Thomas Law is a freelance writer and works for the Public History Lab at the Munk School of Global Affairs and Public Policy.
This essay is part of the Prosperity’s Path series. In a time of geopolitical instability and a shifting world order, the challenges facing Canada's economy have only gotten more visible, numerous and intense. This series brings solutions.
For the most part, the overcommercialization of the beautiful game has priced out working-class fans, distorted any semblance of competitive balance and broken the link between community and team. This year’s World Cup epitomizes that phenomenon, not least with FIFA’s latest “hydration breaks” (driven by the chance to sell advertisements mid-match) that ruined the flow of the game.
More importantly, FIFA’s lopsided contracts grant it all revenue from broadcasting rights, ticket sales and merchandise and dump costs onto host cities. This World Cup, Canada has shelled out more than a combined $1-billion between various levels of government and, beyond bragging rights and general “vibes,” for what? Some more drinks bought at the local bar? Data from a payment provider reveal only incremental raises in spending in Toronto, for example.
Now Canada has exited the tournament, the last match in this country has been played and the post-party hangover begins. It’s time to consider what we can actually get from being FIFA’s money bag. How can Canada ride the wave of a home World Cup and actually turn soccer into a lucrative venture?
Canada's Head Coach Jesse Marsch and players applaud fans after the team's elimination from the World Cup following a loss to Morocco in the Round of 16.Molly Darlington/Getty Images
The reality is that Canada as a footballing nation very much falls into the cash-strapped category. The Canadian Soccer Association (CSA), the governing body of the sport in this country, cannot afford to pay the wages of the men’s national team manager, Jesse Marsch – up until this World Cup, he has instead been funded by the benevolence of the owners of the three Canadian teams in Major League Soccer (MLS). It was only a few years ago that players from both national teams took strike action over a pay dispute. Meanwhile, the Canadian Premier League (CPL), now into its eighth season, has lost teams in Edmonton and Winnipeg owing to financial difficulties.
Mr. Marsch himself has castigated the CSA’s finances, and for too long, mismanagement and a lack of business acumen has prevented Canada from systematically developing the sport. But as the excitement around this World Cup shows, the interest is there, and if harnessed correctly, the economic boom could be immense.
Opinion: When it comes to soccer, this is as good as it gets for Canada
Exact figures are hard to come by, but in 2015, a Scotiabank-commissioned report put the direct and indirect economic activity of hockey – from community rinks to the NHL – on Canadian communities at more than $11-billion. Of course, the study is from a decade ago, and hockey is Canada’s home game. But as actor Kiefer Sutherland elegantly narrated in a TSN promotional video, “today that home has a new addition, and a backyard with different nets.” Soccer has surpassed hockey to become the most-played youth sport, and has nearly one million registered players – all buying kits, playing for clubs in need of equipment and staff, and competing in tournaments that take them around the country.
Canada’s three MLS clubs, Toronto FC, CF Montreal, and Vancouver Whitecaps, are valued at US$730-million, US$430-million, and US$450 million, respectively, less than any NHL team but far in excess of any CFL franchise.
The impact of a successful run by Jesse Marsch’s men in the World Cup should also not be underestimated: Canada has never made it as far as it did this time, and the team has clearly captured the heart of the nation. MLS, off the back of the 1994 World Cup in the United States when the host team were also eliminated in the round of 16, went from 10 teams and $250-million losses in its first five years to 30 teams, drawing higher average attendances than the NBA and NHL, featuring 18 of the world’s 50 most valuable soccer teams (including Toronto).
Newish CSA chief executive officer Kevin Blue has made good progress, notably securing a $10-million grant from the federal government to fund an elite, high-performance training centre for national teams. He renegotiated a highly controversial and poorly rewarding commercial deal with what is now called Canadian Soccer & Media Entertainment (CSME), which, while far from perfect, results in higher guaranteed revenues for the governing body. (It expects a surplus for 2026, for the first time in years, of $6.5-million).
Fans watch Canada's match against Morocco at FIFA Fan Fest in Toronto on July 4. Canada's historic national team performances and role as a tournament co-host has led to renewed interest in the sport across the country.Jon Blacker/The Canadian Press
But the potential of Canadian soccer far exceeds training grounds, small surpluses, or even a planned $25-million philanthropic “Canada Rising” fund. Hockey shows just how lucrative a popular sport can be. There is no reason soccer could not have a similarly galvanizing impact.
The prevailing opinion is that, even with price tags in the billions of dollars, elite European soccer clubs are undervalued. CPL teams, and those in Canada’s women’s Northern Super League, may have some financial difficulties, but if Canadian soccer can realize its true potential, there’s no reason why teams from Halifax and Calgary can’t skyrocket in value.
An entire economic ecosystem could be constructed, encompassing communities from coast to coast to coast, beyond the big three hubs. In just one season, clubs in the English Football League (the three divisions below the top-flight Premier League) had a £636.69-million ($1.2-billion) impact on the U.K. economy, through multipliers like fans spending money on club merchandise and food and drink on match days. Canada cannot expect to immediately recreate such a deeply socially embedded structure dating back to the Victorian era, but even on a smaller scale, the sporting and economic impact could be immense.
The tricky question is how such change can be affected in Canadian professional soccer. That starts with resolving some of the long-simmering conflict between various companies and organizations, and uniting all relevant parties together with a single mission.
As it stands, CSA has outsourced its commercial rights to CSME, a group predominantly owned by CPL club owners. The women’s equivalent, the Northern Super League, is independently owned and operated by Project 8. Then there are the three MLS teams owned by MLSE with wildly divergent management models: Toronto, under MLSE (75 per cent owned by Rogers), CF Montreal (owned by Quebec businesman Joey Saputo), and Vancouver (under a consortium led by Vancouver entrepreneur Greg Kerfoot). Despite their financial support of Marsch and his staff, they primarily run their businesses as, well, businesses, and not necessarily with the long-term health of Canadian soccer in mind.
Vancouver are on the verge of being relocated by MLS. Montreal fans consistently bemoan the lack of attention and resources directed towards their team by Mr. Saputo, who sits on the board of Italian club Bologna.
It’s a similar story with Toronto, with many fans feeling overlooked in favour of MLSE’s more lucrative teams: the Leafs, Jays, and Raptors. What’s more, up until May, Rogers was involved in a lawsuit against CSME for refusing to carry CPL and national team matches on its cable packages.
Many soccer fans feel Toronto FC is overlooked in favour of MLSE’s more lucrative teams: the Leafs, Blue Jays and Raptors.Yader Guzman/The Globe and Mail
Canadian soccer is defined by competing parties jealously guarding their turf. To achieve its full potential, all these parties need to learn to co-operate, to grow the pie rather than seek to dominate their small patch. That means ending the lawsuits, working together to fund mutually beneficial projects like academies (contingency plans should be put in place to continue the Whitecaps academy in the event of their relocation), broadcasting more of each other’s content, collaborating over scheduling to maximize viewership, and working together to pitch various funding proposals to benefactors and governments alike.
Asking businesses to put aside their competitive instincts to guarantee long-term growth goes against the natural instincts of the vast majority of interested investors in Canadian soccer. That may seem like idealistic thinking, but if soccer teaches us anything, it’s that anything can happen.