The economic sustainability of Eurovision for the broadcasters
Of course we can’t touch on this topic without first mentioning the traditional form of revenue the EBU needs to broadcast the contest. The participation fees collected from each participating nation through their national license fees are often a contentious subject among broadcasters. Each year the EBU calculates a league table like system, adjusted based on viewership figures, population and economic prosperity of each broadcaster. Thus, the ‘Big Five’ – Germany, France, Italy, Spain and the UK contribute the most towards the contest. Recent figures suggest the UK pays roughly £300,000 per year. Currently Germany pays the highest fee. Estimated to be in the region of 500,000 euros.
Due to rising inflation and the extra budget costs in terms of logistics, travel, accommodation and staging props, this has left many poorly funded broadcasters struggling. The likes of Bosnia are in massive financial debt to the EBU. Others like Bulgaria, Moldova, North Macedonia and Romania cite the economic pressures of participation among the reasons for their current absence.
We all want to see the biggest and best contests with 40+ participating nations present. However, the price of that comes to the host broadcaster in the form of additional dressing room space, more interview room space, additional stage crew, security and runners and as a result more rehearsal time which adds to the stage production costs. Most of the financial outlay for hosting Eurovision is on labour costs. As well as this, the wider knock-on effects result in increased needs for accommodation and city infrastructure.
So what is the plan?
The increase in commercial partners has helped support the funding of the production costs for the contest in recent years. Although that does not relieve the financial pressures on the individual broadcasters. Even the former Executive Supervisor, Martin Österdahl struggled with this dilemma during his tenure.
Perhaps the answers may lie outside the lens of the contest. Take Formula 1 for example. In 2021 the FIA introduced a ‘cost cap’. This was introduced to attempt to create a more even playing field to narrow the gap between the top teams and the backmarkers. Ending the extravagant spending that made several teams go bust before its introduction. Could a similar cost cap in Eurovision work? Is this a way to limit the rich nations from buying their way into the final with big budget staging.
Another idea from the sporting world could be a revenue stream to support the least well off broadcasters with a ‘parachute payment’ from the wealthiest broadcasters. In major sports such as the Premier League, NBA and NFL they take a proportion of revenue to support the lower league franchises. Perhaps 5%-10% of participation fees could be used as a welfare fund for the broadcasters at the bottom end of the EBU’s tier system.
