The Transformation Of EPL In The 1990s

[This writing is based on a case study about the mentioned topic researched by FIG of University of Liverpool]

The economic situation of British football has changed massively in the last ten years: what was a hugely under-capitalised industry at the end of the 1980s (that operated on very tight margins and often had to endure enormous losses) has been transformed into a multi-million pound business where the maximisation of revenue and profit are key strategic objectives for clubs and associations alike. This factsheet offers some basic information on the key points of the transformation of British football in the 1990s, and highlights some of the important academic work conducted on the nature of the game. Authors' names in the text refer to the work highlighted in the bibliography.

Introduction

A distinction needs to be drawn at the outset between the new capitalist mode of operation in modern football, and the economic basis of the sport over the previous hundred-odd years of its history. All sport has been economic since the first fan was charged an admission fee to watch a game, since the first fences and stands were put up around pitches to prevent people simply watching fixtures for free from nearby fields, and since since the first players were paid professionally. However, in the last twenty years, the need to cover costs where possible (an economic consideration - discussed by Arnold 1991, Szymanski and Kuypers 1999) has been supplanted by a desire to raise as much revenue as possible, and generate profit wherever practical (a capitalist consideration). This has drawn on the systematic erosion of the principles of cross-subsidization within football, that previously offered routes of re-distribution of income from the large successful to their smaller, less wealthy counterparts throughout the League. These included levies on attendance revenue, for instance. Such re-distribution was based on a desire to protect the integrity of the entire professional structure, a concern that has been successively eroded in favour of the new free market economics of the game. This new conception of the professional game has led to new conceptions of how clubs should be financed, whereby each club is deemed to be responsible for itself and no other, leading to a splitting of the top clubs from the rest.
This shift, that has underpinned much of the transformation of football in the UK, was not accidental, nor can it be seen as simply an inevitable form of "modernization" of the sport to fit wider social values and trends. The policies that have been pursued in the organization of football in the 1990s were the product of a political/economic project deliberately aimed at generating revenue and profit, and of detaching the biggest clubs from the smaller ones. This was the logic behind the constant threats by the "Big Five" clubs in the late 1980s (Liverpool, Everton, Manchester United, Arsenal, Tottenham) to split from the rest of the Football League if they did not receive a greater share of TV revenues (Conn 1997). The path laid down is therefore best seen as the result of deliberate choices, that have proved remarkably successful in economic terms. Central to the transformation of the game was the arrival of the new business entrepreneurs in the game from the 1980s onwards: chairmen such as Doug Ellis at Aston Villa, Ken Bates at Chelsea, Irving Scholar at Tottenham brought the experience of the non-football business world, new ways of thinking about the commercial and financial opportunities within the game, and new preparedness to work with commercial interests. These directors and chairmen brought a new attitude to the financing of the game, and brought knowledge and experience to the game that had previously been lacking and had not been sought either. Equally, the arrival of Sky TV and the hundreds of millions of pounds they paid for exclusive coverage of the FA Premier League, forms the starting point for the development of a much more sophisticated and developed football business.

Stadium

Within this context of new professional people being brought into the game, and growing pressures within the top clubs for greater shares of revenue, the impact of the Hillsborough disaster of 1989 gave a massive impetus to the development of the football business in the UK (Duke 1994). The requirements laid down by Government following the Taylor Reports into the Hillsborough disaster for the redevelopment of football stadia lead to millions of pounds of taxpayers' money to pay for the removal of terraces from top stadia, and for a general reconstruction of stadium facilities. While clubs did spend many millions of pounds of their own money, together with money received from the Football Trust for ground redevelopment, clubs were able to draw on Government help to create new stands and stadia up and down the country that offered the prospect of generating significantly increased revenues on both match and non-match days. Combined with the existing desire already visible amongst the top clubs to generate increased revenues and to keep more of the money tat was being earned, this lead not only to the sharp raising of ticket prices at top facilities, but also the development of new corporate facilities and other devices to attract new more affluent supporters to the game.

