One of the underlying reasons why potentially qualifying for the Champions League group stages would be such a massive boon for the club next season is that the television deal for the Premier League and the total prize and television money for the Champions League are exponentially expanding. It has been tentatively projected by various media outlets and blogs like The Swiss Ramble in the last year that a team in our position (5th/6th) from 2016-2019 could potentially take in somewhere between 135-140 million pounds from the new television deal. To put that in perspective, in 2012-2013, per our annual report, we only took in 57.3 million pounds of television revenue. That's a massive increase in a short period of time, where our wage bill has not exponentially expanded (it was around the 90 million pound mark back in 2010-2011 and as of 2014, with many high earners still on the books, was around 100 million pounds per our annual report).
When you mix-in qualification for the group stages of the Champions League (let's project conservatively that nets us 30-35 million pounds in total revenue), it's not unreasonable to project potential revenues next season of between 260-270 million pounds, which is nearly double the turnover of 2012-2013, and would place our turnover above the likes of Juventus. Our wage to turnover ratio per Swiss Ramble for 2011-2012 and 2012-2013 was 63 and 65% respectively, so with a reasonable guesstimate of our current wage bill of somewhere between 105-110 million pounds (allowing for recent new contracts, but offset by sales/release of high wage players like Lennon, Adebayor, Soldado, Paulinho, etc), a wage bill of 150 million pounds would only be 56% of that aforementioned total revenue including CL qualification, which is the ratio where we've operated the last couple seasons. To put that in perspective, a 40 million pound wage bill increase (which I'm not remotely advocating, by the way, but discussing for illustrative purposes) like that would cover a 60K a week wage increase for 15 players in the current squad. That is demonstrative of just how much financial flexibility a potentially game-changing television deal and CL football in unison would provide a burgeoning club like ours.
The chief benefits of the above are two-fold for us on the pitch:
1. We can keep our best players, and our manager, by providing them far more competitive wages than an overwhelming majority of teams throughout the continent. Considering the collective average age of the squad, that is a very big deal if we continue to see improvement from the team. While it's true we can't exactly match what a United or City could pay someone like Harry Kane, the above revenue increases could allow for us to come closer to them in wage parity, which for a player who has an affinity for his current club could be enough to keep them from leaving. A corollary to this, by the way, is that we can resist the temptation of high money bids for players, as we genuinely do not need the money, and in many ways, a sale of a key player could be detrimental to the development of the squad, and the future revenues it earns. Now, I know there are some who've bandied about a theory that if you begin to break the wage structure for one player, it will cause discord as others demand parity in pay. But in practice, I'm not sure this happens all that often. Most professional players know and probably accept that the better players in the squad are paid more.
2. It allows the club substantial flexibility in the transfer market, especially for players outside of the UK. The next time a world class player out of favor at a top club is available, we can competitively look to make a play for their services (Arsenal have done this with both Ozil and Sanchez and reaped the benefits). The same thing goes for the next budding superstar from a smaller club looking for a big move (like Hazard did with Chelsea).
Considering we are moving into a new stadium in a few years, getting Champions League football next season could really allow us an opportunity to strengthen our brand, attract higher paying sponsors, and establish ourselves in the same rung as the likes of Atletico Madrid and Borussia Dortmund as a top club ready to upset the apple cart, and set us up to become one of the best clubs in the world by the end of the decade provided we can keep things together.
Once again, I'm not advocating massive spending increases based upon the above, but the financial flexibility it provides us to bolster ourselves on the footballing side is a very big deal in my opinion. Now, there are caveats to the domestic television deal, which will see others increase their revenues and heighten competitiveness in the league, and I know there will be some that reflexively feel that any surplus money moving forward should be plowed into making massive up-front debt payments on stadium construction costs (that would be fairly unprecedented in the professional sports world, as far as I'm aware), but I'm not so sure that's how Levy will view necessarily view things.
Ultimately, I think more than any other year, CL football this next season, coupled with TV revenue increases, could be the short term game-changer we've been waiting for, with the longer term game-changer coming in three seasons time.
When you mix-in qualification for the group stages of the Champions League (let's project conservatively that nets us 30-35 million pounds in total revenue), it's not unreasonable to project potential revenues next season of between 260-270 million pounds, which is nearly double the turnover of 2012-2013, and would place our turnover above the likes of Juventus. Our wage to turnover ratio per Swiss Ramble for 2011-2012 and 2012-2013 was 63 and 65% respectively, so with a reasonable guesstimate of our current wage bill of somewhere between 105-110 million pounds (allowing for recent new contracts, but offset by sales/release of high wage players like Lennon, Adebayor, Soldado, Paulinho, etc), a wage bill of 150 million pounds would only be 56% of that aforementioned total revenue including CL qualification, which is the ratio where we've operated the last couple seasons. To put that in perspective, a 40 million pound wage bill increase (which I'm not remotely advocating, by the way, but discussing for illustrative purposes) like that would cover a 60K a week wage increase for 15 players in the current squad. That is demonstrative of just how much financial flexibility a potentially game-changing television deal and CL football in unison would provide a burgeoning club like ours.
The chief benefits of the above are two-fold for us on the pitch:
1. We can keep our best players, and our manager, by providing them far more competitive wages than an overwhelming majority of teams throughout the continent. Considering the collective average age of the squad, that is a very big deal if we continue to see improvement from the team. While it's true we can't exactly match what a United or City could pay someone like Harry Kane, the above revenue increases could allow for us to come closer to them in wage parity, which for a player who has an affinity for his current club could be enough to keep them from leaving. A corollary to this, by the way, is that we can resist the temptation of high money bids for players, as we genuinely do not need the money, and in many ways, a sale of a key player could be detrimental to the development of the squad, and the future revenues it earns. Now, I know there are some who've bandied about a theory that if you begin to break the wage structure for one player, it will cause discord as others demand parity in pay. But in practice, I'm not sure this happens all that often. Most professional players know and probably accept that the better players in the squad are paid more.
2. It allows the club substantial flexibility in the transfer market, especially for players outside of the UK. The next time a world class player out of favor at a top club is available, we can competitively look to make a play for their services (Arsenal have done this with both Ozil and Sanchez and reaped the benefits). The same thing goes for the next budding superstar from a smaller club looking for a big move (like Hazard did with Chelsea).
Considering we are moving into a new stadium in a few years, getting Champions League football next season could really allow us an opportunity to strengthen our brand, attract higher paying sponsors, and establish ourselves in the same rung as the likes of Atletico Madrid and Borussia Dortmund as a top club ready to upset the apple cart, and set us up to become one of the best clubs in the world by the end of the decade provided we can keep things together.
Once again, I'm not advocating massive spending increases based upon the above, but the financial flexibility it provides us to bolster ourselves on the footballing side is a very big deal in my opinion. Now, there are caveats to the domestic television deal, which will see others increase their revenues and heighten competitiveness in the league, and I know there will be some that reflexively feel that any surplus money moving forward should be plowed into making massive up-front debt payments on stadium construction costs (that would be fairly unprecedented in the professional sports world, as far as I'm aware), but I'm not so sure that's how Levy will view necessarily view things.
Ultimately, I think more than any other year, CL football this next season, coupled with TV revenue increases, could be the short term game-changer we've been waiting for, with the longer term game-changer coming in three seasons time.
Last edited:
