How the Champions League is Selling European Football Short
Could it be that the commercialisation of the Champions League has not gone far enough?
In their quest to make Uefa a more profitable and commercially-friendly sporting organisation, Michel Platini and other top officials have travelled frequently to the United States over the past few years to learn the trade secrets of the National Football League (NFL) — the richest professional sports league in the world. Those visits made clear to Uefa's officials that they have a lot to learn from the way professional American football is set up, the most obvious indication of which was the decision to switch the Champions League final from a Wednesday to a Saturday, even if Platini did try to explain that away by claiming he was looking to make it possible for more families to attend. NFL may be played and watched almost entirely by Americans, and its income derived mostly from North America, but its turnover is five times greater than that of Uefa's leading brand, the globally popular Champions League.
There is no doubt that — globally speaking — football is a more popular sport than American football. According to a study by Initiative Futures Sports and Entertainment in London, the Champions League final was the most watched annual sporting event of 2009, attracting an average worldwide audience of 109 million viewers, compared to 106 million for Super Bowl XLIII. Yet Uefa's annual income from the Champions League is less than £1 billion, while three US terrestrial television networks, plus the cable channel ESPN, are paying a combined total of £13.1bn to broadcast NFL games to the end of the 2011 season in the case of CBS, Fox and NBC, and to the end of 2013 for ESPN.
There are a number of explanations for the disparity in income streams. The NFL is a league based in the most developed sports industry in the world, while the Champions League involves teams from comparatively poor parts of Europe. It naturally hurts the ratings that the Champions League is a midweek tournament, and that it faces competition from domestic leagues.
At the moment, the Champions League can't meaningfully be directly compared with the NFL, but there is a growing feeling among sports business experts and academics around Europe that, with its pan-European status, a quasi-monopoly on the biggest sporting brands on the continent and its popularity around the world (especially in the developing markets of Asia), the Champions League should make a lot more money than it does.
There are many reasons the US sporting model makes better economic sense than its European counterpart: there is no relegation, there is fierce regulation regarding wages in the form of a salary cap, and revenue-sharing between clubs. The current structure of the Champions League is the major reason Uefa isn't as economically successful as the NFL; in truth, it's probably been outdated since the Nineties. If a version of the NFL's structure were adopted, though, the Champions League could become not only the most popular annual sports tournament in the world, but also the one with the largest income.
These days the Champions League can be tedious during the group stage, a sentiment common in newspapers, television programmes and blogs around Europe — even in the smaller nations. As survey in Ireland, for instance, found that 40 per cent of fans thought the Champions League group stages were boring. Even in a best-case scenario, minnows from around the continent cause only mild irritation for the grandees on their way to the knockout stages, when the real action begins. This season, 13 of the 16 sides ranked first or second in their group made it through to the second round. It was the same story last season. The final two rounds of games in this season's group stage were effectively without any sporting importance. That hasn't affected the competition's income yet but once the current television rights contract expire, there must be a major doubt as to whether Europe's largest television and telecommunications companies will pay more than they do now to show the likes of Debrecen, MŠK Žilina or Hapoel Tel Aviv. The same goes for Uefa's sponsors and partners, and we have already witnessed a decline in the Champions League attendances. Last season average attendances were 41,904 — down from almost all previous seasons; this season it's 38,746.
Platini's rhetoric is that "football belongs to everyone", that small nations should get a larger slice of football's income. What he did with the new play-off system, designed to increase the number of countries represented in the group stage, though, was to dilute the quality of the Champions League, where the highest standard of football should be played. Huge sums of money were diverted to small clubs, many of whom have a limited knowledge of how to spend it. In Israel, for instance, that resulted in Hapoel Tel Aviv spending its Champions League revenue on expensive players rather than on infrastructure and youth development. Hapoel received more than £8.5m from the Champions League this season, but a leading youth coach at the club will still earn only around £5000 a year for his work.
Florentino Pérez, the president of Real Madrid, has been fantasising about uniting other major European football clubs and establishing a pan-European Super League that would take the Champions League to a US-style structure. "We have to agree on a new European Super League which guarantees that the best always play the best — something that does not happen in the Champions League," Pérez said. Ivan Bravo, Real Madrid's director of strategic planning, claimed that a Champions League season in which the biggest clubs do not face each other on regular basis is like a tennis season in which Roger Federer and Rafa Nadal do not play against each other.
