Gareth Bale’s £85 million move from Tottenham Hotspur to Real Madrid in the summer of 2013 saw him earn £300,000 per week on a six-year contract, doubling the yearly salary of UK Prime Minister David Cameron in just one week of work. With thousands of consumers struggling to cope with rising ticket prices, there is an imbalance between player remuneration and the cost of going to watch your team play. Football doesn’t have an income problem, it has a spending problem. With income from broadcasters and sponsors at an all-time high, ticket prices have greatly increased, yet record numbers of clubs find themselves in debt. Footballers’ wages are dictated by the market, as the industry conforms to supply and demand like any other.
There is an argument that as the football industry is a multimillion-pound industry worldwide, the people involved in the industry should reap the rewards. When considering the industry, the best clubs and players make up a very small percentage. Just as a small percentage of actors and musicians may receive massive income streams for albums and movies, the small percentage of footballers will receive the best wages according to the income of the industry.
It is important to take account of supply and demand when considering the earnings of individuals. In the case of supply factors, the best players will typically command higher salaries because their skills are in scarce supply. A higher potential salary is driven by the rarity of the skillset of the individual. Demand factors also play an important role. A firm, or in this case a football club, is prepared to part with large sums of money because they will expect to receive a positive return on their investment. Real Madrid, and football clubs more generally, believe they will be more successful, and their brand more lucrative through merchandising sales, advertising and sponsorship deals, with star players such as Bale in their team. The combination of big demand and small supply is what generates such high salaries.
As it stands, there is currently no salary cap on any football in England, although recent controls have been put in place in an attempt to change this in the long-run. By 2016, there will be a limit on the total amount of TV money that Premier League clubs can spend on players’ wages of £60 million. Despite this, income from ticket sales and sponsorship deals can still be spent on wages. Therefore, more lucrative clubs will still tend to have more money available to them. From a consumer perspective, the increased player wages put an upward pressure on ticket prices, increasingly alienating supporters. High wages may well disconnect the fan and the player due to a distinct lack of comprehension about the figures in question.
Not only this, but investors are showing an increased inclination to disregard the needs of the fan. Once it is bestowed upon you, being a fan is for life. A consumer of a supermarket such as Tesco chooses where to shop based on price, quality, amongst other business related factors offered by the firm. Should these factors change, the individual may choose to switch allegiances to Asda or Waitrose. With football, the individual has a vested interest in a certain club, and will not give their disposable income to a competitor under any circumstances. The investors understand that the club they own have a chronically captive audience.
Fans have been marginalised, with the free-market nature of the football industry facilitating their exploitation, forcing them to consume their club’s output regardless of quality or cost. TV deals for 2013-16 were worth over £5.5 billion to Premier League chairmen, but the funds were spent on inflated transfer fees and the aforementioned player wages as opposed to subsidisation of ticket prices. The average cost of the cheapest season ticket at Premier League clubs rose by more than 4% in 2013, with prices ranging from £300 to almost £1000. Seven clubs raised prices for the current season, with the average price of the most affordable adult season ticket in the top flight moving from £467.95 to £489.11 in the past year. In England, the price of the cheapest match day ticket was more than 15% higher than in 2011, meaning that prices have risen three times faster than the cost of living.
Fans are being priced-out of the beautiful game, and are considered cash cows with little to no representation in the administration of the clubs they follow.
