Apparently, hosting a World Cup has become a net negative to a country. The costs (significant and increasing) go to the government and the profits go to FIFA and the sponsors.
Yep, its really sad. It also applies for events like the Olympics, where infrastructure improvements are mandatory, and costs far outweigh any profit they may receive.
Counterpoint - the infrastructure stays around. The stadiums get used and re-used, transport improvements benefit locals in perpetuity, tourism/trade brings in money to the economy, not to mention there are general "morale" reasons to host.
These are not profit making events to host, or at least they ought not to be. The benefits are varied and certainly not trivially reducible to profit/loss on the event itself.
This is sadly common, but not always the case. The London 2012 organising committee appear to have done a pretty good job of avoiding the infrastructure 'money pit'.
In fact, the 'legacy' of the Games was one of its main themes[1]. A ton of money was spent redeveloping Stratford, the area surrounding the Olympic Park, and the site itself has been converted into a park. Lots of the venues were temporary, and the major ones - e.g. aquatics, velodrome - are still being used. Many of the venues were also designed with conversion in mind - the aquatics centre was downsized, the stadium is being taken over by a football club. I think a lot of past problems stem from massively oversized venues that nobody can use afterwards, so hopefully that will be avoided.
> Surely that's a question of implementation not inevitability?
Not really. While there might be some cases where some of the infrastructure is something where the operating/maintenance costs would be justified but which didn't get built because of the up-front capital costs, and where hosting a special event which happened to need the same infrastructure might provide an excuse (or an otherwise-unavailable source of funding) for the capital costs, that's rather exceptional. Normally, the most of the infrastructure needed for the event consists of things for which the operations/maintenance costs would not be justified once the event is over.
Vancouver 2010 is a fantastic example of just that. Yes, there were some developments which could have gone better (Olympic Village, for one), but some much needed infrastructure and stadium upgrades came out of it:
- Sea to Sky Highway went from being a ridiculously dangerous road between Vancouver and Whistler to being a pretty good road (still twisty, but there's only so much that can be done about that), and sorely needed these improvements for many, many years without budget for it.
- Canada Line also received a whole bunch of federal money to get built, probably bringing it ahead of schedule by many years. An airport transit line was badly needed in Vancouver, especially with $40 cab rides to downtown.
- BC Place's renovations got a major budget boost from the Olympics, allowing it to be turned into a great venue. The pressurized roof was a huge annoyance (air locks, yay! /s) and collapsed on several occasions, so the new retractable roof probably wouldn't have happened without the Olympic money.
- Cypress Mountain finally got off their ass and built a proper lodge with proper facilities to support the Olympics.
Vancouver also reused a lot of existing stadiums and infrastructure, opting to upgrade rather than build from scratch. It was honestly an example of a really, really well executed Olympics with a lasting legacy. There have been complainers the entire time, but honestly, it made Vancouver a better city. Closing of Granville for theentirety of the games also allowed the city to experiment with closing off city blocks for events, and that now has become a yearly tradition (along with Robson St). On a more sentimental note, it brought the country together in a unified passion which I had not seen before and have not seen since. It was truly a spectacular experience. I like rewatching the closing comments on CTV (https://www.youtube.com/watch?v=vX_dndXEGHI) as well as Stephen Brunt's video essay (https://www.youtube.com/watch?v=kz8tzP3oeDg) every so often to remember that.
This is exactly what I’m talking about – Vancouver 2010, or Kiel+Munich 1972 are perfect examples for reusing existing infrastructure and upgrading it.
Even London 2012 was a great example – reusing infrastructure, upgrading it, etc is a good way to do it.
Another good idea: One of the recent UEFA cups was hosted by two countries together (actually, several of them were). Which is another good idea, several less developed countries working together to still get the profit off of the games, but sharing the costs.
On the contrary, recent experience with Olympics and World Cups alike shows that the stadiums often lie fallow, a complete waste of resources. Promised "transport improvements" are often never built in the first place, or built at a level far below what was promised to local residents. Tourism money fails to recoup what was invested.
One assumes the stadiums must meet a variety of criteria for power supply, cabling, vehicular access, camera gantries, internet connectivity, commentary positions, etc.
Probably easier to build new ones than adapt old (cf the demolition and reconstruction of Wembley to fix these and other issues.)
3 of the 10 stadiums built in Portugal for the Euro 2004 have been considered for demolition because they have been largely unused since the tournament and the municipalities have no way to fund their basic maintenance.
In many ways, the World Cup was a tragic waste of resources for South Africa, and even though it showcased the country (for that one month the South African government showed it could rise above mediocrity), the opportunity was soon squandered.
Most of the alleged spin-off infrastructure (Gautrain, new Durban Airport and Gauteng highways), would have happened regardless, and probably at much lower cost, because of price fixing and the general supply-and-demand situation in the construction industry as a result of the World Cup.
