.

[00:48:27] And even if we're speculating on the ambition, it's like, well, there's a great big number that are looking for. So the ambition is going to be great. And to be honest, I think that's what, I draw a distinction between, the general tone of the sports media market for the last 18 months has been pretty flat.

[00:48:44] A lot of the tone has been people are struggling to realize rights, values. All the rest of it. This actually could be a, in answer to your question, Richard, what would other smaller leagues, federations, entities look at it? They might go, well, that's a really bold step. Maybe we should just be, let's, let's dust off that plan to be, let's re realize our ambition to go again, because I think the whole market probably needs a good dose of that.

[00:49:09] Michael Broughton: mean, I love Bold and I think this was a necessary product to come out with and I'm delighted it's out there. If I'm on the other side of the table receiving a deck saying invest one to two billion dollars in this product. Post money, if I'm minority, so you're saying if I put a billion in and I'm minority, this is worth over two billion. Justify that. If it's two, this is going to be worth five billion. it's bold. It's brilliant. I want to see them do more with it. It's going to be, I think, a really impressive sales job from UBS to get it away.

[00:49:47] Richard Gillis Unofficial Partner: Can I just

[00:49:47] ask a question, Mike? And again, I don't want to create another podcast. So I want to, we want to finish this one. And this might be a different one. Whose money is it? And does it matter? So , we've, the question there is UBS is going to the marketplace and we've got a podcast, obviously you've got other people's money, it's always other people, but will there be a filter on who's, because you made a really interesting point in terms of, they might not have a choice to start making decisions that they might not want to make, betting.

[00:50:14] That will be determined by the, whose money is on the other side of this equation, which we obviously we don't know yet because it's, it's going to market. if you say, okay, that's a good question, but we'll park it and have another conversation about it. But it just struck me that there might be something in that.

[00:50:31] Michael Broughton: I think it's a great question. I think it is another podcast because I think we, just this group could talk about that for an hour. I expect FIFA to always have at the very least a golden share. Right, DeVito, what they do, what they do, and things like, is gambling allowed or not? I think, I think they'll get a lot of interesting feedback from, I don't think there will be any shortage of people who will take meetings. to discuss it and get into the weeds and have a view on whether or not this is worth the money. And I think it's well worth them doing. I, I, I think there will be some very difficult conversations around if you're bringing external capital in, what is the valuation? How does this achieve the growth that is needed to get a return of 20 percent IRR, whatever it is that the investors want to come up with. Again, I think there are ways for you to get there. Whether that's subscription, whether it's gambling, whether it's whatever it may be. Advertising, if you get the kind of audiences that you can. I suspect, and I've seen this in most presentations I've seen in sport businesses, there's rarely a line that says their own cost of marketing. So the numbers all look sexy and you're going, hang on a minute, but how do you get that audience? Because after World Cup, they all sign out again. So, I mean, I think it's going to be, I'd love to be a fly on the wall in those meetings 

[00:51:50] Richard Gillis Unofficial Partner: Okay. Thank you. And that will, we will have that conversation, thanks so much for your time. And I've, very conscious that we and we, and it worked. It came together. Who knew? So thank you very much. Hugo, Mike, Dave, and Carlo really appreciate it. 

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