Yeah, another post on Financial Fair Play. So if it’s TL;DR, just watch the above video and relax.
For the rest of you, one of the major weaknesses in criticism of FFP in English top flight football is that it presumes that conditions in the Premier League post-FFP would remain unchanged from before. They seem to assume that it’s a law that clubs will always require money to spend on wages and the transfer market to make a challenge, and for this reason, forcing clubs to not spend in excess of turnover is the same as condemning them to mediocrity forever.
However, there is a model for an approach to FFP that would preserve some measure of competitive parity, the ideal in which smaller clubs can one day catch-up the giants: the Bundesliga.
The top two professional tables in Germany have a break-even licensing requirement for their member clubs. Taken alone in a league without further regulation, this would likely fulfil the worst fears of FFP critics: permanent dominance of the top of the league table.
Yet FFP cannot merely be a standalone measure to prevent clubs from spending well in excess of their revenues on the back of investor cash. The Bundesliga’s 50+1 member (fan) ownership rule for example ensures that Stefan Szymanski’s vision of owners not bothering to invest in players because of forced profitability—i.e. why spend money to improve and make profits when we have to make profits to stay in the PL?—won’t leave clubs in competitive stasis.
Moreover, the Bundesliga does not sit in a development vacuum. Changes to the academy system in 2000 sowed the seeds for today’s current talent pool, in which academy products help prevent a transfer bonanza every summer window.
Finally, Bundesliga clubs don’t attempt to hose fans with inordinately high ticket prices, but regard match day revenues as an economy of scale: lots more seats for less money.
The result? A profitable league (14 of 18 clubs made a profit in 2011-12) whose revenues have increased year over year from a variety of sources, and whose clubs now challenge the best in Europe. Break even requirements certainly didn’t bring this about alone, but formed one part of a comprehensive approach.
For those who say that there is no way English football would permit these changes, they would be correct, for the time being. But FFP is at least one step, and the changes proposed as part of the Elite Player Performance Plan could help Premier League challengers a lower-cost source of players, and lower league clubs a much-needed source of income. Increased fan ownership in clubs would provide an incentive for owners to improve the on-field product in spite of enforced profitability, and the Premier League might look to expanding stadia and lowering ticket prices as a means to increase ticket revenue, not lower it.