The Football Bubble. Will It Burst?

Watching Skys deadline day coverage and club transfer fees constantly being broken, will it all eventually go belly up?
Personally I think it's unsustainable. The insane money that goes in to getting broadcast rights, ridiculous"superagent" fees and the wage fees for players can't go on forever, surely?
What do ye lads make of it?

Nah.

People talking about bubbles often raises a smile for me. How do people think it'll "pop"? TV deals are usually sorted about 18 months before they come into force so even a 10-20% dip as opposed to the usual increases can be mostly absorbed in new contracts. A few clubs will go bust every so often (as has always been the case) and some owners might let clubs go to the wall. Others may be bought up and have extra cash pumped in.

I see where your coming from but do you think the costs will reach a plateau or keep rising?
I know the word bubble is thrown out too often but I maintain something is gonna have to give

Cake of Tremendous Power

Cake of Tremendous Power wrote: »

I see where your coming from but do you think the costs will reach a plateau or keep rising?
I know the word bubble is thrown out too often but I maintain something is gonna have to give

It'll plateau a bit, though international TV rights may increase more yet. It will be interesting to see how they handle streaming and new revenue streams and the like but a good point I read in Soccernomics was that football clubs aren't exactly massive companies in the grand scheme of things. There's still plenty of scope for growth even if it's not as massive as in recent years.

NIMAN

We've been getting told it can't keep going like this for 10 years or more.

People said Shearer moving for 15mill was madness, and giving guys 50k per week.

Now we are at 200mill and 500k per week.

Richard Hillman

There is still another couple of stages where the TV rights have not been taken too and that are global TV rights. The reason the likes of NFL are still on free to air is that the TV companies have such a large market.

If the TV deal became unsustainable for the likes of Sky (which is starting to look like it is due to the amount of sports they are losing), then the PL can take the deal as one world wide package. Imagine the TV ad revenue of Free to Air on a global scale? It will make Superbowl ads look like a 1 inch ad in the Southside people.

If that became unsustainable, then the clubs will push for a European Super League.

The moment those TV rights go global, is the first wheels in the motion of the Super League. The Spanish global rights will be hammered if the PL goes Free to Air globally. They are just lucky at the moment that the PL is run by Richard Scudamore who was basically somebody in the right place at the right time when he got the gig

Ohmeha

Every bubble bursts, the football bubble insanity scam of late will be no different

When fans fully cop-onto dodgy boxes and cheap IPTV services and then it's a guarantee

I look forward to seeing the next generation of footballers actually earning their money at 20% of their current wages

MD1990

Dunno why I see this mentioned all the time on boards.


No it won't burst anytime soon. But costs will plateau in time. The rise in tv money since 2012 will slow down.

I dunno either. I haven't come across it.
Why don't you think it'll burst?

~Rebel~

Spending has always been a % of football revenue, so the actual figures being quoted are almost worth ignoring. All that's relevant is their ratio with each other.

As was said above, there's enough time built into the renewal of contracts, that teams will know well in advance if they need to scale back their wage structures etc - and since everyone will need to do this simultaneously, it'll happen across the board.

The interesting things will be where the rights go next. We're not far off the likes of Facebook and Netflix bidding with Sky and BT for rights.

Great point, looking at it as a ratio. Where it goes next is a fascinating thought.
Could there be an official subscription pack for just Arsenal games, Manchester Utd games etc? Could that garner more income than what the premier league gets from sky and bt?
What happens to the Swansea's and Bournemouths of this world then. Who subscribes to that on a worldwide scale?

sugarman

sugarman wrote: »

Of course it will eventually, it'll get to a point where people cant afford to pay for TV packages such as Sky, BT... cant afford club season tickets, or just regular tickets.. cant afford new kits etc..

Every day people, the working class fans are the ones being priced out of it and it'll only last so long.

Look at shear number of people using dodgy streams/android boxes now over traditional tv services, massive losses in revenue.

