Soccer radio deals in the U.S. put spotlight on FIFA's bidding process
By Mica Rosenberg
NEW YORK (Reuters) - As world soccer body FIFA faces pressure to reform in the wake of a global corruption scandal, several current and former media executives are raising questions about the transparency of the bidding process for U.S. radio broadcasting rights to the World Cup.
In particular, these executives point to the apparent two-decade lock on U.S. Spanish-language radio rights held by Miami-based broadcaster Futbol de Primera. The company was co-founded by Andres Cantor, who famously introduced American soccer fans to the Latin American style of yelling "Gooooooal!"
One former chief executive of a rival broadcaster, Joaquin Blaya, said that in 2000 then-FIFA president Sepp Blatter told him he had a deal for the next two World Cups in South Korea/Japan (2002) and Germany (2006), but the contracts instead went to Cantor's Futbol de Primera for a lower price.
Since then, other Spanish-language radio broadcasters, including GLR Networks and ESPN Deportes, have been interested in the rights but see no way they can prise them away from Futbol de Primera, according to people familiar with the companies' thinking.
A spokesman for Walt Disney's ESPN cable business, which held English-language U.S. television broadcast rights to several World Cups, said that when the network acquired U.S. rights in 2005 to FIFA events through 2014, "we knew going into the bidding process that the Spanish-language radio rights in the U.S. were not part of the package."
A spokeswoman for Madrid-based Prisa, which controls GLR, said it has never negotiated with FIFA for World Cup rights but did not respond to a question about whether it has been interested in obtaining them.
Cantor declined to comment. His business partner, Alejandro Gutman, said in an interview that Futbol de Primera won the radio deals fairly through a competitive bidding process vetted by FIFA's lawyers, but he declined to give details about the other bids. FIFA declined to comment on its deals with Futbol de Primera and on the process used to award Spanish language radio rights in the U.S market.
FIFA was thrown into turmoil last year when U.S. prosecutors announced a sweeping probe of corruption in the sport, including how the organization and its affiliates marketed and sold TV and radio broadcast rights to soccer tournaments.
Prosecutors have charged 41 people and entities, mostly soccer bosses from throughout the Americas, and identified $200 million in bribes and kickback schemes tied to marketing of major tournaments and matches.
FIFA often awards multi-year contracts. Futbol de Primera has held the exclusive U.S. Spanish-language radio broadcasting rights to every World Cup tournament since 2002 and holds them through the 2022 competition to be held in Qatar, according to FIFA documents and the company website.
Futbol de Primera syndicates the World Cup and a separate soccer commentary show hosted by Cantor to 115 radio stations across the U.S. in exchange for advertising space, according to the company. It is privately held and does not disclose its annual revenues.
Cantor, who is also an announcer for NBCUniversal's Spanish-language television station Telemundo, burst on the soccer scene when he was a commentator for the 1994 U.S. World Cup, earning him spots on commercials and even a cameo on the animated sitcom The Simpsons.
Some FIFA critics are pushing for more transparency.
"It's all closed doors. You never see contracts. Even if you want to go for the rights, you are basically told the deals have already been done," said one radio network executive familiar with bidding for soccer broadcast rights.
Michael Hershman, a former member of FIFA's Independent Governance Committee, said because radio deals are usually smaller than television contracts they have received less scrutiny over the years.
Blaya, who headed Miami-based broadcasting company Radio Unica until it filed for bankruptcy protection in 2003, told Reuters he questions how Cantor's Futbol de Primera won the original deal that launched its 20-year streak of exclusive U.S. radio contracts.
In an interview, Blaya said Radio Unica held the U.S. Spanish-language rights to the 1998 World Cup in France and was hoping to extend them. He said he flew to Zurich in 2000 to meet Blatter, who was suspended last year as FIFA's president in the wake of the corruption scandal.
Blaya says he offered $15 million to win the rights to both the 2002 and 2006 World Cups, and was told by Blatter he had a deal. But he later found out the rights went to Cantor's company for less money. Blaya said this suggested "there were clear, clear irregularities" in the process.
A lawyer for Blatter declined to comment.
Gutman, Cantor's partner in Futbol de Primera, acknowledged that their company offered less money for the deal but declined to say how much. He said Blaya's offer came too late after a rigorous licitation process that lasted about 18 months, and that Futbol de Primera won the deal because the company had other advantages, including a wide distribution network and a specialization in soccer.
"When Unica decided to go and offer this money, we had already made a deposit and signed the contract," Gutman said. "President Blatter had already told us 'welcome to the FIFA family.'" Gutman declined to give more details about the contract, citing confidentiality clauses in its deals with FIFA.
MEETING IN ZURICH
Members of FIFA's Congress are scheduled to meet in Zurich on February 26 to vote on a package of reform proposals including some aimed at increasing transparency. They include a plan to create a separate General Secretariat to handle business dealings that would have an independent audit and compliance committee to oversee those decisions.
The regional body CONCACAF, which governs soccer in North and Central America and the Caribbean, called in outside experts to oversee bids for its upcoming tournaments after several of its officials were indicted by U.S. prosecutors last year.
"Regular companies, when they are selling products or buying companies, usually get opinions from banks about whether there is a fair price," said Samir Gandhi, a CONCACAF attorney.
A third party evaluation, Gandhi said, can "make sure there is sunshine on the process."
(Reporting by Mica Rosenberg in New York; Additional reporting by David Ingram in New York and Simon Evans in Miami; Editing by Noeleen Walder, Amy Stevens and Martin Howell)