Soccer Buoys Business, Not City!

I saw my teammates post on Champions League final and its economical effect. I found that very interesting and made further research and found out actually it is not really profitable to the hosts as it claimed to be.

The League of Champions final, besides a sporting event, was a grandiose financial undertaking. The winner of the match Manchester United became about £85 million richer, and Moscow received about £35 million. City officials s to spent all of the city’s two-year sports budget of $227 million. At the end of the day only the service sector saw a payoff from it.

Analysts estimated that English fans left about £35 million behind them when they visited Moscow, with every fan spending over £650 on the two-day trip. That makes this year’s championship twice as expensive as last year’s in Athens. The estimates are based on the attendance of 40,000 fans. In reality, only 25,000 Britons came to see the match, with many holding back due to the trip’s high price.

The expenses of preparing for the match were shared by the City of Moscow and the Russian Soccer Union. A RSU posted on its web site that most of the expenses, the size of which is not being made public, were borne by the city. Some analysts estimate that the city spent 800 million rubles (about $33.7 million) on Luzhniki Stadium, 10 million rubles ($420,000) sprucing up the stadium’s grounds and the surrounding area and 37 million rubles (about $1.5 million) on temporary pedestrian bridges over roadways near the arena. Moscow received from the UEFA 20 percent of the revenue from ticket sales, which was 35 million rubles. Moscow also received a premium of $1.15 million. The only other revenue the city received from the event was in the form of restaurant and hotel taxes.

The city’s foreign guests were greeted by special inflated prices. The Baltschug Kempinski Hotel was booked for the match dates as soon as they were announced last year. A special rate applied between May 20 and 22 with rooms starting at 28,000 rubles. Swissotel Red Hills was charging 40,000 rubles for rooms that usually cost 18,500 rubles. The Euroluxe Hotel at the edge of the city raised the price of its double rooms from 3950 rubles to 16,000 rubles. Rooms that cost 2900 rubles in the Izmailovo complex were raised to 6000 rubles. Restaurants saw a 50-percent increase in business.

As we can see from the numbers it was not profitable to the City of Moscow at all. But at least they can get some of their money back in forms of taxes.

Entry #14, 20600793

Mozilla Firefox 3.0

For fans of Firefox, Mozilla’s increasingly popular multi-platform Web browser, today is a big day indeed: It’s the official launch of Firefox 3 (Windows only — Mac and Linux releases are imminent). So, what’s new? What’s exciting? What’s the big deal?

For starters, the developers claim Firefox 3 is significantly faster than both 2.0 and Internet Explorer 7. That’s always good. The new Places Organizer lets you tag, manage, and search bookmarks — a big improvement over the old bookmark manager. Firefox 3 also delivers improved security features, better password management, resumable downloads, and an auto-completing location bar:

Type in all or part of the title, tag or address of a page to see a list of matches from your history and bookmarks; a new display makes it easier to scan through the matching results and find that page you’re looking for.

You can see the full list of Firefox 3’s new goodies on Mozilla’s site. You might also want to check out Lifehacker’s Top 10 Firefox 3 Features.

There is a case pending in EU economical court against Microsoft and it seems like in near future Windows OS will be sold without Internet Explorer. Mozilla and European consumer commission accusing Microsoft of product tying.

Mozilla is a part of Software As A Service or Web 2.0 generation of softwares. It's distributed for free over the net and independent programmers can create new features and share it with others. Because of that it became the most popular internet browser and aiming to get a bigger share.

Entry # 13, 20600793

Politics and outdated perspectives hurt business.

Gazprom to Stick to Britain’s Model in U.S.

Russia’s gas monopoly Gazprom is in talks with holders of a few gas traders in the United States about the buyout of the majority stakes from them. The monopoly applies the same methods to pave the way to Britain’s market of gas retail, which has been thoroughly protected against its expansion. Gazprom has covered 1.5 percent of it, stepping up the supplies from 2 percent to 8 percent in the last six years.

The company is studying chances for the first acquisition in the United States, Vitaly Vasiliev, who is the CEO at Britain’s subsidiary of Gazprom, Gazprom Marketing & Trading (GMT), made clear it very clear. The project could start from scratch, or via the partnership or through the acquisition, Gazprom will make the final decision by this year-end, the official specified.

