Kick-off between Liverpool and Stoke City this afternoon marks more than just the start of the new Premier League football season. Thanks to a bidding war between broadcasters, it also inaugurates a yet-more lucrative phase for Britain’s top-flight clubs. The question is, what will they do with the money?
There will certainly be plenty of it. Although Sky Sports will still be showing the lion’s share of matches, newly launched BT Sport outbid the incumbent for 38 games, raising the value of the deal by more than 70 per cent in the process. The result is a record £3bn price tag for the next three years’ television rights and a bonanza for Premier League clubs, every one of which will receive an extra £14m annually.
The temptation, of course, will be to splash out on players. One need look no further than, for example, Manchester City – propelled from mediocrity to stardom by the near-bottomless pockets of owner Sheikh Mansour – to see the benefits of throwing money at a team. And recent talk of Tottenham’s Gareth Bale transferring to Real Madrid for a record-breaking £85m suggests the limits of players’ demands and clubs’ indulgence are still to be reached.
The urge to spend, spend, spend should be resisted, though. Rocketing wage inflation has left football’s finances in dire shape. While heavy losses might be bearable for those with plutocrat owners, even trophy assets face problems if or when their sugar daddies lose interest (or financial heft). Meanwhile, those without the benefit of such largesse struggle to compete or rack up huge debts trying.
After a string of high-profile problems, there have been attempts to regularise football finance. Premier League governance rules and Uefa’s Financial Fair Play regime – which applies its first sanctions next year – have curbed some of the worst excesses. But there is a long way to go yet. Despite record revenues, Premier League clubs still made combined losses of £361m last year.
The TV-rights windfall should, then, go towards stabilising balance sheets and improving grass-roots facilities, rather than ratcheting up wage bills. With competition so sharp and so global, however, the hope may prove a vain one.