Real Madrid, the 'galactico' of Building a Branding Empire

HDVoomer

SatelliteGuys Family
May 25, 2004
79
0
Here is an article I came across on another fourm if anyone is interested in reading it. Its very good and it does state that there are cable companies in the U.S. trying to sign a carriage deal for Real Madrid Television.

Here's the link.

http://www.iht.com/articles/2005/11/06/yourmoney/madrid07.php


Real Madrid, the 'galáctico' of building a branding empire
By Doreen Carvajal International Herald Tribune

SUNDAY, NOVEMBER 6, 2005


PARIS When Real Madrid's international soccer stars, David Beckham and Zinédine Zidane, play this season, the multimillionaire "galácticos" will be starring in no fewer than four full-length movies and on two new 24-hour television channels in English and Spanish.

Also coming soon are manga-style cartoons, a Muppets television show, mobile phone clips, video games, podcasting and, perhaps, even theme parks in Madrid and Miami.

"Our colloquial term for this is that we're a multimedia cathedral," said Michael Novack, a former Spanish journalist and Real Madrid's managing director for media.

Club executives speak with religious fervor about their effort to search for fans beyond the Santiago Bernabéu stadium and its 80,000 seats in Madrid.

Foreign territory is the ripest source of potential growth for rich clubs with pricey players like Real Madrid or Manchester United, in England, which has a pay-television channel of its own and an official team Web site in Mandarin. But the globalization of top teams and the transformation of clubs into media empires is raising some alarms about future access to players and the potential for independent, critical coverage.

Last week, for instance, the club manager for Manchester United pulled a regular feature, "Plays the Pundit," after the team captain, Roy Keane, criticized the performance of five teammates in a 4-1 loss against Middlesbrough. The British press seized on the issue, quoting United fans who accused the club's television channel of demonstrating as much independence as Pravda under the Soviet regime. The British press reported that the club manager had ordered the program to be pulled after hearing Keane's scorching comments.

"It's a big problem," said Jens Sejer Andersen, director of Play the Game, a nonprofit research group in Denmark that seeks to provoke debate about ethics and freedom of expression in world sports. "The little independence that is left starts to disappear, and players will be like isolated rock stars. The big companies want to control the photos that are coming out of the games. They have too good a product to leave it to independent journalists."

Real Madrid, which this autumn issued financial results showing that it was the world's richest soccer team, with revenue of 275.5 million, or $325.8 million, is the most aggressive club to plunge into foreign territory.

The advantage that Real Madrid has over other wealthy teams like the New York Yankees is that soccer is more international than baseball, whose core audiences are concentrated in North America and the Pacific Rim.

"As growth in broadcasting values has slowed across Europe, more clubs have looked to expand the brand overseas and to try and develop new revenue streams," said Paul Rawnsley, a consultant in the sports business group at Deloitte. "For football's biggest brands, their power and money-spinning potential reaches across the globe, and clubs have been targeting the Far East, China and the United States in particular."

Last month, Real Madrid took a booth for the first time at Mipcom, the global television trade show in Cannes, to seek alliances with cable and satellite operators to distribute 24-hour Real Madrid TV.

Miniature soccer balls littered the floor of the exhibit booth, and free DVDs were passed around with Real Madrid TV programming highlights, not to mention classic matches starring Real Madrid, a record nine-time European champion. This year the club has assured qualification for the round of 16 in the lucrative Champions League but is seeking to avoid a third straight season without a trophy.

The new channels have hired journalists from the BBC, CNBC and MTV for its programs, and the club intends to send them to cover the athletes when they play for individual national teams in the World Cup.

An early version of Real Madrid TV started in 1999 as a subscriber option on basic cable, which reached only 65,000 customers. In February, the Spanish version transformed into a free channel, and the English version started in July. Club officials say they cannot estimate the new viewership yet.

Real Madrid TV is already carried on seven satellite stations reaching Asia, Europe, the United States and the Middle East. Novack, Real Madrid's managing director for media, said the company was trying to strike agreements with cable operators in the United States as well. So far, the club has not revealed how much it has spent on its budding media empire, and the two newly created television stations are losing money.

But its latest accounts for the fiscal year that ended in June illustrate the critical importance of business beyond the stadium. Marketing revenue for merchandising and sponsorships nearly tripled from a year earlier to 116.8 million. That amounts to more than 42 percent of the club's income, far eclipsing gate receipts of 70.8 million and 65 million for broadcasting.

Within that category, international development and new technology brought in 16.8 million for the club, which is privately owned and recorded a pretax profit of 8.05 million for the year.