Look at shear amount of people buying knock off kits from China, your Aliexpresses and DHGates etc.. again, massive losses.

It all adds up and it'll continue to go that way once the offsets are passed onto the fans in the various forms.

I always wonder how it's affordable to support your team in the UK. As an arsenal supporter I don't know how I could afford the membership to allow me to buy tickets on a regular basis and if you factor kids into it, it gets more ridiculous. Then they want a scarf or a shirt and it all comes at a serious price

Fr Tod Umptious

I'm loving the word "plateau", does it remind anyone else of "soft landing" ?

Football is a bubble but how it will burst is harder to figure out.

Right now the bubble is being inflated by TV money and foregin owners.

I can certainly see a slow down in domestic consumption of football, at some stage soon, people will decide that the price of admission is too much and the price of TV subscription is no longer value for money.

But this could probably be mitigated by increased revenue from foregin media rights. There is enough of a market to keep it going outside the UK.

I can't see the product ever being free or cheap in the UK, it will always be pitched as a premium product.
If it's ever cheap or free it will be when the arse has totally fallen out of it and no one will be interested in it.

There are probably enough foregin owners out there to take on the slack if current owners pull out, and as we have seen the cost of running these clubs is a drop in the ocean for some owners.

razorblunt

Transfers definitely look to be changed, it’s almost going down the NBA swap route.

Skylinehead

It's slowing down in the domestic market. The international market will easily compensate for that.

Fr Tod Umptious

Cake of Tremendous Power wrote: »

Great point, looking at it as a ratio. Where it goes next is a fascinating thought.
Could there be an official subscription pack for just Arsenal games, Manchester Utd games etc? Could that garner more income than what the premier league gets from sky and bt?
What happens to the Swansea's and Bournemouths of this world then. Who subscribes to that on a worldwide scale?

The obvious outcome would be that the big clubs would pull away from the rest of the pack.

The rights for the big teams would be in multiples of what they would be for the small ones.

It would hasten the formation of a European Super league.

NIMAN

Fr Tod Umptious wrote: »

The obvious outcome would be that the big clubs would pull away from the rest of the pack.

The rights for the big teams would be in multiples of what they would be for the small ones.

It would hasten the formation of a European Super league.

I think a ESL is inevitable.

Football has to continue to entice fans and consumers. Eventually fans will tire of the leagues, and they won't want to see their team playing West Brom or Stoke every 2nd week. They'll want only top teams coming to their ground and on TV, and thats when the ESL will come into being.

Donnielighto

sugarman wrote: »

Of course it will eventually, it'll get to a point where people cant afford to pay for TV packages such as Sky, BT... cant afford club season tickets, or just regular tickets.. cant afford new kits etc..

Every day people, the working class fans are the ones being priced out of it and it'll only last so long.

Look at shear number of people using dodgy streams/android boxes now over traditional tv services, massive losses in revenue.

Look at shear amount of people buying knock off kits from China, your Aliexpresses and DHGates etc.. again, massive losses.

It all adds up and it'll continue to go that way once the offsets are passed onto the fans in the various forms.

There's plenty of non working class people who'll keep paying so it isn't about the working class, a questionably named group, being kept in the loop but overall population interest and the spending power they are will to give towards it.

Donnielighto

NIMAN wrote: »

I think a ESL is inevitable.

Football has to continue to entice fans and consumers. Eventually fans will tire of the leagues, and they won't want to see their team playing West Brom or Stoke every 2nd week. They'll want only top teams coming to their ground and on TV, and thats when the ESL will come into being.

ESL would ruin the prestige of a lot of the larger clubs and turn them into perennial also rans. It would just be the pl played out with a larger budget and no relegation.

Fr Tod Umptious

Donnielighto wrote: »

ESL would ruin the prestige of a lot of the larger clubs and turn them into perennial also rans. It would just be the pl played out with a larger budget and no relegation.

