Sunday, March 12, 2006

Jonny Wilkinson for England (vs Australia), 22nd November 2003

Last month it was announced that Real Madrid had toppled Manchester Utd to become the richest football club in the world. Real topped the table with earnings of £186.2m and United fell back to second place with a paltry £166.4m (Chelsea, Liverpool and Arsenal also featured in the top 10, with Newcastle, Spurs, Manchester City and Everton all making the top 20).

It should be noted that this list only reflects earnings, taking no account of outgoings (like the estimated £5m p.a. earned by the various Galacticos at Madrid). Yet somehow it still seems significant because for years and years, United have prided themselves on their commericial and financial clout. In addition to declining performances on the pitch, it seems that they are beginning to lose ground elsewhere too.

The fact that the Glazer takeover has plunged United into massive debt probably has a little to do with the financial decline, but it's almost impossible not to see the transfer of David Beckham as being significant. Peter Kenyon sold Beckham to Madrid in 2003 for a deal worth £24.5m. On the face of it, that sounded like a reasonable fee for a player a few people doubted was really on a par with Zidane and Ronaldo. Three years on, it looks more and more like Madrid got by far the better of the deal. For starters the deal itself was made up on an initial cash sum of only £5.25m, with the rest being tied up on installments (£12m over 4 years) and on payments triggered by performances in the Champions League (£875,000 every year the qualify, and £875,000 every time they make the quarter finals). On that basis alone, Manchester United will not have received the full £24.5m.

Worse still, the Real Madrid Director charged with the negotiation of the transfer, Jose Angel Sanchez, has revealed how he could not believe how little Peter Kenyon asked for Beckham when he was asked to name his price. Sanchez was apparently authorised by Madrid to pay double the £24m, and was astonished at how little the richest club in the world realised what an incredible commercial property they were giving away. Real put Beckham's commercial worth to them as something like 500m Euros - that's a 1,500% return on their investment. Not bad. (There's a good article on this here).

I wonder how Chelsea feel about this, having been so proud of their acquisition of Kenyon as their chief executive?

Football finances are crazy, as we all know, but I thought it might be interesting to have a quick and completely unscientific look at three England captains in different sports and have a look at their earning potential, together with photographs of them with their partners....

Jonny Wilkinson - England Rugby Union Captain (well, he would be if he wasn't injured all the time)



Salary: about £200,000 per year

Key sponsors: Lloyds-TSB, The Times, Lucozade, Adidas, Hackett

Total income: about £5m per year (probably as much as three times more than any other rugby player in the UK)

Andrew Flintoff - England Cricket Captain



Salary: £160,000 p.a. central contract, £60,000 bonus for winning the Ashes

Sponsors: Barclays Capital, Woodworm Cricket Equipment, The Sun, VW, Red Bull, Thwaites Brewery

Off-Pitch earning potential: estimated at between £1m - £1.5m per year

David Beckham - England Football Captain



Salary: £4.4m per year from Real Madrid (plus bonuses)

Sponsors: Adidas, Police Sunglasses, Castrol, TBC, Marks & Spencer, Tsubasa Systems, Meiji, Pepsi, Upper Deck....etc.etc

Total earnings: £17m p.a. including £12.5m from advertising contracts

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I know it's a pointless comparison really, I just thought it was interesting how much more Beckham makes than the other two - even just on basic salary. I appreciate that football is the most popular sport in the world and that it generates far more income worldwide than the other two sports put together.... even so - that's a lot of money.

I suppose you can't blame any of them for cashing in whilst they can, and to be fair, all three have reputations as dedicated professionals.... but it must sometimes be hard not to be distracted by commercial opportunities outside of their day jobs. Beckham for one is often criticised for making trips to the USA / Far East when he would perhaps be better resting.

Let's hope he focuses totally on the football in the run up to Germany this summer, just as Freddie focused on the Ashes last summer, and as Jonny focused on the World Cup in 2003... which remains the last time he played for the national side.

2 comments:

DavidM said...

I completely agree. I was stunned that such a commercially savvy club as Man Utd let Beckham go.

Aside from his impact on the pitch, the vast majority of Man Utd shirts worn by fans had his name on the back, the Far East fans loved him and he was a good role model (at least he was before he went to Spain).

I haven't seen as many Real Madrid Beckham shirts on kids as I expected and Man Utd have found a new hero in Wayne Rooney, but even so I reckon it cost them far more than the £24.4m they are waiting to get from Madrid.

Lord Bargain said...

...but the point of football is that the transfer of players isn't about commercial gain. Ferguson (for reasons I'm not sure we still have full knowledge of) thought he'd be better with a different player on the right side of his midfield (even a different system) than Beckham. That decision wasn't made on a commercial basis - it was made for team and footballing reasons.

(not that I am suggesting that Kenyon didn't f*ck up the commercial aspect once the football decision had been made, however)

I thought we got good money for him, considering we got talented but "prone to a fall" preening Portuguese idiot Cristiano Ronaldo and about £10million out of the Beckham deal.

And it's all very well being the richest club in the world, or the second richest, but a domestic League Cup between them over the last two seasons is surely a better measure of their success?