This FasterSkier series will examine the growing challenge to the national team model by privately funded ski teams and independent sponsorship agreements. Will national teams be able to support themselves in the future, or will corporate teams take over cross country skiing? This first article in the series will look at Petter Northug, Jr.’s record deal with Coop and the implications it has for the Norwegian National Team and the sport as a whole.
Last May, Petter Northug, Jr., the bombastic figure of nordic skiing, called a press conference and announced that he was leaving the Norwegian National Team. The news hardly came as a surprise to Norwegian ski fans; for weeks prior to the announcement rumors had swirled in the press that the ski star had signed a lucrative deal with Coop, a Norwegian grocery chain.
The deal was indeed a profit windfall for the then 27-year-old Norwegian. Though the financial terms of the agreement haven’t been made public, the three-year deal was widely reported to be worth somewhere between 10 to 20 million Norwegian kroner a year, or $1.6 to 3.3 million dollars.
Predictably, Northug’s decision to leave the Norwegian National Team, or the Norges Skiforbund (NSF) as it is known in Norway, caused a certain amount of backlash at home. Northug’s career has been rife with moments of controversy, but his decision to leave the NSF may well be a watershed moment for skiing, one that comes to redefine the role of national teams in the international ski arena. This spring will likely see what the future holds for skiing, as the NSF debates whether it will allow Northug to continue to ski for Norway, and other ski stars watch and weigh their options.
“I’m going out of the national team and will train independently,” Northug said at his press conference last year. “I want to prepare myself mostly alone. Motivation makes me draw this initiative. If you are not 100-percent motivated, you’re done. I want to control things myself.”
“There are major challenges,” Northug’s father Petter Northug, Sr., better known by his middle name, John, said. “He chooses not a good arrangement for the national team, but said he had to do this to get greater motivation.”
John Northug added that the cause of his son’s flagging motivation was the stagnation of having already spent seven years on the national team.
“This was the new personal challenge he needed,” he continued. “I see that he thrives on it and he thinks it is brilliant to have responsibility for himself. He is in high spirits everyday. It has given him a new dimension to govern himself.”
Inevitably, Northug’s announcement caused a stir. Some accused him of being unpatriotic, even traitorous, a point of view that Northug says he understands. The older generation of Norwegians is more critical of Northug’s perceived lack of patriotism, while younger Norwegians are more sympathetic with his financial desires.
To counter the fallout, Northug brought NSF Cross Country Head Coach Åge Skinstad to sit beside him in front of the press. Looking like an older, somewhat elfin version of Northug with his similarly shaggy hair, Skinstad was there to lend his protégé support, if not his stamp of approval.
“We have discussed the consequences,” Skinstad said. “And although we have disagreed about the decision, there have been good discussions. … We still have a common goal towards next season with the Olympics, the Tour de Ski, and the World Cup.”
Skinstad stressed that all the funding and support that Northug had enjoyed from the NSF would end immediately. But he added, “When we come to the [World Cup] ski races in Kuusamo [Finland], then Petter will get the same support as the others.”
Northug penned the agreement in the belief that he would still be able to compete for Norway at World Cup competitions, the Olympics, and World Championships through a representation agreement. Since only national teams are allowed to compete at these competitions, temporary representation agreements are often drawn up to allow skiers who are not normally on the national team to temporarily join the team when they qualify for competitions.
It is this representation agreement that continues to put the NSF in a bind. The problem is simple: sponsor exclusivity.
“… [Northug] has signed a major sponsorship agreement with Coop, which is a competitor of NSF’s sponsorship Norgesgruppen/Spar,” Stein Opsal, NSF secretary general, stated on the NSF’s website. “NSF sponsors have industry exclusivity in their agreements. It has therefore been important for the NSF to fulfill our partners’ interests. It is these partners who contribute to the financing of … Norwegian cross country skiing.”
“At the same time,” wrote Opsal, “it has been our clear desire to contribute to Petter getting the best possible athletic program before the Olympics, within the limits we can defend.”
For a star like Northug to be absent from the team for 10 months of the year, while partnering with the NSF’s sponsor’s closest competitor, creates a vexing problem for Opsal and his organization. They were counting on Northug to provide them with Olympic medals in Sochi, and felt that they could scarcely afford to sacrifice that all-important marker of success over exclusivity clauses.
For that reason it was to no party’s advantage to see him left out of the team in a critical Olympic season, but with the 2014 Games behind him his future is in some doubt. Partly it depends on the desires of the Norgesgruppen. If the food conglomerate insist upon total exclusivity, then Opsal will be under serious pressure to exclude Northug entirely. If, on the other hand, Norgesgruppen decides that his temporary inclusion on the national team still elevates its sponsorship profile, or fearing a negative backlash if they force him out, the company may let the issue rest. In any case, Northug correctly gambled that he wouldn’t be pushed out, though that may change.
