Speaking to BettingSites.co.uk, Dr Rob Wilson, football finance expert and professor of economics at Sheffield Business School, believes England hotshot Jude Bellingham could be worth billions to La Liga in revenue following his electric start to life at Real Madrid.
- Luis Diaz disallowed goals could cost Liverpool up to £80m
- Bellingham the closest thing we’ve got to a global European football star
- Continued VAR blunders will turn football fans away
- Man Utd might be better off with a new stadium, rather than trying to redevelop
- Premier League sides more unbalanced than ever before
- It’s important David Beckham comes out and explains his Qatar decisions
- Mohammed Bin Salman’s ‘sport generated a 1% growth in GDP’ comments were really bold
How much could Luis Diaz’ disallowed goal cost Liverpool?
RW: ”There’s a discernible difference in prize money for the Premier League’s top two of about £5m or £6 million, but Liverpool still would have qualified for the Champions League, and that’s much bigger than finishing 5th. It’s offset a bit by the Europa League, but £80 million is the difference between qualifying for the Europa rather than the Champions League.
“That’s why it’s much more important for clubs to finish in the top four than finish champions. There isn’t that much difference between finishing fourth or finishing first, but it’s next to nothing. Fifth to fourth is where the big money is earned.”
Could Liverpool launch a legal challenge?
RW: ”I’m not a lawyer, so I couldn’t answer if Liverpool would have a legal case against the Premier League or not. My understanding is that the laws of the game prevent the game from being stopped. As far as the officials were concerned, the VAR decision was the right one, but you would imagine some kind of legal challenge. That legal challenge would involve multi millions of pounds in unachieved revenue.
“That could entail not finishing at the top of the Premier League or not reaching the Champions League – which is easier to calculate. Failure to get into the top four will cost Liverpool £80million next year. I don’t see we’ve got any precedents here, other than when Mascherano and Tevez were playing for West Ham, and the Hammers sent Sheffield United down.
“That ended up being a £5million payment which was never relative to the cost of relegation. That does give us a precedent to say a legal challenge will be the next stage. There has been talk about a lot of clubs suing Everton for similar reasons – that’s, of course, if they’ve been found guilty of breaching FFP.”
Could continued VAR blunders turn football fans away from the game?
RW: ”Yes. If VAR isn’t sorted fairly soon, the competition integrity will suffer. The more that happens, the less people are interested. It doesn’t turn the product into a spectacle. It works now as a talking point, which is good for brand awareness, but the more it happens, the less confidence people will have in the integrity and they’ll start to drift out and look for different opportunities – whether that’s partners, sponsorships, and so on. The pressure will be on PGMOL now to sort this out. There are too many high-profile incidents right now and whilst I have sympathy for human error, the tolerance of that will decline.”
Boxing alienated fans through poor refereeing decisions, could football follow the same path?
RW: ”There is a risk of fans becoming alienated, but for different reasons. Some of the boxing point-scoring is borderline fraud as it doesn’t bear any resemblance to what’s happened in the ring. When the Liverpool situation happened, people said the same thing – that it was deliberate and the officials were making it so Liverpool couldn’t win.
“That’s why PGMOL released that audio as needed to acknowledge the mistake. I don’t think that level of corruption happens in the Premier League, but it’s an acute issue that needs to be dealt with sooner rather than later. People will lose faith, and they’ll consider if they’ll bother even watching a game either in person or on TV.
“The biggest challenge that the Premier League has is the other channels people have in terms of content – whether that’s UFC, rugby union, short-form cricket, going to the cinema, or going shopping. We’re always talking about opportunity cost – the Premier League has got status to achieve that opportunity cost at the moment, but if they’re not careful, they’ll lose it quickly.”
There seem to be more teams capable of playing in the Champions League than ever, is that food for thought?
RW: ”That’s where the coefficient is important at the UEFA level – they give more places depending on the level of competition. We get four in England, but Germany only get a couple, and Scotland only gets one direct spot. That’s designed to be representative, but it’s drifted away from its call, which was to feature only the champions of different leagues. There are teams in Gibraltar who are able to qualify for it! That’s the beauty of jeopardy in sport.”