To promote the Real Madrid global brand, the team's president, Florentino Pérez, has actively encouraged movie productions involving the team. The club was a co-producer on the first of four planned movies, "Real: The Movie," which had its premiere in August at the team stadium with a green carpet promenade for strolling soccer stars.

"Real: The Movie," was directed by Borja Manso, a confirmed Real Madrid soccer fan whose brother, Luís, was a co-producer. The movie was a mix of fact and fiction that followed the lives of five soccer fans from New York to Japan. Ticket sales, however, were disappointing in the land of Los Merengues, as Real Madrid is nicknamed, and some critics scorned the movie as a team love letter or advertorial. Even so, the film is now moving on to theaters in Asia.

"What did people expect? It's strategic communications," said Novack, who said the team remained satisfied with the results so far because it reaped promotional benefits and expected more revenue from DVD sales.

Real Madrid is organizing a premiere of the movie in Washington, although a date has not been set, Novak said, to press the Real Madrid brand in the United States.

"Obviously, it was a movie about Real Madrid and I wasn't looking for the bad news in the house," said Manso, who added that filming was initially difficult because he had to gain the confidence and trust players. "But we tried to strike a balance."

Manso said he was disappointed in the film's advertising campaign because he believed that some women avoided the film, mistakenly thinking that the entire focus was on soccer instead of human drama.

That lesson was mastered by the producers of "Goal2," another movie with Real Madrid taking a star turn. "Goal2" is the second part of a trilogy of movies that charts the "Rocky"-like rise of a young Mexican soccer player from the English Premier League to Real Madrid and finally to World Cup star.

Milkshake Films, a Los Angeles production company, is producing the film with the backing of Icon Productions, Mel Gibson's studio. The producer, Mike Jefferies, said his company chose Real Madrid to feature in the second movie because he wanted to make a film with realistic football scenes.

Soccer has generally fared poorly in the theaters, dating back to when Sylvester Stallone played goalkeeper in John Huston's 1981 World War II film, "Victory," about a team of Allied soldiers taking on the Nazis on the field.

The sport is harder to film than a movie baseball game because of the speed of play, said Manso, who used special high-definition Sony cameras that let him shoot constantly at lower cost.

In April, Douglas Gordon, a Scottish artist, and Philippe Parreno of France placed 15 special U.S. military surveillance cameras, which can magnify images 300 times, around Madrid's stadium, focusing the powerful lenses on Zidane. Their 90-minute-long movie, tentatively named "Zidane: A Portrait of the XXI Century," may help Real Madrid reach yet another elusive demographic group among the 93 million fans that one Harvard business case study estimates may lean toward the club.

"This one is going to be shown in museums," Novack said. "It's an art film."

PARIS When Real Madrid's international soccer stars, David Beckham and Zinédine Zidane, play this season, the multimillionaire "galácticos" will be starring in no fewer than four full-length movies and on two new 24-hour television channels in English and Spanish.

Also coming soon are manga-style cartoons, a Muppets television show, mobile phone clips, video games, podcasting and, perhaps, even theme parks in Madrid and Miami.

"Our colloquial term for this is that we're a multimedia cathedral," said Michael Novack, a former Spanish journalist and Real Madrid's managing director for media.

Club executives speak with religious fervor about their effort to search for fans beyond the Santiago Bernabéu stadium and its 80,000 seats in Madrid.

Foreign territory is the ripest source of potential growth for rich clubs with pricey players like Real Madrid or Manchester United, in England, which has a pay-television channel of its own and an official team Web site in Mandarin. But the globalization of top teams and the transformation of clubs into media empires is raising some alarms about future access to players and the potential for independent, critical coverage.

Last week, for instance, the club manager for Manchester United pulled a regular feature, "Plays the Pundit," after the team captain, Roy Keane, criticized the performance of five teammates in a 4-1 loss against Middlesbrough. The British press seized on the issue, quoting United fans who accused the club's television channel of demonstrating as much independence as Pravda under the Soviet regime. The British press reported that the club manager had ordered the program to be pulled after hearing Keane's scorching comments.

"It's a big problem," said Jens Sejer Andersen, director of Play the Game, a nonprofit research group in Denmark that seeks to provoke debate about ethics and freedom of expression in world sports. "The little independence that is left starts to disappear, and players will be like isolated rock stars. The big companies want to control the photos that are coming out of the games. They have too good a product to leave it to independent journalists."

Real Madrid, which this autumn issued financial results showing that it was the world's richest soccer team, with revenue of 275.5 million, or $325.8 million, is the most aggressive club to plunge into foreign territory.

The advantage that Real Madrid has over other wealthy teams like the New York Yankees is that soccer is more international than baseball, whose core audiences are concentrated in North America and the Pacific Rim.

