Fox, Telemundo Are the Real Winners of the 2026 World Cup Vote

(Bloomberg) -- As the U.S., Canada and Mexico revel in their selection as host of the 2026 World Cup, executives at 21st Century Fox Inc. and NBCUniversal’s Telemundo also have reason to celebrate.

The two broadcasters won the U.S. television rights to the tournament in a private auction -- at a discount -- long before North America was selected to host on Wednesday. That gives the companies an advertising platform during an event that’s expected to be the biggest, best-attended and most profitable in global soccer history.

To add to the windfall, the 2026 event will have 48 teams, up from this year’s 32, and be broadcast across advertising-friendly time zones. That’s in addition to North America’s robust sponsorship and marketing infrastructure -- particularly in the U.S., which will host 60 of the event’s 80 games, including every elimination game.

“It’s going to be as strong a ratings force as you can possibly have for a sports property,” said media consultant Lee Berke.

Qatar Quandary

Eight years ago, Telemundo and Fox agreed to pay a combined $1.1 billion for the U.S. rights to the 2018 World Cup in Russia and the 2022 World Cup in Qatar. (Telemundo agreed to pay about $600 million for the Spanish-language rights, Fox more than $400 million for the English package.)

Later, afraid that Qatar’s summer weather would be too hot for players and fans, FIFA, the sport’s governing body, voted to stage the 2022 event in the fall, moving the tournament from a relatively quiet period in sports into one of the busiest ones, when the National Football League, National Hockey League, National Basketball Association and college football are all in full swing.

To make it up to Fox and Telemundo, FIFA held a closed auction for the 2026 rights, much to the shock and anger of competitors like ESPN and Univision, who were unaware of the negotiations. Telemundo agreed to pay $350 million, plus a $115 million bonus if the U.S. ended up hosting the event; Fox’s price was $300 million, plus a $180 million bonus.

That works out to about $945 million. At the time of the negotiations, a member of FIFA’s governing council said the global soccer body could have made as much as $500 million more by soliciting open bids.

‘Leap Forward’

Fox said in a statement that it expects the tournament to be a “massive leap forward” for soccer in North America. Telemundo Deportes President Ray Warren, who wasn’t at the network when the 2026 rights were awarded, said Wednesday’s decision was a positive.

“Every cycle has been a surprise -- some good, some not so good,” Warren said on the Bloomberg Business of Sports podcast. “Things tend to even out over time.”

It isn’t yet decided if all three host nations will receive automatic bids, another factor that would affect ratings in all three countries. The U.S. failed to qualify for the 2018 event (a disappointing result for both broadcasters), while Mexico has played in every World Cup since 1994. Canada has only qualified once, in 1986.

The selection is also a big win for the major FIFA sponsors that are currently under contract through the 2026 event. That includes Adidas AG, Dalian Wanda Group and Coca-Cola Co., which will also benefit from the higher attendance, larger number of eyeballs and increased commercial attention.

©2018 Bloomberg L.P.