Deloitte’s annual report on football finance reveals just how reliant English clubs are on television income.
Football fans may bemoan how their favourite pastime has become a hostage to the great god of television, with kick-off days – and times – revolving around optimum viewing opportunities (and not necessarily in the UK).
But the fact remains that broadcasting revenue is still a money-spinner for all of Europe’s top leagues – and particularly the Premier League.
The annual comprehensive review of football finances by Deloitte reveals continued revenue growth in four of the “big five” leagues (only France’s Ligue 1 missed out), despite the increasingly difficult global economic environment.
And leading the way was the Premier League, with a 12 per cent rise, thanks in no small part to its enhanced new broadcast contracts, which came into effect in the 2010/11 season.
Deloitte says Premier League broadcasting income grew by 13 per cent in 2010/11, helping it stay 770m euros (£618m) – or 44 per cent – ahead of its nearest rival, the German Bundesliga.
The Premier League clubs received more than £1 billion (1.3 billion euros) from broadcasting rights in 2010/11 – over half their total income of £2bn (2.5bn euros) – and the only one of the “big five” to rake in more than 1bn euros from broadcasting alone.
The broadcasting figure is more than 350m euros more than the next-highest – in Italy’s Serie A.
As our graphic shows, the Premier League broadcasting figure dwarfs those of the other top-four nations, and is in fact larger than the entire income of Ligue 1.
Yet interestingly, at 52 per cent, the English league’s revenue from broadcasting is a smaller proportion of total income than France’s or Italy’s – 58 and 60 per cent respectively.
And ever-efficient Germany is far less reliant on TV – at 30 per cent, its broadcasting revenue is the lowest proportion of all five, the same as its sponsorship income and only a little higher than matchday revenue – putting the Bundesliga far less at the mercy of an ITV Digital-style collapse, where the broadcaster’s demise cost Football League clubs more than £100 million in income they had already budgeted for.
Deloitte’s report says: “In contrast to the other ‘big five’ leagues where broadcast revenue is the largest source, the Bundesliga’s model is underpinned by the strength of the German commercial market…
“All of the Bundesliga’s revenue streams grew in 2010/11.”
It says of the Premier League – whose broadcasting revenues were just 39 per cent four years earlier: “The movement [to 52 per cent] is underpinned by the popularity of the league in both domestic and international markets, which has generated substantial increases in broadcast revenues to clubs rather than under-performance across other revenue streams.”
The English elite enjoyed the most rapid growth – 18 per cent – from commercial sources, aided by newly negotiated sponsorship deals for some of the Premier League’s top clubs and the continued growth at high-spenders Manchester City.
But it still lags behind the Bundesliga’s commercial total of 816m euros.
The popularity of the two leagues is reflected in their matchday revenue.
But whereas the Premier League’s attendances – boosted by good performances in European competition by some of its top clubs – continued to benefit from high admission prices, the German league enjoyed the highest average attendances in Europe, thanks to a combination of high-quality stadiums (often with terracing areas) and comparatively low ticket prices.
Ligue 1 suffered a drop in overall revenue, blamed largely on its top clubs’ relatively poor performance in European competition.
The five per cent growth in revenue in Spain’s La Liga is attributed by Deloitte to substantial rises in broadcast and commercial streams, which offset the decline in matchday revenue.
And just in case economists get too absorbed in the complexity of where Europe’s football leagues get their cash, Deloitte issues a reminder of the importance of where they channel the bulk of that income – their players.
Its table comparing final positions of all Premier League clubs in 2010/11 with total wage costs reveals very little difference – the top three are still Manchester United, Chelsea and Manchester City, although Chelsea’s wage bill of £191 million put them top of the payout pile.
Only West Ham, who finished bottom and were relegated, despite having the 12th-biggest wage bill, buck the trend noticeably.