PSL: The fattest cash cow in Africa?

The Premier Soccer League’s (PSL) newly announced R500-million sponsorship deal with Absa and the five-year R1,6-billion broadcast deal it struck with SuperSport International confirm South Africa as one of the richest football leagues in Africa and the developing world.

Announcing the deal, Irvin Khoza, chairperson of the PSL, said the re-constituted league has grown in ”leaps and bounds” over the years and was now well placed to attract the best talent from South America, Africa and Asia.

Khoza said the five-year deal meant that the winner of the league would get more than double what the Telkom trophy pays out — the winner of the knockout gets R4,25-million. Absa is the current sponsor of the national team as well the Absa Cup — the domestic knockout competition — for which the PSL will announce a new sponsor next week.

In securing the premiership, Absa reportedly shrugged off challenges from Vodacom, Standard Bank and Old Mutual. The outgoing sponsor, SAB, maintained that it remains ”part of the PSL family”.

Outgoing chief executive of the PSL Trevor Phillips said the deal was ”by far the biggest” in Africa, to place it on par with the top leagues in South America. He would not specify how the South African league compares with the Tunisian, Egyptian and other Arab leagues that tend to retain their skilled players and, for that reason, dominate continental competitions.

The Mail& Guardian has established that, with the levels of investment coming into the PSL, the league might soon compare favourably with the Brazilian league, one the best in the world in terms of raw talent.

In 2005 the Brazilian league had total revenues of $462-million, of which 29% came from broadcasting. Last year they made $457-million, 29% of which came from broadcasting, according to a report by Casual Auditores Independentes, an accounting firm in Brazil.

A significant amount of their money, about 25%, comes from selling their players to Europe and last year about a fifth of their revenues came from sponsorships. The São Paulo club generated about $8,65million in revenue last year.

Although Nigeria is recognised as one of the top footballing nations in Africa, relatively little money trickles into its league.

When the Nigerian Premier League signed a deal worth $17-million over four years with MTN, it was hailed as the biggest sponsorship deal in the West African country’s football history. But the deal has been contested by Globacom, a phone operator, which insists that its $2,3-million deal with the league is still binding.

Giving perspective to the football sponsorship, David Sindenberg of BMI-Sport Info, a research consultancy, said South Africa cannot be compared with the rest of Africa as most African leagues don’t have broadcast deals. ”It’s only now that some of the bigger companies are coming because of the World Cup in 2010.”

Sindenberg speculated that the PSL might well be one of the top 14 leagues in the world.

Uganda FA recently signed a five-year deal worth $5-million with Gateway TV, Africa’s new pay-television company, in a deal touted as the biggest in Ugandan football. The deal dwarfed the $500 000 MTN was paying to sponsor the national team. Mamelodi Sundowns gets R20-million a year from MTN, the biggest telecommunications player in Africa.

Closer to South Africa, Zimbabwe’s football league was until last year sponsored by Econet, a cellphone company, to the tune of $330 000 a season, spread over five years, before a premature divorce and the coming on board of local bank CBZ.

Mascom, a cellphone company, is sponsoring Botswana’s league to the tune of R5-million, spread over a period of three years. This sponsorship covers administration, prize money and youth development.

The Ghana Football Association signed an agreement with OneTouch, but it is working to try to source more funds to meet the valuation of the league at about $4-million. The Tanzanian league recently signed a five-year $3,2-million deal with Vodacom.

While these figures reveal the competitive pull of the PSL, it is still far behind Europe’s top leagues, which continue to grow exponentially. The biggest leagues in Europe — the English, Spanish, German, Italian and the French — grew to â,¬12,6-billion in the year 2005/06.

In the same period the English Premiership generated profits of up to £14,3-million; the German’s Bundesliga of up to â,¬73,5-million and the French league â,¬40-million, all mainly due to TV money, according to Deloitte’s annual review of football finance.

This is the first time the French league has made a profit since 1999/2000.

With all the money flowing to South Africa, the country’s football market is poised to become one of the most competitive leagues in Africa and the developing world.

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Percy Zvomuya
Percy Zvomuya is a writer and critic who has written for numerous publications, including Chimurenga, the Mail & Guardian, Moto in Zimbabwe, the Sunday Times and the London Review of Books blog. He is a co-founder of Johannesburg-based writing collective The Con and, in 2014, was one of the judges for the Caine Prize for African Writing.

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