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Blue Sky thinking

By Peter   Lee  ::  16/06/2012   11 Comments (Last) The details of the Premier League television deals with Sky and BT from 2013 were released to the media last week. The sums are enormous and the final totals will include the overseas rights which have yet to be added in.

Commentators are suggesting that the impact on the finances of Premier League teams will be AT LEAST a £30m increase, with the prize for winning the league doubling compared to the current prize money. The same commentators were speculating that we are not far away from seeing the first £300k per week Premier League player. If past football club behaviour is anything to go by... that?s probably correct.

Now, I consider myself to be a football fan but my loyalty is first and foremost to playing the game, which I had to call a halt to three years ago. A final knee problem ended evening five-a-side, a substitute for the past 20 years for Saturday afternoons that ended with a hip problem.

The close second in loyalty terms is to Everton FC, of course. Like most of my friends, I have no allegiance to England, which I class in my own mind as just another London club. I hope that Everton players never play for England; if they look good, someone will take them off us, and if they do, I hope that they have a poor game, get substituted, and, whatever else, come back fit. Colin Harvey was the best midfield player never to play for England... suited me; Brian Labone should have played ahead of Jack Charlton... True, but I was happy ? and I suspect Harry Catterick was too.

Although I don?t care, really, what will be the impact of the new deal on England? I ask because the potential consequences could be a stimulus for FA support for a change in the way the money is doled out. Although it is the FA Premier League, the initials themselves tell us what influence the Football Association actually has... but let?s speculate anyway.

I saw a stat this week that said that the league with the greatest number of participants in the Euros this week is the Premier League, and comfortably so. The money available, despite the moans about tax rates, continues to attract the best and many second-level players from all over Europe. Increasing the paypot will certainly massively reinforce that trend. Given the desperate need that clubs will have for instant success ? and that for most means staying in the Premier League ? the loss of fortune involved in relegation is too horrible to contemplate; they will continue to seek ready-made answers. It?s a vicious circle, of course. They will all do it... all pay loads more in fees and wages... and there will still be three relegated at season?s end.

This must surely mean that there will be even less opportunity for talented English born youngsters to come through and to improve their skills playing in the best teams at the highest levels. A Scots friend of mine suggested that this had already happened in the Scotland and, if we look at the current England side, some may claim that the decline is irreversible. Carroll, Downing, Henderson, Parker, etc... international class? Really?

So it is in the interests of the international side to stop the trend and come up with a way of making sure that the money doesn?t go in wages. So the FA should be on board for? something.

Well, see if this makes sense; the chances of it happening might be remote but suspend disbelief for a while.

The Premier League chairmen decide that, from 2013, any increase in the monies paid by the broadcasters will be kept in a central fund to which the clubs have a 5% entitlement to draw on. They may draw on this money for two purposes and two only: the first would be for ground improvements and the second would be to reduce admission prices.

Now the cynics out there will already be thinking that the crafty accountants will be thinking of ways around that. I reckon that, even if they do, it can only be around the fringes. The clubs would use the ground improvements to generate additional income anyway so there would be an incentive in playing it straight in that sense.

Take some examples. Arsenal would use the money to pay down their debt and, when that was done, reduce admission prices. Man Utd would do their best to improve the facilities in the very cramped confines of what they have to sell more beer and burgers... but in the end they would have to use the money to reduce ticket prices.

A new stadium was costed a while ago at £10,000 a seat. So 40,000 equals £400M. The additional £30M a year would pay for a stadium loan comfortably within normal commercial loan terms. However, a club like Everton couldn?t go down that route and access bank money because the TV money isn?t guaranteed to stay at these ridiculous heights and Everton are not guaranteed to remain in the Premier League for the full term. The same could be said of most clubs.

But, and this isn?t a disguised plea for a shared stadium, I?ve long advocated that, if it can work in Rome, it can work anywhere... If the two Merseyside teams pooled the cash, then £60M a year presents a totally different financial picture to a lender, with a shorter term to pay back and less risk.

Now I know that the fact that the availability of cash for developments would effectively mean that clubs can go to the banks for loans to buy players, using any facility they have for that rather than ground improvements, but the Financial Fair Play (FFP) rules would still control that ? if we believe that they can at all.

In the end, the beneficiaries of this cash injection would be the fans who would have better facilities and at least stable and ultimately falling costs of watching the match. This is only right. I suspect that most season ticket holders, regular fans, have a TV subscription; I don?t myself. After Hillsborough, I determined never to make any contribution to the Murdoch coffers. I don?t buy the Times and I don?t have anything that comes from Sky. I do feel guilty if there is an Everton away game I can?t get to and I watch on Sky in the local. I reckon that to be balanced by feeling that I am somehow getting my own back by watching Sky on Albanian TV in the same pub for nothing. Does anyone know if that will still continue in future?

Incidentally, I never did buy the Sun. When it first came out, the mid-week match reports finished at half-time and I blame Murdoch?s approach to popular ?journalism? for the destruction of real tabloid papers like the Mirror used to be. Different rant that though...

So, if the proposal was viable and adopted what would we have? Essentially the status quo with regard to the chances of English players making first teams in the Premier League:

  • Better facilities and or lower costs of attendance for the fans;
  • Probably bigger attendances with a better atmosphere as a result, a more saleable prospect ultimately.
  • No stretching of the existing disparities in wealth as a consequence of the TV deal, which would otherwise undermine the intended effects of the FFP rules.
What are the chances of it happening?

