The UEFA financial report is overblown; the G14 will be back; and, prepare yourself for a super league.

A new report by UEFA demonstrates the precarious debt situation of the EPL.  English Clubs hold 56% of the debt of European Clubs.  Here’s my response: meh.  These numbers make great headlines, but one glance deeper into the numbers demonstrates that individual Clubs don’t have any issues; the problem is for the EPL.  The big Clubs have leveraged their value, increased their revenue and acquired more debt, but they are also being forced to carry smaller clubs.  Something’s gotta give.  This means there will be an inevitable push to shed the limitations of the local domestic leagues, yes, like the EPL, to form a bigger, more wealthy super league.

Lets get rid of the chaff shall we?  English Club apparently have about £3.5 billion in debt.  But of that debt, £1 billion of it is held by just two clubs -liverpool and manchester united.  This would seem to bode ill for those two teams, but not really.  Both of those clubs can and would be bought by deep pockets should the opportunity arise.  Imagine if manu were put on the block, usmanov would drop Arsenal like a bad habit and throw gazzilions at the club.  Another reason we don’t want him at Arsenal.  The same goes for liverpool.  It’s a big club with a great tradition, given the chance, another deep pocket purchaser is sure to arrive.

So in reality, nearly 1/3 of the debt carried by EPL teams doesn’t really count.  Of the remaining £2.5 billion, I don’t know how much UEFA attributed to Arsenal, but whatever the amount, again it doesn’t matter.  Besides the fact that Arsenal leaves within its means, there are two billionaires competing to buy the Club now; and, should the Club be put on the market, there would be no shortage of potential buyers for The Club of London.  And of course, chelsa and mancity have no money issues.

So this means that most of the debt is being carried by the other, smaller, weaker clubs.  Fulham and Everton for instance come to mind.  Aston Villa supposedly has debt.  But it’s owned by a billionaire and has been operating within its means as well, not that some debt is necessarily bad.

But as Portsmouth has shown, the constant threat of administration of an EPL team threatens the stability of the entire league.  The EPL doesn’t want to constantly have teams falling into administration and the big clubs can’t handle having points potentially stripped from them or losing players to injuries playing teams that might not even exist at the end of the season.

The problem is, either way you cut it, the pressure is on the current crop of big clubs: Arsenal, manu, chelsea, liverpool and now even mancity, to (1) cease carrying the other teams, and (2) assure a constant high revenue stream.  As a result, there are only two solutions.

One, the EPL encourages mega billionaires to continue to buy EPL teams and make up for any loss should a club not make it to the champions league.  For instance, mancity isn’t likely to make the Champion’s League after this year, but they can suffer the financial loss because of their owners, restock over the summer and challenge next season.  To keep the league competitive, if stratified, this requires at least 15 mega billionaires (or their equivalent) to buy EPL teams.  The remaining three teams would just be doomed to regular relegation most likely.

Americans would recognize this system, we call it a professional sports league.  Where every team goes into a season on a pretty equal footing potentially: well run organizations do better than poorly run ones with money as a secondary factor.  But this isn’t likely to happen in Europe, instead, we’re likely to arrive at the second option: a super league.

Soon enough, the illegitimate child of the G-14 will return in a different guise, despite Platini’s objections.  Big EPL clubs will begin to agitate for more consistent revenue streams.  This will mean an effort by a collection of the wealthier clubs to disengage from the EPL and begin to form a super league with other interested Continental parties; the Italians in particular, but don’t yawn at Lyon and Bayern’s interest as well.  Once the ball gets rolling, it’ll snowball.

Some of my European colleagues might scoff and dismiss my Americanized view.  But remember this: (1) the best run sport leagues, yes, that’s plural, are in the United States; and, (2) football owners around the world know this, hence the EPL constantly asks advice from the NFL (really they do).  We have the best competition, best consistent revenue streams, best negotiated television contracts, well played players, massive endorsements, huge stadiums and growing fan base in all of our major sports.  Soccer (football), on the other hand, is the most popular sport in the world, and it lacks all of the above.    If anything, the biggest impact of American ownership of EPL teams will be this push for this professionalization of the sport.

-the student

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