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Tear down the walls of footballs cartels

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Former Bolton Wanderers chairman, Phil Gartside, lost his battle with cancer yesterday. During Bolton’s 18 year Premier League tenure, Gartside wanted Celtic and Rangers in the league, as part of a reorganisation which would have seen a second tier Premier League created.

His motivation was the realisation that English football’s model was inherently dysfunctional. Teams like Bolton would over-commit to the player contracts necessary to keep them in the league, but with everyone else doing the same thing, it was only a matter of time before they finished in the bottom three. Less than 3 years since relegation Bolton face a winding-up order this month over a £2.2m debt to HMRC.

‘The Gartside Plan’ for league reorganisation found little support among his Premier League peers. Each passing TV deal poured ever-more money into the Premier League but the model remains dysfunctional. Those relegated regularly face dire consequences – and that’s before the bubble bursts.

As English and Welsh clubs who have dropped out of the Premier League continue to deal with the consequences, Europe’s mega-rich clubs are unhappy with their return from Champions League football. The relative democratisation of Champions League qualification, introduced by Michel Platini, which sees more clubs from smaller countries reach the group stage, is seen as a problem to some of Europe’s richest.

They want games against Manchester United, not Dinamo Zagreb. So do TV companies and sponsors.  The football industry in Europe operates a series of EU sanctioned cartels.  These sanctioned exceptions were granted on the basis that football is a sport, not a conventional business.  The more top clubs act like businesses, not sporting institutions, the more reason to tear down the walls of these carters.

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  1. Tear down the cartels indeed.

     

     

    Not likely to happen as long as corrupt corporate power runs everything, football is merely a drop in the ocean compared with their other dirty dealings.

  2. Saint Stivs says SACK THE BOARD on

    so Man Utd report a quarterly profit of £18m.

     

     

    the glazers must be raging they didnt go after PETER L, imagine how much they would be worth now,

  3. GlassTwoThirdsFull on

    Paul,

     

    They want big (but currently struggling) clubs from the big leagues to get automatic entry (eg Milan). Not sure how this affects/helps us?

  4. Who really has the influence, power and nous to take on these cartels?

     

     

    Barring financial meltdown on a planetary scale, nothing is going to change.

     

     

    Mind you, the rumblings amongst the off the charts wealthy about returning to the gold standard might shake things up a wee bit…

  5. The Green Man says SACK THE Board on

    Florida Bhoy

     

     

    ‘Who really has the influence, power and nous to take on these cartels’

     

    Ive already complained to Donald Trump…..he says he will deal with it:)

     

     

    HH

  6. I’m sorry but there is a lot of wishful thinking in this post

     

     

    Lot’s of clubs are getting promoted and relegated. How many have accumulated the level of debt associated with Bolton? Only QPR spring to mind.

     

     

    Teams like Burnley, Norwich and Bournemouth are well equiped in the event of relegation.

     

     

    Most years, a relegated team will bounce straight back. Hull or Burnley could this year. Add that to Newcastle, West Ham, Norwich & QPR

  7. Paul67

     

    Good article

     

    Until they give the big leagues

     

    Less champions league places

     

    Were screwed we should automatically quality as should all smaller nations this ain’t gonna happen

     

    Another thing on a side issue

     

    Every winner of the European cup

     

    Should have a badge like the multiple winners do that would be cool don’t us think

     

    Celtic should press for this

     

    Gives us and other teams that have won it more prestige

     

    And the competition as a whole

  8. TBJ says Wee Oscar Knox is in heaven with the angels on

    Maybe the big boys are worried that the sfa Mibbery promotes a club founded in 2012 into the champions league in 2017

  9. Will probably have to wait until all court cases against Blatter, Fifa etc before anything happens.

     

    If anything is going to happen.

  10. timaloy29

     

     

    Coventry, Southampton, both the Sheffield clubs, Charlton, Blackpool, Wigan, all struggled massively after relegation, non of them bounced straight back, there are several others.

     

     

    some have even done back to back relegations

  11. foghorn leghorn on

    up with barcelona v bayern

     

     

    down with dinamo zagreb v slovan bratislava

     

     

    maintain the cartel

     

     

    you know it makes sense

  12. The Green Man says SACK THE Board on

    NEWRADBHOY

     

     

    The new agenda of open policy for football governing bodies.

     

    Will never reach Scoddland.

     

    The football authorities here, are too busy hunting and burning witches, and flashing strange hand signals.

     

    Might reach Scoodland in the 24th Century.

     

     

     

    HH

  13. GlassTwoThirdsFull on

    Thought I would check out the SPL fixtures for the weekend. Reckoned the Scottish Football section of the BBC website would be a safe bet.

     

    No sign of any fixtures, but at least I now know that Mexico beat Senegal 2-0 in a friendly…..