At the same time, the attitude of clubs towards revenue and profit changed dramatically: the previous decades had seen clubs operating as "utility maximisers" (Arnold 1991), that is functioning with the primary concern of winning trophies while seeking to perform as economically as possible. There was no attempt to maximize revenue or profit, and the structure and daily operations of the clubs were geared not to commercial considerations, but to generating success on the pitch. This attitude has been progressively lost over the course of the 1990s, with not just the top clubs much more concerned to maximize revenue and generate a profit, regardless of success on the pitch. The most common strategy adopted to achieve this has massive diversification based around a new, proactive approach towards commercial opportunities. Progressively, top clubs have massively expanded the range of commercial features and facilities on offer to supporters, and expanded the range and scope of their commercial operations, especially in regard to the new facilities put in place in stadia as part of post-Taylor reconstruction.
The need to redevelop stadia coincided with the desire to increase revenue, leading to the construction of themed cafes, bars and restaurants, the sale of franchised outlets in some grounds (Liverpool FC has a McDonald's store at Anfield, for instance), expanded and enhanced visitor centres and museums, much bigger and wide-ranging club shops and "mega-stores", hotels and conference centres (an approach adopted by Chelsea FC in the Chelsea Village, and Sheffield United at Bramall Lane, and a feature that was part of the original plan for the new national stadium at Wembley), and the development of much larger merchandise ranges. These new types of merchandise ranges from club badged motorbikes (as offered by Chelsea for instance), club credit cards and mobile phones, and expanded leisurewear ranges, alongside the more traditional flags, replica club shirts, scarves, household items etc. Not only has this contributed to a massive expansion in the revenue (and sometimes profits) of clubs, but it is part of an attempt to fundamentally alter the social meaning of the sport, moving it towards other leisure experiences: football clubs now view their "product" as being in direct competition to cinemas, home entertainment and other sporting events. Merchandise and other additional elements around the actual football are deliberately targeted at the new preferred demographic of supporter, the more affluent supporters, those who attend in families and the less "loyal". Those who attend games are increasingly constructed as "consumers" rather than "fans", driven by a desire for entertainment, rather than expressing a loyalty or strong personal identity. This also extends to the creation of large-scale hinterlands of support for British clubs abroad, which are increasingly deliberately targeted and created by top clubs. Part of this same project of maximising revenue and offering a new social meaning for the game have been attempts to maximise the usage made of most clubs' key asset, the stadium. Whereas in the past, stadia would only be used on match-day, and did not offer anything other than the football match, stadia at top clubs are being progressively moved towards six-day operations in an attempt to increase revenue generated, and to make the stadium a place to visit in itself. The stadium thus becomes a leisure and tourist facility in its own right, especially for affluent families with high levels of disposable income. The museums and stadium tours now commonplace at British stadia are examples of these objectives. Another reason to do this, in theory, is to release clubs' financial performance from dependence on the team's performance: by creating new fan-bases who interact with the club on the basis of entertainment, leisure and "lifestyle" choices, clubs hope to create revenue streams that would not be overly affected by declines in the team performance: gate receipts, sponsorship and advertising revenue, and television revenue all generally decline if a team is relegated. The new facilities at stadia can be advertised, and therefore hopefully used, regardless of the team's actual performances (such as hotels and conference centers).

Marketing and market research

As football clubs become more interested in specific target demographics, so marketing and market research have become increasingly significant. Football has radically shifted its attitude towards marketing: twenty years ago, football had no understanding of either the need or the opportunities presented by marketing, and had no desire to do so either. Football clubs have now developed increasingly more sophisticated forms of marketing, bringing in professional marketing expertise from outside the game, and creating dedicated marketing departments, that increasingly are taking over ticket departments as well. Increasing amounts of
money are being expended on the development and sophistication of marketing departments, which are seen as increasingly important ways of increasing brand awareness, and advertising the club and its fixtures.
Secondly, there have been moves towards developing regular forms of market research of the fan-base, often in conjunction with sponsors and other commercial interests, both to measure the popularity of existing policies and the prospects for new developments (such as ParPerView). The prime example is the annual Carling survey conducted on behalf of the FA Premier League,

which not only detail how spectators view current arrangements in football, but how they would respond to certain new developments.