"As growth in broadcasting values has slowed across Europe, more clubs have looked to expand the brand overseas and to try and develop new revenue streams," said Paul Rawnsley, a consultant in the sports business group at Deloitte. "For football's biggest brands, their power and money-spinning potential reaches across the globe, and clubs have been targeting the Far East, China and the United States in particular."

Last month, Real Madrid took a booth for the first time at Mipcom, the global television trade show in Cannes, to seek alliances with cable and satellite operators to distribute 24-hour Real Madrid TV.

Miniature soccer balls littered the floor of the exhibit booth, and free DVDs were passed around with Real Madrid TV programming highlights, not to mention classic matches starring Real Madrid, a record nine-time European champion. This year the club has assured qualification for the round of 16 in the lucrative Champions League but is seeking to avoid a third straight season without a trophy.

The new channels have hired journalists from the BBC, CNBC and MTV for its programs, and the club intends to send them to cover the athletes when they play for individual national teams in the World Cup.

An early version of Real Madrid TV started in 1999 as a subscriber option on basic cable, which reached only 65,000 customers. In February, the Spanish version transformed into a free channel, and the English version started in July. Club officials say they cannot estimate the new viewership yet.

Real Madrid TV is already carried on seven satellite stations reaching Asia, Europe, the United States and the Middle East. Novack, Real Madrid's managing director for media, said the company was trying to strike agreements with cable operators in the United States as well. So far, the club has not revealed how much it has spent on its budding media empire, and the two newly created television stations are losing money.

But its latest accounts for the fiscal year that ended in June illustrate the critical importance of business beyond the stadium. Marketing revenue for merchandising and sponsorships nearly tripled from a year earlier to 116.8 million. That amounts to more than 42 percent of the club's income, far eclipsing gate receipts of 70.8 million and 65 million for broadcasting.

Within that category, international development and new technology brought in 16.8 million for the club, which is privately owned and recorded a pretax profit of 8.05 million for the year.

To promote the Real Madrid global brand, the team's president, Florentino Pérez, has actively encouraged movie productions involving the team. The club was a co-producer on the first of four planned movies, "Real: The Movie," which had its premiere in August at the team stadium with a green carpet promenade for strolling soccer stars.

"Real: The Movie," was directed by Borja Manso, a confirmed Real Madrid soccer fan whose brother, Luís, was a co-producer. The movie was a mix of fact and fiction that followed the lives of five soccer fans from New York to Japan. Ticket sales, however, were disappointing in the land of Los Merengues, as Real Madrid is nicknamed, and some critics scorned the movie as a team love letter or advertorial. Even so, the film is now moving on to theaters in Asia.

"What did people expect? It's strategic communications," said Novack, who said the team remained satisfied with the results so far because it reaped promotional benefits and expected more revenue from DVD sales.

Real Madrid is organizing a premiere of the movie in Washington, although a date has not been set, Novak said, to press the Real Madrid brand in the United States.

"Obviously, it was a movie about Real Madrid and I wasn't looking for the bad news in the house," said Manso, who added that filming was initially difficult because he had to gain the confidence and trust players. "But we tried to strike a balance."

Manso said he was disappointed in the film's advertising campaign because he believed that some women avoided the film, mistakenly thinking that the entire focus was on soccer instead of human drama.

That lesson was mastered by the producers of "Goal2," another movie with Real Madrid taking a star turn. "Goal2" is the second part of a trilogy of movies that charts the "Rocky"-like rise of a young Mexican soccer player from the English Premier League to Real Madrid and finally to World Cup star.

Milkshake Films, a Los Angeles production company, is producing the film with the backing of Icon Productions, Mel Gibson's studio. The producer, Mike Jefferies, said his company chose Real Madrid to feature in the second movie because he wanted to make a film with realistic football scenes.

Soccer has generally fared poorly in the theaters, dating back to when Sylvester Stallone played goalkeeper in John Huston's 1981 World War II film, "Victory," about a team of Allied soldiers taking on the Nazis on the field.

The sport is harder to film than a movie baseball game because of the speed of play, said Manso, who used special high-definition Sony cameras that let him shoot constantly at lower cost.

In April, Douglas Gordon, a Scottish artist, and Philippe Parreno of France placed 15 special U.S. military surveillance cameras, which can magnify images 300 times, around Madrid's stadium, focusing the powerful lenses on Zidane. Their 90-minute-long movie, tentatively named "Zidane: A Portrait of the XXI Century," may help Real Madrid reach yet another elusive demographic group among the 93 million fans that one Harvard business case study estimates may lean toward the club.

"This one is going to be shown in museums," Novack said. "It's an art film."
 

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