Thursday, 15 September 2011

Will football implode financially in the next three weeks or even three months?


Over the past couple of season’s finance in football has become an obsession of sorts for me - heightened I guess by the troubles that we saw off the pitch at Pompey not to long back. It’s one of the reasons that as a fan I’ve tried to give all the backing I can muster to the campaign to save Plymouth Argyle and spread the message of the fantastic job Fans Reunited are doing on their behalf as well. Reading the news today that their players have once again agreed to defer their wages really brings home how bad the situation is down there and the reality is that if a new owner doesn’t step up to the mark soon then it really could be curtains for the club. 124 years gone just like that? It surely cannot be allowed to happen? Apparently many parties have been interested. One ex-Pompey connection being that of our old owner Terry Venables. I hope that story for the sake of Plymouth Argyle is widely off the mark. The involvement of Peter Ridsdale must be mad enough given his track record at Leeds United and then Cardiff. Is it any surprise to Pompey fans that clubs who’ve employed our ex-CEO Peter Storrie have all had financial problems either with him involved or after his departure; Pompey, West Ham, Southend and Notts County. Not something you’d want people to remember about you surely?

For the past 12 months or more when writing about football finance I’ve held the view that the game of football believes it’s inside an insulated bubble which cannot be burst. I’ve talked about Arsenal, Wolverhampton and Bayern Munich as some who’ve bucked the trend. I’ve mentioned Portsmouth and Plymouth Argyle for obvious reasons. Glasgow Rangers will not be too far away when I’ve gotten to grips with that case. But voices from within side the game aren’t always that common. So I was interested to read the comments from Arsenal’s long serving manager Arsene Wenger when I opened the sports pages of the papers on Monday morning to see him starting to take the lead in the fact that the game isn’t as untouchable as it thinks. Whilst Plymouth Argyle continue to make the headlines in their search for a new owner, I found it refreshing to read the thoughts of a man who alongside the influx of money into the game, has been a revolutionary and a driving force behind making the EPL the league it is today – a worldwide force and phenomenon. Wenger’s arrival and his approach to diets etc for me is one of the reason’s the EPL went on to become so successful. Sure we still hear about antics from players such as Andy Carroll at the criticism from England Manager Fabio Capello that he needs to curb his drinking, but would Carroll have been able to have kept pace with the likes of Paul Gascoigne, Tony Adams, Paul Merson, Paul McGrath or Alan Knight and the entire Portsmouth team who ex-Manager John Gregory famously described as being like a pub team? I think Carroll wouldn’t have lasted much past 11pm.

“I believe that Europe overall, as a unit, is going towards a massive crisis, which nobody really expects now. I am convinced that Europe will go into a huge financial crisis within the next three weeks or three months and maybe that will put everything into perspective again.

Football is not untouchable. We live with people going to the stadiums as well and from advertising from people who buy products. All our income could be a little under threat in the next few months. Football is not only about money. We believe in ourselves that we can compete with them but it’s as simple as this.”

Arsene Wenger’s quotes taken before the Arsenal game against Borussia Dortmund in the Champions League this week.

Wenger had been talking about the dominance of two football clubs; Real Madrid and Barcelona and their power to negotiate their own TV rights away from the rest of the Spanish League. He threw in the names of Chelsea and Manchester City as part of a group whose spending power has separated them from the rest of Europe’s sides. For the Arsenal manager it’s created an uneven playing field where the rest of the clubs are unable to compete. In my previous blog I mentioned the affect of trying to keep up with the Jones’ and how spending big has become the norm in a bid to stay in the top league and compete. If prove of that was ever needed and how big a part players wages play in today’s modern game the recently released following financial breakdowns about wages show just how big a part they have to play and their impact on it’s possible collapse in the not too distant future;

For every pound earned by an EPL club in the 2009-10 season 68p was spent in wages. In Italy’s Serie A it was 69 cents in every Euro and in France’s Ligue 1 it was an even more staggering 75% of everything earned.

With this trend showing no signs of abating how long can the game worldwide sustain these levels of spending before everything starts to go horribly wrong?

One side in Europe who’ve bucked the trend and won on a comparatively small budget were Arsenal’s mid week opponents and current Bundesliga Champions Borussia Dortmund who assembled their Championship winning side at a cost of just £5 million pounds. This outlay was more than covered when Real Madrid purchased playmaker Nury Sahin for a reported fee of around £8.8 million this summer. Although I’m not suggesting that Dortmund are major contenders to go on and win this season’s Champions League, the revenues generated by reaching the group stages for a club already well run financially should be held up as a shining example to other clubs worldwide that success can be achieved on a sensible budget and that you don’t have to break the bank in order to achieve success. To have beaten a side like Bayern Munich with their financial clout in the German leagues is no mean achievement and shouldn’t be undervalued at all.

Spending big has never been a sure fire way to success although Pompey did manage won FA Cup win but we all know the financial implications of that. Interesting to see that or the last seven Champions league finals, six of them have featured and English side in them. The final between Internazionale and Bayern Munich was the only one to have not featured an English side. Of those seven finals there have been two English winners; Liverpool who famously came back from being 3-0 down to AC Milan to win and penalties and the other was Manchester United’s win over Chelsea which was also decided on penalties. So for all the financial power of the EPL spending big still doesn’t guarantee you success in Europe. 

The question remains though as to how long the levels of spending and big wages can be maintained. Scottish clubs forced to compete in wages with their richer neighbours over the border in England have seen current league leaders Glasgow Rangers in an apparent financial meltdown. Whilst Glasgow Rangers and Plymouth Argyle might be far removed from each other in terms of miles and balance sheets in terms of assets, it remains a fact that both sets of supporters will be sat looking at one another very worried at this moment in time. Will one go to the wall; will both go to the wall? If it happens will it be the message that starts the shock waves around the European game and forces them to start taking action. The next three weeks or three months could tell us the answer to that question.

Would you like to argue against Arsene Wenger on the subject?

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