Business Of Sports: Spending Shows How EPL Make Football Decisions

Against a backdrop of war, plague, climate emergencies and cost of living crises, it has been easy to accuse English Premier League (EPL) clubs of spending like there is no money. the following day. But by racking up the bulk of almost all of the record-breaking £2bn (RM10.36bn) transfer window, they are playing a longer game. And their financial power has already widened the great divide in European football.

According to Deloitte spokesman Tim Bridge, “Premier League clubs appear to have come through the Covid-19 pandemic in better financial health than many clubs in Europe… This gives them a competitive advantage across the board. Worryingly, he adds, “We feel we are approaching a point where this disparity could expand and never return. There is no doubt that the rest of Europe finds this troubling.

Adriano Gallian, the newly promoted Monza director, certainly does. The frustrated former AC Milan boss told Tuttosport in Italy: “There should be Brexit in football too. EPL clubs earn four times as much as Serie A. Monza gets 33m €3m (£28m) from TV rights, and we have to give €3m (£2.5m) to Serie B. A newly promoted team in England get €160m ( £135m) How can we compete with Nottingham Forest and how can I stop this trend in the global economy?

Galliani’s numbers need a slight tweak, but his point is valid. Forest, one of the biggest spenders, will need to finish mid-table to earn £135m (RM701m) but I’m not going to quibble about that. With merit-based payments, this season’s EPL winners will receive around £180m and the bottom club around £100m. Even becoming European champions only earns a fraction more than what the English basement club earns.

In 2020/21, Chelsea collected €119m (£101.22m) for winning Old Big Ears, compared to the £97.5m Sheffield United collected for finishing last and going down. For finishing fourth in the EPL, Chelsea were rewarded with an additional £143m. Such discrepancies suggest that there is already an unofficial “Brexit”.

It’s an impression confirmed when Aston Villa and Crystal Palace can compete with seven-time European champions AC Milan. Eight of the 10 biggest spenders in Europe are English and five – Forest, Arsenal, Manchester United, Wolves and West Ham – are not even in the Champions League (UCL).

With one week remaining in the window, Transfermarkt reported that 53 of the top 100 fees paid in Europe this summer were paid by English clubs. And their average spend of £80m is expected to be double that of the 28 non-English clubs in UCL at close of business (6am Malaysia time on September 2).

Gross summer spending had already surpassed 2017’s all-time high of £1.43billion as well as last season’s combined winter and summer total of £1.44billion, which was still affected by the pandemic. But as football finance expert Kevin Maguire puts it, “football has a very short memory, so Covid is now effectively forgotten.”

Uncertain debuts on the pitch were enough to prompt Manchester United, Chelsea and West Ham to embark on a late cart, which picked up items off the shelf in the £60-80m range. Europe – with the notable exception of Barcelona – was watching, speechless but with tightly closed checkbooks.

All of this is of course underpinned by TV money, where the EPL maximize their perpetual pole position to effectively ‘turn’ their rivals. Deloitte has predicted the EPL could exceed £6bn for the season which has just started, putting it ahead of the Spanish and Italian leagues combined.

Its new overseas broadcast deals have now moved beyond the UK domestic market for the first time. Revenue will reach £10.5 billion for the period 2022-2025, an increase of 16%. Revenues from a Scandinavian group, Nordic Entertainment, will bring in £335m a year – double the previous figure – while NBC in the US extended its contract for a similar amount. Its global market share is now 44% and growing. And all this while paying a “Brexit” premium when buying on the continent.

Bridge says: “When English clubs enter the [European] market, there is often this English tax, the feeling of making as much money as possible. But that must be a concern when some of the best talent from other countries comes to play in the mid-tier Premier League rather than the Champions League.

It is more than worrying. The EPL’s pre-eminence was one of the reasons for the formation of the European Super League (ESL) which Barcelona, ​​Real Madrid and Juventus stubbornly refused to give the final crowns. Indeed, after what they perceived as a “not adverse” hearing at the European Court of Justice last month, the moribund ESL could yet come back to life.

The three clubs are contesting UEFA’s right to punish them for challenging what they consider to be “a monopoly” in the management of the UCL. They cling to the hope that the December verdict will go their way and if so, the ESL could be resurrected, albeit in a very different format. They are even said to be lobbying second-tier clubs to counter criticism that it is a closed shop.

Again, there is a chasm between England and the Continent. The fan uprising that brought down the ESL only took place in England while fans on the continent seemed far less outraged. But that hostility would make it extremely difficult for the six EPL clubs that signed up to be reinstated.

With Paris Saint-Germain and Bayern Munich pitted against each other from the start, an all-powerful split would be inevitable. And without the English, French and German heavyweights, ESL 2.0 would be a non-starter.

Meanwhile, the UCL has already given in to the wishes of many big clubs to redesign the qualifying stage by introducing a “Swiss system” from 2024. By doing away with groups – which can sometimes trip up a favorite and let through a minnow – each of the 36 qualifiers will play 10 guaranteed matches instead of a minimum of six to decide who takes the knockout spots.

Never mind that it makes a predictable system even more predictable: insurance is what the Big Boys want. From 2024, the occasional mistake need not be fatal as it was for Inter Milan and Ajax last season. But the new format, with the number of matches increasing from 125 to 225, did not please all players. Manchester City skipper Ilkay Gundogan spoke for many when he called it ‘the lesser of two evils compared to the Super League’.

As if the Champions League weren’t enough of an incentive, the EPL’s so-called Big Six will soon have even bigger revenue to target as new broadcast deals are struck for the UCL. Competition will intensify as only four can qualify to qualify and the Six are already looking over their shoulders at newly-fortified Newcastle United.

So the EPL, which can only benefit from such a fierce rivalry, is gaining momentum. CEO Richard Masters said, “Our international and domestic broadcast revenue over the next cycle will provide stability and certainty to the game as a whole.”

How ironic that this is a situation almost diametrically opposed to the real Brexit!

Bob Holmes is a longtime sports journalist specializing in football