The monopoly is eyeing stakes in traders, but the final agreements haven’t been attained yet. The negotiator is the U.S. division of GMT, GMT USA, which office opened in Texas in 2006.

Russians are trying to build the capability for Gazprom to place its volumes in the market in the most profitable way, to gain the value that Gazprom lost by simply selling at the border or to somebody in the middle. And the promotion experience of the top managers are inspiring. Vasiliev took over GMT in 2002, when Gazprom covered around 2 percent of Britain’s market. Since then, however, the monopoly has extended to above 8 percent on wholesale gas market and reached 1.5 percent on retail market. The progress appears even more impressive given the general antagonism of Britain’s authorities to Gazprom.

On the other hand some financial analyst expressing that fear by US and UK governments might actually make it impossibly for Gazprom to gain more than 10%, which in other words investments for increase of market share might be in vain. Therefore analysts proposing for Gazprom to invest into gas and oil rich Central Asia or try to extend its pipeline monopoly.

Entry # 12, 20600793

Glazer wins control of Man United

from BBC/Sport
US sports tycoon Malcolm Glazer has won control of Manchester United in a £790m ($1.47bn) takeover bid.

The American has secured the 28.7% stake owned by Irish racing tycoons JP McManus and John Magnier, and now has more than 70% of the Premiership club.

Red Football Ltd, acting on behalf of Mr Glazer, said the Irishmen had sold their stakes for 300p a share.

Club fans have vehemently opposed Mr Glazer's ambition all along and fear that ticket prices will soar.

The bid comes five days ahead of the 17 May deadline when Mr Glazer had to make known whether he planned to bid.

'Aggressive'

Mr Glazer now wants to buy the rest of the club's shares. If he gets 75% plus one share, United could be delisted from the stock exchange and Mr Glazer could transfer his debt onto the club.

--------------------------------------------------------------------------------------------
TIMELINE OF A TAKEOVER
March 2003 - Glazer buys 2.9% stake in club
March 2004 - Glazer says he has "no current intention" of making a bid
June 2004 - Glazer's stake in club nears 20%
October 2004 - United confirms bid approach from Glazer, as his stake nears 30%
November 2004 - Glazer ousts three directors from United's board
December 2004 -Glazer makes revised bid
February 2005 - Glazer makes new bid approach, valuing United at £800m, the club later opens its books to the tycoon
14 April 2005 - Glazer moots £800m bid for club
28 April 2005 - Takeover Panel sets 17 May deadline for Glazer to announce whether he intends to buy United
12 May 2005 - Glazer launches formal takeover bid for United after upping his stake in the club to almost 57%
--------------------------------------------------------------------------------------------

If he can get 90% plus one share, he can make a compulsory purchase and scoop up the other 10% of the club's shares.

With heavy trading in Manchester United shares taking place after the announcement, it is already looking increasingly likely that Mr Glazer will quickly reach the 90.01% stake he needs to force out any remaining shareholders.

United's third-biggest shareholder Scottish mining millionaire Harry Dobson is already reported to have sold his 6.45% stake after the Irishmen sold theirs.

Shares in Manchester United closed up 34.25 pence, or 12.92%, at 299.25p on Thursday.

Constitutional Affairs Minister Harriet Harman said the government had urged Mr Glazer to have talks with fans, the Football Association and the club in order to ensure there was "constructive involvement".

She told BBC One's Question Time: "Manchester United is very important to English football and the government is keeping a very close eye on the situation.

"The fans are very worried and obviously there is concern that ticket prices will go up and that there won't be investment in the players."

'Damaging'

Mr Glazer first showed an interest in buying the club last autumn and tabled a formal proposal in October, which was rejected by the board.

The owner of the Tampa Bay Buccaneers is thought to be keen to exploit the strength of the Manchester United brand in the US.

Two weeks ago, the club board said it could not recommend Mr Glazer's second takeover proposal to shareholders because his business plan appeared to be too "aggressive".

His offers were rejected on the grounds that his plans relied too heavily on borrowed money.

The club's chief executive David Gill said Mr Glazer's business plan was "potentially damaging" to the club amid fears that the American could saddle it with up to £300m worth of debt.

However, members of the board did agree that some shareholders might think the offer was a good one.

Outrage

Manchester United fans are angry at the latest news. Last year, they formed a shareholders' association to buy club shares and try to protect it from Mr Glazer's clutches.