European Super League(s) would not necessarily mean no relegation.

I'd imagine a scenario where you have multi layered European leagues.

A top flight for the likes of Utd, City, Chelsea, Liverpool, PSG, Madrid, Barcelona, Munich, Juventus etc etc.

Then a second level for the likes of Celtic, Ajax, etc etc and so on down.

The lower levels (that a few Irish clubs could compete in) might be further sub divided geographically for cost reasons.

Donnielighto

Fr Tod Umptious wrote: »

European Super League(s) would not necessarily mean no relegation.

I'd imagine a scenario where you have multi layered European leagues.

A top flight for the likes of Utd, City, Chelsea, Liverpool, PSG, Madrid, Barcelona, Munich, Juventus etc etc.

Then a second level for the likes of Celtic, Ajax, etc etc and so on down.

The lower levels (that a few Irish clubs could compete in) might be further sub divided geographically for cost reasons.

That wouldn't happen, it'd be done like the leagues in the states. The Irish clubs and similar standard wouldn't be able to afford it.

NIMAN

Donnielighto wrote: »

The Irish clubs and similar standard wouldn't be able to afford it.

No, they wouldn't be invited.

LuckyLloyd

A European super league is a mouth watering idea.

MD1990

A ESL 1-10 divisions & UEFA funding small clubs like the LOI would be brillant.

j8wk2feszrnpao

Trevor Francis sold for £1m about 30 years ago, and people thought it was mental at the time.
Listened to the Guardian Podcast yesterday, in '89 Arsenals top player got ~3% of their income, which is about the same that Ozil just got.
Football hasn't been exclusive to the working class for quite a long time, hence the money in the game; even billionaires want a part of the action.

It's not a bubble. This is the money in the game, and it's actually gonna increase in the next international TV deal.
European Super League talk is decades old, just like Celtic/Rangers joining the English League.

LuckyLloyd

MD1990 wrote: »

A ESL 1-10 divisions & UEFA funding small clubs like the LOI would be brillant.

It would be unreal. You could really lock down transfer windows and christmas breaks, etc in such a scenario. And you could genuinely look at things like FFP with a level playing field.

Skylinehead

LuckyLloyd wrote: »

. And you could genuinely look at things like FFP with a level playing field.

Within a bubble. The idea of a level playing field and a European Super League is inherently contradictory.

LuckyLloyd

Skylinehead wrote: »

Within a bubble. The idea of a level playing field and a European Super League is inherently contradictory.

In this model, anything outside the model wouldn't be relevant really.

Skylinehead

LuckyLloyd wrote: »

In this model, anything outside the model wouldn't be relevant really.

Hence the bubble. What consideration is given to the lower league structures in England, for example? I can't see any good coming out of this for them.

dfx-

Skylinehead wrote: »

It's slowing down in the domestic market. The international market will easily compensate for that.

It is at this stage now. The domestic market isn't big enough for both BT and Sky to be paying a billion or so for very long. Sky have always had their competitors die off quickly, but BT's relative longevity is hurting both of them it seems going by the breadth and basic coverage of other sports or even other games.

But it is at the stage that the Premier League can still get by through pooling the international rights. What would it take for this to fall away...

LuckyLloyd

Skylinehead wrote: »

Hence the bubble. What consideration is given to the lower league structures in England, for example? I can't see any good coming out of this for them.

Meh, **** em. Entertain me. They'll still have their lower divisions and domestic cups to play for.

Skylinehead

LuckyLloyd wrote: »

Meh, **** em. Entertain me. They'll still have their lower divisions and domestic cups to play for.

Considering the massive culture around lower league football, the tens of thousands they employ, that's pretty callous just so you get your entertainment fix, which is hardly in short supply in the current setup.

dfx-

What is the scenario for the PL splitting? Given how they have votes on everything, can clubs just get up and leave?

The big club setting off to a European Super League would drain the EPL money internationally. But the likes of Stoke and Watford or anyone outside of the top six would never vote for it...

