Just how profitable is the Premier League in comparison?
La Liga may well be able to boast the two finest teams in world football, as well as a selection of the most talented individuals, but when it comes to the financial side of the game the Spanish league is flagging almost as badly as the country’s economy.
The Premier League, by contrast, has, despite regularly seeing it’s best players tempted abroad by Barcelona and Real Madrid, managed to make the best of a reasonably good situation.
The quality within the Premier League is arguably worse than it was seven or eight years ago, but the way our league is sold as a product has increased steadily.
£3b was just part of the valuation given to the Premier League by broadcasters. BSkyB and BT will now pay over £6m each per game they broadcast, and that’s before they international television rights, expected to fetch around £2b, have even been sold.
This new deal will begin from the 2013/14 season and will mean that the top clubs in England are, on average £30m per year better off. In comparison to last season, the bottom placed team would receive an extra £15m per year and the champions would receive almost £40m more than Manchester City did this year.
The system with La Liga is obviously hard to compare considering the clubs in Spain sell their rights individually. Whilst Real Madrid and Barcelona both receive upwards of £150m per season the other ‘top clubs’ receive about a fifth of that, and the lesser clubs make a comparative pittance.
Overall in the Spanish league TV rights are sold for around £510m per season, with over half of that going to Real Madrid and Barcelona. Jose Ignacio Wert, Spain’s sport minister, said however that the Spanish giants would be open to the idea of restructuring the way the television rights are distributed in an attempt to raise the general level of the league.
As things stand, although the top two receive easily the highest amount of money in world football for television rights it will not be sustainable if the rest of the Spanish league falls in to administration. Furthermore, the more competitive the league is, the more that companies will be willing to pay for the rights to broadcast that league. It sounds like a simple enough decision to make, but it is nonetheless a big step from the top two in Spain, especially considering that Barcelona have considerable debts of their own.
So how does the Premier League compare to the Bundesliga? In terms of actual attendances at games the German league averages 45,000 per match, which makes it comfortably the most watched league in the world. With their own version of financial fair play already enforced they are also the most economically stable league in the world. However, the money they receive from broadcasting rights is still dwarfed by that of the Premier League. From 2013/14 to 2016/17 the Bundesliga television rights were recently sold for €2.5b to Sky Deutschland. That’s a £1b less than the Premier League’s deal for the same period.
Admittedly part of that shortfall is a result of the Bundesliga having two less teams but the price paid per match also works out less than what is paid by BSkyB and BT here in England.
There is definitely a point to be made in terms of how ticket prices affect this. Ticket prices in the Bundesliga are considerably cheaper than they are in England. This could, in turn, explain why attendances are so high at their games and, as a consequence of that, there are less viewers on television meaning that the broadcast companies are perhaps prepared to pay less for the rights.
The opposite could therefore be true in England. High ticket prices force more people to stay at home and watch the games meaning there is more money to be made from advertising with higher ratings during the games which, in turn would mean companies like BSkyB and BT are willing to pay more. Obviously there are other factors which have to be taken in to consideration, such as the entertainment provided by the league, but there will ultimately be more issues than that leading to this glut of broadcasting money considering that Germany has 30 million more people than England.
So what about shirt sponsorship then, how does that compare between Europe’s richest three leagues?
Well in the Premier League the total amount received per year was €128m for 2011/12. In the Bundesliga it was €121m. Again, considering that the Bundesliga has fewer teams the amount received by each club actually works out roughly the same but the distribution is more even in Germany. For the German clubs the lowest paid to any club is €1m and most receive more than €3m. In England however, the smallest deal is €0 (Blackburn – charity) and the next smallest is €0.3m (Norwich – Aviva).
In Spain the situation is far more desperate. Were it not for the shirt sponsorship deals of Real Madrid and Barcelona the entire rest of the league would only have brought in €9m for the season. The list for the average amount received per club for 2011/12 is as follows: Germany (€6.7m), England (€6.4m), Italy (€4m), Holland (€2.1), France (€1.5) and Spain (€0.5m if you exclude Real and Barcelona).
Premier League chief executive Richard Scudamore said on the matter:
“The Barclays Premier League continues to provide excellent football and enthralling drama as we saw last season. The value this drives for our rights-holders is evident and we are extremely pleased that this has been realised for our UK live rights. As ever, the security provided by broadcast revenues will enable our clubs to continue to invest in all aspects of their football activities and plan sustainably for the foreseeable future. This deal allows them to keep delivering what fans want; top quality football in some of world’s best club stadia and an increasing focus on and commitment to areas such as youth development.”
This perfectly sums it up. A amalgamation of entertaining football in a competitive league with a relatively high number of star players combined with an effective worldwide marketing strategy has put the Premier League firmly in the financial driving seat of world football.
We may not have the economic prudence of the Germans or the very best players in the world playing in our league but what we can provide, which companies will pay through the roof for, is a league that was ‘won’ and ‘lost’ so many times over the course of ten months and was finally decided in the final minute of the final game of the season.