December 16, 2019

Football has progressed financially and it is the richest

Football was developed in England and was codified in London in the year of 1863. Since Football was established it has been deemed as the most popular sport in the world, “Someone said football is more important than life and death to you’ and I said ‘listen, it’s more important than that.”, This Bill Shankly quote (famous Scottish footballer and manager) demonstrates how massive this sport is and how important it is to people around the world. Over the years it has progressed financially and it is the richest business, but is there too much money in it now?

The club at this present time with the most wealth is Real Madrid, with their current value being at £2.17 billion despite a decrease of 5% in their club’s value in 2017, with Barcelona being behind them with a club value of £2.1 billion which is an incredible amount of money in today’s society.

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In 1961, footballers were just earning a maximum of £20 per week and just 50 years later, players in top division Football are now earning a minimum of £30,000 a week, but there are different aspects to why this is and one of them is inflation as £20 then in comparison in today’s money is £322.04. This has changed dramatically as in 2017 PSG bought Neymar the world’s most expensive player for £200m and is currently earning £50 per minute which equates to £500,000 per week, but you would think that Neymar earns the highest amount of money per week right? Well no he is second on that list. The player with the highest earnings is Carlos Tevez who is currently playing in the Chinese Super League and is earning £650,000 per week.

There have been many various variables as to why there has been so much money put into football players and clubs over the years, and it is through endorsements, sponsorship deals, stadium naming rights, ownership deals and much more.

In the early 1980s, there was a corporate sponsorship of English Football, even though a small competition like the Texaco Cup which was sponsored in the 1970s. In 1982 there was the league cup which was the first competition to have a sponsorship deal and it was negotiated with the Milk Marketing Board. In the next season, there was a negotiated deal between Canon and the Football league, and ever since the Premier League started in the year 1992 the league has had its own sponsorship deals which are separate from the Football league. The very first sponsorship deal in England in terms of kits was on the 24th January 1976. The team was Southern league Kettering town which had the name of their sponsors on their shirts after signing a deal with Kettering tyres. Unfortunately, the FA then demanded that Kettering town remove the Kettering tyres slogan even though there was a ban in sponsorship in 1972, but Dougan (Chief executive of the club) claimed that the rule had not been written, now because of Dougan’s incompetence, he was faced with a £1,000 fine. fortunately, due to the backing of clubs like Bolton Wanderers and Derby County the ban was lifted in 1977. Shortly after these big TV companies like the BBC and ITV were refusing to broadcast highlights of any team who were wearing sponsors on their shirts. In 1979 Liverpool striker a £100,000 two deal with Hitachi a Japanese company, in doing this the contract stated that the shirts cannot be worn in any European competition or be televised in any domestic games.  

From five-figure deals to now six-figure deals with sponsorships, the Premier League teams are now making a ridiculous amount of money in the 2017/18 season from sponsorship deals on shirt and sleeve sponsors. Chevrolet, the shirt sponsors of Manchester United has the biggest deal with a price of £47million per season until the year 2021, and Manchester United are currently negotiating with Tinder, the dating app for a sleeve sponsorship deal. Furthermore, the team in the premier league who are at the bottom of the pecking order with a cheaper deal in Brighton with a sponsorship deal with American express with £1.5million per season and joint with Brighton is Huddersfield with their shirt sponsor being OPE Sports. The reason the bigger teams earn more money in these sponsorship deals is that teams like Arsenal, Chelsea and Manchester United get more exposure as they have a wider range of audiences supporting their club and have more shirt sales than the teams with less exposure because they have more fans.

