A football story: how big money remade the people's game

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“Love for the working class game” read the banner that football fans held in the English town of Leeds just hours after the announcement of a new ‘European Super League', a breakaway move from some of the continent’s wealthiest clubs. The fans feared the new league threatened the principles of fair competition in England and across Europe that the game relies on.

The move was the latest by the breakaway teams’ owners to reset the distribution of a market worth €28.9 billion across Europe in 2019 according to Deloitte.

Next Saturday, 137 TV platforms across 91 countries have bought the rights to stream the Champions League final, Europe’s elite club competition, which has a worldwide audience of somewhere between 2 and 3 times that of the American Super Bowl. The two teams in the final best represent a new buy-to-win model, the top two spenders in Europe: Manchester City and Chelsea. Chelsea has spent €2.22 billion on players since it was bought in 2003 by Roman Abramovich. In the same period Manchester City has spent €2.14 billion.

But how did working class entertainment known as “the people's game” become a coveted business that remade fans into customers with billion dollar deals?

In England, the first football clubs formed during the 19th century between workers in the new industrial economy of Britain, organised on factory floors, churches and pubs.

In 1850, the British Factory Act introduced a restriction on Saturday working hours. Factories could no longer keep workers later than 2 p.m., and football became the workers’ favourite way to spend their free afternoon.

From the U.K., workers would export the game to other places: miners brought it to Spain, sailors to Argentina and so it travelled around the world. By 1904, an international body to organize the sport, the Fédération Internationale de Football Association (FIFA), was founded.

Over the decades, football became a global game, but one that reflected the local traditions of its fans. British fans sang during the games, inspired by working class songs and popular music. South American fans adopted a carnival style, using firecrackers to accompany the teams’ matches.

When the first game was broadcast in 1937, some teams feared that their fans would skip coming to the stadium to watch the games at home, slashing the ticket sales that supported local clubs. In the 1960s, the UK responded by banning live broadcasts on Saturdays between 2:45 and 5:15 p.m., backing the clubs.

Loyalty to a football club became a strong symbol of community the world over, and young people grew up idolizing international stars like the Dutchman Johan Cruyff and Northern Ireland’s George Best, and embraced an idea of competition best captured by Brazilian football legend Pele: “Success is no accident. It is hard work, perseverance, learning, studying, sacrifice.”

When Diego Armando Maradona scored the “Goal of the Century” against England in the 1986 World Cup, Argentinian parents named a generation of those young fans after him.

Meanwhile, TV audiences for the beautiful game swelled. The 1990 World Cup semi-final between Italy and Argentina drew a record audience of 27.5 million in Italy. But that was the last time public broadcasters in Italy would have exclusive rights to televise the games live.

As “fans” started to be replaced by “customers,” competitions changed to fit owners’ and advertisers’ needs. In 1992, the English top flight teams in the UK's Football League broke away and formed the Premier League, supported by a new lucrative TV deal. The same year, the European Cup was replaced by the Champions League, which added teams and new group games to draw larger TV audiences. When early talks about a European Super League were rumoured in 1998, the Champions League expanded again from 24 to 32 teams, bringing more money in for participants. A new expansion to 36 teams is expected in 2024, the latest concession to some owners’ ambitions for a Super League.

A pay-per-view model and more televised games attracted bigger investors willing to buy players with soaring salaries to ensure wins on the pitch. In the beginning club members were the owners of their teams, their stadiums and training facilities. But as business featured larger and larger in the sport, this model changed. Stadiums were named for companies and players wore advertisements on their shirts.

As the fanbase of many clubs expanded to supporters watching in other countries like the United States and China, merchandising sales became an important part of clubs' revenue. Meanwhile at home, ticket prices to live matches for the biggest teams soared.

The most profitable local teams attracted foreign capital. In 2003, Manchester United were bought by the American Glazer family, and Chelsea was bought by Russian Roman Abramovich. American businessman Stan Kroenke is now the sole shareholder of Arsenal, while Liverpool football club is owned by American John W. Henry. Even wealthy foreign nations such as the United Arab Emirates and Qatar started backing teams like Manchester City in England and Paris Saint-Germain in France.

While the football leagues in England, France and Italy have seen their biggest teams taken over by foreign investors, other countries have set specific rules to protect local control over their teams. In Germany, local fans own at least a 51 percent stake in their club, so small and big decisions have to be negotiated within the club. In Spain, some big clubs such as Real Madrid or FC Barcelona still belong to their members, while others such as Atletico de Madrid have been sold to private owners.

New deals grant the biggest clubs more money from their TV rights. With it, they can attract the best players, guaranteeing their teams play in the biggest games and expand their international audience, with further cash prizes set by the Union of European Football Associations (UEFA), the continental governing body, for winners.

But a new investment model has also brought a new dimension to the business of football: big debt. Pushed by this pay-to-win model, many teams in Europe have seen theirs skyrocket. Now, a poor season and an early exit from big competitions can be disastrous for a team’s finances. Multi-year deals are balanced against presumed success and the TV money extra games bring in.

And so to secure their revenues against that risk, 12 of the most famous clubs in Europe tried to create the 'Super League' which changed the competition to a league format in which none of these top teams could ever be relegated. The competition that was the basis of Europe’s leagues and allowed teams play their way to success would be replaced with a guaranteed right to compete for top teams.

In recent years, top European leagues have lost a competitive element. Wealthy teams are the only ones vying for top spot and can dominate smaller clubs with the proceeds from their higher ticket prices and lucrative TV deals. No more did Pele’s model of hard work leading to success seem viable in the new business model of modern football.

But for now the British fans have beaten back the latest move by top owners, with the U.K. government promising to review whether new restrictions are needed to ensure the competitive spirit of England’s top league and that fans’ wishes are taken into account.

But the new business model continues to challenge how the original idea of fair competition at the heart of the people’s game goes on today.