From his announcement last May, Northug was unable to come to terms with the NSF over a representation agreement until October 13, 2013, an unusually long time for what Opsal called a “general representation agreement.” That agreement also came with “an attachment that governs the relationship between Northug’s sponsorship and NSF sponsorship.”
The Agreement Itself
That attachment seems to have been an awkward compromise at best. As part of his deal with Coop, Northug has become a face of the store, and a poster boy for its healthy living campaign. His visage is on everything from juice, cereal, and bread in the store, and as part of the contractual agreement, all Northug-related products and advertisements that were launched after October 30 had to be removed from stores between January 30 and February 28, 2014, so as not to interfere with Spar’s Olympic exclusivity.
If the products remained in the stores, Northug risked being suspended from the Games, and fearful store managers scrutinized their aisles for Northug items that could have caused trouble. One store manager, Erik Tangstad, said that he didn’t even dare let the advertisements stay in the warehouse, and threw everything away for fear that banned items could be mistakenly be brought into this store during the Olympics.
How long these sorts of arrangements can remain feasible is uncertain.
“It is clear it can be a challenge for the national model,” Opsal told NRK. “It is something we will now evaluate after the season, for our loyalty lies primarily with our partners. So if we feel we have gone above and beyond what we feel is reasonable [with representation agreements], we will tighten it for next season.”
Northug has also put himself at disadvantage in these agreements by having a poor season. Having struggled with sickness in the fall, Northug was lackluster at best on the World Cup and dreadful at the Olympics. Additionally problematic, at least for Northug, was the emergence of Martin Johnsrud Sundby as the Tour de Ski and Overall World Cup winner at the end of the season. Throughout the Northug era Norwegian ski fans have worried that there wasn’t another world-class man on the team. In the one season that Northug was a non-entity, Sundby suddenly emerged as the world’s best all-round skier. With Sundby in good form, Opsal may now feel less pressure to come to an agreement with Northug for the 2014/2015 season.
While Opsal speaks cryptically about tightening agreements, Vegard Ulvang, former Norwegian ski star and head of the FIS Cross Country Committee, is more direct.
“It’s a very difficult issue,” Ulvang told Aftenposten. “In principle, the Norwegian national model is built on a strong Norwegian National Team, which all contribute to the economy [of the NSF]. If the model is broken … then we need to align ourselves with another system, to lay down the national team and let the [professional teams] take over.”
Ulvang questioned who would provide the infrastructure and support system that national team skiers now enjoy. “If you let [skiers] be free,” said Ulvang, “the system will not work the way it does today. In my mind there is not any other way, either to finance or organize this, than we do today. Then everyone must contribute.”
As a longtime advocate for the national-team structure Ulvang does not think that skiing will go the way of cycling with its professional teams. In a June 25 interview with NRK he ranted, “Our sport is not developed alone in a hotel room in Italy. The development of the national [team] environment and the Petter Northug training culture today is a product created over 50 years where everyone has contributed. To break out of the federation’s national system is a serious violation of the way we are organized.”
“I fear that Petter has started something that more will [choose],” he continued. “I am very concerned that this will be the trend. It is important that Northug and all others that are good give knowledge and expertise back to those who come after them. There’s supposed to be a new Northug one day. Therefore, we must avoid that the best break out of the national system once they have received the best fruits contained therein. There is enough flexibility in the national team, so this is about one thing only: Economy.”
“Petter is not the first star who has had the opportunity to do things differently,” Ulvang fumed. “But in previous cases, we have always found flexible solutions within the system.”
“What people are saying I do not care so much about,” Northug responded. “I follow what I want and what I feel.”
Jürg Capol, former FIS race director and current marketing chief, supports Northug’s route.
“The ability to concentrate on one’s own, with major sponsors at one’s back, is too good to miss,” Capol said. “[It’s] essentially a luxury problem: that there is so much money in the sport.”
The fact that there is so much money now in the sport is an issue that national teams have been slow to respond to. The last decade and half has seen a concerted effort by FIS to turn World Cup skiing into a TV-friendly event. The reinvention of race formats and coverage quality has paid off handsomely. The 2013 Cross Country World Cup season boasted an aggregate audience of 1.86 billion viewers over 1,135 hours of broadcast time. This represented an audience increase of 25 percent from the 2012 season alone, and with it, sponsorship revenue.
