Time to level out the financial playing field within the Premier League?
Last week I reviewed some of the finances from TV revenue firstly in the Premier League and also from other sources – which is most notable the Champions League. My analysis showed that there is a massive difference when you compare the income of the Premier League champions Manchester United with a team that finished in the relegation zone such as Blackpool. And that is just purely looking at income from TV and doesn’t include any commercial or match-day income. So is there an argument that the clubs in the lower part of the Premier League should be the ones that receive the greater portion of the TV money in the Premier League in order to level the financial playing field a little bit?
Well I certainly feel that it is something worth considering especially with the new financial fair play rules coming in. The financial fair play rules will have some positive effects at the top of the Premier League, because they should restrict the massive transfer spend that we have seen from clubs like Manchester City and Chelsea in recent years. However, it will make life much more difficult for clubs lower down in the league table. Teams will only be able to spend what they physical can afford to so if they could receive extra TV money then this could be vital to ensure the Premier League is competitive.
There is certainly the argument that the Premier League has become a little bit predictable especially at the top. And if you were to say that the top six next season would be Liverpool, Tottenham, Manchester City, Arsenal, Chelsea and Manchester United then you would be surprised if that wasn’t the case. Therefore, the rest of the Premier League teams know that even if they have a fantastic season the chances are they won’t finish higher than seventh. But do we really have to accept that as fact or can we at least try and do something to make it more competitive? If it doesn’t change then how long will the Premier League still be considered the best the league in the world?
However, we need to stop and take a reality check for a minute before we start dreaming of Stoke or Fulham winning the Premier League and remember the fact that certain clubs are always likely to make more money than others. A good example is Manchester United – now they play in a stadium that currently has a capacity 75,957 with plans to further expand that could one day see the stadium house 95,000 fans. The latest figures show that Manchester United made £100m on match-day income and ticket sales in 2010; this compared with the £11m Fulham made. But aside from that Manchester United have one of the most powerful brands in world football. The commercial income of £81m signifies that; again in comparison Fulham’s figure was just £11m.
So it doesn’t really matter how much these sort of clubs receive in TV money – because there global reputation ensures they will always be super-rich. What Manchester United has done is probably only a pipe dream to a lot of clubs but it’s definitely something to aim for.
Now we know from my report on Premier League TV deals that the difference between the top and bottom is fairly small – with the club at the top getting about 1.5x more than the team at the bottom. But this is only Premier League TV money and if you also include Champions League money then there could well be a gap of around £60m between the top team and the bottom.
Now some people would argue that it’s right that the teams that win the league and qualify for the Champions League should receive the most TV money as a reward for their performance in the league and I can certainly understand that argument. However, those teams do get their reward and that is qualifying for the Champions League and all the money that is associated with that.
So what if we turn the Premier League TV revenue table upside down and the teams that finishes at the bottom gets about £60m and the team that wins gets around £40m. And at the end of the day teams at the top would still earn a lot more money, but the deficit would be less – that could make all the difference and in theory make the Premier League more competitive.
Obviously in an ideal world everyone in the Premier League would have the same money and then we would really see who the best managers are – but those sort of ideas are probably unrealistic so it’s all about finding ways things can be improved for smaller Premier League clubs. As a Norwich City supporter I remember in the early days of the Premier League – when Norwich pushed Manchester United very close to the Premier League title before eventually dropping back to finish third. But I know that with the way things are now that kind of thing can never happen again – but isn’t it stories like that which is the reason we all love football? So as far as I am concerned something must be done to bring football back to the fans.
We need to showcase the best managers – who build teams with fantastic spirit and can actually be successful. Surely if we can do something to lessen the financial gap then we can start to believe in that dream again. My suggestion is probably only a start but it would be without doubt a step in the right direction. But let’s remember that the problem does not start and end with the Premier League and organizations like FIFA and UEFA also have a part to play. Rules such as financial fair play are only made with the Champions League in mind and concerns that English clubs are dominated too much – however they haven’t been thought out in detail and how they will impact the Premier League as a whole. And will only serve to increase the divide between clubs at the top and the ones near the bottom.
Above all though I dream for the day when the Premier League is unpredictable to the extreme that we couldn’t even begin to name the top six before the season has started. If something doesn’t change fans may eventually start to be turned off and follow something like the Championship instead – which has been exciting throughout and very competitive and the play-off final is likely to live up to that tag.
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Nice idea, but the TV deal expires in 2013 and there is about a snowballs chance in hell that any of the top 6 will negotiate a combined TV deal like it is now. It will become a situation like Spain & Italy where the individual clubs sort out their own deals.
Why do you think the bigger clubs have been investing in their own TV channels and working on streaming games through their websites? By 2013 internet TV will be much better than it is now and streaming live games will not be a problem.
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James Kent Reply:
May 30th, 2011 at 5:10 pm
Keep in mind though that streaming live games over the internet is illegal at present.
