PARLIAMENTARY COMMITTEE CAPE TOWN 16 AUGUST 2005

Presentation By Mr Danny Jordaan CHIEF EXECUTIVE OFFICER FIFA WORLD CUP 2010 tm LOC

OAA requirements, deliverables Government Guarantees Budget Human Resources Requirements Understanding what is required for the project Contracts, Projects and Resources Key Activities The planning and set-up of 2010 FIFA World Cup TM is currently in a compliance phase. The operational phase will begin after 2006 FIFA World Cup TM Strategic Planning Concept of Operations Scope definition Levels of service Roles and responsibilities Delivery method concepts Resources reconfirmation Detailed budget Detailed milestones Risks Vision Mission Statement Goals and objectives Venue Requirement & Strategy Key principles Key activities Operating Plans Policy and procedures Timings Procurement Staffing Model venue Detail, detail, detail…based on previous stages Test and Refine Test Event plan must be the yardstick of standard delivery Test Event delivery Contingency Planning Lessons learnt from Test Event plan with 8 months for improvement leading up to 2010 FIFA World Cup TM Identify the divisions which will be tested in advance, whether it is full test or not – this exercise in itself must be planned for, failing which the entire purpose shall be defeated Operational Readiness & Operations Staff training Simulations and testing Refine Plans Rehearse Move-in and set-up operations Debrief Dissolution Debrief Provide knowledge and experience for Today Operational Phase Compliance Phase Debrief Phase

SOUTH AFRICA: A LAND OF INFINITE POSSIBILITIES Where else can you feel nature’s beautyfeel nature’s beauty experience first-world technologyexperience first-world technology face a fiery passion for sport, andface a fiery passion for sport, and live the world’s only political miraclelive the world’s only political miracle

2010 FIFA WORLD CUP tm The foundation of this Bid lies in our resolve to ensure that the 21st century unfolds as a century of growth and development in Africa. The new Partnership for Africa’s Development (NEPAD) was launched to open new space for the economic progress of the continent. There remains work to be done, but the Successful hosting of the FIFA World Cup in Africa will provide a powerful irresistible momentum to this resolute African Renaissance. Extract from President Mbeki’s letter to Mr Blatter

THE EVENT

OPPORTUNITIES: Mega-Sporting Event Commercial Opportunities Comprise of Primary and Secondary Revenue Streams LICENSING NEW MEDIA SPONSORSHIP CORPORATE HOSPITALITY TRAVEL AND TOURS BROADCASTING TICKETING OTHER INCOME Significant commercial growth opportunities exist for Mega-Sporting Events by optimising Traditional Revenues and exploring Non-Traditional Revenue streams Traditional Revenue Streams Mega- Sporting Events Primary Revenue Streams Secondary Revenue Streams Non- Traditional Revenue Streams SOUTH AFRICA 2010

EXPECTED REVENUE DISTRIBUTION IN SPORT (ILLUSTRATIVE) Gate Revenues Broadcasting Rights Sponsor- ships Licensing Others As there are a multitude of platforms for revenue growth, specific platforms and their related benefits should be in line with the Mega-Event strategy 2000 Broadcasting Rights Sponsorships Licensing Others Gate Revenues 2010 International Trends – Mega International Events Source: A.T.Kearney analysis New Media (New Media Multimedia Rights, Infotainment etc)

Total 2002 FIFA World Cup TM Local Marketing Programme Revenues (Total = $581m) Broadcasting Rights of $1.1b remained the most lucrative revenue stream for the FIFA World Cup TM while the Local Marketing Programme generated ticketing income of ~ $475m in 2002 Local Sponsorship TicketsLicensingTotal Local Marketing Revenue $26m (4) $475m $80m $581m Marketing (2) 20% $340m Local Sponsorship 5% ($80m) Other (3) 9% ($149m) Broadcasting Rights 69% ($1,100m) Source: FIFA 8 April 2003 Media Conference, A.T. Kearney analysis Source: A.T. Kearney analysis Notes:(1) Converted from CHF using 30 June 2002 conversion date: 1 CHF=0.675 USD. (2) Represents Official Partners’ sponsorship revenue and excludes CHF 336m (USD 227m) which was securitised and allocated to period (3) Includes licensing, adidas brand, levies. (4) FIFA Marketing, A.T. Kearney Analysis, CPLG Total 2002 FIFA World Cup TM Commercial Revenues (1) (Total = $1,670m)

