TCS Daily

A Level Playing Field?

By Jeremy Slater - June 5, 2006 12:00 AM

Everyone's got World Cup fever, even the regulators at the European Commission. They've come up with a proposal that purportedly would create a level playing field -- at least in business terms -- for various European football clubs.

It will not be the Commission's only recent foray into the world of soccer. Over the past three years its competition directorate has been engaged in a running battle with the English Football Association's Premier League over broadcasting rights. But in applying normal business theory to football, the Commission does not appear to understand what sports fans really want.

The latest effort involves something called the Independent European Sports Review, which was dreamt up the UK government's Richard Caborn and delivered to Commission President José Manuel Barroso in late May. The proposal seeks to reduce the ever-widening gulf between the giants of European club football such as Real Madrid, Barcelona and AC Milan, and smaller teams whose influence on European football is continuing to dwindle.

The proposal states boldly: "There is a real risk that ownership of football clubs will pass into the wrong hands, the true values of the sport will be eroded and the public will become increasingly disaffected with the 'beautiful game'."

It therefore aims to create a European body that will halt the excesses of club football such as its high wages (certainly for sport in Europe), the shady activities of players' agents and the dominance of the big clubs who inevitably win their domestic tournaments and usually appear in the closing legs of the finals of the top European competitions.

Ironically one of the reasons player salaries have grown so astronomically in recent years is a decision made by the EU's judiciary, the European Court of Justice. In 1995 the court made its infamous Bosman ruling on player freedom of employment, which has allowed footballers to act as free agents ever since. Prior to this a transfer fee between clubs would be negotiated, creating a trickle down effect between the wealthier and the less wealthy clubs and narrowing the gaps between haves and the have-nots.

The new review says today's high salaries and frequent player transfers are ruining the game, and many fans agree. However, how many of them would go along with the idea that civil servants or politicians would be any better at fixing the sport's problems?

The report proposes a central body to clear transfer fees and a new European Sports Agency to govern the game. It also sees a salary cap as necessary, but without the cooperation of the big clubs this cannot happen. According to European Commission officials, all will be revealed in a White Paper on sporting policy to be published in January of next year, but it is not clear whether the new agency will replace football's European governing body UEFA or not.

A beefed up UEFA with powers to stand up to the biggest clubs could be a good thing, but if it had to answer to an EU agency the result would most probably be worse than the current situation.

The Commission's has had a mixed record in regulating the business of sports. Its decision to order the English Premiership not to sell all its games to satellite broadcaster Sky TV is unlikely to reduce prices for fans as the breaking up of any other monopoly would. Football fans do not act as rational consumers in a way that is understood in classical economic theory. They will pay to watch their team only and will not accept any other as an adequate replacement. Therefore it is likely that fans will pay two or three broadcasters to watch their team play.

There can be little doubt there is something wrong with the way European football is run at the moment, but a new layer of bureaucracy with unexplained powers does not seem the best way to stop the beautiful game's reputation from tarnishing further.

Jeremy Slater is a TCS contributor based in Brussels


1 Comment

EU influence over football
Soccer is becoming very predictable under the influence of mega-millionaires in charge of certain clubs. Chelsea! Milan! Juventus! Barcelona!
The big clubs can buy key players of their opponents - and then hide them in their reserve teams. They can outbid others for the most expensive players to increase their domination. There are examples this season of refs who are impartial appearing to not get as many games as those biased in favour of the big clubs, and vice versa, where weaker teams are too often at the butt of wrong ref decisions, so often against the very biggest clubs. The same happens in euro national soccer to favour countries that sell most replica shirts.
The result is that the surprise element is dying out. There is little chance nowadays of an Ipswich Town, or a Nottingham Forest, reaching the apex of success when every season that goes by, accumulating TV sponsorship monies harden the hierarchy further against them.
One even senses the national teams select stars that have the most sponsorships, and that sponsors boots are behind the growing number of metatarsal injuries, but that injured players must be coaxed into action to avoid an unknown reserve replacing the injured star and his sponsorships.
No, this isn't an ideological issue, but one that demands some interventions to stop soccer becoming a procession of no great sporting interest.
The oligarchs in football now only want winners. They do not expect to spend fortunes and see their team lose. So good managers are sacked until one is found to deliver wins all the time. Chelsea has such a manager. But who would want to spend £40 to see their team at Chelsea?
To see them lose - 2-0, or 3-0, or 3-1, the result is almost guaranteed. Even when a team takes the shock lead, multi-million pound substitutes come on at half time to ensure Chelsea win and stop their fans crying.
No, its about winning and losing, and the idea that losing means crying and saying it isn't right should have no place in sport.

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