The producers of American reality-TV shows a decade ago figured out what European soccer administrators (and before them, promoters of Roman gladiator bouts) have always known: There’s a compelling spectacle in any clash where the loser forfeits his shirt, his place on the island, or even his life. It’s for that reason that with just four game weeks left in the season (though, crucially, some teams have more than four games to play) the English Premiership’s most entertaining contests are not at the top of the table, where Manchester United are seemingly strolling to their fifth title in six seasons. (Update: United managed to turn that stroll into a stumble, Sunday, conceding four goals at home to Everton to finish 4-4, while arch-rivals Manchester City won away at Wolves, to give them a chance of winning the league if they best United in their head-to-head game next Monday.) The real drama, now, is at the bottom of the league table, where Wolves, Blackburn, Bolton, Queens Park Rangers, Wigan and Aston Villa are locked in a ferocious struggle to survive. That, and the fierce three-way fight between Tottenham Hotspur, Newcastle and Chelsea for the all-important fourth place.
The intensity of those battles is fueled by the fact that the contestants know their futures are on the line: The teams that finish in the last three places of the 20-club league table won’t be in the Premiership next season; they’ll be relegated to the Championship (a euphemism for what was once known as the Second Division — the minors, in American parlance), while their places will be taken by the top three clubs from the second tier. Promotion and relegation between leagues is a time-honored tradition, variations of which apply throughout professional soccer in Europe and beyond.
The significance of fourth place is equally important, at least to the more ambitious and better-endowed clubs, because the top four finishers in the Premier League qualify for the European Champion’s League — the elite competition that not only allows them to attract the best players with the promise of appearing on the world’s premier pro soccer stage, but also gives them a share of that league’s extremely lucrative revenues, which allows them to strengthen their playing squad and maintain their place in the top tier.
Europe may incline towards socialism when it comes to taking care of its populations’ basic needs such as health care, education and income-security, but when it comes to professional football, it mimics the cut-throat survival-of-the-fittest capitalism of the United States: There’s no such thing as a football club “too big to fail” — when I first started following English soccer in the mid 1970′s, mighty Manchester United were in the Second Division, while the titans of that era, such as Leeds United (who won the league in ’74), Derby County (winners the following year) and Nottingham Forest (who won the title in ’78, and even more improbably, the European Cup — forerunner of today’s Champion’s League — in ’79 and ’80) all languish in the Championship today, with none of them challenging for a spot at the top table this season.
And the difference between survival in the Premiership and relegation isn’t simply status and the bragging rights of the long-suffering fans; it’s the equivalent of a comfortably middle-class household falling suddenly and catastrophically into poverty. The bottom clubs in the top division can expect to earn around $64 million from their share of the Premiership’s global TV rights; the equivalent in the Championship amounts to just $5 million (which explains why the play-off match in that league to decide the third promoted side every May is often referred to as the most lucrative game in world football).
Indeed, recognizing the danger that such a drop could financially obliterate relegated clubs and wreck the whole system, the Premiership actually makes “parachute payments” of $26 million a year for two years to clubs that fall out of the top flight, and then a further $13 million in each of years three and four in the lower leagues. Relegated clubs can also expected to lose around $6 million a year as a result of the withdrawal of sponsors who signed on to display their brands in the global TV spectacle that is the Premiership. In all, Deloitte estimates that relegation costs a club around $40 million a year, which continues to rise the longer they remain outside of the top flight.
And most football clubs are not particularly profitable to begin with.
Like sudden poverty in a household, the immediate impact of relegation on a football club is a profound change in lifestyle and prospects: The team that walks out onto the field for the opening game of next season will bear very little resemblance to the one that trudged off disconsolately at the final whistle of this season’s last game. And that’s not simply because the sponsor’s logo will have potentially changed to that of some small-scale local business, but because most of the players that represented the club in the top flight will have gone, replaced by journeymen past the peak of their careers and young prospects nobody ever heard of.
Players’ wages comprise around 80% of Premiership club’s operating expenses, which means that relegation requires a radical slashing of the wage bill by selling most of the club’s best players. The task is made easier by the fact that most players who’ve established themselves in the top-flight have no interest in a return to the minor league — many even include a “relegation clause” in their contracts, obliging the club to sell them if it fails to stay up.
