Desire for profits killing clubs' identities

November 9, 2007
By Phil Holland
(Archive)

Just in case anyone needed reminding of the influence wealthy foreign investors have over football in the UK and the English Premier League in particular, the publication this week of the Football Rich List Top 100 confirmed the worst fears of many.

GettyImagesRoman Abramovich and Bernie Ecclestone have been enjoying the success of English football.

Domestic football on the Sceptred Isle is undoubtedly becoming the preserve of the enigmatic billionaire from overseas, usually shrouded in mystery and occasionally besieged by skeletons emerging from closets.

The list, compiled and published by FourFourTwo magazine, shows that eight of the richest men involved in British football clubs are billionaires and that four of them (Roman Abramovich, Alisher Usmanov, Malcolm Glazer and Stan Kroenke) are foreigners.

Simply being foreign is not the problem, unless you happen to be a knee-jerk reactionary or an extreme football traditionalist, the worry is that football clubs in the UK are at risk of losing their status as vital community assets.

When wealthy investors from overseas emerge and assume controlling interests in clubs, which in many cases are over 100 years old, the worry is not only that the investors know little of such heritage, but that they care even less.

One question in recent years has been why only foreign investors are taking an interest in the Premier League? Well, it now seems the wealthy of Britain are catching onto the craze and getting involved. The top ten new entries on the Rich List shows that half are British businessmen (Bernie Ecclestone, Mike Ashley, Lord Ashcroft, Michael Spencer and Lord Harris), however, this still means that 50% of the new entries are from overseas.

One dilemma worrying those people who dwell on such matters is why these wealthy individuals, be they British or not, are choosing to get involved in football in the first place, questioning their long-term objectives.

In other figures released this week The Daily Telegraph newspaper reported that the Premier League is worth £700million more than other leading leagues in Europe based on revenues derived from television and media rights sales, especially with regard to sales in markets around the world.

The Premier League's overseas television rights, which makes the league available in more than 600 homes in 202 countries across the globe, is worth £625million for this and the next two seasons. Such is the interest in the Premier League internationally that there is an increasing expectation that overseas rights sales could eventually be worth more than the £1.7billion currently paid for domestic coverage in the UK from pay-TV operators BSkyB and Setanta.

And this is the reason investors are so keen to get in on the action. With the possible exception of Roman Abramovich, who with a personal fortune estimated in excess of £10billion can afford expensive pastimes; businessmen are getting involved in football because they believe the potential return makes their investment a no-brainer.

The worry for many, apart from the inevitable watering-down of clubs' local identities, is what will happen if a club's Sugar Daddy gets bored and decides to get out?

Unless a club is run prudently, like an efficient money-making machine, it will have no chance of surviving without the wherewithal of its benefactor. But do we really want our clubs run in such a way?

That is not say clubs should not be run prudently, without paying careful attention to their profit and loss spreadsheets, but there is something distasteful about your local club being run as a profit driven entity which pays a handsome dividend to the already stratospherically wealthy.


In other football news this week the English Football League, quite literally the poor relation of the all-conquering Premier League, has announced a bumper new domestic television and media rights deal covering the three season period from summer 2009 to summer 2012 worth £264million.

GettyImagesJordan: The Palace owner is never shy to share his views.

While some observers were shocked at the value of the £88million-a-year-deal, which, in case you're interested, is joint affair between BSkyB and the BBC; others, notably Crystal Palace chairman Simon Jordan, have sounded a note of caution.

While the deal represents an impressive 135% increase on the current arrangement the numbers really pale in significance to the Premier League which, as stated above, will rake in £1.7billion between the start of this season and the end of the 2009/10 season.

Jordan accepted that the value of the deal was 'a great step forward' and 'a fantastic step in the right direction' before identifying the crucial matter: 'The distribution of money outside the Premier League still needs to be looked at because there remains a huge disparity.'

And Jordan is completely right, of course. But there are two key factors to be kept in mind, and they are factors which a savvy operator like Jordan will be acutely aware of.

Firstly the value of a product is determined by the marketplace, you can't just charge what you like because people won't pay. In this case the Championship, Leagues One and Two and the Carling Cup are not deemed to be as valuable or desirable a product as the Premier League, even when bundled together as they have been in this deal.

And secondly with regards more equitable distribution of Premier League income, if Palace were promoted would Jordan himself be so keen to relinquish his club's hard-earned cash if he were asked to vote on the matter?

Maybe, maybe not. It's easy to talk an altruistic game, but far harder to make good on the preaching when time comes. Turkeys seldom vote for Christmas.


The latest and most interesting twist in Tottenham's unspoken but widely-known plan to address their stadium conundrum appears to be the prospect of an uncomfortable two-year ground-share with West Ham at Upton Park.

Daniel Levy, the Spurs chairman, is understood to have asked architects to draw-up plans for a new 50,000 seat stadium which would be built on the same site as White Hart Lane, the club's existing 36,000-capacity home. But it is expected that such designs would take years to come to fruition and require Tottenham to become temporary tenants at the ground of one of their fiercest rivals.

White Hart Lane
GettyImages / PhilColeWhite Hart Lane: Due for an upgrade.

There is no official word from Spurs on the matter and no clear plan. Redevelopment of White Hart Lane remains an option, as does building a new venue in the neighbouring boroughs of Enfield and Haringey.

None of the available options is that appealing, not least because of the local transport infrastructure which struggles to cope with Spurs' home games at the moment, let alone when you add 14,000 extra fans into the equation.

Most frustratingly for Spurs is that they have been unable to get Transport for London or the Haringey Council to stump up the estimated £80million cost of extending the Victoria underground line to Northumberland Park, literally round the corner from White Hart Lane.

An expansion of the tube to service White Hart Lane would revolutionise access to Spurs and in-so-doing make the new venue a far more attractive proposition to the kind of corporate fans which Arsenal have found easy to attract following their successful move to the Emirates Stadium.


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