  14. foghorn leghorn on

    the bouncebackability of relegated EPL clubs is statistically inconsistent

     

     

    one thing is for sure though – the bubble aint bursting anytime soon

     

     

    its nonburstability is very unbubble like

  15. Saint Stivs says SACK THE BOARD on

    I beg to differ with P67.

     

     

    The ENGLISH LEAGUES are becoming a model of Business growth and profitability.

     

     

    the big teams got their act together, the casualties (Pompey, Bolton and the like are Deid Rangersesque) did not use the money wisely.

     

     

    The levels of Investment in EPL is incredible, this is not a business model that will crash,

     

     

    ———————-

     

     

    Deloitte 2015 report (note the clubs got richer since then, Southampton is now 3 times the size of business that celtic is)

     

     

    Annual Review of Football Finance 2015

     

    Premier League clubs generate over £3bn revenue in season of records

     

     

    4 June 2015

     

    UK Regional Comments 2015

     

    In 2013/14, Premier League clubs generated £3.26 billion; up 29% on 2012/13

     

    Premier League clubs recorded record operating profit of £614m and record pre-tax profit of £187m

     

    19 Premier League clubs recorded an operating profit and 14 recorded a pre-tax profit

     

    Top 92 professional clubs contributed around £1.4 billion in taxes in 2013/14

     

    Premier League revenue was €1.6 billion (£1.4 billion) higher than the next highest earning league, the Bundesliga

     

    Combined revenues of ‘Big Five’ leagues was €11.3 billion (£9.5 billion) in 2013/14

     

    Premier League could surpass commercial revenue of Bundesliga and lead the world in all three key revenue categories from 2014/15

     

    Fuelled by the impact of the first year of a new broadcast rights cycle, Premier League clubs generated record revenue of £3.26 billion in 2013/14 – up 29% on 2012/13 – according to the 24th Annual Review of Football Finance from the Sports Business Group at Deloitte.

     

     

    The average revenue for a Premier League club in 2013/14 was £163m – just £7m less than the combined revenues of the 22 First Division clubs in 1991/92; the final season before the introduction of the Premier League.

     

     

    Dan Jones, Partner in the Sports Business Group at Deloitte, explained: “The impact of the Premier League’s broadcast deal is clear to see. Broadcast income increased by £569m in 2013/14, accounting for 78% of the overall growth in revenue in the Premier League. Continued growth in both commercial and matchday revenue helped Premier League clubs’ combined revenues reach £3.26 billion – a staggering increase of £735m compared with the season before.

     

     

    “In 2013/14 even the Premier League club receiving the least from domestic league broadcast distributions earned more from this source than all but five other European clubs. Following recent announcements of commercial deals for a host of the largest clubs, we expect the Premier League to surpass the Bundesliga in commercial revenue terms and hence lead the world in all three key revenue categories from 2014/15.”

     

     

    Other key findings of the Deloitte Annual Review of Football Finance 2015 include:

     

     

    The ‘big five’ European leagues’ combined revenues rose by 15% to €11.3 billion in 2013/14, with the Premier League more than €1.6 billion higher than the next-highest revenue-generating league, Germany’s Bundesliga, which generated €2.3 billion;

     

    The Premier League surpassed the Bundesliga as Europe’s most profitable league. Clubs in France’s Ligue 1, by contrast, generated a combined operating loss of €140m, €137m worse than 2012/13;

     

    Manchester United generated an all-time record operating profit of £117m, whilst Tottenham Hotspur recorded the highest-ever pre-tax profit, of £80m;

     

    Despite no new stadia opening for the first season since 2004/05, capital expenditure by English football’s 92 league clubs totalled £280m, representing the highest-ever level of investment in stadia and facilities;

     

    Total transfer expenditure for the 92 English League clubs in 2013/14 topped £1 billion for the first time, a record which has already been surpassed by transfer activity in the 2014/15 season;

     

    Premier League clubs reduced their aggregate level of net debt by 6% to £2.4 billion, (of which over two-thirds is non-interest bearing) benefitting from an increase in cash balances. Nine clubs improved their net debt/funds position over the course of the season, with Arsenal, Aston Villa and Tottenham Hotspur responsible for a combined reduction of £205m in net debt;

     

    Total owner investment at both Chelsea and Manchester City topped £1 billion at each club since their respective takeovers;

     

    The Government’s tax take from the top 92 professional football clubs in 2013/14 was around £1.4 billion.

     

    Premier league clubs also made a combined operating profit of £614m, up from £82m in 2012/13, and an aggregate pre-tax profit of £187m – the first since 1998/99. This was almost four times greater than the previous record of £49m, set way back in 1997/98.