The coach will usually go, too, for the same reason, and the die-hard local fans resign themselves to watching a cruder version of the game, perhaps consoled by the fact that they no longer have to pay Premiership prices to get into the ground. It’s very rare for a club to bounce back in a single season, although West Ham United — believed to be President Obama’s team, curiously enough — may be in contention to achieve it. Even more ironic, West Ham’s tale of woe began during the period in which it was owned by the rampaging Icelandic banks that later hit the skids in a cautionary tale of free-market finance capitalism run amok.
Failure to qualify for the Champion’s League is not quite as catastrophic as a fall into poverty, but it could signal the equivalent of a fall from the ranks of the rich into those of the middle class, with the attendant lifestyle adjustments. Chelsea, for example, earned some $60 million from its participation in the Champion’s League last season — one fifth of its total revenue. In the same season, the club reported a net loss of $129 million. So Chelsea’s failure to qualify for Europe’s elite league will hurt more than the vanity of its owner, the Russian oligarch Roman Abramovich, who the record suggests acquired the club for reasons of status rather than a return on his $1 billion dollar investment.
My own club, Liverpool FC, has yet again failed to qualify for the Champion’s League, which was identified as the key target by its owners, the Fenway Group, not only because of the revenues involved but also because it’s a lot harder to monetize a team’s value as a global brand if it’s not competing at the elite level. As a result, it may be difficult to persuade some of the team’s most effective players such as goalkeeper Pepe Reina and striker Luis Suarez to stay on if Champion’s League clubs from Europe offer them a role on the bigger stage. And, of course, failure to secure Champion’s League revenues will no doubt limit the funds available to buy new players to strengthen a squad that lacks sufficient quality to compete for a Champion’s League spot, potentially creating a vicious cycle.
There’s something curious about Europe adopting this cut-throat model in professional sports, in contrast to the United States where the arrangements — revenue sharing, salary caps, jobs-for-life (in the sense that there’s no such thing as relegation) — are positively socialist. For an entrepreneur, buying an NFL or Major League Baseball is a risk, but a limited one — a desperately poor season may be miserable and eat into revenue, but it’s not likely to destroy the investment; American investors such as Tampa Bay Bucs owner Malcolm Glazer who bought Manchester United in 2005, Cleveland Browns owner Randy Lerner who also owns Aston Villa, or the Fenway Sports Group that owns the Boston Red Sox and Liverpool FC, face the prospect of a massive and painful haircut should their teams finish in the bottom three.
Still, there’s no doubting the entertainment value created by the Darwinian logic of promotion-relegation. Pick of the games this weekend, for example:
- Arsenal vs. Chelsea: While Arsenal are current favorites for third place, Chelsea are in a desperately tricky situation. They face Barcelona away on Tuesday in an exceedingly tough second leg of their Champion’s League semi-final (Chelsea somehow won the first game 1-0), but if they don’t win at Arsenal, their chances of qualifying for that tournament next year are further dimmed. There’s a lot on the line, with tricky selection and tactical challenges for Chelsea; expect a cracker of a game, with Arsenal to edge it.
- QPR vs. Spurs: Rangers, in their first season back in the Premiership in 15 years, will surely go straight back down if they can’t pull off some dramatic wins against top end of the table teams Spurs, Chelsea and Manchester City in the weeks ahead. But Tottenham’s high-flying season has gone off the boil, and they’re in a desperate fight to hang on to fourth place. Both sides have been defensively dodgy this season, expect a 3-2 finish. (Going out on a limb, that third goal will be scored by QPR.)
- Blackburn Rovers vs. Norwich City: Newly promoted Norwich are safe in the Premiership this season, and despite their minnow status, they have given some of the top teams a run for their money (most recently winning 2-1 at Spurs). Blackburn are raging against the passing of their Premiership light, and that desperation will make for some entertaining football. And, perhaps knowing they’re for the drop, some of their stars — the brilliant Canadian (yes, you read that right) winger Junior Hoilett, midfield strongman Steven N’Zonzi, and the aging but ever-deadly warhorse Nigerian striker Yakubu Ayegbeni — will also use the occasion to showcase their talents to potential suitors for next season.
Manchester United may have effectively sewn up the title a few weeks back, but the Darwinian rules that govern on which tier teams will play next season ensure that there’s plenty of drama left in the English Premiership until the final whistle on the last day of the season.