Financial Times Business of Football Summit 2024 takeaways: Something’s gotta give

FT’s Business of Football 2024 takeaways – Something’s gotta give

Credit: FT Business of Football Summit

I went to London for this year’s FT’s Business of Football summit, and I came back with a lot of food for thought. My overwhelming impression is that the club owners & managers, the players, the fans, the politicians, and the representatives of national leagues/UEFA/ECA have been unanimous in their calls for a change. It feels that in the current state, the European football is not sustainable–and not just from a financial standpoint.

The club owners and managers complain about the ever-larger revenue gap between leagues (given Premier League’s increasing dominant position) and between the clubs belonging to the same league (often reflecting the respective owners’ financial power). They also complain about the lack of cost controls and claim for a governing body covering all jurisdictions (otherwise, in this world of accounting “optimisation” and arbitrage, the efforts of individual leagues would be useless).

Lower down the football pyramid, clubs are unhappy as well: they get little money from the top divisions (see the recent EFL struggles to strike a deal with the EPL), while they are basically the “nurseries” of the top teams; in the current state of affairs, they are far from being able to invest further in their infrastructure and/or communities, their main concern is being able to stay afloat. 

My opinion: All these concerns are valid. Some form of cost controls is definitely needed; UEFA is making strides in this direction. It is up to the national leagues to also join forces, with possibly stricter rules.
NB: In the first divisions, the gap is also growing between the clubs playing European competitions, and those who do not (see today’s excellent blog from Swiss Ramble).

The fans are sick of being treated as customers. They do not want to pay fortunes for a game or for a season ticket (especially in the EPL); they do not want a reduction of seats available on general sale in favour of ever-larger VIP sections;  and there is no love lost between them and the MCOs.

The season ticket holders are tired of being “monetised’ and are threatening of not showing up to the games anymore. Yes, the seats will be filled, but there will be no atmosphere, no “12th man”, no extra push for players in the dying minutes, no last-gasp win, less sporting success..
Regarding the MCOs, the fears concentrate on the domino effect of one club having financial issues; and no fans would like his club to be the nursery of the  headline MCO club.

As for the younger fans and their supposed lack of interest in watching a game for 90 mins: just make tickets more accessible for them!

My opinion: having attended games at Parc des Princes (PSG’s stadium), I understand their threat: the vast majority of spectators are tourists, and if it weren’t for the ultras, there would be no atmosphere whatsoever. Clubs should not take fans for granted; they should be treated with utmost care and respect. I understand the reasoning behind words like “fan engagement”, “monetisation”, “club’s IP”, but never forget that sporting success is the main driver of commercial success. If your fans pushed the team for a win in the dying minutes of a Champions League game, that is worth close to 3mln EUR, which is more then all the replica shirts sold during a season by most clubs….

The players complain about their decisional power over the competitions in which they play. Their playing time is only going up, and so is the number of injuries. The worries are not just about the impact on their physical and mental state, but also about the quality of the “product” they are supposed to deliver: making something less scarce is not a viable commercial strategy (remember last year’s CL final with players arriving exhausted, having cramps after one hour of play time?)

My opinion: valid concern as well. I have yet to meet someone who can explain the Nations League tournament format….so many games jammed in so little time. And with a son playing Fantasy Premier League Football, I am more than aware of the ever increasing number of injured players.  They are clubs’ and leagues’ main assets, and need protection.

The politicians – given the perceived football’s inability to self-regulate in England, they decided to do it themselves. The UK government just announced the creation of an independent regulator aimed at ensuring the financial stability of clubs (in England, 64 clubs went into administration since the creation of the PL).

My opinion: England could use the model of the French DNCG

UEFA are introducing stricter financial fair-play rules, trying to put a brake on clubs’ spending and make them more financially sustainable. These rules will concern not just the equity, but also the cash levels and the squad cost (wages + transfer fees+ agent fees). Many clubs are not yet ready for this (in the Big 5 leagues, 55% of clubs have negative equity). The CFOs jobs will become increasingly important, and many potential investors will have a close look at the financial leeway before committing to a club project.

My opinion: it’s about time! 

Women’s football – the NWSL (US) is the poster child of the sport’s commercial success. Profitable in the past couple of years, they just closed a TV deal for $240mln over 4 years. Their structure is 100% dedicated to the women’s football, and the infrastructure is impressive: all stadia are seating 10,000+ ; each club has dedicated training facilities; the games are filmed with 12 cameras (for comparison in France we top at 4).

 My opinion: it was not an easy ride, but a lot of lessons are to be learnt from the NWSL’s experience to become commercially successful. Having dedicated stuff, focused 100% on women’s football, is a good first step!

The Super League: still rejected by all the clubs and leagues participating to the event, however some executives think this is a discussion that needs to take place, given the rising inequality between EPL and the “smaller” leagues  (for example, the year they won the Scudetto, AC Milan earned less TV right that the EPL’s relegated Sheffield United). (Also since the FT event, A22 released a fan opinion poll suggesting fans across Europe are now favourable to the creation of a Super League with a promotion/relegation mechanism).

 My opinion: that ship (the Super League) has sailed.

To sum it all, something will have to change, and new ideas are needed…Sharper cost controls, or a levy on the revenues of the top flights to finance the lower leagues, or further tax harmonisation across jurisdictions and further regulation of the MCOs, etc.

PS: To watch all session from the event on demand register at: businessoffootball.live.ft.com