     

     

    Jones said: “Premier League clubs also showed relative restraint in terms of wage costs, with less than 20% of their revenue growth being absorbed by wage costs. Indeed, the Premier League’s wages to revenue ratio reduced to 58% (from 71%) in 2013/14, the lowest it has been since the 1998/99 season. The current broadcast deal also comes as cost control regulations, at both domestic and European level, have caused many clubs to rein in their spending relative to the revenue they are now capable of generating. The end result has been a remarkable turnaround in profitability.”

     

     

    In the Championship, overall revenue increased by 12% to £491m, however, clubs continue to pay more in wages (£518m) than they earned in revenue. The wages/revenue ratio in the second tier was 105% in 2013/14, compared with 106% in 2012/13. This resulted in operating losses of £222m and a combined pre-tax loss of £247m.

     

     

    Adam Bull, Senior Consultant in the Sports Business Group at Deloitte, commented: “Championship clubs continue to deliver some alarming financial results. Whilst the desire of individual clubs to reach the promised land of the Premier League is understandable, and heightened given the value of the new broadcast deals, The Football League is right to try and ensure this is not at the expense of the long-term sustainability of any club.”

     

     

     

    END

     

     

    Notes to Editors:

  16. Saint Stivs says SACK THE BOARD

     

     

    I went and watched ‘The big short’ last night, everything has its time and bubbles always burst.

     

     

    Football clubs i feel for the most part are run by idiots and chancers, there are of course exceptions

  17. Florida Bhoy on 11th February 2016 1:31 pm

     

     

    Mentioning the word cartel here in southern Florida is likely to stimulate a different conversation entirely.

     

     

    =================================

     

     

    :))

     

     

    One that finishes with you sleeping with the ‘Gators, you cock-a-roach…

  18. traditionalist88 on

    Paul67

     

     

    Any suggestions as to how?

     

     

    You don’t think there will be good news for us in 6-9 months coming from the ECA proposals for CL entry revamp?

     

     

    HH

  19. ROBERT88 on 11TH FEBRUARY 2016 1:25 PM

     

    timaloy29

     

     

    Coventry, Southampton, both the Sheffield clubs, Charlton, Blackpool, Wigan, all struggled massively after relegation, non of them bounced straight back, there are several others.

     

     

    some have even done back to back relegations

     

    _________________

     

     

    The Sheffield clubs were relegated before the EPL was a gravy train.

     

     

    I don’t think Charlton, Blackpool & Wigan have any divine right to be a championship club, never mind the premier league. They are all tiny clubs and it should be no suprise they end up in League 1 and the Championship. They have reverted to their level.

     

     

    None of these clubs in the same perilous state as Bolton. (Charlton & Blackpool’s problems are self-inflicted)

     

     

    Paul’s point was:

     

     

    “Teams like Bolton would over-commit to the player contracts necessary to keep them in the league, but with everyone else doing the same thing, it was only a matter of time before they finished in the bottom three. Less than 3 years since relegation Bolton face a winding-up order this month over a £2.2m debt to HMRC.”

     

     

    Bolton had accumulated much of this massive debt (to their owner) in the EPL

     

     

    There is PLENTY of scope for a club to stay up and remain in the black.

  20. West End of East End on

    Saint Stivs – Mind blowing numbers there, I was reading about the Liverpool fans protest at ticket prices and a football finance expert said that when the new money comes in teams could actually afford to let all fans in free and each club would still generate more money than this season….

     

     

    They contacted every clubs supporter association to ask what a fair price would be, £25 – £35 and do away with the sliding scale of category games…

  21. traditionalist88 on

    ernie lynch on 11th February 2016 1:50 pm

     

     

    Mass participation.

     

    =================

     

     

     

    Someone always has to bring religion into it…

  22. Saint Stivs says SACK THE BOARD on

    ROBERT88 on 11TH FEBRUARY 2016 1:43 PM

     

    Saint Stivs says SACK THE BOARD

     

     

     

     

     

     

    I went and watched ‘The big short’ last night, everything has its time and bubbles always burst.

     

     

     

    Football clubs i feel for the most part are run by idiots and chancers, there are of course exceptions

     

     

    ————

     

     

    again I disagree, the Middle eastern royal families, and russian oligarths , and now chinese, do not spend £1bns to make losses, in fact even home grown ones like ashley, its not vanity projects. they aint the idiot owners of old. Even NEWCASTLE are making money now.

     

     

    i bet DD wishes he had stayed invested in Man U, or bought

     

     

    the biggest indicator in the deloitte report is 19/20 clubs made a profit, the next is infrastructure projects, 8 clubs currently expanding capacities.

     

     

    it wont burst.

     

     

    as to the big teams wanting to play Man United not zagreb.

     

     

    well business wise, Man united dont want to play valencia , or Juventus.

     

     

    they now make more hosting arsenal. or bournemouth even.

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