Pérez added that he hoped his proposed format could be implemented "without abandoning the national leagues", and insisted that the 30 most powerful clubs in Europe could secure much better television and sponsorship deals than Uefa has managed.
Now, let's go back to the NFL and its scheduling, under which every team meets every other at least once every four years. There are two conferences, the American Football Conference and the National Football Conference, each of which has four divisions of four teams. Each of those teams plays 16 games in a 17-week period. They play the other three teams in their division home and away. They play the four teams from one of the other divisions in its own conference (on a rotating three-year cycle), with two of the games at home and two away. They play the four teams from a division in the other conference (on a rotating four-year cycle), with two of the games at home and two away. And they play the other two teams from their own conference that finished in the same position within their division as they did the previous season but that they weren't already scheduled to play on the rotation — one at home, one away. This schedule guarantees that all teams play each other at least once every four years, and play in every other team's stadium at least once every eight years. It also guarantees that, regardless of a given team's final divisional placement the previous season, the 16 games that team plays in any given season will consist of four games against opponents who finished the previous season in first place in their respective divisions, four games against opponents who finished the previous season in second, four games against opponents who finished the previous season in third, and four games against opponents who finished the previous season in fourth.
That structure means that every game is interesting either for sporting reasons or through divisional rivalry, and the NFL is a league in which the big winner cannot be predicted from day one: nobody would have bet on New Orleans Saints last year or the New York Giants three years ago. The NFL's structure — along with regulation such as salary caps — encourages this sort of competitiveness and the proper and sustainable construction of clubs. The format shouldn't be copied exactly, but could be adapted to a European culture and schedule.
A European Super League comprised of the top 30 clubs in Europe, that sees every team play at least ten "regular season" games against ten different teams (five home, five away) in which they fight for home advantage in the knockout phase (no second leg) — would make every game both interesting and meaningful, which surely should be the essence of competition. At the moment, a lot of Champions League group-stage games have little competitive edge, something that is already generating a sense of staleness. A glance at the starting line-ups fielded by big clubs in some of the games in Uefa's flagship competition exposes the flaw in the Champions League group stage, but which television network wouldn't want to get its hands on a league in which Real Madrid, Barcelona, Manchester United, Arsenal, Internazionale, Bayern Munich and other European giants play against each other week in week out?
"This is not ugly 'Americanisation' or greed over grass roots: it is rather the Europeanisation of European Football," wrote John Vrooman, economics professor at Vanderbilt University, in his 2007 essay The Unification of European Football, published in the Scottish Journal of Political Economy. Arguing for the economic desirability of a closed league by calculating that fans would rather see their side win a close game than hammer weak opposition, he proposes three conferences of ten teams based on economic strength: six English, two Scottish and two Dutch teams in a northern conference; four from Spain, four from France and two from Portugal in the west; and five from Germany and five from Italy in the centre.
That disbars a large number of countries, and features no teams at all from the east, so a better solution for Uefa and the clubs seeking more income may be a European Super League with a second-string league (Super League B). That would allow Uefa to keep the leading football brands at bay and it could also argue that the Super League shouldn't be a closed league: every team could be given five seasons to prove its worth — with the one with the worst results being relegated to Super League B. Meanwhile, the new structure could offer the opportunity for Super League B teams to gain promotion after 5 years of sporting excellence and proving themselves financially sound.
The new league would not kill the local leagues, just as the NFL doesn't kill the NCAA Football League (the college game), which enjoys great popularity and retains a community feel. Quite the opposite: the enlarged solidarity payments — the fees Uefa pays to its member associations — would, with proper regulation, be invested in grass roots and infrastructure — improving the level of football and football administration.
Would it hurt small football nations — the same football nations that gave Platini the president's seat? Not necessarily. Again, the greater solidarity payments should smooth political objections to the idea. Teams from smaller nations would have to adopt a more organised economic set up before taking their chances against the big guns of European football. At the moment, some teams from the smaller nations, often run in an amateurish way, need only one good domestic season and a favourable draw in preliminary rounds and they are placed in the most popular sports league in the world.
The general feeling among football insiders — agents, managers, officials of clubs and federations — is that the European Super League will happen; it is just a matter of when. The economic imperative for a European Super League is probably stronger now than ever. Uefa should not be afraid of it and, just as it changed the format of the old European Cup for purely economic reasons, it should learn from the NFL how clever scheduling can make money for the clubs and for the good of the game.