Ok my essay starts here
:
The collapse of professional football has just started.
Recently we have heard an amazing amount of bad news regarding professional football. First there was the collapse/troubles with ITV and ITV digital, after that Germany's Leo Kirch comapny (KirchGruppe) had major financial problems, causing him to sell almost his entire company to Rupert Murdoch and Silvio Berlusconi.
It all started with the Bosman trial. It became hard for clubs to keep their players, so they started to show off with money, the entire market was blown out of proportion and right now we're starting to realize that, it's collapsing. Everything is being valued properly again. It's a bit like the Internet/New Media hype from 2 years ago, stocks rose and rose but finally collapsed.
The German clubs paniced because the KirchGruppe had bought the TV rights for the German Bundesliga (and the WC 2002 and 2006 which has been saved due to a genius financial side-step). After the collapse of this deal, German clubs lost a major part of their income. There had to be renegotiated a new eal very quickly. Only this deal wasn't worth just a bit of the older one.
Let's move west, coming to the Netherlands. Not a major competition, but a sort of pond of young talent for the rest of Europe to fish from. Recently the finincial positions of the BVO's (Betaald Voetbal Organisties, in English: the professional football clubs) has been scrutinized. The conclusion of that rapport was devastating; almost every club has major financial problems with massive debts, including the "big" dutch clubs.
Let's cross the North Sea coming to Great Britain. There were the problems with ITV and ITV digital. There were clubs going into registration (dunno if that's correct English) because of their massive debts. Now the SPL seems to be collapsing. "It's like the Titanic man, it's all going down". (© Brad Pitt in Fight Club)
In a dutch football maginze it was explained quite nice. Football clubs are paying their players way too much, or have to many contracted players (Like Ajax who have over 50! contracted players who'll have to be paid). Most clubs don't generate enough income to balance the salary and other costs. So TV deals really helped to balance the costs. Clubs began to rely too much on the TV deals. Now that most people are getting a bit sick of all the football on TV and they stop watching, the TV stations are getting problems, and inflict that on the clubs.
There's only a few clubs who are finincially healthy. The really big ones who generate income by playing in the Champions League and selling merchandise. But the prize money of the European cups will also become less. The UEFA can't pay it much longer either, because they too pay the prizemoney with the money from TV deals.
The solution? I don't know, everything will devalue, players have to agree contracts worth a lot less then they could have had before. It may well be that Zidane or Figo will stay the most expensive footballer ever, because not one single club will, no CAN, pay that kind of money for a player again.