A spokesman for Shareholders United, which represents 17% of the club's shareholders, told the BBC that Mr Glazer was "no Roman Abramovich".

"He's not turning up with a suitcase full of his own cash and he is, in effect, asking Manchester United fans to pay for his takeover, to pay for increased ticket prices and increased merchandising," said spokesman Oliver Houston.

"We feel completely betrayed by John Magnier and JP McManus."

The Irishmen are estimated to have made a £70m profit from their stake.

A spokesman for the duo said: "They saw it as an investment. They got a very good deal."

'Game over'

"I'm giving up my season ticket," said Shareholders United president Nick Towle.

"I'm not putting a penny of my money into this guy's pocket."

Mr Towle said Shareholders United still hoped to stop the tycoon getting a 75% stake.

"If we can get to that 25% of the remaining shareholders, that would be great," Mr Towle added. "But it's looking like an uphill battle for us."

Analysts are convinced that the 76-year-old is unstoppable.

"I think it's pretty much game over now as the key to all this was always going to surround what the Irish duo would do with their stake," said Richard Hunter of stockbrokers Hargreaves Lansdown.

8th Entry, 20400241, Yohan Park

Champions League final had €260 mln economic impact

Last night's Champions League final between Manchester United and Chelsea has been the richest match in the history of football.

Professor Simon Chadwick, director of Coventry University's Centre for the International Business of Sport, said that the match at Luzhinki stadium generated €260 million in prize-money, spending and TV income. The two sides will share €140 million with the victors receiving about 100 million and the losers taking home €40 million.

"The economic impact of the match is incredible not only for England. The interest for the match was unprecedented, with millions of people rushing from work to buy food and drinks adequate for watching a football match. The restaurants and bars also made solid profits," Chadwick said. He compared the event with the National Football League's Super Bowl in the USA.

ITV, who broadcasted the final, have increased their advertising rates for slots around the game by 50 per cent, with an actual 30-second slot during the final itself costing upwards of €350,000.

6th entry, 20400241, Yohan Park

Euro 2008 Kicks Economies Up a Notch

by Mark Scot © SPIEGEL ONLINE 2008

The economic impact of the three-week soccer championship is expected to exceed $2.15 billion for participating countries, including hosts Austria and Switzerland.

As the US gears up for the NBA Finals, other sports-crazy fans around the world will turn their attention to the three-week European soccer championship in Austria and Switzerland, the third-most-watched global sporting event after the Summer Olympic Games and soccer's World Cup Finals.

While the championship, known as Euro 2008, brings together Europe's top 16 national soccer teams, its widespread appeal makes the contest a truly global phenomenon. The Union of European Football Assns. (UEFA) expects TV audiences will top 1 billion worldwide for the matches held between June 7 and June 29. More than 100 million visitors are expected to visit the championship's official Web site, a fourfold increase over the last event held in Portugal in 2004.

Such exposure means big bucks for Europe's economy. According to Simon Chadwick, director of the Birkbeck Sport Business Centre at the University of London, Euro 2008's economic impact on UEFA's 52 members across Europe could top $2.15 billion. That includes extra tourism revenue for Austria and Switzerland, multimillion-dollar TV licensing agreements, and increased food and beverage sales as fans head to bars or host barbecues in support of their home teams.

"Euro 2008 will have a halo effect on the wider European economy," says Chadwick. "This impact will be felt in many countries, principally driven by sponsorship and commercial revenues."

The Bottom Line

While the business impact of this year's tournament is light-years ahead of the first UEFA championship in 1960, some elements have remained basically unchanged. Teams are still split into four groups to play each other in a round-robin format. The top two from each group then move into the knockout stages, until eventually a European soccer champion is crowned. Greece is the defending champion from 2004, but Germany, Italy, and Spain are the favorites this time.

No matter who wins, Austria and Switzerland will reap rewards from the hundreds of thousands of fans expected to descend on both countries during June. Consultants Rutter & Partner estimate Euro 2008 will bring $358 million into the Swiss economy, while consultants SportEconAustria figure Austria will gain $369 million.