The Financial Revolution

The various forces at work in this transformation, the redevelopment of stadia, the diversification and commodification, the desire to maximise revenue and profit, have combined to create a totally new situation within the modern game whereby top clubs have transformed their economic and financial strength, and to draw on the massive hype and popularity of modern British football (fed in large measure by Sky TV) to become instantly recognisable, much-discussed and well-known brands. However the consequence of all the extra millions of pounds that have entered the game since 1992, generated by a massive growth in the value of sponsorships (Vodafone paid £30m to sponsor Manchester United from 2000 onwards), the value of  advertising and the huge expansion in revenue received directly from TV (primarily from Sky, but also ITV), has been to increase on an enormous scale the gap between the top clubs and the rest of the English game: wages and transfer fees in the lower divisions have been dragged upwards, partly due to the massive expansion of wages in the Premier League. So, placing significant extra financial burdens on those clubs who cannot compete in marketing or advertising terms with the top five or six clubs in the country, or on those clubs who have to work much harder to maintain an active and non-active fan-bases and on those clubs who generate less revenue in the first place due to the structure of the professional game.This has been fuelled yet further by significant speculation in the transfer market by Premier League clubs, prepared to spend tens of millions of pounds of players either to ensure that they remain within the financially-lucrative Premier League, or that they qualify for the even more lucrative UEFA Champions League.
These trends were identified by Deloitte and Touche in their annual Football Finance review. The 2000 edition found that:

• The turnover of the top five Premier League clubs was larger than the whole turnover of the seventy-two clubs in the Football League.

• The three highest Premier League spenders on player wages were greater than the entire wage bill of all the forty-eight clubs in Football Divisions League Two and Three combined.

However, even within the Premier League, significant sums of money are lost every year: Deloitte and Touche found that Blackburn Rovers had pre-tax losses in 1999 of nearly £8m, Everton of £10.8m, Liverpool of £8m, Leicester City of £6.1m and Sheffield Wednesday of £9.2m.
The financial position of many clubs has not, therefore, actually improved, despite all the new finance injected into the game, as most of it is simply paid straight out again in hyper-inflating transfer fees and players' wages. It was found that average wage costs increased between 1998 and 1999 across the PremierLeague by 29%, and that nearly half of the operating profit (before transfers) of the entire Premier League in 1999 was generated by Manchester United alone. Profitability remains little more than a distant objective for many clubs, and there are a number of British clubs either in administration or close to it (Hull City, Crystal Palace, Airdrie and QPR, to name just four in the last two years). Clubs like Sheffield Wednesday
and Nottingham Forest FC (both relegated from the Premier League in recent years) are reported to owe over £15m apiece, while Everton FC are reported to owe £20m. Until wage levels are brought under stricter control (and this seems unlikely in view of the power of the players and their agents over clubs, and successive changes to the transfer system since 1995), most football clubs will remain relatively unprofitable, despite the enormous sums of money top sides can hope to generate.
While football was still a very small industry compared to wider capitalist industries in the UK (Premier League clubs generated £669m turnover excluding transfer fees in 1999), the financial position of the top division has been changed beyond all recognition since 1992, and future developments in the industry (PayPerView, primarily, but also the Internet) are expected by many to generate even larger sums for a select group of British clubs.
The explosion in the financial aspects of the game has also brought with it a much greater need for professional skills at clubs and associations, in the areas of legal knowledge, marketing and sponsorship experience, accounting and financial control, administration and personnel skills. The commercial revolution has led to a huge expansion of the "back-room" staff at any British club, in order to facilitate the strategic exploitation of the commercial opportunities on offer.