What kind of impact has this poor start to the season done to the value of Manchester United football club?
RW: “The relationship between sporting performance and financial performance is fairly linear – the better you do on the field, the more financially successful you’ll be, and vice versa. That, however, is not immediate. The outcome of last season, coupled with the modest success of winning the League Cup and finishing third in the league, is where the added value comes from. Manchester United have financially benefited from the broadcasting revenue that comes from the Champions League – and that, in some way, protects their valuation for the sale. If we project forward to the end of the season and United continue their relatively downward trajectory in terms of bad sporting performance, then that would have a very, very large impact on the ongoing enterprise value of the football club. Man United won’t be in the Champions League nor will they win a trophy if they keep playing like this.
“The impact of the sporting performance has been fascinating, as the relative noise around the Glazers’ ownership. They’ve been cast in an even worse light than they were previously. The status of the stadium and the need for maintenance is causing United a decent amount of damage, and the valuation of around £5 billion is probably what we’re looking at. The upside that the new owners will have to put in will be considerable, notwithstanding the stadium redevelopment.’”
There’s footage of fans getting rained on at Old Trafford. How long can they put that off until the costs get higher and higher?
RW: ”I think the situation around Old Trafford is one of the key reasons why the Glazers have to sell. If they don’t, they’ll have insufficient liquidity to do a stadium refurbishment. They simply don’t have the liquidity to redevelop Old Trafford, and when you look at the state of the ground and compare it to the redeveloped Bernabeu, the Tottenham Hotspur ground, and even Manchester City’s ground, it exacerbates the Glazers’ challenge.
“It will get to a point where maintenance gets so costly, that they’d be better off with a new stadium. Perhaps that’s what Manchester United need – a major revamp of the stadium in the style of the Bernabeu. That was also a stadium in need of major work. Old Trafford was once a leading Premier League stadium and is iconic, but it has got to a point where it’s simply been overtaken by lots of their so-called competitors. That’s not acceptable for both Manchester United and the Premier League’s global footprint.”
Arsene Wenger was often mocked for claiming Arsenal couldn’t spend like the others due to their stadium project. The same thing happened with Daniel Levy at Spurs. If Manchester United’s new owners decided to revamp Old Trafford, would that reduce their transfer budget?
RW: ”If Old Trafford was revamped, then Manchester United’s prowess in the transfer market will depend entirely on how that capital redevelopment is delivered. As far as Arsenal and Spurs were concerned, there was heavy borrowing against the stadium redevelopment. It’s like you or I taking out a mortgage to build an extension to our house. If you’re having to repay that borrowing, it naturally impacts the amount of money you’ve got in your business to invest in other areas. If you’ve got £100 million of recurring profit each year and you’ve got to spend £80 million of that doing a capital repayment on your borrowing, then you’re left with £20 million for player purchases and wages.
“Compare that to a club without a stadium revamp project – they’ll have a lot more flexibility. The interesting thing about Man United is that the Glazers don’t have sufficient liquidity to revamp Old Trafford, so they’ll have to get strategic investment or sell the club. It could be argued, though, that if Foundation ’92 were the successful bidder, they would have no issue with doing player transfers because they could fund that capital development through their own financing arrangement. If the Jim Ratcliffe bid wins, I imagine he would have to borrow to do any stadium redevelopment, and that would have a big impact on the transfers. From that perspective, a borrowing-free deal from Qatar would be the absolute best outcome for United as a club – they could do the stadium redevelopment outside the FFP rates, as far as I understand.”
Casemiro has had a rocky start to the season, despite impressing last season. Man United paid £70 million for him and he’s now 31 and tied to a four-year deal. Was that a wise move?
