My (Not Very) Australian Adventure

Failures of the Free Market in Football: Why the Bundesliga puts the Premier League to shame

afootballreport:

By Eric Beard

I recently came across a great piece in the Guardian by Jamie Jackson focusing on the reasons why the Bundesliga is superior to the English Premier League. The sub-headline of the piece is “With cheap ticket prices and sound financial management, the Bundesliga is the antithesis of the Premier League.” For me, this begs the question of whether or not the Premier League is in decline because of all the financial troubles its clubs are facing.

The Premier League, for me, is the most competitive and most exciting league in the world to watch, as every team in every match is fighting for something. However, I completely agree with Jackson on many points. For example, Jackson writes:

In Germany the fan is king. The Bundesliga has the lowest ticket prices and the highest average attendance of Europe’s five major leagues. At Borussia Dortmund their giant stand holds 26,000 and costs little more than £10 for admission. Clubs limit the number of season tickets to ensure everyone has a chance to see the games, and the away team has the right to 10% of the available capacity. Match tickets double as free rail passes with supporters travelling in a relaxed atmosphere in which they can sing, drink beer to wash down their sausages, and are generally treated as desirables: a philosophy English fans can only dream of.

With Manchester United and Liverpool struggling financially, and clubs like Chelsea and Manchester City set to charge ridiculously high ticket prices next season, you have to wonder how making a ticket to Stamford Bridge £10 instead of £60 would change the state of the game. I believe that clubs could only profit by following the German model of making the supporter invaluable.

“The Bundesliga as a brand, a competition, is in good shape. We have a very, very interesting competition, a stable and sustainable business model that relies on three revenue sources,” the Bundesliga chief executive, Christian Seifert, tells Observer Sport. 

The incredibly successful trio of comprising match-day revenue (€424m), sponsorship receipts (€573m) and broadcast income (€594m) is the main contributor to the Bundesliga’s €1.7bn turnover. Now I know 1.7 million euros is an extremely large amount of money, but the revenue the Premier League makes puts that number to shame. The Premier League is the world’s most lucrative football league, with combined club revenues of £1.93 billion ($3.15bn) in 2007–08, and that number has only grown since. So why are Premier League clubs failing to make a profit?

Read More

Having seen what’s happened to Portsmouth this season and with Manchester United, Liverpool struggling with debt, I think it’s time the Premier League evaluate and adapt their Fit & Proper Persons test to ensure that clubs are not being bought by using borrowed money but also pay as much attention to the fans as they do with sponsorship and broadcasting income. At the end of the day if the cost of tickets is driving fans away from their team, the only people left in the stadiums will be those in the corporate boxes.