Media companies and the Football Business

These opportunities have also been recognised by a range of media companies, who have increasingly sought to take stakes in top British clubs. Granada own 9.9% of Liverpool FC, while Sky own 9.9% stakes in Leeds United,
Chelsea and Sunderland; NTL own 9.9% of Newcastle United FC and Aston Villa. Sky also tried, unsuccessfully, to buy Manchester United PLC for over £600m in 1998. These stakes, and the combination of football clubs and media expertise and technology that they represent, are testimony to the enormous financial potential and investment opportunities that are still perceived to exist in the modern British football industry. While most of the revenue projections for PPV or Internet coverage are based on some questionable assumptions about take-up rate and the level that supporters would be prepared to pay, the expectation that these technological innovations will generate yet more millions of pounds for the game has drawn huge media companies even more into the heart of the football industry. How such developments will affect the power-balance of the game, the competitive balance of individual leagues, the social meaning of football, the ability of all social demographics to actively participate in professional football, and the rest of the British professional game is another matter entirely. The fact that the transformation of the game is essentially contested territory, and has created winners and losers within British football, underpins the desire of the British Government's Football Taskforce to ensure that the commercial revolution in football is wedded to concepts of social responsibility, social inclusion, community work and anti-racist practices.

USFC:The lions behind the roar of the Snow Lions

The amalgamation of some very passionate people has given shape to the United Sikkim Football Club. It is a football club formed by  dreams, passion and runs with dedication and professionalism. It is the vision of USFC to set a new path in the Indian football team with advanced technique of club management, club marketing, and professional attitude .

USFC was established in the year 2008 in the name of Sikkim United FC. The passion for football of two person Baichung Bhutia and Arjun Rai (USFC’s current senior Manager)  took shape of SUFC with the help of Sikkim govt and SFA. Initially the focus was on player development. Players from an academy of Namchi formed SUFC and participated in many local tournaments. They also won  Sikkim Gold Cup. Then Dubai based company Fidelis World  took over a majority stake of the club in the year 2009-10. The club was then reformed with a more corporate outlook, along with music legend Shankar Mahadevan, and was renamed as USFC. The nickname, “Snow Lion” has been rightly given to USFC. The mission and vision of USFC has always been to start a new era in Indian football from Sikkim. And the process became easier when a corporate company joined hands with USFC management. In 2010 they debuted in I-league 2^nd division, but missed the opportunity to qualify for the first division. However, their promising performance got them the maximum brand value in that year. Finally, USFC has qualified for I-league main division this year. The dream which was seen by Baichung Bhutia, Arjun Rai, and also the Fidelis world management, finally came true. And the journey towards a new era has begun.

Being a member of this club, I would like to share with everyone, my experience with different key person’s of USFC management.

Let's start with the Chairman of Fidelis World and USFC,  Mr. Anand R Krishnan:

The most dynamic person I have ever met in my life. His philosophy, his guidance adds something extra to USFC management in terms of strategic direction, investment strategies, and corporate governance. I found he is a very passionate towards his work and his dedication towards USFC is evident from the fact that he has attended all most all the important matches and all the I league final round matches himself. Even though he stays in Dubai but he is well aware about the current football scenario in India It was my luck and privilege that I could closely interact with him while working in USFC.

Secondly, the CEO of Fidelis world and the brain behind the investment in Indian football, Mr. Navneet Sharma:

His way of life related to sports. A person with experience of 20 years in this industry and that too with big companies like IMG, Total Sports Asia and many others. He is always keen and prepare to add value to everything with his positivity. I learnt a very unique thing from him, the style of management with a big smile. At our first meeting, he asked me for the name of a certain company. Without being sure I answered ‘Some venture’. He replied ‘Koushik, say anything after being confident about that’ , and of course with a big smile. He was always there to guide me. I also learned punctuality from him. Whenever he said 5 minutes, I never found that to extend to the 6^th minute. He is a person who believes in waking up early in the  morning and then doing some physical training before the day starts. I feel lucky that I could work closely with him and learn from such a great personality.

The next person is my friend, philoshoper and guide in USFC, Amit R Krishnan. He is the head of Corporate affairs and Business Strategy in Fidelis World-USFC. I was not aware that he is from London School of Economics and on our first conversation I talked mostly about Indian Economy. And he encouraged me to do so.  A unique quality I have seen is that  he is a very keen observer. In a meeting,  when we were discussing about our marketing plans and I was showing him some data analysis of TRPs of Indian football. I found that he always tried to question me ‘in between the lines’ of that presentation. He is a great listener and a great learner. I learned from him that  to be a good manager one has to be a good listener and also a good learner. The person I miss most in my recent days is Amit. It was such a privilege and a pleasure for me to work with him.

