The new tv "windfall"

[T 190]

As noted before though only Swansea have done more with their money than Lambert and Hughton in the last 2 seasons.

[paul moy 235]

[quote user="T"]ManU made a 5m loss last season (mainly due to payments to owners and lenders). Chelseas a 4m loss amd Man City a 99m loss ManU had a turnover of 320m last season, Chelseas 261m and ManC 169m. It is primarily ManC which will be impacted by the new rules[/quote]

... and that is primarily in Chelsea''s case because they acknowledged a few years ago that their club needed to be run on a sustainable basis with FFP coming in. The likes of Man City and PSG, hopefully, will suffer consequences of  ignoring the new rules or eventually fall in line. Manure  would have to reconsider their spending if they ever failed to qualify for the Champions League. I don''t see their success lasting forever and they need around 40m profit a year simply to finance their debt.

[T 190]

I think ManC will fall in line which will limit them. Their finances are admirably transparent. Can not see ManU falling away as their revenue dwarfs everyone so that they will always be able to pick up the likes of a RVP to pretty much guarantee them a Champions Legue place. The only other financially viable club is Arsenal. They are now starting to see the long term benefits from their move to the Emirates and have a new commercial deal so I expect them to be more competitive in the future.

[Gaz06 0]

T - You''re right, for the top teams in the Premier League financial fair play will mean clubs like Arsenal will become more competitive. Although i''m sure Manchester City will find a loophole in the rules and sign some lucrative sponsorship deal for their training ground with the owners brother ....

But Manchester United revenues continue to rise and are signing more sponsorship deals than ever. In addition, their shirt sponsorship deal with Nike comes up for renegotiation soon so there will be ridiculous sums coming out of that deal (Rumoured to be 1 billion) So expect Man Utd to dominate the Premier League for many years to come

[It's Character Forming 1,160]

[quote user="Manchester Canary"]T - You''re right, for the top teams in the Premier League financial fair play will mean clubs like Arsenal will become more competitive. Although i''m sure Manchester City will find a loophole in the rules and sign some lucrative sponsorship deal for their training ground with the owners brother .... But Manchester United revenues continue to rise and are signing more sponsorship deals than ever. In addition, their shirt sponsorship deal with Nike comes up for renegotiation soon so there will be ridiculous sums coming out of that deal (Rumoured to be 1 billion) So expect Man Utd to dominate the Premier League for many years to come[/quote]

 

Yes depressingly ManU can tap into worldwide revenue streams and the new setup will only help them.  I''d been hoping the huge debt they took on after their takeover would be a handicap but as long as Fergie is still hungry for success, they are going to remain the team to beat.

 

We can only hope that after Fergie goes, they get someone in who wastes lots of money, they miss out on the Champs League one year and end up in trouble.

I can still remember a joke from the 80s when Man U had been without a title for ages and Fergie had a fairly weak start - what''s the difference between Man U and Windsor Castle ?  A - £35m can fix Windsor Castle (younger readers probably won''t have heard of the big fire at Windsor Castle).  The laugh''s on everyone else now with the tedium of yet another Man U PL title. 

[paul moy 235]

Man Utd won''t have Sir Alex Ferguson, RVP etc forever. Football goes in cycles and they will eventually topple for a while from their lofty perch, just as Liverpool, Arsenal, Chelsea etc have done, and other clubs such as Norwich will rise up the scale. No team dominates the League forever even though they may remain financially dominant as there is more to football than just money, as QPR, Portsmouth, Leeds etc have proven. 

[cornish sam 951]

T, Yes, they can increase by 4 million, whereas we could increase by 8 million (for sake of arguement, I don''t have the figures but assuming a 25% increase on wages from the 2011-12 accounts and a wage bill of £38m). Yes a wealthy benefactor can still subsidise the things like academy and infrastructure, but that won''t improve the revenue, certainly in the short term. continuing the example of Wet Spam, they were somewhere in the region of £100m in debt when they got promoted, they have already atested to having a wage bill over £50m and are so constrained by the wage increase and on top of servicing the debt they need to improve their academy and training facilities, so they do need a wealthy benefactor for these things, we don''t, all of the additional money we receive can go into the playing budget (bar the c.£2m required for Cat A academy status)...

I agree that the FFP rules the premiership have agreed are ineffectual and do little more than maintain the status quo at the top of the table but I think for a team such as ours we will be greatly benefited by them but to state that we are at a financial disadvantage to most clubs is a little pessimistic, in the 2011-12 season we had the 12th highest turnover in the premiership, this was only £6m less than Everton in 8th, however, Everton had a wage bill £26m higher than ours! in effect then (barring wealthy benefactors, which Everton consistently claim they don''t have) we actually have £20m more spending power than Everton!!! We are not the paupers that people seem to think we are thanks to the excellent business management we currently enjoy.

