The English Premier League is the wealthiest domestic competition in soccer, and every team that competes in it is guaranteed to earn truckloads of cash. With the financial advantage helping to bring four English teams to the final of both European cup competitions in 2019, are their deep pockets going to be an advantage forever?
Where’s the money coming from?
English Premier League teams are guaranteed to earn at least $99.9 million from an equal share payout, then additional money for their league position. This money is coming from the record-breaking TV deal the Premier League secured itself.
Between the UK broadcasters Sky Sports and BT Sports, the Premier League received $5.62 billion for the broadcasting rights of the competition for four seasons. The majority of that money is being put into the teams who compete, with a guaranteed $100 million for making it to the league. That means there are a lot of teams in England who are receiving a ton of money every year.
Closing the gap
Before the Premier League can dominate with all of the money it is receiving, it needs to make it to the top of the tree. The Spanish La Liga is considered to be the best league in the world, largely due to the continental success of its teams.
Tottenham and Liverpool fought for Champions League glory in 2019, while Arsenal and Chelsea battled for the Europa League, but British teams have been behind their European rivals recently. In the last ten Champions League seasons, the winners have been English teams only twice, compared to seven wins by Spanish teams.
The Europa League is a pretty similar story, and in the past ten years, Spanish teams have won six times, while English teams have only won twice. With four English teams making the finals of these two competitions though, it’s looking like the investment is beginning to pay off.
Buying players
In receiving the broadcasting money, Premier League teams can buy players to strengthen their teams much easier than their European counterparts. There is a catch though, and transfer fees have gone through the roof following the increased investment in the English league.
All around Europe, teams are having to pay record fees for players, and it’s all thanks to the sale of Brazilian star Neymar to Paris Saint Germain (PSG). The forward was signed for $263 million, and it made all following transfers way more expensive. Now that British teams are becoming super rich, they aren’t able to fully benefit from that cash because of the inflated prices for players.
Alternative spending
Soccer is huge in the UK, and teams can generate huge crowds, even in the second and third tiers. Because fans are so passionate about soccer in the UK, one way for the Premier League teams to spend their money is to invest in their facilities. They can develop state-of-the-art training grounds, plus expand their stadiums by considerable amounts.
The more fans they can get into their stadiums, the more money they can make. With so much cash going to the Premier League teams at the moment, the smart thing for many of them to do would be to make their facilities better.
Smaller Premier League teams now don’t have to be held to ransom over their players by the top teams in the league, so they can hold onto their best players. Traditionally, top teams would take the players from the smaller teams because they couldn’t afford to turn down the transfer fee.
That is now a thing of the past, and if the top teams want players from other sides in the league, they’re going to have to spend big. The dynamics are shifting, and to gain an advantage in the future, teams are going to have to focus on developing their academy players. Teams will always make transfers, but it’s going to be harder to justify them.
Maintaining success
The two best teams in the Premier League in the 2018-19 season were champions Manchester City, and Liverpool, who finished one point behind. Those two teams were so far ahead of the competition, and it’s largely down to the money they’ve invested. Manchester City have very rich owners who spend whatever it takes to get the players they want, while Liverpool have had to be smarter.
Liverpool are owned by Fenway Sports Group, the owners of the Boston Red Sox, and rely on their impressive marketing and scouts to gain an advantage. These are the models that teams will have to follow to gain success in the future. Not every team can be owned by billionaires, so the Liverpool approach is perhaps the more likely for many teams.
With a guaranteed $100 million for every season in the Premier League, even the mid-table teams can potentially be run better than the majority of the elite European sides. This can only increase the level of competition in the Premier League, making the top teams even better. That constant influx of money every year could be what gives English teams the advantage over their European rivals in the future. If it works, then it could take a long time for their rivals to catch up.
For now, the English Premier League is in a strong position. With the teams only getting richer, the signs suggest the Premier League could begin to dominate soccer. European elite clubs like Real Madrid, Juventus, Bayern Munich, and PSG, can compete with English teams at the moment, but for how long?