It’s not just the World Cup races that are popular to watch on TV. The Vasaloppet captures 73.9 percent of the television audience in Sweden the first Sunday morning in March. It’s such a TV event that former race director Jonas Bauer, looking to expand the Vasaloppet’s market abroad, concocted a new marathon circuit: the Swix Ski Classics.
The Swix Ski Classics was inaugurated in 2011 with the Tour de France as a role model, and the races follow in that tradition. There are now 32 professional ski teams that compete on the circuit, and 200,000 euros in prize money. The series consists of six long-distance classic races: La Diagonela, Marcialonga, König Ludwig Lauf, Vasaloppet, Birkebeinerrennet, and the Årefjällsloppet. These races were broadcasted last year in 50 countries with 20 million live viewers.
Though far from equaling FIS’s TV audience, the Ski Classics is only in its fourth year and growing rapidly. This alternative ski circuit has fueled the creation of private ski teams, particularly in Scandinavia, where sponsorship money is ripe for the picking. It is precisely these ski teams that are now catching the eye of many top cross-country skiers.
A former member of the Norwegian junior and recruit national teams, Chris Andre Jespersen left the national team in favor of Team United Bakeries. Jespersen had a breakout season this winter, finishing second in the Tour de Ski. At the summit of the Alpe Cermis after the race, he was asked whether or not he would join the national team the next season. Shrugging off the question he thanked United Bakeries for the support they’d given him.
“I got an offer last year,” Jespersen said on top of Alpe Cermis. “We get good financial support, all of the camps, private physio — we really have it all. There is no reason why we should not go as fast.”
He doubted whether he would receive the same kind of treatment in the NSF. Asked about his future on April 2, Jespersen gave a cautious answer, “I’ve decided, but I do not want to say what I’ve decided.”
All of this leads back to the Northug debate, and the amount of money that Northug had left on the table while still on the national team. Public tax statements indicate that Northug’s income in 2012 was 1.6 million kroner ($268,000), the lowest amount that Northug has reported since 2008. As more money is available in the sport, Northug has apparently been making less.
The high water mark for Northug was in 2011, the year the World Championships were held in Oslo when he reported 3.59 million kroner. All told, according to Bergens Tidende, Northug’s net worth in 2012 was 11.9 million kroner ($2.18 million dollars). Compared to these numbers, the 10-20 million kroner ($1.5-3.6 million) Coop is now paying him seems too good a prize for him to have passed by.
For skiers on the national team, the base salary is 200,000 kroner ($33,500), while its top stars earn 450,000 kroner ($75,400). Prize money and additional sponsorship make up the rest of a skiers income. Even so, Therese Johaug reported an income in 2012 of 1.1 million kroner ($184,000) while Marit Bjørgen made only million kroner herself, though her total wealth is estimated at $3.6 million.
All of this comes as the NSF’s sponsorship revenue has exploded. In 2009 the team collected 20 million kroner ($3.3 million) in sponsorship funds. In 2013 that number was 66 million kroner, or $11 million.
To what extent Northug was responsible for the 10-million kroner increase per year is up for debate. Skinstad dismissed the idea saying, “It is impossible to say what Northug has had on the economy [of the team]. I believe that the total interest is not very dependent on individuals.”
Northug’s manager Are Soerum Langås, has a different take. “Peter has contributed an amazing amount in all the years in which he has been part of the national system, including by increasing the FIS market,” Langås said.
In the minds of Camp Northug, Petter has already contributed his share, and has seen his personal income drop while the profits of FIS and the bankroll of the national team have soared.
Bernt Halvard Olderskog, the NSF’s commercial manager questioned the notion that Northug helps attract sponsorship to the NSF in a March 2014 interview with Adressa. Olderskog noted that this year with Northug only temporarily on the team, the NSF received 73 million kroner in sponsorship funds, up 7 million from the previous year, an increase of 10 percent.
“We expect an increase next year,” said Olderskog. “The large income jump we have already taken, but there is additional revenue in license products and equipment sales.”
Olderskog defended the fact the NSF’s ski stars make less than their earning potential while they’re on the team. “It’s a social democracy that prevails in the national team,” he said. “Marit and Therese could have earned more …”
Will Others Follow?
The biggest threat to the National Team’s economic model of course is losing more of its star athletes. Of chief concern are its leading ladies, Marit Bjørgen and Therese Johaug, both hugely popular figures in Norway. The NSF receives sponsorship from ASKO specifically for Bjørgen and Johaug, and if it lost them, the team would likely find itself much less attractive to partners and its overall revenue would decline. The NSF will likely never be able to offer athletes the money and exclusive perks of a well-funded corporate team, instead for the time being they are relying on other methods to keep their athletes on board. What the team can offer is top-notch resources and personnel, not to mention prestige, national pride, and camaraderie.
