Latest Football Money League raises long-standing questions

23 January 2015 |
Latest Football Money League raises long-standing questions
Deloitte’s Football Money League, the 18th edition of which was published last week, contained some standout statistics. Chief among them was the fact that the top 20 clubs in the business advisory’s annual ranking achieved combined revenue of over €6 billion for the first time, while much was also made of the fact that all 20 Premier League sides featured among Europe’s 40 highest-earning clubs thanks to record broadcast rights sales in the UK.

Spanish giants Real Madrid, too, gained much attention for topping the Money League yet again with earnings of €549.5 million in a year in which they finally secured ‘La Decima’, their much coveted tenth Uefa Champions League title.

Each of those headline-making statistics tells a story that is fascinating in its own right. Yet there was one less publicised story that caught the attention, and it had to do with matchday income.

According to Deloitte’s report, the amount generated from matchday revenue streams, including ticket and corporate hospitality sales, has fallen to its lowest ever percentage of total revenue. Of the top 20 clubs in this year’s Money League, 14 saw the revenue they generate from matchday activities decline as a proportion of total revenue as compared with last year, with only two clubs reporting a percentage increase.

Meanwhile, as the Deloitte report points out, the percentage of revenue that the top 20 clubs generate through more indirect means such as broadcast rights and commercial activities has reached an all-time high.

This overall trend – decreasing matchday income versus increasing commercial revenues as a proportion of the total – is nothing new. In fact, it has been ongoing for a number of years. Ten years ago, in the 2004/05 season, the top 20 Money League clubs generated around a third of their revenue from matchday sources, but that fraction has now fallen to one fifth.

The shift in emphasis towards growing commercial revenue is, of course, a sign of the times. As match attendances stagnate and the cost of living continues to rise in many European countries, it is only natural that the continent’s top clubs will seek to diversify their income streams in order to achieve revenue growth and financial security. And besides, the likes of Liverpool and Manchester United are global brands with fans the world over, why not charge companies in far off lands like Nigeria and South Korea for the chance to associate with and tap into that considerable reach and influence?

But with this kind of business philosophy come ethical considerations. In England in particular, the escalating cost of attending a Premier League match has been a bone of contention for as long as anyone can remember. Last year’s BBC Price of Football study found that the average price of the cheapest matchday ticket in the top four divisions of English football was up 4.4 per cent from 2013 – three times the rate of inflation. Premier League fans have seen ticket prices rise by 15.8 per cent in the last three seasons.

These figures have come at a time when TV money has soared to record levels. An eagerly anticipated bidding war between BSkyB, BT and, according to recent reports, Eurosport owner Discovery for the next round of domestic Premier League rights is widely expected to garner yet another increase in broadcast income for the league’s 20 clubs. Should that happen, the calls for England’s elite to follow their German counterparts in subsidising matchday tickets are likely to grow even louder.

Though only an indicator of income and therefore only able to tell one half of the story, the Money League provides further evidence that more can be done to help out regular match goers, many of whom already feel disenfranchised for one reason or another. Indeed, Deloitte's report states that ‘If this trend is to continue, as we expect it to, it raises significant questions about the nature of ticket pricing and marketing of the matchday experience within the business models of the world’s biggest clubs.’

All fans can do is keep asking those questions.

By Michael Long, Digital Editor, SportsPro

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