In the month of May in the year 1992 Sky won the right for live Premier League matches which cost an outstanding £304 million five years, and the BBC won the highlights package and Match of the Day, and in doing that it froze out ITV. In the year 2000 Sky paid an amazing £1.1billion to renew their premier league deal for a package of 66 live games, and ITV paid £183million for the highlights which ended Match of the day for the time being. Fast forwarding, in the year 2016 the PL has sold its TV rights for an incredible £5.136 billion which is officially a record. Sky have five of the seven TV packages deal for 4.2billion and while their major rival BT sport has paid £960million for the other two TV packages, and this deal will run for three years. Due to this, it will mean that Sky will be showing 126 matches and BT will be showing 42 matches, which will cost them £10.19million per game. This increase of TV deals is most likely to go higher in price which has had an impact on Premier League teams, and because of the amount financial activity Football is deemed as more of a business. Real football fans denounce stadium rights deals as the fans feel it is a step closer in the crass commercialisation of Football. Approximately, 50 years ago most of the Football stadiums and arenas were named after a location or an important person, but now because so much money has been put into the Premier League, most stadiums are being named after big companies for revenue. In 1997, the first stadium sponsor was a frozen chips firm and the first footballing ground to be named after its sponsors were Scarborough’s stadium, and it was named after the frozen chips company McCain’s, and it was while The Wanderers new ground was named the Reebok Stadium in 1997 when it opened. In 2004, Arsenal struck a deal with Emirates Airlines and this deal was worth £100million for 15 years for the naming rights of the stadium and eight years for the kit. “The combined value of both elements of the sponsorship is by far the biggest deal ever undertaken in English football”. This quote from Arsenal demonstrates how things in Football has changed and it is mostly about money. Furthermore, this deal was massive as other companies started doing deals with other clubs as it meant that the companies gained more exposure and customers.  In 2016 Arsenal signed a contract in 2016 until 2021 and will be extended until 2028, with the naming rights and the sponsorship deal adding to a total of £30 million a year.So, do you remember the days when football supporters didn’t know who their owner of the club was? Well, now we are living in a time where supporters know their club owner and have practically become as big as news as the actual players and managers. As the years have gone by money has become critical for Football club’s success and this is when the owners come into place. Teams like Newcastle, Everton, Blackburn, Aston Villa, and Sunderland have had huge success with major trophies in the past, but since so much money has been pumped into clubs by owners and other deals, teams like this have not been getting the same type of success as they use to have. The likes of Manchester City, Manchester United and Chelsea have been gaining more success as they have richer owners who are willing to put money into the club to buy world-class players. Ownership deals do not always have its benefits as a word-class team like Arsenal have problems with their owners as it is considerably different from English Football clubs. It is owned by a parent company, which have a few shares. The shareholder with the most shares is Stan Kroenke who owns 67.05% and his rival Alisher Usmanov who owns 30.04%. Even though Usmanov owns a good amount, he still has no seat on the board and is unable to influence any changes in the club. Usmanov made a £1billion bid to buy out Stan Kroenke in May but there was no response. Stan Kroenke manipulates loyal fans for money as he makes broken promises to the fans so that they will spend money on the club by buying tickets and buying Arsenal shirts. “they have increased revenues by a huge amount. If I was a fan of that club, I would sit there and go, ‘Wow.'” This quote from Arsenal’s major shareholder demonstrates the mindset of what Football means to him. It is not about the love of the club it’s about how much money he gets out of it and this is an example of how the business in Football has disfigured the values and traditions in Corinthian sport. Currently, transfer fees have risen over the roof as clubs in the higher division must pay millions to sign the players that they need. The first ever three figure transfer fee was £100 and was in 1893 for Willie Groves and paid by Aston Villa, and in 1904 there was the first ever four-figure transfer fee for Alf Common who joined Middlesbrough from Sunderland. Furthermore, Trevor Francis is regarded as Britain’s first one-million-pound player including tax. Then in 1928, Arsenal paid £10,000 for David Jack who originally played for Bolton Wanderers. Transfer fees just started rising as Manchester United paid Newcastle United seven million pounds for Andy Cole, then Alan Shearer commanding an outstanding fee worth £15,000,000 in 1996. Few years down the line there was the first £30,000,000 deal for Rio Ferdinand to Manchester United in 2002.  Since then, the transfer fee for players has rocketed sky high in not only English Football but in other countries as well. In 2017 PSG bought Neymar the world’s most expensive player for £200million and in 2018 Barcelona completed a signing of £142million of former Liverpool player Coutinho, would you say transfer fees for players have gone out of hand? Footballers are now not seen as just regular athletes, they are celebrities, role models, and targets for companies who want to promote their brands. For example, Cristiano Ronaldo endorsement deals are worth £35million and his salary is around £45million and he is currently the richest athlete in the world. The companies with endorsement contracts with Ronaldo are Konami, Clear, Nike, CR7 and Herbalife. Ronaldo has promoted all these brands via media outlets and altogether the companies got $176million because of his promotion, and the player right behind him as the second richest footballer is Messi who earns $53M which is his salary and with also form endorsement deals he earns $27m with his biggest endorsement deal being with the company Adidas. Football has changed dramatically since 1961 when players use to earn £20 a week. Football is now business nowadays as most players move to teams for money and owners use Football clubs as a way of generating more income by increasing ticket prices every year and using different techniques to bring money into clubs. Real supporters of the club are what make Football what it really is, as fans are being more and more alienated out of Football. There have been many arguments as to why it’s a benefit that money is being pumped into Football. Hudson (2001) said that “in many ways, this influx of additional money into the game has improved football considerably”.

In conclusion, it does not seem that things are going to be getting better as we have business tycoons running football clubs and making clubs making themselves into adverts for sponsorship deals. There are many factors as to why there has been so much money put into football. For example, endorsement deals, ticket prices, TV deal, ownership deals and so much more. The value of a real football athlete playing for their club they love is not there anymore as they go to the team with the most money.

 

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