GavRedKing

PL TV rights for the 3 year period starting for the season 2019-20 are due to be bid on in the coming days.

Sky paid over 4.2 billion the last time for their majority share and BT paid roughly 1 billion for this share of the games, totaling some 5.15billion for the last set of rights.

Its predicted that this will rise to over 6billion or roughly 20% over the last deal and its expected that Amazon could get involved for one of the packages.

The bubble wont burst in the English game anytime soon when teams are going to be raking in about 100m+ just on TV rights.

Fr Tod Umptious

GavRedKing wrote: »

PL TV rights for the 3 year period starting for the season 2019-20 are due to be bid on in the coming days.

Sky paid over 4.2 billion the last time for their majority share and BT paid roughly 1 billion for this share of the games, totaling some 5.15billion for the last set of rights.

Its predicted that this will rise to over 6billion or roughly 20% over the last deal and its expected that Amazon could get involved for one of the packages.

The bubble wont burst in the English game anytime soon when teams are going to be raking in about 100m+ just on TV rights.

But the TV money is the bubble.

If Sky or anyone else are to pay 6 billion in rights then that money has to be made back some way.

And that some way will likely be higher subs and higher prices for ad space.

At some stage people decide that the sub price is too high and they quit, or the ad agency decide that the 30 second spot on Super Sunday is too expensive and they don't buy it.

Fromvert

The sports TV money bubble is still growing at the moment. Over in the US the NFL just got a 50% rise on the rights to their Thursday Night games package, $660m a game now. Rating going down steadily these games are the worst to watch and least competitive they have to offer and they get a 50% bump! For the online streaming rights to the same games, Twitter paid $10m two years ago, Amazon $50m for the season just gone, I expect it'll be $75m+ this year.

The issue the likes of Sky/BT or Fox/ESPN/CBS have is live sport is the only thing that brings in ratings and subscriptions so they have to cut corners elsewhere to keep the subscriptions and push the price of sport up. This year ESPN slashed $80m from it's wage bill and Sky must be looking at some of it's on air talents costs and be ready to take an axe to it when they can.

VAR will bring in revenue too soon enough, with the official VAR sponsors etc. This is going to end up having advertisements running through it and a game will end up getting stretched from 2 hours all in to gradually 2.5 hours over a period of years and that's where it'll be painful.

LuckyLloyd

Skylinehead wrote: »

Considering the massive culture around lower league football, the tens of thousands they employ, that's pretty callous just so you get your entertainment fix, which is hardly in short supply in the current setup.

Yeah, I'm pretty callous on this topic. English lower league football is whatever as far as I'm concerned. This is the key point of discussion on this whole thing really. The mega money for TV rights is for Man City, etc vs; not for Brighton vs Watford. Eventually we'll reach a point where - to keep the growth happening - we need more Man City vs Man City type games, maybe all Man City vs Man City type games. Some hard decisions will need to be made.

Mushy

LuckyLloyd wrote: »

Yeah, I'm pretty callous on this topic. English lower league football is whatever as far as I'm concerned. This is the key point of discussion on this whole thing really. The mega money for TV rights is for Man City, etc vs; not for Brighton vs Watford. Eventually we'll reach a point where - to keep the growth happening - we need more Man City vs Man City type games, maybe all Man City vs Man City type games. Some hard decisions will need to be made.

What about where games between top teams are dirt?

GLaDOS

Mushy wrote: »

What about where games between top teams are dirt?

Anyone who takes part in an unentertaining game is banished from the garden.

Fr Tod Umptious

munstermagic11 wrote: »

Trevor Francis sold for £1m about 30 years ago, and people thought it was mental at the time.
Listened to the Guardian Podcast yesterday, in '89 Arsenals top player got ~3% of their income, which is about the same that Ozil just got.
Football hasn't been exclusive to the working class for quite a long time, hence the money in the game; even billionaires want a part of the action.

