By Kevin Fylan

BARCELONA (Reuters) - No-one could accuse Real Madrid of blazing an online trail when the possibilities of the Internet began to emerge in the 1990s.

The eight-times European Cup winners did not manage to get an official site up and running until May 2000, significantly later than arch-rivals Barcelona, and even then it offered little beyond the standard fare of potted biographies and press releases.

But after a successful relaunch in March 2001 and an encouraging first foray into e-commerce over the last six months, the Internet and other new technologies are now firmly part of the club's business strategy.

The approach remains cautious -- there will be no headlong rush to broadcast games online -- but the club are now convinced they have found a way of turning a huge worldwide fanbase into loyal customers as well as loyal supporters.

"We have between 70 and 80 million fans in the world," Real's director of new technologies Miguel Angel Hernandez told Reuters in an interview at the Planet Futbol trade fair in Barcelona last week.

"That's a lot more than the five million people who live in Madrid, plus another five million tourists, not all of whom are going to visit the shop. It's a question of markets."

POSITIVE RESULTS

For the last six months, Real have been selling the merchandise from their club shop online.

That hardly makes them Internet pacesetters -- a quick survey reveals that six other first division sides in Spain have their own online shops up and running.

The early results have been positive though and the club are now convinced the web can work hand-in-hand with their planned worldwide chain of club shop franchises.

"We had sales of 24,000 euros in the first month in September last year," Hernandez explains. "That's without advertising because we wanted to see how well it worked. In December, the figure was up to 72,000 euros."

A major limiting factor at the moment is that while Real's Web page has content in English and Japanese, the online shop is accessible only in Spanish.

That has no doubt contributed to the fact that Mexico is currently the most lucrative market, with the United States second and Spain third.

"Seventy-five percent of the sales come from overseas," Hernandez says. "That shows we're not cannibalizing our own sales. These are new markets."

POINT OF CONTACT

Hernandez insists Real's Internet strategy is only partly about generating income.

The club are committed to using the web to communicate more directly with their fans and they have an in-house editorial team putting content directly on to the site, cutting out any spin the four competing daily sports newspapers in Spain may care to add.

That content is also being used in another money-making project as the club look to exploit the craze for text messaging.

"We're looking for different channels to send out the information we produce," Hernandez said.

"The basic way is via the Internet but we're also sending text messages to mobiles, costing the fans 0.15 euros per message.

"People can tell us what sort of message they want and a maximum number they want to receive each day. We don't want to take advantage of the fans.

"We'll only send the most important information, for example if (Zinedine) Zidane gets injured. We can also send halftime and full-time scores, post-match quotes and the views of a fan's favorite player if they've spoken after the game.

"At the moment, you have to buy a newspaper to find out if Raul, for example, is OK. That costs more than this service."

INTERNET RIGHTS

Real are members of the G-14 lobbying group of clubs who had their general assembly in Barcelona last week, after which they issued a stark warning about the possible financial collapse of some clubs if costs were not cut and new income was not generated.

One item on the agenda at that meeting was the possible exploitation of rights for web broadcast after the Internet transmission, on delay, of a recent premier league match between Manchester United and Liverpool.

Real are much more cautious about the potential of online broadcasts as they wait for the promise of broadband and 3-G mobile telephony to become a reality.

With one eye on the problems the Internet world has faced in recent times, they are anxious not to over-estimate potential streams of income.

"At the moment the infrastructure doesn't support it," Hernandez said. "Video on Internet is particularly difficult for sports like football and basketball, with a lot of movement."

He added: "We want to go slowly.

"We've all lived through the last year or year-and-a-half of the Internet debacle and we know we have to go slowly, step by step.

"Our shop in the stadium didn't make billions of pesetas in its first week."

Hernandez is confident, though, that the notorious reluctance of people to actually hand over money for online services will not be a problem with football fans.

"In the world of football, supporters are accustomed, or at least they've become accustomed, to spending money," he explains.

"If you want to go to the game, or watch a game on pay per view, you have to spend money. If you want the shirt, you have to buy it and if you want information about the team usually you buy one of the sports newspapers.

"If you look at what happened with pay per view, I think the first match attracted just 75 viewers. Now, around five years on, hundreds of thousands of people are watching some games.

"The fans just had to get used to paying."

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