Premiership Football: Limitless Cash Flow
I have a confession to make: I’m a Chelsea Football Club supporter.This is probably not something I should admit in public – though in mitigation it dates back to my schooldays,many years before the arrival of Roman Abramovich (the Russian owner) & Jose Mourinho (the flamboyant Portuguese manager who recently left ‘by mutual agreement’) In the summer I was confronted by a financial & philosophical dilemma: whether to renew my season tickets for 2007/8. The seats are in an excellent position – a few rows back from the pitch,almost opposite the centre circle and protected from the rain (depending on the wind) by the stadium roof. But they are very expensive: well over £1000 for the two.
If I gave the seats up,there was not the remotest chance of ever getting them back again. There’s a long waiting list of fans prepared to pay the interest on their credit cards (or even take out a small mortgage) even if that means having to watch Andriy Shevchenko (Ukrainian: £121,000 per week) wander around looking lost, Michael Ballack (German: £130,000 per week) in relaxed mode and the team pass the ball sideways or back to the goalkeeper for 85 minutes then win 1-0 just before the final whistle.
Buying tickets on a match-by-match basis (if you can obtain them) can prove even more prohibitive. The top charge at Arsenal is £94,followed by Tottenham (£71),& Chelsea (£60). Manchester United (£39,though going up) and Liverpool (£34) are lower down the list. Many Latin Americans in London are football enthusiasts but are not able (or prepared) to pay that sort of money. It’s not clear why the clubs ask for so much and risk upsetting their supporters when their ‘gate receipts ‘ are not even their main source of income & certainly don’t cover their huge annual expenditure. Chelsea’s crowd capacity,for example,is only 41,000 so total ticket sales couldn’t possibly meet squad salaries.
Roman Abramovich – even with more than £11 billion – doesn’t want the massive financial deficits of the past three seasons to continue. He’ll be helped by the new £625 million deal which the Premier League has just negotiated for overseas television and media rights. Premier League matches are shown in 195 countries via (usually) networks owned and/or controlled by NewsCorp ,the proprietors of BSkyB (ie: the Murdoch organisation) Another £1.3billion will come from Sky (for 92 games),£392 million from Irish broadcaster Setanta (46 games) & £400 million from internet and mobile phone rights. All this will be shared amongst the 20 Premier League clubs. What proportion they get will depend on what position they finish in. If Chelsea win the title again they will receive £50 million. In 2005/6 they got ‘only’ £30 million,which is what will now be paid even to the team that finishes bottom in 2007/8. The value of promotion from the Championship to the Premiership is calculated at £60 million. Teams which are relegated will be given ‘parachute payments’ of £10 million for two seasons to help them adjust to their changed circumstances. In particular,they need time to offload players accustomed to Premier League salaries.
All this has not gone unnoticed by agents,prospective club purchasers and the players. The take-overs continue: Manchester City has been bought by Thailand’s deposed Prime Minister,Thaksin Shinawatra. There will be others. Agents are anticipating higher transfer fees and thus more commission for themselves – sometimes (it is rumoured) achieving this by encouraging the players they control to request a move from their current club. The players,inevitably,want their cut of the spoils. The predictions are that the ‘elite’ will soon be getting £200,000 per week (£10 million per annum) Meanwhile,the involvement of ‘Media Sports Investments’ (owners of Corinthians Paulista in Brazil) with Argentina’s Carlos Tevez (now with Manchester United) has been extremely controversial.
So (I can hear you asking) did I renew my tickets? Yes,of course. Managers and (even) Owners come & go. The Club (so we like to tell ourselves) is really ours and that’s how it will always be.