Football must wait for the financial final act

703

Interesting financial news from Deloitte that FA Premier League clubs turned a profit in season 2013-14, the first time the combined results of the top 20 clubs in England have been in the black for 15 years.  The reason for the £190m surplus was a 29% increase in revenue, largely as a result of the-then new TV deal, which runs until summer 2016.  Wages rose only 20% that year.

Clubs will be happy to have stemmed the losses, although the first year of a new TV deal is always their high water mark, but the underlying bubble remains a problem.  Income cannot continue to rise at heady double-digit rates, shareholders of BskyB and BT will eventually see to that, despite the fact that next big boost from TV is already confirmed for season 2016-17.

The play to watch is not if or when a dysfunctional football sector gets its act in order, it’s when an almost-as dysfunctional broadcasting industry reaches equilibrium.  We’ve discussed before Sky’s absolute need for Premier League rights to secure their place as a prime broadcaster.  BT, Virgin, Netflix and others are busy eating into their movie, news and entertainment broadcast market.  It’s this need which is driving revenue towards the English Premier League.  Without English Premier League football, Sky are vulnerable.

Sky took the first step towards passing the financial pain of their new deal down the line to consumers this month in the form of a price increase.  The company have successfully done this before, many low income families are now paying £70 per month for satellite TV, and subscriber losses after previous increases have been almost non-existent.

Millions of people have high stakes skin in this game: subscribers, Sky and BT executives, their respective shareholders, Premier League clubs and the dependent ecosystem below them.  All the spinning plates have remained in the air, despite price increases through a recession, but one fundamental remains:

This is a bubble.

Speculators are confused when they only see a market inflate over a long period that it’s not a bubble.  The moment these TV deals become unaffordable to subscribers, or more likely, to the broadcasters, the bubble will burst.

Debts are high, profitability is here, but the underlying commercial pressures to stay in the league remain, so wage pressure will continue to eat away at available funds.  Those outside of the bonanza have to figure out how to compete for audience and players, while waiting on the final act.

Click Here for Comments >
Share.

About Author

703 Comments

  1. Gweedore Celt on

    Good afternoon Folks, looks like a good days racing ahead at Meydan and Donny.

     

     

    So it’s time I had a decent priced winner so I’m backing HillBilly Bhoy @ 3.45 Doncaster.

     

     

    Good luck & happy punting

  2. tommytwiststommyturns on

    Bull – if you can get wifi on your phone, then don’t see any issues! Enjoy the holiday.

     

    We’re out with the H’s at TKF tonight!

     

     

    T4

  3. Cosy Corner Bhoy on

    what a goodnight 335S Could’nt resist it since we are going to the Kano bash tonight

  4. 16 roads - Celtic über alles... on

    16:40 @ Chelmsford City – Yeenaan – NAP!

     

     

    Good luck everybody.

  5. Ah well, can’t complain. Bronze Angel has been very good to/for me in the past. Maybe just asking a bit too much. Congrats to VP and fleagle in picking a very good Lincoln winner……..

     

     

    TBM

  6. CQN Saturday Naps Competition : WEEK 31 results (14th Mar)

     

     

    Well done to with his 3rd winner on the bounce (Theinval @7/1).

     

    Other winners: twists n turns (Goonyella @6/1), Zihuatanejo (William Henry @11/4), and green T (Brave Spartacus @15/8)

     

     

    Selections :

     

    16 roads (Buck Magic)

     

    21-5-79 (Katgary)

     

    Bada Bing (Pawn Star)

     

    BMCUWP (Grendisar)

     

    BULL67 (Canuspotit)

     

    Burgas Hoops (Pawn Star)

     

    Cathal (Samingarry)

     

    Che (no selection)

     

    Cosy Corner Bhoy (Atlantic Roller)

     

    Eurochamps67 (Katgary)

     

    fleagle1888 (Plucky Dip)

     

    green T (Brave Spartacus)

     

    Gweedore Celt (Cloudscape)

     

    hashadenough (Deputy Dan)