It's not a bubble. This is the money in the game, and it's actually gonna increase in the next international TV deal.
European Super League talk is decades old, just like Celtic/Rangers joining the English League.

The Champions League is the 1990s answer to the threat of a European Super League.

It gave the big teams a big pay day while keeping domestic leagues in place.

But it's over 25 years old at this stage and it's inevitable that with the growth of new media streams and new markets the big clubs will want to find new ways of maximizing revenue.

Fr Tod Umptious

Fromvert wrote: »

The sports TV money bubble is still growing at the moment. Over in the US the NFL just got a 50% rise on the rights to their Thursday Night games package, $660m a game now. Rating going down steadily these games are the worst to watch and least competitive they have to offer and they get a 50% bump! For the online streaming rights to the same games, Twitter paid $10m two years ago, Amazon $50m for the season just gone, I expect it'll be $75m+ this year.

The issue the likes of Sky/BT or Fox/ESPN/CBS have is live sport is the only thing that brings in ratings and subscriptions so they have to cut corners elsewhere to keep the subscriptions and push the price of sport up. This year ESPN slashed $80m from it's wage bill and Sky must be looking at some of it's on air talents costs and be ready to take an axe to it when they can.

VAR will bring in revenue too soon enough, with the official VAR sponsors etc. This is going to end up having advertisements running through it and a game will end up getting stretched from 2 hours all in to gradually 2.5 hours over a period of years and that's where it'll be painful.

Good post.

This is why it's a bubble

The price keeps going up but the product returns nothing extra in value to the buyer.

Fromvert

Fr Tod Umptious wrote: »

Good post.

This is why it's a bubble

The price keeps going up but the product returns nothing extra in value to the buyer.

It must be returning less or soon to be.

Lower ratings and lower subscriptions = lower ad revenue surely?
As noted before the big clubs or even the PL will probably pull out of a TV deal if the deals take a sharp turn and go direct to the customer/advertisers. Why even let Sky/BT get a slice of the pie when they can go straight to everyone with no middle man taking a cut of advertisement money.

Mushy

GLaDOS wrote: »

Anyone who takes part in an unentertaining game is banished from the garden.

Deadly, so lots of ways to get points must be needed

atilladehun

A break from domestic leagues to an ESL would mean less games. Doesn't seem like a runner for more revenue.

Fr Tod Umptious

atilladehun wrote: »

A break from domestic leagues to an ESL would mean less games. Doesn't seem like a runner for more revenue.

I'm sure you could cobble together 20 teams from England, Spain, Italy, France, Germany to make it happen.

LuckyLloyd

Utd
City
Chelsea
Liverpool
Spurs
Arsenal
PSG
Monaco
Dortmund
Bayern
Madrid
Athletico
Barcelona
Milan
Inter
Juventus
Roma
Lazio
Porto
Benfica

I’d watch that.

Hardly a great idea for match going fans

Laois_Man

I think the bubble will burst for small/medium size PL clubs who are getting a reasonably equal slice of the pie in TV money.

When it's not TV anymore, and stuff like AR takes over, that's when the gap between the have and have nots will widen hugely and Sky will be redundant! They need to be a bit more forward thinking than renaming their stations!

GLaDOS

RoboKlopp wrote: »

Hardly a great idea for match going fans

As if the ESL proponents care about them.

I'm sure native Liverpudlians would be happy to see the Merseyside derby discarded.

OwaynOTT

Why the **** would spurs be in a European super league?

Cantona's Collars

http://www.dailymail.co.uk/sport/football/article-5346117/BT-Sport-prepared-ditch-Premier-League-TV-rights.html#ixzz55ze39mdg

The squeeze has started. BT reported to be dropping EPL coverage due to falls in subscribers and rising customer costs.

Sky are considering dropping MNF to keep costs down.

When you look at what foreign broadcasters are offering,it makes a mockery of the UK ones.