Premier League vs Champions League: The ‘worrying’ split in football’s purchasing power

There is so much more to the UK’s cost of living crisis. In these final days of the summer transfer window, Premier League clubs continue to spend as if tomorrow may never come.

Indeed, the numbers are unprecedented. Over 1.4 billion pounds ($1.65 billion) has been spent by Premier League clubs on transfer fees over the past two months and more will come before next Thursday’s deadline.

And all the while watching the rest of Europe.

Bayern Munich, Barcelona, ​​Paris Saint-Germain and Juventus have all spent in line with their English counterparts this summer, but the Premier League’s financial strength has never been more evident.

Eight of Europe’s ten highest spenders in this window were English. Five of those are not in the Champions League this season: Nottingham Forest, Manchester United, West Ham United, Arsenal and Wolverhampton Wanderers, all of whom have spent more than Real Madrid, who won the Champions League in May.

Medium English clubs are the financial heaviest with Premier League money. For example, Leeds United, who avoided relegation to the Championship on the final day of last season, have spent £89m so far this summer after selling some family silver. Or West Ham United, a club that has faced countless setbacks in the current market, still manages to spend £115m.

Not that the rest of Europe can’t write a big check. Real Madrid invested £67.5m to sign Aurelien Tchouameni from Monaco, while Bayern Munich found £57m to sign Matthijs de Ligt from Juventus. Barcelona, ​​despite all their financial problems, raised £129m to sign Rafinha, Jules Conde and Robert Lewandowski.

However, the bulk of the spending now comes from Premier League clubs.

Nineteen English Premier League clubs, who overlook Leicester City team yet, have completed a total of 57 transfers It is individually valued at £10 million or more. According to Transfermarkt, the site dedicated to such matters, 53 of the top 100 transfer fees have been paid this summer by the English clubs.

An indication of the power shift are the new wealthy. Nottingham Forest FC, a club in the Championship for three months, has spent an unimaginable nine-figure sum to fix its squad. Fulham hardly misses being one of the top 20 spenders in Europe after investing around £47m.

Average spending across the Premier League this summer in a region £73 million per club. That number is almost certain to head north to £80m in the coming days, and maybe even kiss £90m by the end of the window if you target the big fish, like Anthony, Alexander Isaac Wesley Fofana, drug addict.

And the rest of Europe? Nowhere near.

The 28 non-English clubs up to the Champions League group stages have spent an average of £42.6m on new players this summer. This figure deviates from the relative smaller clubs, such as Maccabi Haifa, Viktoria Plzen, Dinamo Zagreb and Shakhtar Donetsk, but even for just 13 clubs from Spain, Germany and Italy, the average spend is still just £58m.

Analysts expect the gaps to only grow. Deloitte’s annual review of football finance 2022, published last week, showed that the collective revenue of Premier League clubs in 2020-21 is back on an upward trajectory after COVID-19, at around £4.58 billion. The German Bundesliga came in second with just over 2.53 billion pounds, with Spain with 2.49 billion pounds and Italy with 2.13 billion pounds.

However, the forecast numbers for this season help explain the summer that is drawing to a close.

Deloitte has forecast that Premier League clubs’ collective revenue in 2022-23 could exceed £6 billion thanks to new overseas broadcasting deals. The Premier League’s share of the global media market for domestic football leagues is now said to be 44 per cent, compared to 40 per cent.

The accounting firm estimates Spain will be the best in Europe at £3.7 billion this season – just over half of the Premier League’s turnover. If forecasts come true, the Premier League’s annual revenue will comfortably outpace the profits of the Bundesliga and Serie A combined.

“The gap between the Premier League and the rest is just too big now,” says Tim Bridge, senior partner at Deloitte’s sports business group. the athlete.

“It appears that Premier League clubs have experienced the COVID-19 pandemic in better financial health than many clubs in Europe and beyond the system in England. This gives them a competitive advantage across the board.

We feel that we are approaching a point where this inequality can expand and never return. There is no doubt that the rest of Europe finds this troubling.”

If the Champions League offers 32 clubs a place in the group stages next month, their fortunes cannot keep pace with the Premier League.

UEFA’s 2020-21 financial report revealed that winner Chelsea earned €119m (just over £100m) when lifting the trophy in Porto, the same as second-placed Manchester City. For comparison, Sheffield United earned £97.5 million to finish last in the Premier League in 2020-21.

Aside from Manchester City and Chelsea, no other team has won this much Champions League. Paris Saint-Germain is ranked second in terms of income with around £95m.