COMPARATIVE INVESTMENT (Amount in ZAR billion)

WC EVENT # of MATC HES # of TICKETS (mn) PRESTIGE TICKETS % of PRESTIGE TICKETS % of TOTAL TICKETS SOLD AVG TICKET PRICE (CHF) TOTAL REVENUE ($ mn) USA , %100% France ,0008.5%100%1, – Korea - Japan ,0003.4%100%1, – 200 (est.) 2006 – Germany (proj) , %100%1,926N/A 2010 – South Africa , %89% N / A N/A WORLD CUP TICKET SALES COMPARISON

TICKETS AND SPONSORS FIFA controls ticket sales and tour packages through “Match” -1/3 tickets international (including Africa) -1/3 tickets to FIFA family and commercial partners -1/3 tickets host country -In total 2,78 million tickets will be sold Hospitality, reserved & unreserved tickets, Africa Ticket proposed Confirmed financial support and commitment from multinational corporations

SA FOOTBALL BRAND DOMINANCE Markinor Top Sports Brands in SA 2004 %

SA FOOTBALL REVENUE LAGS BEHIND ZARmillions

54.2% % 7.4% SA SPORT SPECTATORS

COST ( R BILLION)BENEFIT STADIA 2.5FIFA 3.1 TO LOC TRANSPORT TAX 9.8 BROADCASTING TOURISM 5.7 ICTFOOTBALL STADIA SECURITYPROFIT GUARANTEE

BUDGET The inspection report reveals the following budgetary implications for SA: Expenditure – Infrastructure: USD 112,000,000 Operations: USD 364,054,993 Total expenditure: USD 476,054,993 Income – ticket sales:USD 467,459,448 Local sponsors:USD 73,726,103 USD 541,185,551Total income for SA:USD 541,185,551

IMPACT 350,000 visitors projected 2,78 million tickets to be sold (18,500 visitors Cricket World Cup) 40 billion viewers in 204 countries Sectors of 2010 tourists FIFA Exec, Congress Del., Staff (1,200)*VIP Guests Commercial partners/b’casters *Foreign govts/officials Participating teams (32 nations)*Media Officials* Spectators/Fans (350,000)*

ECONOMIC IMPACT Direct expenditure of R12,7 billion R21,3 billion contribution to GDP Will generate 129,000 jobs Additional R5.7 billion to be paid in Government taxes Spectator spend: R9,8 billion

THE EVENT: MAJOR MARKETS #CONTINENT COUNTRIES EXPECTED TO QUALIFY 15EUROPEEngland, France, Italy, Spain, Germany, Portugal, Sweden, Denmark, Netherlands, Russia, Greece, Czech Republic, Turkey, Croatia, Poland 6AFRICA Egypt, Morocco, Nigeria, Cameroon, Ghana, South Africa (Host) 4ASIAKorea, Japan, China, Saudi Arabia 4SOUTH AMERICABrazil, Argentina, Paraguay, Peru 3NORTH, CENTRAL AMERICA, CARRIBEAN USA, Mexico, Jamaica

CHALLENGES: TOURISM 2,78 million tickets to be sold 40 billion viewers in 204 countries Sectors of 2010 visitors (2002 Korea-Japan): FIFA Exec, Congress Del., Staff, VIP Guests 3,000 Commercial affiliates & other rights holders 25,000 Foreign governments & officials 1,000 Participating teams (32 nations) 3,000 Media 15,000 Spectators/Fans 200,000 TOTAL (2002): 247,000 EXPECTED IN 2010: 350,000

