ARE SUPER-CLUBS FRACTURING SOCCER'S ECO-SYSTEM?
Updated: Mar 5
This article was originally published on February 26th, 2020.
Leicester City's 2016 fairytale Premier League win continues to be the rogue exception to the current dominance seen in European soccer, and that is how the sport's elite appears to want it to stay.
“Football history suggests fans like big teams winning,” said a senior official from a ‘big six’ English club. “A certain amount of unpredictability is good, but a more democratic league would be bad for business.”
But is a soccer Cinderella story really bad for business? Who is it bad for? And why is soccer even being viewed in that way?
Europe's elite soccer clubs across have conditioned the sport to believe that situations experienced by Leicester City in 2016, where a club from outside the financial super-elite actually wins a major title, are blips and should be seen as close to impossible.
Executives such as former Real Madrid president Ramon Calderon have aimed to deceive fans by insisting that “football has always been like this”. However, it appears that if anything the elite's stranglehold on the sport is getting worse and is threatening to become irreversible. The growing financial disparity is set to destroy the inherent unpredictability which many love about the sport. The modern game now has a small selection of super-wealthy clubs, who are now so financially insulated. Meaning that they are now winning more games, by more goals, and breaking more records than ever before. Therefore, the elite are stretching the game in a way that has caused the entire sport to transform and shift.
As a consequence of the explosion of money in the game, clubs now need an annual revenue of at least $485m, to even begin competing in 2020.
Therefore, when one of these super clubs like Liverpool or Manchester City maximizes that revenue, the gap on the field gets even greater. Leading to longstanding records being broken one season after another.
In the last decade alone, European soccer has seen a number of firsts:
a second Spanish treble
a first German treble
a first Italian treble
a first English domestic treble
three French domestic trebles in four years
a first Champions League three-in-a-row in 42 years
the first-ever 100-point season in Spain, Italy, and England
‘Invincible’ seasons in Italy, Portugal, Scotland, and seven other European leagues
13 of Europe’s 54 leagues currently seeing their longest run of titles by a single club or longest period of domination.
The concentration of money has lead to all of these previously thought impossible feats being achieved by the competition's wealthiest. A trend that looks set to continue.
Pushed to the Brink
Soccer has famously always been the game that anybody can play, with games any team could win. However, the recent lack of diversity at the top of European leagues has been identified by many organizations. UEFA’s 2020 annual benchmarking report, ‘European Club Footballing Landscape,’ even included the introductory statement from President Aleksander Čeferin:
“The report highlights a number of threats to continued European football stability and success. These include the risks of globalization-fuelled revenue polarisation, of a fragmenting media landscape and of cases of overdependence on transfer activity revenue.”
Furthermore, in the annual celebration of wealth in the sport, Deloitte’s Football Money League, also recommended “that the financial interests of the game as a whole are considered throughout those discussions to avoid a situation where on-pitch results are too heavily influenced by the financial resources available to clubs hence damaging the integrity and value of the sport. We trust that key stakeholders of the game will not underestimate the importance of unpredictability in results as a key driver of long-term and sustainable value.”
La Liga president Javier Tebas thoughts on the subject were even more serious, “We need to be able to help other leagues and place them in a good situation so they can grow and that means redistributing the wealth generated.”
“If we continue to have economic problems in Eastern European leagues or other leagues like the Greek league then in a few years our industry will collapse. We need to strengthen football as a whole.” Tebas warned.
The problem of financial disparity has pushed European soccer to the brink, thanks to the precarious financial health of clubs outside the elite. Creating tension between the ‘big 5’ leagues and the rest of Europe. As well as the tension between the super clubs and the rest.
The Great Differential
To truly understand how soccer has changed it is worth taking a trip back to the 1980s. During this time many club owners did not see the running of a soccer team as a for-profit business.
The English First Division (now Premier League) signed a television broadcasting deal worth around $7 million. The league’s international broadcasting rights totaled less than $70,000.
During this period the wage bill for the wealthiest clubs was not so different from those clubs near the bottom, meaning that often some of the best-paid players could be playing for middle or bottom of the league teams. A great example of this comes from Brighton and Hove Albion’s Michael Robinson and Steve Foster whose $35,000 salaries made them two of the best-paid players in the country.
The 1980s also offered a great amount of competition, with as many as 13 clubs realistically fighting out to finish in the top four in England. While on the European stage teams including, Aston Villa, Steaua Bucharest, PSV Eindhoven, and Red Star Belgrade all managed to win the European Cup.
However, money has been the great differential. Premier League broadcasting rights for the current 2019–22 cycle are now worth $11.7 billion. Champions League prize money is now worth around $2.5 billion.