Sheffield United players

Sheffield United earned more after finishing last in the Premier League in 2021 than most teams have made in the Champions League (Photo: Jason Kerndof/Paul/Getty Images)

He failed to get out of the group stage, as Inter Milan and Ajax did that season, and Champions League profits are likely to be less than £45m depending on the club’s coefficient rating, which is determined by the past five years of European results. The higher the club’s coefficient, the higher the stake the club receives, regardless of performance in that year’s tournament.

The European elite can be confident that they will stay in the Champions League year after year, but their frugal spending could signal some risk aversion. Atletico Madrid, Sevilla, Eintracht Frankfurt and Bayer Leverkusen have spent less than £20m so far this summer – or, in other words, less than Crystal Palace.

The prize money for those lucky enough to be in the Champions League has gone up and will continue to go up by the time a new TV tournament starts in 2024.

A new three-year British deal, struck last month, is believed to be worth £500m a season and a 20 per cent increase. Paramount Global has agreed a six-year deal for US media rights – $250m (£212m) per season. That’s a 50 percent improvement in financial terms.

These deals will start in 2024-25, coinciding with the competition shifting to a Swiss model, making the Champions League lift worth more than ever.

Despite this, the Premier League already has its own lucrative deals.

A new Scandinavian deal with Nordic Entertainment has begun, which is worth double the last £335m deal on the season, while NBC’s extension of the US rights package is worth a similar annual figure.

The Premier League’s overseas TV deals now bring in more than the domestic market. Combined, it is estimated to be worth around £10.5 billion over the next three years. This represents an increase of 16 percent.

Given that the additional international income will be distributed through merit payments, it is estimated that this season’s Premier League winners will earn close to £180m.

“The Premier League is clearly the market leader in European football again this season,” explains Dr Dan Plumley, sports finance expert and lecturer at Sheffield Hallam University.

“Total revenue still outpaces the other major leagues in Europe and if you look at broadcasting deals too, which is the main driver of spending, the Premier League has international rights topping domestic rights for the first time. We are looking at around £10 billion in a cycle Its duration is three years.

“Knowing that this revenue is there until 2025 gives the clubs the assurance that if you stay in the league the money will be there. The clubs know they can spend against that.

“Even if you finish last in the Premier League, you are guaranteed in the region with £100m of broadcast money alone. That is why there are those clubs outside the big six who are willing and able to spend such large numbers because they know what is coming. On their way year after year.”

All of this, of course, plays a part in the narrative that the European Premier League is more sleepy than dead. Barcelona, ​​Real Madrid and Juventus, the greatest provocateurs of the last time, are not satisfied with the advantages enjoyed by the English clubs and believe that the new European competition will bring its enormous financial benefits.

Real Madrid, Juventus and Barcelona were key players in the Europa League plan (Photo by Visionhaus/Getty Images)

“Premier League clubs earn four times more than those in Serie A,” former AC Milan general manager Adriano Galliani, who is now with newly promoted Monza, told Italy’s Tuttosport last month.

“Monza take €33m (£28m) in TV rights, we have to give €3m (£2.5m) to the second tier. The newly promoted team in England gets €160m (£135m) How can we compete with Nottingham Forest, and how can I stop this trend of the global economy?

“There should be Brexit in football too.”

Galliani’s numbers detailing a windfall of £135m for Forest may be high, but his broader view remains. English football and its financial power are crushing the idea of ​​fair competition in Europe.

Some players will choose the status and opportunity to play in the Champions League, such as Charles de Kitleari, who preferred to join Milan at the expense of Leeds United this summer, but others are content to make the Premier League its peak.

Mateos Nunes could have played in the Champions League again with Sporting Lisbon this season, but he preferred a move to Wolves, who finished 10th in the Premier League last season. The same with Diego Carlos, who gave up the Champions League with Sevilla to join Aston Villa. Red Bull Salzburg, the Austrian champions and thus the group stage auto qualifier, were unable to keep Brenden Aronson and Rasmus Christensen. Both are now with Leeds United and former coach Jesse Marsh.

“When English clubs enter the market, there is often this English tax, a sense of making as much money as possible,” Bridge adds. “But it must be worrying when some of the best talent in other countries comes to play in the middle division of the Premier League instead of the Champions League.”

The earning power for players is always higher in the Premier League, but there is a growing sense, taking hold this summer, that England’s top flight is where talent lurks. The dominance of the Premier League is real and only hardening.

(Top: Casemiro of Manchester United; Ash Donilon/Manchester United via Getty Images; Styling: Rodri Cannon)

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