THE EVENT: FANS’ EXPECTED SPEND Licensed merchandise Transport Meals Accommodation Entertainment TOTAL EXPECTED SPECTATOR SPEND R9.8 BILLION

The Cities Johannesburg Pretoria Durban Bloemfontein Cape Town Port Elizabeth Polokwane Rustenburg Kimberly Nelspruit Orkney

Technical and Socio-economic positioning, with cost of developing stadia and potential proposed matches City Tech Pos. Socio- Econ Pos. StadiumCost Proposed matches 1 st Round 2 nd Round Quarter Final Semi- Final 3 rd PlaceFinal Johannesburg (Gauteng) 21FNBR364 m5111 Ellis parkR23m511 Ethekwini (KZN) 12R48m511 Cape Town (Western Cape) 33R18 m511 Tshwane (Gauteng) 44R27m411 Rustenberg (North West) 56R13m41 Nelson Mandela (Eastern cape) 65R250 m4111 Bloemfontein (Free State) 77R33 m41 Polokwane (Limpopo) 88R250 m4 Nelspruit (Mpumalanga) 99R250 m4 Kimberley (Northern Cape) 11 R250 m R1,526m

MATCH ALLOCATION 1.Number of World Cup matches 64 2.Number of Venues (WC) 10 3.Number of Friendly matches 64 4.Training Venues ( 4 x 10) 40

STADIA ALLOCATION RUGBY FOOTBALL KINGS PARK Soccer City Ellis Park Royal Bafokeng Nelson Mandela Polokwane Nelspruit NewlandsAthlone Kimberley Free State

TRAINING VENUES Rugby/ Cricket Football WanderersOrlando Rand Marks Park Makhulong George Thabe Super Stadium (Atteridgeville) HM Pitje (Mamelodi) Caledonian

TRAINING VENUES (CONT) RustenburgMafikeng Olympia EthekwiniUmlazi Princess Magogo Kings Park (Soccer) Univ KZN

TRAINING VENUES (CONT) St George's Oval Telkom Adcock Wolfson Cape TownVygies Kraal Langa Green Point Kimberley, Polokwane,Nelspruit and Orkney to be visited October 2005

VENUE Soccer City NET CAPACITY 94,700 [PMG note: Stadium picture not include]

VENUE Ellis Park NET CAPACITY 60,000 [PMG note: Stadium picture not include]

VENUE Rainbow Junction NET CAPACITY 41,000 [PMG note: Stadium picture not include]

VENUE Loftus NET CAPACITY 45,093 [PMG note: Stadium picture not include]

VENUE Peter Mokaba NET CAPACITY 40,080 [PMG note: Stadium picture not include]

VENUE Oppenheimer Stadium NET CAPACITY 40,000 [PMG note: Stadium picture not include]

VENUE Kimberly Stadium NET CAPACITY 40,010 [PMG note: Stadium picture not include]

VENUE Kings Park NET CAPACITY 60,010 [PMG note: Stadium picture not include]

VENUE Port Elizabeth Stadium NET CAPACITY 49,500 [PMG note: Stadium picture not include]

VENUE Mbombela Stadium NET CAPACITY 40,000 [PMG note: Stadium picture not include]

VENUE Newlands NET CAPACITY 40,020 [PMG note: Stadium picture not include]

VENUE Royal Bafokeng Sports Palace NET CAPACITY 40,010 [PMG note: Stadium picture not include]

CHALLENGES Accommodation Transportation Security Hospitality Information Technology Broadcasting Telecommunication

BENEFITS (TANGIBLE) Sport itself and global competitiveness **360 Billion US Dollars Our objective **Our objective: Secure a greater share of the global football economy Economic considerations for SA **R16,9 billion direct investment; At least 122, 800 jobs ** visitors Human resources and capacity-building **Demands highly skilled organisers, professional individuals and world-class technology Taxes R5,6 Billion

BENEFITS (INTANGIBLE) National unity Pride Promotion of country Infrastructure attracts tourists / investors

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