[T 190]

Cornish Sam you are actually making me do a little bit of work. On revenue we are indeed 12th but in order to get an indication of the funding available you also have to take into account the losses as this is the amount that the club is also effectively subsidised by the owners. On that basis we are 19th. Ultimately that determines wages. On the basis we are again in the relegation zone. Do a league table based on wages and league position and they are shockingly similar. 70 to 80 per cent similar.  Outperforming Swansea and underperforming QPR account for the majority of that 20 to 30 per cent lack of correlation. I think we are only arguing degrees though. We will still be at a financial disadvantage compared to most other clubs next season but signifigantly less disadvanatage than this season. I think Bassong and Turner this season and RVV next season are concrete examples of how that disadvantage is reducing.

Surveys consistently show that fans typically overestimate a teams likely performance. Surveys consistently show that people have a poor understanding of probabilities. Stoke would not be in the Premier League otherwise! The evidence consistently shows there is a very strong correlation between wages and performance. The Premier League over the long term is brutally predictable.  How many times have ManU won the top league? How many times have Norwich won the top league? How many times has the premier league not been won by the financially strongest clubs?

[PurpleCanary 5,557]

[quote user="cornish sam"]

T, Yes, they can increase by 4 million, whereas we could increase by 8 million (for sake of arguement, I don''t have the figures but assuming a 25% increase on wages from the 2011-12 accounts and a wage bill of £38m). Yes a wealthy benefactor can still subsidise the things like academy and infrastructure, but that won''t improve the revenue, certainly in the short term. continuing the example of Wet Spam, they were somewhere in the region of £100m in debt when they got promoted, they have already atested to having a wage bill over £50m and are so constrained by the wage increase and on top of servicing the debt they need to improve their academy and training facilities, so they do need a wealthy benefactor for these things, we don''t, all of the additional money we receive can go into the playing budget (bar the c.£2m required for Cat A academy status)...

I agree that the FFP rules the premiership have agreed are ineffectual and do little more than maintain the status quo at the top of the table but I think for a team such as ours we will be greatly benefited by them but to state that we are at a financial disadvantage to most clubs is a little pessimistic, in the 2011-12 season we had the 12th highest turnover in the premiership, this was only £6m less than Everton in 8th, however, Everton had a wage bill £26m higher than ours! in effect then (barring wealthy benefactors, which Everton consistently claim they don''t have) we actually have £20m more spending power than Everton!!! We are not the paupers that people seem to think we are thanks to the excellent business management we currently enjoy.

[/quote]

 

Except that without a wealthy benefactor it is hard to see how we can justify funding the ground expansion the board said was vital if we were in the Premier League. Fulham are expanding by 4,300 seats to 30,000. I haven''t seen a cost for that; they may be funding it out of income, but equally Fayed may be chipping in.

[paul moy 235]

[quote user="T"]

Cornish Sam you are actually making me do a little bit of work. On revenue we are indeed 12th but in order to get an indication of the funding available you also have to take into account the losses as this is the amount that the club is also effectively subsidised by the owners. On that basis we are 19th. Ultimately that determines wages. On the basis we are again in the relegation zone. Do a league table based on wages and league position and they are shockingly similar. 70 to 80 per cent similar.  Outperforming Swansea and underperforming QPR account for the majority of that 20 to 30 per cent lack of correlation. I think we are only arguing degrees though. We will still be at a financial disadvantage compared to most other clubs next season but signifigantly less disadvanatage than this season. I think Bassong and Turner this season and RVV next season are concrete examples of how that disadvantage is reducing.

Surveys consistently show that fans typically overestimate a teams likely performance. Surveys consistently show that people have a poor understanding of probabilities. Stoke would not be in the Premier League otherwise! The evidence consistently shows there is a very strong correlation between wages and performance. The Premier League over the long term is brutally predictable.  How many times have ManU won the top league? How many times have Norwich won the top league? How many times has the premier league not been won by the financially strongest clubs?

[/quote]

I would argue that it''s not wages but transfer fees that have skewed things more in recent years. For example, QPR paid very high wages but to journeymen players that were towards the end of their careers and who would not command much of a fee, but high wages did not help them. I believe that FFP will cause transfer fees to fall on average, thus allowing smaller clubs such as Norwich to compete in a more level market.    

[T 190]

I agree that ideally you should also look at net transfers. We know for instanace that City spent 10m in the summer but the data is not readily available so wages is the best proxy. I agree that FFP will act to reduce fees but the increased TV money will act to increase transfer fees.  The premier league was subsidised by over 190m last season by benefactors but ManC with 99m are the only team that signifigantly exceedes the allowed loss and will have to reduce its subsidies. On the other hand the premier league will receive at least 584m extra just for the UK TV rights. Wages and Transfer fees will increase as the Premier League will take more of the better players from other leagues. e.g RVV

[It's Character Forming 1,160]

It''s a general correlation between player wages and league position.  Transfer fees don''t show a similar correlation.

