Economic Transformation of Global Soccer (Essay Sample)

Name:
Dr. Nestorova
International Studies 4195
May 2014
Economic transformation of global soccer
Sport, especially soccer, is one of the most vibrant and sociologically enlightening domains of globalization. Since the finish of the cold war at the beginning of 1990s, the world has undergone major changes. The time of economic globalization reshaped soccer dramatically. The new era of soccer was implied by the last two decades. The history of industrialized soccer started in 1970s the gap between social classes had increased (Irak, 3). The 1970s was a time of distress experienced by many countries, for example, turkey and England. This was due to the global oil crisis that was caused by the Arab-Israeli conflict. Besides, the decade also experienced the northern Irish problem in Britain. These events affected soccer. In 1990s, there was a flow of capital across borders in the global economy of soccer. European clubs post scouts throughout the developing world and also bought teams (Giulianotti and Robertson, 2-3). For example, Newcastle united started to use china’s Dalian Shide soccer club as a feeder. Big clubs regarded themselves as multinational conglomerates. Real Madrid and Manchester united organizations acquired restaurants, cable stations, megastores. As a result, Manchester united profits rose above $65 million by July 2003 (Giulianotti and Robertson, 2-3). Economic transformation of soccer has been spearheaded by globalization since 1990s; clubs such as real Madrid, by embracing globalization have accumulated much wealth. However, this has led to diminishing national sovereignty. Soccer organizations currently involved in large television deals. Big clubs sale and buy players. For example, sales from Beckham and Renaldo bring more income to real Madrid in a month compared to other clubs.
Since 1990s, all the clubs have been concerned at maximizing profits and revenues regardless of success in the field. Big clubs have expanded the range of merchandization, mercantile features and amenities on offer to followers and the scope of their commercial operations. From that time, there has been wearing down of principles of cross-subsidization within soccer (Irak, 5). Also, there was an increase in economic competition between clubs. In addition, the clubs attitude towards profit and revenue changed radically. Since the start of the 20th century, soccer clubs entered the international market due to the demand of additional profits to achieve competitive advantage. They, therefore, began to exploit all possible business alternatives by forming strategic alliances with partners in supporting industries, for example, sports equipments. Clubs started to quote themselves on the stock market and established cross-border partnerships among big clubs. They also increased international player contracts as well as trying hard to enter lucrative and new markets abroad (Irak, 7).
The globalizing trends that occur in sports are a representative of overlapping and multiple tendencies that are found at the regional, national and global levels. Such tendencies include the advanced involvement of global telecommunication companies such as news corp. in the controlling of the scheduling and production of sporting competitions as well as the use of sport as a marketing device. International sports organizations and federations such as the international federation of soccer associations, the international Olympic committees and those international amateur athletics have also been in the forefront of generating large revenues through the sale of television rights and sponsorships to transnational corporations. Globalization in sports is also characterised by the proliferation of foreign athletes on professional teams.
The triumph of neo-liberalism in the world has benefited world soccer. Neo-liberalism encourages free trade and privatization. Neo-liberalism has increased commodity consumption. In respect to world soccer, for example, in 1993, the four key proficient confederations in the United States sold $9 billion significance of franchised supplies. Besides, the three major television networks generated $ 2.2 billion in sport advertising while cable networks generated about $ 800 million. For teams like Brazil, neo-liberalism has been the road to their financial stability. It is the only way through which wealth is transferred from the public social safety to private capital. Neolilberalism has led to economic justice in the world of sports.
As a result of neo-liberalism in the world of soccer, clubs such as Manchester united have been able to establish marketing outlets in North America and Asia. More polycentric marketing ventures continue to arise. There is no directive when it comes to neo-liberalism. It is characterised by free market that is not prone to restriction. Consequently, there are no legal restrictions that undermine soccer club capacities in regard to recruiting labour from any nation. TNC clubs are still close to nations due to law or finance (Dolles &Söderman, 5). Besides, player recruitment is so apparent in regional and global clubs. English clubs import labour from other countries with similar culture and language such as Scandinavia and commonwealth. Importation of labour internationally has been the reason for the sudden rise of wealth among top clubs in England since 1990. Recruiting foreign players is a form of extra soccer FDI. For example, buying players from Asia players can boost a soccer club’s sale of merchandise in the Far East.
Due to neo-liberalism, the world of soccer has been observed as an industry in its own. The characteristics of world soccer resemble those of other businesses and services, for example, the entertainment business. This is because, just like the way people have a choice to go to the cinema or an amusement park, they as well have an option on whether to watch a soccer match or not. Soccer has been ranked as a business activity especially in the economies of those countries that promote soccer as a national sport. Today, soccer represents a large percentage of the nations’ GDP (Dolles &Söderman, 6). This is because soccer events compel other sectors such as the media as well as transportation and catering services.
The benefits of neo-liberalism in soccer have been advanced by globalization. Glocalization in the soccer industry has led to the concentration of resources too few big South American and European clubs which have the ability and the economic resources needed to face bloated contest from foreign clubs and other businesses in the entertainment field. There is a multi-billion EURO business in a professional soccer that is not recognized in scientific articles. This has become a truly international business.
Glocalization explains how global and local symbiosis differs according to specific cultural circumstances. When the word is applied to wider cultural projects, ...