Therefore, clubs such as Manchester United have gone from around $160 million in turnover in 2000 to around $870 million in 2018–19. The superclubs no longer have to compete with their domestic opponents, with clubs now able to have wage bills up to 20 times bigger than the big to lower level clubs. Something that in the 1980s the richest clubs only around twice the size as the poorest teams in the league.
England’s big six pay now more than 50% of the total wages paid out by Premier League teams. Therefore, this disparity is beginning to dissolve the sport’s unpredictability. Leading to the average points one by champions, in the big five leagues, increasing dramatically.
Furthermore, the greater disparity has pushed up the requirements to win the league. That can be seen in the most ominous figures of all: the title-winning streaks. In some leagues, it is getting impossible for almost anyone else to win.
Prior to this run, Bayern Munich had never won more than three Bundesliga titles in a row. They have now won seven in a row, which is by far the longest streak of league victories in Germany’s history. It is also one of eight such situations across Europe.
There are the situations like in Croatia, where Dinamo Zagreb has won 13 of the last 14 titles, or Dundalk, who have won five of the last six Irish titles. There has never been a situation where so many of Europe’s leagues, 13 of 54 are suffering from such domination at the same time.
That it extends from the very top to mid-sized leagues like the Austrian Bundesliga, to the bottom and the Andorran Primera Divisió, shows the depth of the problem.
It further shows the effect of Champions League prize money, which has become one of the most profound problems in the game, as influential as anything else in creating this disparity. The difficulty in qualifying for the competition, of course, is just another representation of that disparity.
That is emphasized by the fact more clubs finished in England’s top four in the first five years of the 1990s than in the 20 years so far of the new millennium. The number for 2010 to 2019 as a whole is seven, down from 13 in the 1990s and 1980s, and 15 in the 1970s and 1960s.
The shift as a whole is now undeniable and has never been this bad. While it might yet get even worse.
Controlling the Narrative
An argument brought on by the super clubs is the idea that they bring in all the international attention. Therefore, they deserve more of the money.
A point which Tottenham Hotspur chairman, Daniel Levy, was apparently pressing in a meeting with other club representatives. In the discussion about Premier League international broadcasting rights he continuously repeated the phrase, “We only want what’s fair,” while referring to how the ‘big six’ should be compensated.
Despite this narrative portrayed by super clubs, they need other teams to play against. While one of the founding principles of the Premier League was the idea of equality.
If super clubs continue to get their way and receive a larger share of the pot, the better they will become, on and off the field. Therefore, they will attract bigger audiences and better commercial partnerships. Furthermore, increasing the already wide gap.
In their bid to control revenue distribution discussions, super clubs have begun to threaten their domestic counterparts with a potential European Super League. Which would see the biggest clubs from the 'big 5' leagues leave their domestic competitions and join a brand new competition.
In 1986, when Silvio Berlusconi took over ownership of A.C. Milan, he set out to revolutionize the way soccer thought about TV broadcasting. He saw the opportunity for European soccer to become a “world-wide television spectacular.”
In his opinion, the continent's biggest clubs were not meeting regularly enough. Therefore, he set in motion his plans for the first European super league.
UEFA rejected the concept. However, if it did go ahead it would have turned teams such as Rangers and PSV Eindhoven into some of Europe’s most influential clubs.
Despite the rejected idea, Berlusconi’s grand idea lead to the creation of the first Champions League, in 1992–93. The new competition incorporated many of the same ideas, right down to branding and an anthem. While also going on to influence the launch of the Premier League. “People think there must be a lot of thinking in this Premier League,” the late Graham Taylor said at the time. “There is none … I think a lot of this is based on greed.”
Nothing has had more of an impact on this minimum financial threshold needed to compete in European soccer than the Champions League. The popularity of the tournament has lead to clubs receiving life-changing money each year. So much to the point that it has distorted the entirety of the European game.
Simply appearing in the group stage of this season's competition, earns clubs over $18 million. If your club reaches the final it will be worth $75 million. All of this is before adding rewards for games won and over factors.
In Tottenham’s road to the 2019 final, they netted almost $140 million, pushing them into the top 10 of the Deloitte Football Money League. Therefore, if a domestic team now wants to compete with Spurs, for the next season, they have to find close to $140 million.
When the rewards are so big, it begins to have a major effect on the domestic level. Especially on leagues within smaller nations. Therefore, the lack of domestic competition leads to local audiences turning to the bigger leagues. Further depriving the smaller clubs of much-needed resources and killing their attractiveness to top sponsors.
European soccer clubs have ceased to resemble local circuses and have developed into a global entertainment business, providing glamorous content. Therefore, more super clubs are going to go out of their way to kill off the next Leicester City, as it damages their own image, content, and endless desire for money.
The European soccer eco-system is set to be destroyed for the benefit of a handful of clubs and their billionaire owners. Taking along with it the valuable social dynamics the sport plays in local communities across the continent.