The Impact of Coronavirus on Italian Football

The spread of the coronavirus in Italy has already caused millions in loss of revenue from ticket sales, and the damage to television rights and sponsors could seriously affect 75% of the country's professional clubs, explains sports industry expert Marco Bellinazzo to EFE, a writer and journalist for Italy's leading economic daily, "Il Sole 24 Ore".

At a time when Italian football was experiencing significant growth, with clubs like Inter Milan and AC Milan averaging over 50,000 spectators per match, the pandemic and the inevitable suspension of the league can have consequences not only in the short term, with substantial financial losses, but also in the coming years.

While some money from sponsorship contracts and television rights has already been received, a definitive suspension of the league season and international competitions would have tremendous consequences for Italian football.

"In Italy, television rights generate 1.4 billion euros per year, in a commercial market worth around 600 million euros per year for Serie A alone. A portion of the season has already been played, so we're talking about losses of nearly 600 million euros from television rights and about 200 million euros in damages from sponsors," explains Bellinazzo to EFE.

"In addition, there are around 150 million euros in losses from tickets. We're talking about a total damage of around 950 to 1,000 million euros. This is the amount of money at risk," he adds.

This problem would trigger a series of chain reactions that would continue to affect the football system in the coming years.

"In these months, we were preparing to sell the television rights for the next three years. There were also hypotheses of creating a thematic channel with the audiovisual group 'Mediapro'. The pandemic blocked this path and, regardless of what will be decided, it could generate lower revenues compared to the clubs' expectations," says Bellinazzo.

"This is because all members of the sports system will suffer losses. Think of the losses of pay-TV channels, there may no longer be the capacity to offer amounts that exceed 700 million euros, as is the case with 'Sky' (the platform that broadcasts 70% of Serie A in Italy)," he adds.

Italian football has one hundred professional clubs and it is estimated that 75% of them, both in the lower leagues and in the elite of Serie A, will face serious difficulties in balancing their books.

"If the government does not take measures to help these clubs, 75% of them will face serious economic difficulties. It is a very serious problem for the lower leagues, but also for Serie A clubs, who could see a significant drop in their financial accounts," explains Bellinazzo.

"For example, Juventus, at this moment, after the investment of 80 million euros per year for Cristiano Ronaldo (between a gross annual salary of 60 million euros and 112 million euros for his transfer), is operating with losses of about 130 million euros per year. These losses were usually offset by player sales," he continues.

"This problem could worsen due to a structural crisis in Italian and European football, which would reduce important buyers for players in future transfer windows," concludes the Italian expert.

However, this is the worst-case scenario, namely the definitive suspension of the league. In this case, Bellinazzo warns of the danger of legal actions between the parties involved, clubs, television networks, and sponsors, who would need to come to an agreement to minimize their damages.

It is evident that, from an economic point of view, completing the league season, as well as European competitions, even in June with the postponement of the Euro 2020 to the following year, is crucial to limit the extent of the damage.

"The idea of postponing the Euro 2020 and playing it in 2021 would allow other leagues to complete their seasons, maybe behind closed doors, in the summer, when experts say the virus will be less aggressive with the heat. This would save everything in terms of television rights and would preserve the income of the teams," explains Bellinazzo.