RW: “Signing Casemiro was a wise move if we’re looking at his individual performances. He performed sufficiently last season, and whilst he’s a diminishing prospect in terms of his age, the need for Manchester United for him was such that they had to spend 50 to 80 million to bring in a player of his calibre. Some people argue that Declan Rice would’ve been a better investment due to his sell-on value, but we saw him go for £100 million this summer.
“From what I can see, the impact of Casemiro’s performance this season has been less about his age and more about team structure. It’ll be interesting to see if that changes. I don’t see a discernable transfer strategy being used at Manchester United, and if they bought Casemiro as their luxury item whilst developing young talent underneath him for resale purposes, then it’s no problem. I don’t see that strategy in place, though, and he’ll ultimately cost Manchester United rather than generate any tangible return – unless his, and the team’s, performances increase and they win a trophy – therefore generating more revenue in the forms of sponsorship and commercialism.
‘You could argue that Casemiro was significant in achieving Champions League qualification last season, and that the fee was offset, but the club have also heavily invested in the squad in other areas. Notwithstanding what they’ve invested this year, they still invested heavily last season, too. He and Antony were the standout transfers. Teams will do that – they’ll buy an expensive asset, but United can’t afford to keep writing off 60 or 70 million quid. That’s why they couldn’t get Harry Kane.”
Following Newcastle’s 8-0 win over Sheffield United, there is a growing belief the league is more unbalanced than ever. Could this impact the Premier League, financially?
RW: ”The Premier League is risking the basic economic principle of competitive balance and competitional uncertainty. I’ve not run the data, but what we saw until about 2018 was a declining competitive balance in the Premier League and the emergence of a Big Six.
“We can reasonably extrapolate that the competitive balance across the league has probably stablised and has seen an emergence of 8 to 10 teams who can genuinely compete in the top half of the table. There’s then a gap, and then you’ve got the teams who have just come up, and there’s another gap. Another gap exists between promoted Premier League sides and sides currently in the Championship. It’s why we’re starting to see score lines like the 8-0 between Newcastle and Sheffield United. I don’t think this will become commonplace, but the teams who come up will really struggle to get results and we’ll see decent sides demolish them.
“That’ll damage the Premier League’s brand over time. When we get to a point where the Premier League is renewing its next TV deal, I don’t think it’ll be a surprise that the Premier League is getting into bed with the EFL to sell collective rights internationally – they know that there’s a competition float between the elite Premier League, the rest of the Premier League, and the elite Championship and the rest of the Championship. Those gaps are not healthy at all. It’s great for a team to win 8-0, it’s not good for the receiving team.”
Are teams who go up from the Championship better off preparing for relegation than investing to try and compete in the Premier League?
RW: ”Yes. It’s wiser for teams to prepare for relegation than investing to stay up and we’re starting to see that already. Teams will use parachute payments and their season in the Premier League as a way of accruing wealth so they can make an effort to retain that position. It’s no surprise to see Norwich go up, fail to invest, and go back down.
“They’re building a bank balance to eventually consolidate and retain that status as a yo-yo club. I don’t think that’s healthy for competition, either.”
Do you think that contributes to the gap?
RW: ”It does contribute to the gap, but then you’ve got sides like Fulham who have really gone for it. A few years ago, they spent their entire Premier League TV deal, about £140 million, and got relegated. It’s a big gamble and, as an analyst, I’d say the incremental progression of teams is a much more long-term and sustainable way of achieving it, but it’s not good for competition exposure, either.”
“Forest managed it by the skin of their teeth. That’s good for the broadcaster, but it didn’t make for good TV.”
Mohammed Bin Salman claimed that sport generated a 1% growth in GDP and that he’s pushing for another 0.5%. What did you make of those comments?
RW: ”I thought Mohammed Bin Salman’s comments were really bold. As an analyst, there has to be a strategy behind the investments that companies in the Middle East or US are looking to realise. It’s the first time we’ve heard someone very senior call it GDP growth and not sportswashing.