To prevent the further loss of athletes, Opsal is debating his options. Ulvang is encouraging the total exclusion of Northug from the national team to set a precedent, while Opsal seems to be favoring a more moderate approach.
An April 2, 2014 article in NRK stated that Opsal is actively reviewing the NSF’s representation agreement policy and would come to a conclusion on the matter by the end of May of this year.
“It is wrong to talk about possible outcomes at this stage in the process,” Opsal said. Nevertheless, NRK proceeded to outline the three possible outcomes:
1) The policy will remain the same. Athletes can sign representation agreements even if they have other conflicting sponsorship agreements.
2) Athletes can sign representation agreements only if they have no conflicting sponsorship agreements.
3) Athletes that are offered membership on the national team but opt not to join will be refused the right to sign representation agreements.
While it’s unlikely that the NSF would choose Option 3 and essentially force skiers onto the national team, Opsal must choose whether or not to allow sponsorship conflicts to continue. His decision will be shaped by how threatening he finds Northug’s private initiative to be for the future of the national team. With Jespersen likely to remain with United Bakeries, and Eldar Rønning hinting that he may pursue something similar after next season in order to be more “family friendly,” Opsal may heed Ulvang’s warning.
Yet Opsal knows that if he goes with Option 2, it is very unlikely that Northug will leave his partnership with Coop. Therefore, if he changes the terms of the representation agreements, Northug will almost certainly no longer ski for Norway. Whether Norway can remove the sting of the Olympics with a Northug-free relay team at next years World Championships in Falun, Sweden, is also a question that must be on his mind.
The reality is that Northug is fully prepared to no longer ski for Norway. He has already won everything there is to win, and though he surely would like to win more, he and the NSF don’t get along very well, and never really have.
His disagreements with the NSF began at the very beginning of his career: he was contentiously left off the Norwegian team for the 2006 Olympics, and has said he has not yet forgiven then National Team Coach Krister Sørgård for the decision. The bad blood he felt between himself and the national team from this episode has remained with him throughout his career, and with each new conflict he can taste it again — a sense of mistreatment and injustice.
The Northug Complex
To understand Northug is to know that for him skiing has always been about proving people wrong. His motivation seems to stem from a sense of himself being set against the world. Many thought he would mellow with age, but so far at 28, that hasn’t quite happened. Even as he became arguably the best skier of his time, he kept up his war of words: belittling Sweden at every opportunity, mocking his rivals, and making boastful comments whenever a microphone was in front of him, much to the delight of reporters.
Media outlets like NRK have covered him extensively, and the following two sections are based largely on their reports.
Perhaps the most telling example of his attitude was Northug’s warmup jacket at the 2013 World Championships in Val di Fiemme, Italy. Emblazoned on the back of the jacket was a picture of Northug’s face holding up a single, shushing finger over his mouth, while an inscription on his sleeve read in English: “Haters gonna hate.” If that wasn’t clear enough, Northug took it upon himself to point out the inscription whenever the cameras rested on him.
Critically, though, for Northug, he wasn’t able to maintain a harmonious relationship within the insular national team. In April of 2008, Northug was reprimanded by his teammates at the end of the season evaluations for “contributing too little in training.” The grievance was that he was too concerned with training at the right intensity to fully participate and push his teammates in the harder workouts. Northug’s occasional lack of effort at training sessions has continued to be a bone of contention on the team.
Northug’s sponsorship battles are also nothing new. In November of 2008, he showed up on the TV show “Grosvold” with his personal sponsor, a decision his teammates criticized him for. His sponsorship conflicts really heated up though the following year, when Northug signed on with Red Bull. The NSF did their best to stop the Red Bull deal going forward, despite the fact that on the NSF’s alpine team, the famous Aksel Lund Svindal was enjoying a rewarding partnership with the very same brand.
The NSF threatened to revoke Northug’s racing license over the issue, and he was accused of sending “unfortunate moral signals” by pursuing the deal. Northug in the end was allowed to keep his Red Bull contract, but for him the experience equaled the injustice he felt following his 2006 Olympic team omission. It was then, in the fall of 2009, when the Red Bull tensions were at their highest that Northug first began to privately consider a career for himself outside of the national team.
Of course there have been many other flare-ups along the way. He was outraged at not being given a bib in the sprint race at the 2009 World Championships in Liberec, Czech Republic, the race he felt gave him his best chance to win gold. After a poor performance in the 15 k at the 2010 Olympics Northug declared that something had been done to his skis.