This writing will be incomplete, without mentioning anything about Arjun Rai (Our very own Arjun da):

One of the main visionary of USFC was Arjun da. The man behind the present success of USFC is Arjun da. Starting from ground management to team management whenever we faced any problem, Arjun da has been there with a solution always ready . He is the main person behind the success of the current Indian star Nirmal Chhetri and Sanju Pradhan. Many Sikkim boys are playing in Indian football only because of him. Moreover, as a person he is very nice and honest. Even after a 100 year history will speak about Arjun da, the visionary whose once small dream has taken the big shape of USFC. I always believe on a statement that when passion become someone’s life then nothing in this world hardly matters to him. Arjun da is the perfect example.

Last and the legend himself Baichung Bhutia, The BB15:

What can I say about him? Everyone in India knows about him.It is not my capacity to say anything about him. But Iwould like to share two interesting things which I observed about him. One is his energy. A person gets almost everything in his life in his field, and also becomes a legend. I feel great to see him so energetic and enthusiastic on or off the field . Many so called legend have been born in Indian football, but I believe that, BB15 is a true legend and a true football visionary. Till now no Indian players have contributed to the development of Indian football . Starting FPAI, BBFS, USFC, and also another international standard academy in the pipeline shows his contribution for the Indian football. The second thing is his leadership quality. Everyone is aware about his leadership quality on the field. But I have seen his off the field leadership quality also. It's very difficult to be a coach cum player of any team. But he is the player cum manager cum owner of USFC. I witnessed, how a person can multitask dedicatedly and also be successful. This is a big thing to learn from him. I never found him tired about football. A ver rare and complete mix of passion, dedication, mental stability, physical ability and intelligence has produced a Baichung Bhutia as a person. In our every meeting I  learned something new from him. I found the actual mix of my 4Is (Intention, Innovation, Involvement and Integration) in him with the perfect proportions. I would not say pleasure, rather say privileged and lucky to work with him.

USFC is now in I-league. I feel sharing these experiences will help all to feel the real passion that USFC is all about. I lived every moment of my life there, and learnt a lot from each and every one. Apart from these 5 persons, Pema L Shangderpa, Shail Kapri, Ritesh R Krishnan, Arunava Bhattacharjee all was there who loves this club dearly.

People often think that a football team is only made by players and coaches. But the truth is that, a football club is made with passion, dedication and proper planning. The management is not only working for the sake of their investments but also for their passion for this sport. USFC is not only the name of a football club, it’s an echo of millions heartbeats, which initiated from the above mentioned names. Whenever the name USFC will come up, these 5 people will surely be mentioned for their dedication and success in making their dream come true. Now it's time to hear the roar of snow lions in I-league main division, from this year onwards.

India...Raising: Indian football-When will wake up?

Indian football-When will wake up?

Indian football-the sleeping giant. What is the use of being a giant if you are sleeping? I would rather choose to be a working ant than a sleeping giant. Now a million dollar question is that, ‘How long the giant will sleep?’ ‘Will he ever wake up?’. FIFA is doing their part quite well, and so is AFC. But unfortunately the domestic association’s is not so proactive like them .

In my opinion, to give proper shape to a new plan, the 4Is (Intention, Involvement, Innovation, Integration) is the most essential aspects. The worst part is that the Indian football administration is not practicing any of the 4I. Proper planning and implementation are very vital, as no game can show results by itself. It needs proper planning and good investment of ideas. I am trying to point out some problems in Indian football and would like to discuss, and share my point of view regarding the betterment of Indian football. Let's start with few basic problems which need to change immediately.

Recently I read a case study on the evaluation of EPL after 1990s. It took around 10 years to change it completely and make EPL the world’s best football league. Another example can be MLS and becoming world’s one of the major money league. After 1994 WC, US football federation changed the internal infrastructure of football and can successfully make MLS world’s one of the best marketed football league now. We can also learn from the rising story of Japan, Korea after late 1980s. Even now days the Far Eastern countries are coming up quite nicely. If we consider all the mentioned leagues, we will find one common thing, i.e., The success story of their national team. Every emerging football playing nation is moving ahead, but the Indian football team is always between 150 to 160, and even sometimes below 160. We need to revamp our entire structure to change the entire current scenario.

