A Game of Two Halves? The Business of Football
Sean Hamil, Jonathan Michie and Christine Oughton


CONTENTS


Acknowledgements
Sean Hamil, Jonathan Michie and Christine Oughton
 
Foreword
Alex Ferguson  
Introduction
Sean Hamil, Jonathan Michie and Christine Oughton


1 A Whole New Ball Game? Why Football Needs a Regulator
Sean Hamil


2 The New Commercialism
David Conn

3 Thinking the Unthinkable or Playing the Game? The Football Task Force, New Labour and the Reform of English Football
Adam Brown

4 The BSkyB Bid for Manchester United Plc
Simon Lee
5 Football and Broadcasting and the MMC Case
Jonathan Michie and Christine Oughton
6 Revenue-sharing from Broadcasting Football: The Need for League Balance
Jeanette Findlay, William L. Holahan and Christine Oughton
7 Is Paul Ince an Asset or a Liability? Accounting and Governance Issues in Football
Jonathan Michie and Shraddha Verma
8 Whose Game is it Anyway? Stakeholders, Mutuals and Trusts
Jonathan Michie and Shay Ramalingam
9 The Evolution of Irish Plc Co-operatives: Lessons for English Football Clubs
Anne Bourke
10 Modern Corporations and the Public Interest
Rob Branston, Keith Cowling, Nestor Duch Brown,
Jonathan Michie and Roger Sugden
11 Supporter Representation on the Board: The Case of Northampton Town FC
Brian Lomax
12 The Struggle for Democracy at Barcelona FC
L’Elefant Blau
13 What Future for Football?
Jonathan Michie and Andy Walsh

Acknowledgements

The following chapters were commissioned specifically for this book. We are therefore grateful to the authors for having undertaken this work. The chapters were written during the course of 1998 and were then presented and discussed at a meeting of all the authors in February 1999, following which they were revised for the book. Several other experts attended that meeting to comment and make suggestions for redrafting, and we are therefore grateful to the following colleagues for this: Ernie Battey, Lloyds Bank Project Finance; Lucy Burns, Government and Parliamentary Relations Manager; Michael Crick, Shareholders United; Dr Chris Forde, Leeds University; Professor Andrew Gamble, University of Sheffield; Simon Grover, University College, Northampton; Diana Jackson; Gavin Kelly, The Fabian Society; Michael Kitson, St Catharine’s College, Cambridge; Soo Hee Lee, Birkbeck College; Emily Lomax, Lancaster University; Simon McNeil-Ritchie, Hamilton Laird Consulting; Roland Muri, Birkbeck College; Steve Parrott, Birkbeck College; Dr Jenny Piesse, Birkbeck College; Huw Richards, freelance journalist; Nick Toms, Independent Manchester United Supporters Association (IMUSA); and Dr Peter Trim, Birkbeck College.

We are particularly grateful to the members of the Barcelona supporters campaign group L’Elefant Blau, for travelling from Barcelona. Hearing of their campaign to maintain their club as precisely that – a club, owned and run by its members – in face of the new commercialism, was inspiring to all who heard them talk during the day as well as over the previous evening. Their delegation included Armand Carabén, the general manager at the time Johan Cruyff was brought to the club, as well as Alfons Godall, Joan Laporta, Jordi Moix, Joan Sola and Albert Vincens.

Thanks also to Steve Warby who organised the February meeting, helped with the production of this book and at the time of writing is preparing for a conference in July 1999 at Birkbeck College on the governance and regulation of professional football.

Others who were unable to attend the February meeting but who nevertheless provided valuable advice include Dr Simon Deakin, Reader in Law, Cambridge University; Gordon Farquhar, Radio 5 Live; Mark Longden, Coalition of Football Supporters; Stan Metcalfe, Professor of Economics, Manchester University; and Malcolm Sawyer, Professor of Economics, Leeds University.

We are grateful to Bill Campbell, Sarah Edwards, Andrea Fraile and Elaine Scott of Mainstream Publishing for the speedy turnround of the manuscript.

Jonathan Michie would like to express his special gratitude for various advice and assistance from Carolyn Downs, Director of Leisure, Calderdale Borough Council; Alex Michie, a football manager (fantasy league) always almost on the edge of a dramatic breakthrough to success; and three-year-old Duncan Michie whose personal friendship with Paul Scholes is – quite literally – fantastic.

Finally we are grateful to Alex Ferguson for taking the time to contribute the Foreword to this book. It is particularly appropriate for a book edited from a Department of Management that we should have this contribution from someone who must be one of the country’s outstanding managers not just in football but across the board.

Sean Hamil, Jonathan Michie, Christine Oughton


Foreword

There is no doubt that football is now big business. New opportunities are opening up. But if these are to be taken rather than squandered, intelligent action is required.

The government should therefore be congratulated on launching the Football Task Force to report on what can be done to ensure the best possible development of the game for the largest number of people. But the issues involved are far too important to be left to the Task Force alone, or even government. More input is needed from people in the game itself. We all need to be involved in these discussions and decisions – the game’s administrators, the clubs and the fans.

Firstly, there is a danger of over-commercialisation, in particular with the inflation of players’ salaries. This will have to be addressed, sooner rather than later. We are already seeing clubs in financial trouble. The influx of TV revenues has gone largely in increased salaries. There has also been the fantastic development of football stadia across the country and through the divisions. But as any football fan will tell you, the hugely increased revenues certainly haven’t gone to keep ticket prices down.

One of the reasons the money has gone disproportionately to top players’ salaries is the Bosman ruling. Clubs have had to sign their players on longer contracts. And this has involved increasing salaries.

So far the pressure has fallen most heavily on the smaller clubs. But unless something is done, the big clubs will start to suffer too. And fans will get priced out of grounds.

Of course, fans are tremendously loyal. And they want their players to be well rewarded. But there is a limit to how far they will be prepared to pay for multi-million-pound salaries. Sooner or later this issue will need to be tackled. It would be best if the initiative came from the players’ representatives themselves. The Professional Footballers Association in this country needs to take a responsible view of their members’ interests as a whole, right through the leagues, and also of the game as a whole. But it’s also an international problem – the players’ representatives internationally should be talking about this, in the interests of the game as a whole and ultimately in the interests of their own members.

The second main point I would make is that while the new broadcasting developments – especially pay-per-view – promise large revenues to the bigger clubs in particular, it is in everyone’s interests to maintain some degree of league balance. The Premiership is a fantastic league because there’s fierce competition. On their day, anyone can beat anyone else. And that’s how it should be. But if the authorities are to ask the large clubs to share these increased revenues through the league, for the good of the national game, something should be given in return.

For clubs playing in European competitions, a mid-season break would allow them to compete on equal terms. There should also be flexibility when it comes to arranging domestic fixtures, as there is on the continent. Helping our own clubs in Europe would benefit the whole game. It would increase the number of places English clubs get allocated. It would give more European experience to English clubs, which can only help the players, particularly by learning more of the tactics and how the game is played on the continent. It could only be good for the national team.

These are exciting times. I welcome the national debate that is emerging on these issues. If we can make the right decisions now, there are fantastic opportunities right through the game – from increased international success, through to improving facilities for the millions of people who play football week in, week out.

Certainly, football is big business. But it also plays an important role in the country’s social and cultural life. Some may see it as just about money. I see it as much more important than that.

Alex Ferguson

May 1999