While it was never confirmed whether anything had happened to his skis, tension remained high throughout the Games as his father stepped in, giving Northug the equipment and wax service he needed to be successful in Vancouver.
In April 2010 he was hounded by the Confederation of Norwegian Sports over his poker habit, and that May he failed to show up to a national-team camp citing illness, but was skewered in the press after it was revealed that he had actually gone instead to play a soccer match for Mosvik, a lower-division club he occasionally plays for. That revelation was relatively benign compared to the popularly held belief that he had skipped the camp to get blindingly drunk on the Spanish island of Mallorca.
In December 2010, Ulvang howled that he was “embarrassed to be a Norwegian” after Northug showed up late to an award ceremony after a World Cup race in La Clusaz, France. Last year, Sundby called him a coward, and Northug had to fight to be allowed to ski in the World Cup races in Sochi, preparation he said was vital ahead of an Olympic year. All told, by the end of the 2012/2013 season he simply ran out of patience with the national team and its “haters-gonna-hate” attitude, as his sleeve that year attested.
It’s likely Northug had been developing his strategy for a national-team exit for some time before his announcement last May. To understand how he managed to land such a momentous agreement with Coop, one need not look farther than Northug’s father.
The Ultimate Ski Patriarch
John Northug is nothing if not the ultimate ski patriarch. He is the father of three sons, all skiers: Petter, Thomas, and Even, and he has been instrumental in developing their ski careers. Aside from his eldest son Petter’s obvious success, Thomas, age 23, is a member of the National Team, and Even, 18, is on his way up. When Even took third in a Norwegian rollerski race last summer, Petter exclaimed: “We don’t play around, we don’t play around. F*ck, we’re good.”
For three years John has managed Petter’s career, helping him reach an unprecedented level of success and fame. Yet the relationship between the two was argumentative, often tense in the public sphere and said to be even more turbulent behind closed doors.
“When I started, it was because Peter wanted it. And I was positive. We both agreed that I was the right man for the job,” John told Dagbladet. “In the aftermath, we can say that it was a misjudgment.”
After three years, they decided that John would move on from his managerial role, and he told Dagbladet he was relishing a return to the simple life of living on his farm and working at the Agricultural Office in Inderoy.
“Now I have it good,” John said at the time. “Now I have found serenity. When I was a manager, I walked around with a tension in my body all the time. What would show up today? It was something all the time.”
He didn’t last long at the Agricultural Office. If John Northug thought he was ready to return to the simple life of a municipal worker, and leave his role as chief of the “Northug Circus” as his son’s exploits are referred to, he was kidding himself.
“It is just a little bit that I do some other things too well,” he said about he decision to leave the municipality.
He then joined a sport-management company based in Trondheim, Norway, called Nye Høyer, or “New Heights” in English. As a senior consultant with New Heights, his role was largely to help the company develop its activities relating to major Worldloppet ski events such as the Marcialonga, Dolomitenlauf, and the Engadin.
It was no accident then that Northug arrived at the doorstep of New Heights, the company he actually signed with when he left the national team in 2013. Whether John was hired by New Heights with the expectation that they would manage Petter’s business affairs in the future, or whether that idea was borne later, by last spring it was decided that Northug would partner with New Heights, and that they would, “handle all areas around the Petter Northug brand.” The deal they arrived at with Coop didn’t disappoint the company motto of, “a profitable journey of continuous improvement.”
With New Heights, Northug has the experience of his father backed up with the support and connection of a well-oiled management company. New Heights cited their connection to the legal firm Pretor Advokat and the Trondheim branch of the international auditing house PricewaterhouseCoopers to provide Northug with extra legal, financial and tax assistance.
To what extent New Heights is currently leveraging their connections to assure that their golden boy remains able to compete for Norway in big competitions is unknown. Perhaps his future will lie entirely in the world of marathon races, and if so he may lift those events to even greater prominence. In any case, whatever Opsal decides and despite Ulvang’s cries of alarm, the sport of cross-country skiing is not likely to proceed in the same way for long. FIS has been successful in making skiing popular to watch, and there is money in the sport in a way there never has been before. With Norwegian national-team salaries capped at $73,000 and most other nations paying their athletes significantly less, it’s only a matter of time before more skiers opt for a more remunerative route.
If Opsal opts to change the agreements he may delay the inevitable for some time in Norway, but star athletes from other countries will likely soon hear the siren sound of private teams, exclusive contracts, and real wealth.
This series will continue by examining Therese Johaug and her path to a successful career while on the Norwegian National Team.