“As an objective analyst, it was nice to hear someone confess and admit they’re doing it to grow their GDP. I think 1% is a bit mean and there’s more than that, and it could become more due as a product of Saudi’s economic system. They’re trying to move away from non-renewables like oil. He called it out for what it is. It’s about income generation. If he was to wash more sport to generate GDP growth, then he’ll do that. “
Where does that growth come from?
RW: ”It’s a mixture. You get the investments in the property itself – things like broadcast, commercial, sponsorships, and so on, but you’ve also got the re-imaging impact of the country which ties to their tourism sector. Things like Etihad Airways getting more exposure thanks to their sponsorship of Man City. This, in turn, will lead to more Etihad Airways passengers flying to Abu Dhabi either for tourism or as an international connection.
“It’s about putting major industries on the map to consider them viable to visit – this is where the ‘sportswash’ comes in. You’re connecting a country or a city to a sports team, and that makes it more accessible for someone who never previously considered going there. Dubai are doing it with the Emirates, Abu Dhabi are doing it with City, and we’ll see the PIF of Saudi doing it with their airline en route to Australia or East Asia.”
David Beckham had a Netflix documentary go out today. How much do these documentaries increase someone’s marketability?
RW: ”David Beckham is already iconic, and we’ve seen Lionel Messi has trumped him as the most recognisable figure at Inter Miami. The doc comes at a good time as it allows him to ramp up his brand again. His brand awareness was high when he was playing, and then he did his stuff in the States, and then he went to Inter Miami. He needs to reinvent himself, and a behind-the-scenes program is a way of re-engaging people with him. He can also use it to find a new audience. There will be a generation who didn’t watch David Beckham get sent off in the World Cup, and giving him the chance to release a documentary will have an impact of swelling his bank account – something he’s been good at for 20 years.”
David Beckham came out and addressed the criticism he received from the LGBT community regarding his business in Qatar. Would this have impacted Brand Beckham?
RW: ”Beckham received a lot of criticism for his work in Qatar, and it’s very easy to alienate sections of society without really thinking it through. I don’t think he considered the impact of that. It’s important he comes out and explains his decisions and then people can make up their own minds about him.’’
YouTuber KSI will fight Tommy Fury, who is not an elite boxer, yet the fight will be on PPV for around £20, possibly more. Is this unprecedented in sport and how damaging is that to real boxing?
RW: ”There are two halves to the KSI/Fury question. The first half is it being representative of Generation Z and Generation Alpha and what they’re looking for in content consumption. There’s a proliferation of platforms like TikTok, Snapchat, Instagram, and so on. You have so-called social media stars who have been able to generate a brand by activity on those channels. That leans into broader entertainment and products, such as the PRIME drink. They have legitimacy in the market, and, critically, the legitimacy they have is in a different market from what we might term a traditional supporter.
“When Tommy Fury fights KSI, the people who buy tickets won’t be the same ones who buy tickets for Klitschko versus Tyson Fury. They’re very different markets – these are people who watch YouTube versus people who are interested in the sporting impact. The second half of the question is more interesting – we know we’ve got a major issue in attracting the 16-24 demographic. They don’t consume live sport as we know it, which is why we’ve seen a shortening in competition format, things like the IPL’s 100, and so on. The impact that the ‘YouTuber’ has on mainstream competition will be quite interesting.
“Anecdotally, when I’ve been with my son to watch YouTubers box, the sporting spectacle is dire. I wouldn’t pay to watch it. The celebrity culture existing around these people is so big, they sold out Sheffield Arena! The kids get a lot more access to the athletes, and it’s all over their own Instagram. That connection is much higher. If you go back to the late 80s or early 90s, you had that access, but you don’t get that now. They’re different markets, but they’re equally as profitable. It will be interesting to see how mainstream sports try to combat it.”
Is it in danger of catching up with, or even surpassing, mainstream boxing?
RW: ”It is! When you look at the audience markets in esports, you’ll notice that access to celebrity culture through social media certainly has a big impact on mainstream sports. Marshmellow’s concert on Fortnite attracted a bigger audience than has ever been seen at a Premier League game! It’s more sustainable because it can be steamed and the content is more interesting. That’s why there’s been a proliferation of behind-the-scenes documentaries on Netflix – it’s all about that connection.’