Stadiums and kind of businesses that appear nearby take up valuable space that could be used for higher-value economic activities. There was a rush of US mayors sponsoring stadiums in the 1990s. Almost all of those turned out to be net negative, compared with the opportunity cost.
Which is why I support all these competitions to follow Euro 2020's idea: 13 cities in 13 countries. This one, the costs per nation are much lower and we stop seeing nations building new huge stadiums which are then completely empty and unused most of the time (like some of those built in Portugal in 2004).
"huge stadiums which are then completely empty and unused most of the time (like some of those built in Portugal in 2004)"
Not "some of those built in Portugal in 2004" but actually most of them are currently being used way below capacity. And some of them are actually causing financial problems for the local governments, as the stadiums generate little to no revenue and the maintenance costs are huge.
But everyone involved in getting them built, apart from the guys laying down the bricks, profited hugely from this absurd and pharaonic decision, and the taxpayers didn't really complain properly (and still don't).
Not necessarily. In some places you can host Olympic games without throwing money away, even getting a profit.
Take for example the proposed Olympic Games 2024 Hamburg and Kiel:
Kiel hosts the largests sailing event worldwide every year, and hosted the Handball world cup before – and, due to having the best european team in Handball, we also have often large matches.
Hamburg has also lots of other sports which are done on worldcup level. Combined, we have the infrastructure done to host more than half of the Olympics RIGHT NOW. You could host more than half of the Olympics right tomorrow, without any additional constructions.
And Kiel has also been co-host of the Olympics two previous times, each of them producing a net-profit and developing a complete new district out of the investments – the facilities built for Olympia 1972 are still in use today.
What are we going to build for Olympia 2024? Nothing new – we’ll update existing infrastructure and stadiums, improve public transport (which would have been done anyway, and is already being built today), and add some new living quarters for the contestants – which could be used as cheap student housing afterwards, as both Hamburg and Kiel are facing a crisis where not enough affordable apartments for students exist.
Reusability quota: 100%. We’d have no losses, only profits, and it’d be cheap, too.
The 1984 Los Angeles Olympics were similar. It and surrounding areas had the Los Angeles Memorial Coliseum with a 92k capacity and the Rose Bowl with a 103k capacity available, and numerous smaller professional arenas, and a large number of college and university facilities. For Olympic Village they used the University of Southern California.
Only two new permanent facilities were built for the games: Olympic Velodrome at California State University, Dominguez Hills and the Olympic Swim Stadium at the University of Southern California. Both of those received heavy corporate sponsorship which covered most of the costs.
Overall, the Los Angeles Olympics made a profit of around $200 million.
I lived in the area at the time (Pasadena, to be precise), and the Olympics were remarkable unobtrusive. Mot people expected traffic to be really terrible during the Games, but enough people apparently took vacations or arranged to work at home or shifted their schedules that my daily freeway commute during the games was actually much faster than it had been before.
If you were actually in Vancouver, you'd know that this statement is incorrect. While yes, the actual events were very limited (I only got to go to a medal ceremony, for example), the whole city was alive. There were massive TVs all over the city, showing the games. There were celebration zones, with live streams during the days and big-name concerts and fireworks at night. There were the country and province pavilions, showcasing the best of Canada and the world. There were things to do literally all over the city for this two week period. And all this was completely free of charge, with access by anyone. The absolute best part was the excitement of it all. People across the country were united in their love for Canada, the streets were filled with people at all times, cheering on the athletes. It was an incredible sight.
So yes, while the actual events were hard to get to, there was more than enough for everyone to do, and it was, as OP put it, a massive party. I'd easily do it again for $8000.
Well said. This is similar to how Sydney felt during the 2000 Olympics. One of the few times I've really felt connected to my fellow citizens in that sort of way.
I live less than a mile away from the golf course hosting the Ryder Cup next year. I am NOT looking forward to it. The Ryder Cup isn't as big as the World Cup, but it's considered bigger than the Super Bowl[1]. Thankfully they don't need to build any stadiums, but I'm sure we'll be stuck with all the incidental expenses.
This is highly dependent on the host nation. The biggest factor is that they have already invested a large amount in infrastructure and/or will continue to make use of the facilities after the event. The 94 Cup in the US and the 2006 Cup in Germany are the two most recent examples. It is very hard for developing nations like South Africa, Brazil, or Qatar to have any chance of turning a net profit.
I'm not so sure how beneficial that will be. Some of the previous investments will carry over, but it will be more limited than one might first expect. The Olympics is a different kind of event and is focused on a single metro area or region while the World Cup is nationwide. Any money spent outside Rio and the surrounding area for the World Cup will be of little use for hosting The Olympics.
I'd venture in saying that the costs actually go to the taxpayer, as the government will simply cut on actually relevant things to build stadiums.
As to who reaps the profits, I wouldn't neglect decision makers within governments, as usually the companies that are involved in building and promoting the whole thing have to be "friendly" to get the contract...