One of the major problems is the structure of the Indian domestic league. Domestic leagues are the backbone of any football playing nation. Firstly, the Indian domestic league does not follow any fixed calendar. We can see that there are lots of unexpected regional tournaments held, which hamper the scheduling of any club for a season. As a result players or teams have to play too many matches, which hamper their performance graph and the potentiality in long run. According to sports medical science, Indian football players have the capacity to play around 40/45 full matches in a season. But some players have to play around 60/65 matches in a season. AIFF needs to understand this and formulate a unique and more scientific calendar for an entire season.

The Indian football season starts with the knockout tournament Fed cup, which is a baseless concept. Everywhere in the world the league format is the best option to start a season. After around 2 month rest, players need time to reach their peak form. So,the league format is the best to start a new season.

There is also another problem with I-league 2^nd division scheduling. An I-league playing teams have to play 26 matches throughout the entire season in I league 1^st division and after that 2 teams are relegated. Whereas, in the 2^nd division every team has to play almost 18/20 matches within 2/3 month and only 2 teams are eligible to qualify in main division. According to the current format, the number of matches played by a 2^nd division team is equal to approximately 70% matches of any I league team play in I league 1^st division. But only 2 teams can qualify from the 24/26 team and play around 14/16 matches. AIFF needs to think and change this format soon to develop and spread the game in India. They should plan to make it as exciting as I league 1^st division, and the 2^nd division teams can also play throughout the entire season. There are many talented players who play in 2^nd division I league teams, but are neglected from the selection of national team due to no scouting, which also need to change and show faith on them.

Another problem is national team’s camps. A month long camp in good infrastructure cannot be the only reason for good performance. A proper planning with the team is very much necessary, and was done by Bob Houghton before. Arranging more friendlies with different standard of teams on FIFA announced dates from earlier is very much necessary. A complete proper scheduling for the entire season is necessary for the betterment of the national team. National team needs to use all the FIFA dates for friendlies.

Now Indian football is looking for a coach for their national team. Before recruiting a new coach there is a need to identify the pattern of our game and select coach accordingly. In the recent past when Bob was the coach, national team used the long ball strategy. But we don't have tall and strong players to play long ball. Rather our players are more skillful with average speed. So coaches from Netherland, Hungary, Latin American countries, can be more productive with the national team. So selecting the right coach is the big factor now.

 I think not only a coach, but a complete team of staffs for the national team is required. A good head coach, along with two efficient assistance coach (among them one must be a defender specialist), 1 good foreign Physio, and 1 video analyst is very much necessary with the current squad. Apart from having faith only on the national coach AIFF should appoint 4/5 regional spotters who will spot the right talents and shortlist them for the final selection. The final team should be selected jointly by the head coach (I rather call him as a TD) and the spotters.

AIFF does not have a complete database of every player playing in AIFF registered tournaments. AIFF should have a complete updated database of every player, so that the selection can be easier for the coaching team.

Recently AIFF have started 8 regional academies with FIFA, which will develop the future generation. Having the U-16 team in Florida for the last 2 years can be helpful to get more developed players in India. We have seen that, our football team is very competitive in world standard under the category ranging from U-12 to U-16. But once they start playing Indian clubs the competitiveness and playing standard deteriorating. We need to send our senior or above U-18  players abroad to give them more exposure. Big example is the Afghanistan football team. They have developed only after sending their players abroad. Playing in the big leagues in big clubs is a complete waste of time due to below standard performance of our current players. Our players need to go to the various average standard european leagues like in Cyprus, Finland, Belgium, Hungary,  Norway etc and develop their game from there. AIFF should take initiative in this.

There are a few steps which AIFF needs to start following for the betterment of the national team. We all are Indian football lovers. We want to see our national team in WC or in Asia cup regularly. We also want to see our clubs playing in the AFC champions league. Following the right steps can open the door for our team in the world football arena. We are not lagging with talents, but lagging with a vision to channelize those talents in the right way. I think the right use of 4I’s will change the current picture of the game. The day when the giant wakes up will be not far away.