Well, there are 20 votes on this. Voting ?No? would be in the interests of half-a-dozen clubs who feel that they have a right to regular Champions League involvement. Voting ?Yes? would be in the interests of the 14 who don?t kid themselves about that prospect but who still keep dreaming that there is still a chance, if they can stay in... and if the financial advantages of the minority don?t increase and stretch into the distance.

Dream on?

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Reader Comments

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Eric Myles
316   Posted 16/06/2012 at 15:23:34

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"I?ve long advocated that, if it can work in Rome, it can work anywhere"

You do know that AS Roma plan to build their own stadium don't you?

Lyndon Lloyd
322   Posted 16/06/2012 at 15:59:40

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I'd like to think that Everton would set aside their increased share for improvements to Goodison but I think for the benefit of thr national game, the FA should mandate that some of the new, additional riches should go towards grass roots development.

Germany took their embarrassment of 2000 and overhauled internally and are reaping the benefits now from a youthful team that plays fast attacking football.

England's response to their debacle in South Africa has been more of the same as far as we can tell. We need a radical rethink and studies to see how a country as small as Holland can churn out superb footballers playing attractive, effective football (usually!) while the quality in England is declining.

It won't happen but that's where some if this cash should be spent...

Peter Lee
332   Posted 16/06/2012 at 16:25:53

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Yes Eric they do, and the same thing has happened in Milan but my point is it worked for years.

But let's not turn it into a shared stadium debate again.

Tom Hughes
448   Posted 16/06/2012 at 21:18:02

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Costed at £10k per seat? where?
Stephen Kenny
463   Posted 16/06/2012 at 21:49:48

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I can see what your getting at although obviously some details would prove problematic as the PL and the FA are separate entities. From what I read the FA have little control over what the EPL does. It's also a big stretch to imagine the so-called guardians of our game doing anything other than trying to get a few decent jollies out of the bigger gravy train.

The amount of money coming into our game and the amounts that are going back to grass roots or even infrastructure should be a national scandal.

Derek Thomas
502   Posted 17/06/2012 at 03:19:27

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I would like to think it would be so or something along those lines. But as some one said at the last rise in Sky money....most of it will end up in the players carpark. The turkeys will not vote for Christmas. The toothless governing bodies will posture and bluster while having at the back of their mind the ' Golden Rule ' ...Those who have the Gold make the rules.
Terence Leong
514   Posted 17/06/2012 at 07:42:16

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There is very little incentive for the FA to do what is proposed here. As long as they are getting these pots of money without having to reform, they will continue to do so.
John Crawley
517   Posted 17/06/2012 at 07:56:54

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I have zero faith that the FA will do anything substantial which will be of benefit to the game over all. They can't even come up with a fair system to allocate the FA Cup Final tickets! In addition they were complicit with the big five clubs (shamefully this included Everton) which destroyed the old Football League system which was a lot fairer than the current one.

The only way we will get proper regulation in this country is if the government step in and there seems little or no chance that this will happen. Everton and Liverpool could provide a tiny amount of this money to transform the playing pitches and changing facilities on Merseyside. It would make a huge difference to local football. You only have to look at say the Bill Shankly playing fields to see how bad things are in terms of local pitches and facilities.

The reality is that this money will end up in the pockets of players and managers in increased salaries. The system of football in this country needs a complete overhaul, á la the Bundesliga and Germany.
Thomas Lennon
570   Posted 17/06/2012 at 11:32:32

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You are asking the Premier League to do the one thing that they don't want to - change the successful business model.

I agree a nationwide change in wage structure would be a good idea up to a point - but the PL will argue that clubs must be free to pay top dollar for top talent to entertain and in the end justify the huge amount of money paid by Sky.

I agree that a compromise could be to keep say 50% of these massive income increases to support the competition - which means supporting the likes of Everton, Liverpool and smaller clubs with their need to improve facilities. As long as that is the same for everyone and is done intelligently I can't see a good objection to focussing some money on stadia and other facilities..

Declan Brown
573   Posted 17/06/2012 at 11:56:00

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This is a bit pie in the sky but i'll suggest it anyway.

1. I don't know how it could be tightly regulated, but there should be a limit on wages expenditure for clubs who are in debt, say a percentage of turnover, this should free up funds for clubs to pay off debts, with all this money about it's a sin that clubs are in such financial dire straits.
2. For clubs with a debt, any future income from TV / media deals should only be given to clubs in order to pay off their debts first and foremost. Those who are debt free can use it how they want but should be encouraged to improve facilities, reduce ticket prices, merchandise prices etc.
3. A maximum ticket price should be set across the board for all premier league clubs to avide by where the loss in ticket sales would be subsidised by the ridiculous amounts of money from TV deals.
4. In an ideal world, the agents are taken out of the game, replaced by representatives from the PFA to act on players behalf's on a wage set by the PFA, maybe with performance related bonuses (a very small amount of money) but with commission being completely banned.

The players wages, the money in the game and the agents fees for me, has ruined football from what I grew up with, i'm only 33. Don't about you guys but the romance has long left the game and it's a business now, those with the money generally do better in the Premier League while the chasing pack rack up debts trying to keep up with / chase the front runners. It's like saying I support Tesco's, they're the best supermarket in the country because they make the most money - it doesn't feel like a proper sport any more!!!

Just a few ideas...

Sean Patton
597   Posted 17/06/2012 at 14:38:53

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Some idea number 4 is, if that was implemented it would transform the game but sadly it will never happen.

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