There’s a new EA sports game out after the association with FIFA ended. Do you think EA could benefit from this?
RW: “EA will probably have more flexibility when it comes to how they represent certain players or sponsors. Less regulation could make it more profitable, and FIFA have taken a big gamble as it reduces a revenue stream for them.”
Going back to stadiums, will Chelsea’s ambitions thwart their funds to spend on players?
RW: ”The Chelsea situation is interesting as they’ve been gearing up to do either a stadium redevelopment or a stadium build. They have just raised half a billion in strategic investment. I think that the situation is game-changing for Chelsea because Stamford Bridge, for all its history, is knackered. It doesn’t befit a leading Premier League team. It won’t be too long before we start talking about Anfield, either, as that’s in a similar state to Stamford Bridge and Old Trafford. It may not leak as much, but it’s an old stadium. Everton are moving to a new stadium for the same reason, Brentford and Brighton are in new stadiums, and the big teams will have to keep pace. There’s an expectation to do so.”
Tottenham Hotspur are hosting the NFL soon. How much does that benefit the club? Where does that money go? Does it go into the players? If it does, isn’t that unfair?
RW: ”The money from the NFL technically goes to the club, but I’d need to check that. There’s obviously a license agreement to use the stadium and the money generated goes to Spurs. I don’t think it’s unfair. I think it’s a really good way of diversifying revenue for competitive advantage.
“The trouble with any stadium is that it tends to only be open twice a week during the course of the season. You need to also host concerts and generate alternative forms of revenue – which is exactly what Spurs have done. It’ll become an iconic venue for the NFL. Fair play to them.”
How much would even two NFL games a season generate?
RW: ”It’s tough to say, but I’d wager something like £10 million, if not more. You’ve got ticket sales, which the club will have a share of, you’ve got hire costs, and there’ll probably be something like economic rights production which will be contracted as well. The NFL will pay a fee to broadcast it, too. They’ll be making money from all of that.’’
Are you seeing signs that Jude Bellingham could be the closest thing Spanish football has had since Messi and Ronaldo, in terms of luring broadcasters?
RW: ”I would say Bellingham is probably the closest thing we’ve got to a global European football star. Not many players stand out in the Premier League – Haaland maybe. I think Jude Bellingham could well be the next Ronaldo/Messi in terms of value. If he continues performing as he has, exploding onto the Spanish scene, then he can do that.
“His performances in the Champions League will be more important than in La Liga, but he has the potential to become as, if not more, marketable than Messi and Ronaldo. He could even surpass David Beckham or Wayne Rooney. Without being rude, Wayne Rooney didn’t have the looks of Jude Bellingham. He has all the hallmarks of a super-elite athlete.”
How much could Jude Bellingham be worth to La Liga
RW: ”It’s early days for Bellingham, but if he continues playing as he has, he can help sell more tickets, even when Madrid play against lesser sides. That means more money in La Liga, which helps them attract more talent. That, in turn, could raise the level of the league as a whole. He could be game-changing for La Liga as they don’t have the quality they once had. You can imagine him scoring a world-class goal in a Champions League final -stuff that the league organisers are desperate for.’
“‘It could be massive. We’re talking about big commercial deals and player endorsements. The economic activity could be huge. Nobody measured the impact of Ronaldo and Messi in La Liga, but it could have run into the billions. We need to go through the annual reports and revisit them in five or six years time! Then we could say whether or not Bellingham was the catalyst. It also depends on how long he stays there. I’d imagine he’ll stay at Madrid for a while, as he may reach a point where he’s considered unsellable. As soon as he hits £200 million, nobody will go near him.’
“The big thing for Bellingham will be how he handles the exposure. Gareth Bale was on 600,000 a week, for example! There are so many variables that could knock him off, but he looks really good at the moment.”