The Economics of Sport: State, Media, and Business Working Together

The Economics of Sport: State, Media, and Business Working Together

At ‘The Economics of Sport: State, Media, and Business Working Together’ panel session, the participants discussed the prospects for development of sport as an efficient sector of the economy. The discussants included famous athletes, such as Greco-Roman wrestler and three-times Olympic winner Alexander Karelin, legendary Portuguese footballer Luís Figo, mixed martial arts fighter Khabib Nurmagomedov and famous Canadian hockey player Phil Esposito.

Arkady Dvorkovich, Deputy Prime Minister of the Russian Federation, noted that the state considered investment in sports as investment in the future. “The sports infrastructure will operate for decades. These are long-term investments. Sochi essentially became a new city. It became a new point of attraction, a centre for many people who live there and for the millions who come for business or recreation. Yet we understand that it will take a minimum of five more years for the infrastructure to be used 100%,” he specified.

Alexander Karelin, a State Duma deputy, Greco-Roman wrestler and three times Olympic winner, said that “consensus” was the key word in the interaction between the state and business. “The main thing that the state does, it is not facilities or world-wide sports forums. The main thing the state does is to put the emphasis in the right place. This is what Tina Kandelaki is doing now, because these correct emphases appeared together with Match TV. There is now an understanding how to package and sell a particular product,” Mr. Karelin stressed.

Sergei Kupriyanov, Press Secretary of Management Committee Chairman of Gazprom, gave specific examples of sports projects creating the requisite background for business partnership. “After we became Schalke’s sponsor, people became more aware of us in Europe. And the associations with the Gazprom brand changed, too: now we are thought of as a stable, reliable partner,” Mr. Kupriyanov explained.

Michael Payne, the IOC’s former Marketing and Broadcast Rights Director, has stressed that there are not that many countries in the world where governments support sports like the Russian government does. “Sport is a unique site for partnership between the state, business and the media. Yet there is no universal recipe for achieving the best results in this. Effective use of a sporting brand has tremendous economic potential,” the expert believes.

Roman Rotenberg, Vice-President of the SKA Hockey Club (St. Petersburg), has noted that the experience of leading foreign clubs had been studied but it was impossible to copy a foreign model in its entirety. “Today, we are the most successful hockey club not only in Russia but also in Europe. Last season’s commercial revenues were RUB 1 billion. Our thanks go to FC Zenit St. Petersburg, who showed the way and taught people to be fans,” the football official said.

Phil Esposito, Canadian hockey legend, supported the statement that investing in sports means investing in the future. “I spent 24 years creating the Tampa Bay Lightning hockey team. For almost ten years, the southern city was learning to love hockey. Traditions were being shaped. And now Tampa is one of the strongest teams in the league, both game-wise and financially”, Esposito noted.

Tina Kandelaki, General Producer of the Match TV channel, said that the preferences of the entire potential audience should be taken into account. “When working on the IIHF World Championship, we involved Alisa Znarok, daughter of Russia’s team’s head coach, and women began to watch our broadcasts,” Ms. Kandelaki said by way of an example.

Hong Li, Chairwoman of Shankai Sports, shared the Chinese experience with developing the sports sector. “Before the 2008 Olympics, China had no concept of sports marketing. The Olympics were a turning point in the development of the sports sector. Of course, one should not discount the role of the state and the growth of the Chinese economy, but all that had to be put to a good use. Chinese companies understood that sports were a shortcut for making it, among other things, to global markets,” Hong Li emphasized.

Alexander Zhukov, President of the Russian Olympic Committee, reminded the audience that Beijing would host the 2022 Winter Olympics. “Many people asked why China needed it when it did not have well-developed winter sports. Yet China plans to involve 300,000,000 people into the sporting events. Olympics are a powerful driver for developing the sports industry,” Alexander Zhukov emphasized.

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