     

    Hotel de Paris (Captain Cat)

     

    Jobo Baldie (Four Seasons)

     

    leftclicktic (Battalion)

     

    Nye Beavans rebel soldier (Catching On)

     

    PFayr (Mumgos Debut)

     

    Raymac (Theinval)

     

    Rockon (Touch Back)

     

    Som mes que un club (no selection)

     

    TheBarcaMole (Bertie Boru)

     

    tommytwiststommyturns (La Vaticane)

     

    twists n turns (Goonyella)

     

    voguepunter (Mydor)

     

    What is the Stars (Bob Ford)

     

    Zihuatanejo (William Henry)

     

     

    Cheers, fleagle1888

  7. CQN Saturday Naps Competition : WEEK 32 results (21st Mar)

     

     

    Well done to both leftclicktic who napped Hunters Belt @20/1 !!!

     

    …and Raymac who hit a four-timer with Rebel Rebellion @7/1.

     

     

    Selections :

     

    16 roads (Jimmy Two Times)

     

    21-5-79 (Sharney Sike)

     

    Bada Bing (no selection)

     

    BMCUWP (Golden Doyen)

     

    BULL67 (Vengeur de Guye)

     

    Burgas Hoops (Sin Bin)

     

    Cathal (Peters Grey)

     

    Che (no selection)

     

    Cosy Corner Bhoy (Hi Note)

     

    Eurochamps67 (Marjus Quest)

     

    fleagle1888 (Sin Bin)

     

    green T (Gimme Five)

     

    Gweedore Celt (Spookydooky)

     

    hashadenough (Godsmejudge)

     

    Hotel de Paris (Persian Snow)

     

    Jobo Baldie (Tara Mist)

     

    leftclicktic (Hunters Belt)

     

    Nye Beavans rebel soldier (Tara Mist)

     

    PFayr (Pepite Rose)

     

    Raymac (Rebel Rebellion)

     

    Rockon (Samstown)

     

    Som mes que un club (Vengeur de Guye)

     

    TheBarcaMole (Amigo)

     

    tommytwiststommyturns (Samstown)

     

    twists n turns (Gimme Five)

     

    voguepunter (Ohio Gold)

     

    What is the Stars (Twenty Twos Taken)

     

    Zihuatanejo (Imperial Circus)

     

     

    Cheers, fleagle1888

  8. CQN Saturday Naps Competition : WEEK 33 results (28th Mar)

     

     

    Well done to voguepunter & me who napped Lincoln winner Gabrial @12/1.

     

    Other winners: Burgas Hoops (Related @4/1), green T (Sizing Titanium @8/11).

     

     

    Selections :

     

    16 roads (Yeenaan)

     

    21-5-79 (Mujazif)

     

    Bada Bing (Boomerang Bob)

     

    BMCUWP (Zarwaan)

     

    BULL67 (Lucky Beggar)

     

    Burgas Hoops (Related)

     

    Cathal (Lincoln)

     

    Che (no selection)

     

    Cosy Corner Bhoy (What a Goodnight)

     

    Eurochamps67 (Astaire)

     

    fleagle1888 (Gabrial)

     

    green T (Sizing Titanium)

     

    Gweedore Celt (Hillbilly Boy)

     

    hashadenough (Astaire)

     

    Hotel de Paris (Belgian Bill)

     

    Jobo Baldie (Westerly Breeze)

     

    leftclicktic (New Years Night)

     

    Nye Beavans rebel soldier (Indy)

     

    PFayr (GM Hopkins)

     

    Raymac (Lanceur)

     

    Rockon (Edmund Kean)

     

    Som mes que un club (Forgotten Gold)

     

    TheBarcaMole (Bronze Angel)

     

    tommytwiststommyturns (Moohaarib)

     

    twists n turns (Ocean Tempest)

     

    voguepunter (Gabrial)

     

    What is the Stars (Indy)

     

    Zihuatanejo (Certificate)

     

     

    Cheers, fleagle1888