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Gord Reply:
May 30th, 2011 at 5:54 pm
With respect, you need to check your laws. It is not illegal to stream games over the internet. Sky stream every single live game they show on the internet thru sky player. It is only illegal to stream games if you do not have the rights for them.
If the clubs do not sell the rights to their games they can do whatever they want with them. Lets say they charge £300 a season to watch all their games. A million people worldwide take that up; which is not outside the realms of possibility, thats £300000000 a season….and that does not include advertising revenue from during the games.
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James Kent Reply:
May 30th, 2011 at 5:56 pm
I think you know I wasn’t referring to SkyPlayer
Gord Reply:
May 30th, 2011 at 7:31 pm
Well Sky player is streaming and the point still remains that it is not illegal to stream games if you own the rights.
If you recall England sold a game via streaming in 2009. The qualifying match against Ukraine was only available online for £4.99 a pop.
No because they are not the clubs people want to watch.
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It wont happen. The moment the big teams dont get the cash cow, will be the moment they televise their own games.
Imagine MUTV going global & broadcasting their games PPV all over the world. The financial reward to them would be frightening. Even if its the ‘home’ team who pocket the cash. £5 x millions of ppv subscribers if frightening.
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A Norwich fan? Never…
Football back to the fans? Do us a favour
We have just seen the closest and most exciting Premier League season following the second most exciting. If it aint broke…
Notice how the big 4 term is now redundant? It is all about the darlings Liverpool. Now it is a big 6, why?
If anything Man City have helped to even the field by weakening the previously dominant monopoly of the top 4. As such we enjoyed Tottenham deservedly competing with them last season and will see City next season. We will probably see Liverpool back soon too. At least there is change among the top 6 but isn’t that an improvement on a closed shop of Arsenal, Liverpool, Chelsea and yoonoited again, again and again?
Disagree on TV money. Football is a business and has been for a very long time. Don’t hate the player don’t bother hating the game either. People always love victories, (95k at OT?) they will always follow the top sides and drop em just as quickly when the time comes. That’s why Fergie has an army of sycophantic journalists in his extended squad still.
Something must be done to give Norwich et al a bigger reward for finishing bottom than the teams that deserve to finish top?
How is that fair?
Financial Fair play is all about protecting the elite. Don’t believe me? READ IT! It will create much more struggle for the majority that already struggle and yet people welcome it. Such is life.
Stupid idea, stupid people, stupid idea…How do we expect it to not go wrong?
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dont think it is a good idea . the lower teams are being subsidised by the bigger teams as proved by viewing figures ie man utd. they shold be more than happy with what their getting because as with any buisness if the top four dont get what they know they are worth they will indeed negotiate their own deals . so then its a double whammy utd get an absolute fortune and the lesser teams get a worse deal than now. a far worse deal . better the devil you know
w
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James, just like Financial Fair Play I don’t think you’ve thought this through. Your talking about big clubs subsidising small clubs, or essentially, succesful private companies sharing their profits with less successful companies. It will never happen. Your concepts on TV revenue distribution are equally ill advised…you are effectively rewarding teams for losing, how would that work? If your not gonna win against the ‘big six’ your best bet is to get as near as you can to relegation without going down…ridiculous.
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Terrible idea. Effectively you’d be giving teams an incentive to throw matches. Imagine if one of the top teams won the title on the last day of the season because they were playing a safe mid-table team who quite fancied losing because there was potentially an extra million quid in it for them? Or a team went down because one of their relegation rivals were playing a mid-table team who “happened” to score 3 own goals…?
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you sound like a manu fan
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probably the worst idea ive ever seen. I wasn’t surprised when you said you were a norwich fan.
rewarding failure, punishing success. Why didn’t you write a piece on spanish football where the big 2 get 12.5 times more than what the smaller clubs get.
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Manchester United was the best placed team to take advantage of the money from the satellite TV explosion and the creation of the Prem and Champs league because they just happened to be the best club in the country when all these things happened.
Using the money from TV,the Prem and Champ league and with the benefit of live football being beamed around the world for the first time United have managed to turn themselves around from a club worth around 15 million into the billion claimed today whilst almost doublng their attendances.
As a result of the massive financial disparity United have won 50% of their trophies during the Sky / Prem years.
The only way United would be caught is if another type of revolution in football took place.
Welcome the owners of Chelsea and Man City to break Uniteds dominance and to make the league more interesting.
Turning the league upside down now would not take away the gap between United and the rest of the league. City and Chelsea might bridge that gap so might Liverppol ans Spurs but does anyone really think that teams like Wigan and Fulham who have their own Sugar Daddies have the right to be challenging the top clubs by taking money away from those top clubs.
All that would do is weaken our teams in Europe but the same clubs would be at the top of the table.
Thats if they stay in the prem and don’t set up a different league so they can keep hold of the money themselves
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