 

Happily QPR showed that you can''t simply pay massive wages and watch your league position improve.  Any number of their players have failed to deliver.  I think it''s great that they''re getting relegated as it shows the game is not completely about money. 

 

But QPR are rather the exception - what we''re talking about are the outliers from that general correlation.  If you look at the top of the table, they''re the clubs with the higher wage bills, and vice versa.

[cornish sam 951]

Sorry to make you do some work T, i''ll try to avoid it in future ;-)

 

I agree that we are indeed financially weaker than other teams, however, the point I was trying to make was the difference isn''t as great as some seem to think, the fact that we are also outperforming our relative wage spend and can increase the wage spend by more than those that aren''t means that if we maintain the correlation we would climb the table significantly. I''m not talking challenging for Europe next year, but realistically top ten should be achievable from which point we have further increased our revenue and can push on with that funding higher transfer fees or the increased capacity (though not wages beyond the then £58m cap as the ''prize'' money for finishing higher is actually a greater share of the TV money).

 

I wasn''t actually aware that Fulham were adding that many seats Purple, I''d be interested to see how they are doing it, both from a financing point of view and physically, there isn''t much space unless they knock down the cottage is there? If it''s adding to an existing stand then you have the potential double edged sword (which we would also need to consider) in that it takes a certain number of seats out of circulation for the duration of the improvement thereby reducing the gate receipts and match day revenue for that period, which in turn increases potential loses for FFP for that one season (unless over the course of the season the extra money from those extra seats offsets the lost income during construction)... As the Big Mac seemed to say at the last AGM though, the ground improvement is less imperative than first thought, partly due to the increased TV funds and partly due to the economic climate. The elephant in the room in this respect though has to be Wet Spam with their imminent move to a new 60k seat stadium, they almost certainly won''t fill it every game and have certain commitments to offering ''affordable'' tickets so may not see the jump in revenue that they otherwise might, but still....

[PurpleCanary 5,557]

[quote user="cornish sam"]

Sorry to make you do some work T, i''ll try to avoid it in future ;-)

 

I agree that we are indeed financially weaker than other teams, however, the point I was trying to make was the difference isn''t as great as some seem to think, the fact that we are also outperforming our relative wage spend and can increase the wage spend by more than those that aren''t means that if we maintain the correlation we would climb the table significantly. I''m not talking challenging for Europe next year, but realistically top ten should be achievable from which point we have further increased our revenue and can push on with that funding higher transfer fees or the increased capacity (though not wages beyond the then £58m cap as the ''prize'' money for finishing higher is actually a greater share of the TV money).

 

I wasn''t actually aware that Fulham were adding that many seats Purple, I''d be interested to see how they are doing it, both from a financing point of view and physically, there isn''t much space unless they knock down the cottage is there? If it''s adding to an existing stand then you have the potential double edged sword (which we would also need to consider) in that it takes a certain number of seats out of circulation for the duration of the improvement thereby reducing the gate receipts and match day revenue for that period, which in turn increases potential loses for FFP for that one season (unless over the course of the season the extra money from those extra seats offsets the lost income during construction)... As the Big Mac seemed to say at the last AGM though, the ground improvement is less imperative than first thought, partly due to the increased TV funds and partly due to the economic climate. The elephant in the room in this respect though has to be Wet Spam with their imminent move to a new 60k seat stadium, they almost certainly won''t fill it every game and have certain commitments to offering ''affordable'' tickets so may not see the jump in revenue that they otherwise might, but still....

[/quote]

 

Cornish Sam, Fulham are lucky in that they apparently do have the room simply to build a second tier behind and above the riverside stand, which can be fully utilised during construction. The club says it will not lose revenue.As to our ground expansion, I am not sure (I may well be wrong) but I don''t remember the board saying specifically it was less necessary now because of the extra TV money. It just seemed, from what I recall, that the mood music was noticeably less bullish about this happening any time soon. Of course the TV money may be a significant factor, but - as you say - there is also the economic climate. My suspicion has always been that the board over-estimated the demand for extra seats.

[T 190]

19th would be a par performance this season on a financial basis and I reckon 16th next season without the debt repayments and given as you say are relatively high revenue. (Thanks to Delia''s catering ;-)). The wage bill differentials start to get less outside the top 6 so it is a more even playing field so agree top 10 would be possible next season but with 16th a par peformance with a standard deveiation of a couple of placees then survival will still be the priority for us

[William Darby 0]

I pretty much agree, however being slightly pedantic. A comfortable season rather than survival would be good progress. For example Fulham, rarely ventures further up than the middle, and seem to never have a serious worry of relegation.

[blahblahblah 2]

"The wage bill differentials start to get less outside the top 6 so it is

a more even playing field so agree top 10 would be possible next season

but with 16th a par peformance with a standard deveiation of a couple

of placees then survival will still be the priority for us."Sounds a little bleak T, if likely very accurate.Can you at least throw in a cup run ? :)

[T 190]

I may let you have an FA cup win after a couple of more years stabilization.