The Lunatics Are Driving The Financial Nails In To The Coffin Of The Beautiful Game (Football in General)

Name: opinions4u

Hello doyoo user, You have to be logged in to use these functions... Login or register Close window

Send message to member

Product:	Football in General
Date:	31/10/02 (121 review reads)
Rating:

Advantages: Err none

Disadvantages: Read it!

The financial plight of football


I am a massive fan of the beautiful game. Since I was old enough to understand the concept of kicking a ball between two coats, I have loved football. I am now 34 and I am just about to accept that my ambition of playing professionally will never be fulfilled. Only now do I realise that my lack of skill, talent, fitness or vision are a handicap. But hey, I can still love the game!

The collapse of ITV Digital is, of course, the main problem facing lower division clubs these days. But, with no real competition to Sky, it is inevitable that Premiership clubs will also see a reduction in their income when the BIG TV deal is renegotiated over the coming months. I find it odd that a football club relying on a 3 year TV deal will offer a player a 4 or 5 year contract. But they do.

The story was different 3 years ago. Sky offered in excess of £1bn for Premiership, ITV Digital promised £250m for the Football League and NTL promised to pay £40m for pay per view matches. They eventually reneged without showing a single match. The logic of paying such money was that they could charge viewers who wanted to watch the matches featured on telly. Now, I love Stockport County. But even my loyalty to the might Hatters from Edgeley Park does not lead me to believe that a team that never sells out its own ground could command huge TV audiences paying £8 for the privilege of 90 minutes entertainment in their own home. Furthermore, even a Premiership game along the lines of Southampton v Charlton Athletic is not something I would pay for. No disrespect intended to either side. I would simply prefer to watch the Bill (or some other average fayre from normal telly) for nothing! And I say that as a football nut. Manchester United v Liverpool ? I would consider.

But, these clubs, many of them subject to close financial scrutiny as plcs, could not see the obvious. Firstly, paying somebody £40,000 a week
for a remarkable talent is one thing. Failing to build a clause in to that contract that demands a pay cut if the club is relegated is truly high risk. And relegation from the Premiership is a financial catastrophe. Maintaining the same cost base on half the income in an industry that is barely profitable anyway is business suicide. But most football clubs do it. It is essential that future contracts give clubs an agreed right to cut pay if the team performance leads to relegation. There is no law that stops this. So it can be done.

Furthermore, many clubs have borrowed money against future season ticket sales. An example of this is Newcastle. They added 20,000 to the capacity of their stadium and will repay the £30m it cost back, with interest, out of the additional ticket sales over the next 25 years. In other words, although Newcastle are now filling a much bigger stadium, they will not actually enjoy any extra income from this until they year 2025. They may pack 50,000 people in every game now, but it is not that long ago that they were getting crowds of less than 10,000 at the bottom of the old Division Two. The point I am trying to get across here is that football is a funny old game. If Newcastle suffers a downturn on the pitch, the crowds will disappear. The loan repayments will be too expensive and the club will fold. I hope this scenario does not happen. But it is a dangerous long-term business plan.

The economics of football are simple. Transfer fees within the UK will stay in the game. Wages leave the game. You may be able to justify paying the likes of Beckham £90,000 a week because he plays the game pretty well and the merchandising linked to his name in a Man United shirt more than pay for it. Roy Keane may be a better player (my opinion and it is a game of opinions) but he certainly does not have the same merchandising pull as Beckham. Non-Premiership Derby pay an Italian who is not good enough to represent hi
s country £40,000 a week to be injured. I assure you that this is total economic nonsense. A nonsense that will destroy many clubs. The difference between Manchester United (a worldwide brand) and Aston Villa (a half decent Premiership team of little interest to anybody outside the Midlands) is immense.

So what can football do? Well in the lower divisions there is already talk of part time players and regional leagues instead of national leagues. Well, regional leagues were tried in the past with the old Division Three North and Division Three South. In truth, the cost of travel is a tiny fragment of a football club and its income so this measure seems pointless. Part time players? Well, personally this does not appeal. Does a 2nd Division striker earning £75,000 a year reduce the amount of training and earn £37,500? I suspect the market will leave the game in the lower divisions full time. The wage bills of our football clubs will simply fall to an affordable level anyway. And lets face it, £37k a year for kicking a ball on a cold Tuesday night in Stockport is not a bad deal.

There is talk about the top clubs in the Nationwide League breaking away and forming a Premiership 2 (or Phoenix League). This would ensure any new TV rights are shared between 20 teams instead of 70. While it is greedy, it is also (financially) sensible and will probably happen.

Leaving the likes of my beloved Stockport with an income of less than £2m a year to pay 20 professionals and 30 back room staff, along with rates and stadium maintenance bills. The sums, when back up with sensible wage bills, actually add up. It can be done. Just. But the days of big wages for players who simply do not deserve it are gone outside the top handful of clubs. In many respects, football may just become a better game for this! Driven by a desire to win rather than a desire to pocket silly money for kicking the modern equivalent of a pigs bladder.


>

Summary: