By Tony Attwood
It is rather amusing, one might even say “rather droll,” that just as FFP is being dismantled by Uefa in the face of multiple legal claims, and a year after FFP in the Premier League was supposed to have been introduced (but never was), the media is celebrating the success of FFP in making 95% of the Premier League profitable.
If the fear of FFP led to this upturn, then the joyous release that Man City and Chelsea now feel from its effective abandonment by Europe (and total abandonment by the Premier League) will mean that loss making should immediately return.
If on the other hand the cause of the 2013/14 profits for PL clubs announced yesterday in the Deloite review, was not FFP, then we need only pause for a second to work out what other factors affected clubs during that season.
The answer is obvious. In 2013/4 clubs in the PL had an income of £3.26bn – about £1bn more than the second richest league: the Bundesliga. Indeed the TV income alone of the Premier League was more than the total income of the Spanish League.
The prime cause of this upturn in profit was that this was the first year of the PL’s 2013/16 TV deal for £5.5bn.
And my thought is, hell, if you can’t actually make money in the first year of one of these astronomic TV arrangements, you can never make money. What is likely to happen is that with TV and match day revenue static for both 2014/15 and 2015/16, the profits for both these seasons will show a retreat.
So total profits for 2013/14 as revealed in Deloitte’s today were £614m a 700% increase on the previous year. It won’t be like that in their next report.
The Championship clubs made an average loss of £10m, and that again while FFP regulations were still being talked up. With QPR’s legal battle with the Football League still meandering its way around various solicitor’s offices, even their FFP regs could fall in due course, which would increase losses by even more.
As it was, in 2013/14 the Championship, even with FFP, still spent more in wages than their total income. Deloitte calls the Championship’s operating losses, of £222m, a “significant issue”. I call it “rather careless”, but we each have our own way with words.
So we can expect these figures to be the high point of profit for League clubs. After that, unless a miracle happens and FFP or some other agreed restraint gets introduced, it will be back to business as usual.
Thus Arsenal still has to weather the storm of fighting two oil-funded clubs and Man U’s worldwide marketing.
So how will Arsenal survive at the top in the face of what appears to be the forthcoming collapse of FFP under a raft of legal challenges and the resultant uncontrolled spending by everyone from Man C to Bournemouth? Here are what seem to me to be the ten factors working in Arsenal’s favour.
1. Teams need balance not just top players.
Yes the oil funded clubs can afford anyone, but just buying a team of the most expensive players in the land doesn’t give you a team that can work together. Money didn’t buy Coquelin, Wilshere and Bellerin, and only modest amounts of money bought Ramsey, Santi C, Monreal etc. (While Santi’s transfer was quoted in places like Goal as being £18m, most reported the fee as closer to £15m – a bargain for the player we have seen this season. Monreal was £8m – ditto).
2. Big owners can lose interest, be shot, be deposed, be imprisoned.
I’m not wishing harm on anyone, but in the business world we all know that any operation that is dependent on one person is built on dodgy foundations. In my own tiny arena, my advertising agency was initially built around my ability to write (ok reading Untold you may not believe that, but when it comes to adverts some people think I’m fairly decent at it – especially with the luxury of a proof reader checking every word, something Untold doesn’t run to). We all realised that was a danger, so now we employ other writers to work alongside me. When it comes to being a billionaire it is difficult to find a similar backup system.
Thus I look at the owners of one or two clubs and just wonder how fascinated they still are with football. Arsenal on the other hand has stability because even if Stan Kronke breaks his word and changes a habit of a life time, and sells, we don’t need to find a person who has billions to invest as the basic model of the club – just people to buy the shares.
Those shares could go to one very rich person – or they could go to half a million individuals, it wouldn’t matter.
3. The 25 rule is still there
The reason this rule survives both in the Champions League and the Premier League is, it is so simple. Even Chelsea’s multiple loan strategy which is considered by some to be undermining the whole of football, can’t get around this – although they are making it ever harder for clubs that do seek to play with the rules to find under 21s to bolster the squad.
Arsenal, now the stadium cost burden is reduced, can put out an astonishingly strong 25. And we have the under 21s too – see below.
4. Top players demand to play in each game
That’s the problem – bring in a man for £35m and he expects to be there all the time – and if he is not playing well he still expects to be there because the problem is always someone else’s, not his. Buying big can be the start of the problem, not the end.
If Bellerin or Coquelin lose their places next season through a lack of form, they will hopefully be sensible enough to remember that it was Mr Wenger who gave them the breakthrough chance, and hard work will allow them to come back.
5. There are not that many top managers around
Players make decisions based on their reading of the game as a whole – which means not only looking at whether the pay packet is £4m a year or £5m a year, but also how the manager will manage the team. Manager reputation is important, and players know exactly which managers have it and which ones don’t. Wenger’s reputation is right at the very top.
6 The Arsenal youth system.
There’s a lot of debate within Untold as to why our two youth teams did poorly in their leagues this season – but always we come back to the point that this last season we got two top players out of our youth system and into the first team. Plus there are around five players still with the academy who we can point to as having the obvious class that is needed – although no one ever quite knows how they will develop.
Indeed our squad at the moment has a whole raft of players who have joined the club at ages from 9 to 17 (all of whom can count as players developed by our youth system). The last Chelsea player to make this breakthrough (including players who were brought in from other academies) was John Terry. The last at Man City was Micah Richards, now at the age of 26 a free agent.
As the recent article on the Arsenal History Society site showed in reviewing the Arsenal youth team of 2009, players do fall by the wayside, but we also bring youth players through at a far, far higher rate than the oil funded clubs. Which of course saves us a fortune and gives us players who tend to be loyal to Arsenal.
Indeed I have seen it argued that Chelsea’s new youth loan policy was devised in part to undermine Arsenal’s youth success. It didn’t happen though.
7. Top clubs with lots of money tend to lose sight of reality.
Real Mad and its property, Barcelona and its youth policy, Man City with its failure to meet even basic FFP rules last season – clubs like this just seem to wander off into a make-believe world, which might suit Messi and Ronaldo, but not everyone.
Just having lots of money doesn’t mean you know how to behave and how to spend it, nor does it mean that your accountants will give you good advice. If it did, it would mean that the Chelsea and Man C youth policies would have been more successful, Man City’s accountants wouldn’t have screwed their FFP so badly, and Man City would have come closer to Chelsea than they did.
Arsenal’s grip on reality, I would argue, is stronger, and therefore their long term planning is better.
8. Man U even with endless wealth didn’t win the league each year
Of course Sir F brought them stunning success, but they had world-wide marketing and vast incomes long before that, but lacked the person in charge who could turn that into victory-no-matter-what. Indeed they had the biggest income by far in the 1st division in 1973/4 when they were relegated from the first division.
Money to success can happen – as we have seen with Chelsea, but it is not automatic, nor necessarily continuous. So it is not an automatic given that Arsenal will come fourth because we are only the fourth richest club in the league.
9. We were still top four during the pre-FFP rules, and paying for the stadium.
Arsenal offer a continuity within the Champions League that only Real Madrid can rival. Arsenal offer a stadium and training facilities that only a handful of clubs can rival. This helps attracts new players. And given what the club achieved during the pre-FFP period with very limited cash, there is every reason to be hopeful that the sort of FA Cup success we have just seen, is likely to continue now the financial controls are off.
10. Our next manager will have everything in place
Arsene Wenger’s team is still buying young players – players who will not come to first team fruition while he is still at the club. Think about Maxi Romero for example.
Now compare this with the slash-and-burn technique of Ferguson in his last year at the club. Yes he won the Premier League again, but at the cost of leaving a very unbalanced squad and a team that managed to come even lower than Tottenham the following year which when you come to think of it, was quite an achievement.
Arsenal thankfully doesn’t work like that.
So, overall, FFP or no, I think we are set fair. I’d love FFP to continue, but if it doesn’t I don’t think it will be Arsenal that will slip back.
Anniversary of the day
4 June 1925: Herbert Chapman returned to England early from a tour with Huddersfield, ready for talks with Arsenal about becoming the club’s new manager.
I think I’m right in believing that the expected abandonment of the FFP Rules, is due to the shortage of prosecuting advocates in the employ of the governing bodies.
Surely there must be a way of ensuring the success of these Rules, so important in controlling the financial stability of football clubs. 😉
In my opinion the failure of FFP despite the best efforts of Mr Platini (as far as I know) just goes to reinforce my belief that football no longer belongs to the fans. It belongs to the money bags. They decide what happens to our game. Unfortunately it is the fans that will pick up the pieces when the whole thing comes crashing down, as it surely will soon.
Tony – In your point 10 – Wenger may not be manager for long but he will not be allowed to leave nor will he want to. He is part of the fabric of this club that he has molded.
The shareholding in Arsenal has been its strength but has a level of weakness because of the volumes held by 2 individuals. Clubs with member share holders will be the future for a stable system. The owner model that has evolved with billionaires is similar to the American sport model. In my opinion it is not good for maintaining the traditional social purpose of these clubs. It will change the purpose to a wealthier social group that do not have the same emotional attachment to the clubs.
Arsenal can be a bit of a shining beacon in the footballing world. But on another note, what if the Qataris lose the WC, as will happen if is is found out they won by bribery. They could lose interest in the game, that would affect big clubs dependant on their finance
6. I doubt I’m alone in feeling a little shot of disappointment whenever I hear of an Arsenal defeat at u21 or u18 level but, as Tony says, getting players through is all that matters- Szczsesny, Gibbs, Wilshere, Gnabry, Coquelin, Bellerin : most in the league get nowhere near that level of success and I doubt anyone beats it.
Add Walcott, Ox and Ramsay to them, as players who obviously took their first steps elsewhere but nonetheless only became top flight players with us, and the managers success at turning youngsters into established top class pro’s is sensational (you’d have to be daft as a young player not to see your best chance is here)
A few weeks back there was an article on here discussing poor results at youth level. I said it was probably mostly down to aggressively fast-tracking players, and releasing early those who it’s clear won’t make it at Arsenal (but who could often do a good job for us at youth level).
I saw a little bit of surprising news this week that makes me think I was onto something with the second part. Apparently, one of the players who just finished the first year of scholarship and only recently signed pro forms is to leave the club. Mystified me at first as he seems a good player and one with an excellent attitude.
What’s more, he plays cb and the youth teams were at times short of numbers there last year. In the next few years he would surely have been an asset for the u18/21 teams. Seems to me that it’s probably because he’s well liked at the club that they are letting him go at this point : he’s good, but they don’t see him playing for first team, so he leaves and other players get those minutes he would’ve had.
Just an example of how we walk the walk of prioritising development over results.
I liked an example I heard a few years ago about our approach : if a goalkeeper has been struggling with crosses, they tell him to come for everything for a while. Now I know from my own youth career what the more typical British attitude is- if you’re bad at something, don’t do it (because we have to win!)- and i know what happens if you don’t work on your weaknesses during matches (hello, near useless left foot)
Mandy Dodd, good point and certainly one I hadn’t thought of. Qatar has influence all over the place now.
Barcelona, PSG (which I think they actually own rather than sponsor), the Aspire Academy (ditto), KAS Eupen in Belgium (ditto) … there are probably more that I have missed.
Tony
Think I heard the owner of PSG is the brother of the guy behind Qatar world cup bid. And Platini’s son * works for one of the two of them! Small world, you could say.
Question at the moment is where will this FIFA investigation end. It seems impossible that it could go as far as it should- and root out all actual, let alone moral, corruption- because that would presumably result in nothing being left at all.
Go all the way with the investigations, and I’m pretty sure a cornucopia of links between the guys who have been buying world cups and making moves in club football, and the administrators of said club football, are likely to emerge. I’d expect plenty of 3rd party stuff is in the mix as well.
Club culture and FIFA culture have very little separation as far as I’m concerned (which made it grimly amusing to see Martin Samuels- a vociferous campaigner to do away with FFP, as it stops ambitious owners chasing their dreams- coming on strong against FIFA corruption. The culture and mentality are exactly the same : rich guys who, at best, have zero respect for the spirit and rationale behind any rules and regulations, who therefore find it as natural as breathing to trample over and evade them in the pursuit of what they want)
Presumably the FBI will have to draw the line somewhere, and it might even be best for world stability if they do, but I hope not.
*QSI (Quatari Sports Investments)- part of his job was apparently ensuring they comply with FFP. What was Christmas dinner like at Maison de Platini this year,ey?!
Next year, the league table might be a little more volatile because every Premier League team manager will have a wad of cash burning a hole in his pocket. Until this money finds its level (higher wages) it leaves open the possibility that astute teams may pick up good, largely foreign players(English players are already crazy expensive)
Re FIFA I am still trying to get my head around why France and Spain voted for Blatter – if that is confirmed to be the case. Absolute shame on them. Or do they have something to hide…?
There are many worms being disturbed by the American salt. It will be the best thing that hits this false oil investment that is destroying honesty. I am looking forward to a few jail sentences & chickens coming home to roost with or without their worms.
If the Warner brother sings calypso it will certainly be a hit that betters ‘shame & scandal’. Who’s doing who will bring out some surprises.
I consider it unlikely that the English FA can be exonerated from involvement in such apparently widespread and deep-seated FIFA (and UEFA?) corruption. After all, the watches and the Mulberry handbags are hardly symbols of probity and correct procedure.
Therefore I find Mr. Dyke’s recent outpourings, backed by the British political establishment to be particularly irritating. The self-righteous nonsense about England getting the 2022 World Cup in place of Qatar is equally unimpressive.
Having previously made a mess at the BBC, no doubt Mr. Dyke can look forward to a move to another lucrative position as head of something in the event that the FA is truly found out.
I still say that to allow the FFP Rules to perish, purely because of the shortage of governance lawyers is morally and practically a disgrace. 😉
” Successful people build each other up . They motivate , inspire and push other people.
Unsuccessful people just hate , blame and complain “.
“A bend in the road is not the end of the road …Unless you fail to make the turn.”
~Helen Keller