Where will the money be spent? Kim Hollywood, a spokesperson for the Austrian tourism board, says the hotel and service industries will gain the most. In Austria alone, overnight bookings have already hit the 2 million mark -- well above usual rates for June -- while almost 11,000 temporary jobs have been created to cope with the influx of visitors. "Austria wants to show that it knows how to celebrate," she says.

Huge Wide-Screened TVs

For fans unable to attend one of the tournament's 31 matches, each of the eight host cities has invested millions of dollars in "fan zones," centrally located party areas where supporters can gather to watch the games. UEFA has forked over more than $13 million for the necessary infrastructure, including huge wide-screen TVs to show the action.
Sponsors, such as Coca-Cola, McDonald's, and Adidas also have spent millions in product promotion to maximize their connection with Euro 2008. "Fan zones help people engage with our products in a meaningful way," says James Leipnik, chief of communications and corporate relations for Europe, the Middle East, and Africa at Canon, one of the official sponsors.

Britain Bumped, Other Countries Buoyed

The tournament's economic bounce won't be limited to the host countries. Along with extra food and beverage sales, gambling across the Continent is expected to rise as Europeans stake money on teams winning Euro 2008. British betting firm Ladbrokes expects more than $700 million to be wagered on matches during the three-week event, in part thanks to the explosion in Internet gambling.

The economic windfall will benefit some European countries more than others, though. Because the English national team failed to qualify for Euro 2008 (Britain's other home nations -- Scotland, Wales, and Northern Ireland -- also missed out), Britain likely will lose hundreds of millions of dollars in potential revenue. More than 40 percent of the English express a "strong interest" in soccer, so Birkbeck's Chadwick reckons the team's absence could depress the economic impact of Euro 2008 in Britain. When England reached the quarterfinals of the 2006 soccer World Cup, for example, an estimated $3.1 billion was spent in the local economy.

Too bad for Britain this time around, but other countries in the final 16 could get a nice pick-me-up. From Portugal to Russia, the European soccer championship will undoubtedly be a kick for the economy.

- 5th Entry, 20400241, Yohan Park

European Football Market Tops €10 billion

Accountants Deloitte and Touche have estimated the European football market to be worth around €10 billion in their latest report on football finances. Dan Jones, director of Deloitte and Touche Sport commented, 'England's matchday incomes are now almost three times those of other big leagues. German, Italian and Spanish clubs need to address revenue generation and commercial issues at their stadia urgently or they will fall further behind.' In particular the report notes that clubs in Italy and Spain 'lack the relative balance between different revenues that Premier League clubs have (being too reliant on broadcasting money) and have historically shown far less discipline regarding player costs.'

The report shows that the 'big five' leagues in Europe (which between them account for 80 per cent of all football income) experienced mixed fortunes in terms of revenue growth in the 2001-2 season. England (up €1.7 billion) and Germany (who broke €1 billion for the first time) recorded very healthy increases of 21 per cent and 19 per cent respectively. French revenues were static and Italy decreased by 2 per cent. There were no reliable figures for Spain. The 2001/2 growth rates meant that the English Premiership built on an already substantial revenue gap to the next biggest league (Italy). The absolute gap now stands at over €600m.

Wages again rose substantially. In the big leagues the increases ranged from 6 per cent in France to 26 per cent in England. Only Germany recorded a percentage wages increase (19 per cent) less than growth (17 per cent). Wages/turnover ratios increased everywhere except Germany. The English Premiership was Eropean champion in terms of operating profits, generating €130m in 2001/2, up from €125 million. Germany saw operating profits rise from €87m to €100m. France, and particularly Italy, recorded sizeable operating losses. Italy's loss of €404 million, up from €216 million in the previous season, was largely the result of static income and rising wages.

The Premiership remained the best-attended top division in European football. Its average crowd is eleven per cent above its nearest rival, the German Bundesliga. Italy's Serie A, whose average attendance fell by eleven per cent, slipped back into third place. Average attendances in Spain have fluctuated around the same levels, in the low twenty thousands, for years. France, after a post World Cup boom, has settled back into fifth place. The Premiership is the only league to exhibit consistent growth in attendance in every season since the mid 1990s.

The UEFA Champions League is the de facto sixth 'big' European league. Its estimated broadcasting income of €420m would rank it third among the 'big five' leagues. The competition's average attendance in 2001/2 (34,351) was higher than any of the 'big five' domestic leagues.

-4th entry, 20400241 Yohan Park