This summer seems to have been characterised by exorbitant and often, frankly, disgusting transfer fees. The last round of TV broadcast rights negotiations saw Sky Sports, BT Sport and a host of other broadcasters around the world pay more than might have been prudent to buy up live Premier League football.
What might be bad news for fans – and even have a knock-on effect to other areas of TV output given the amount of spare cash left over at the likes of Sky – looks like good news for football clubs. They now have more money than most have ever dreamed of. The problem is, the transfer market seems to have changed with it.
The reality, though, is a little different, because although the perception may have changed, the market really hasn’t. If it seems like prices are beyond control, that’s because they’re being compared to a different era – we’ve entered into a new one, and attitudes will change as a result.
Last season, Premier League clubs were paid £2.4bn at the end of the season, purely in money from TV rights. The season before that, it was £1.6bn, and so that means Premier League football clubs are almost twice as rich as they were this time last year. And that seems to make sense in the transfer market: a broad, general rule might well be to simply think of any transfer fee as double what that player would have been worth in old money.
Think of it as an exchange rate: whereas a 2013 equivalent of a top striker might have cost £40m, the going rate is closer to £80m. It makes sense when you think of fees paid for the likes of Kyle Walker at Manchester City – £50m seems a bit too much for a player of that calibre and position, but if you half the fee, it seems more than reasonable.
That sounds like a cheat: just pretend they only cost half as much. But it’s not a case of pretending, it’s a case of translating. If buying clubs are twice as rich, then selling clubs will ask for twice as much.
Now, that’s not to say that the perception that fees are too high haven’t changed the actual transfers themselves. In fact, there are two things to note. One is that, while most clubs around Europe are richer this year than ever before thanks to a spike in TV revenue across the board, no other country saw quite the same jump as England.
Premier League clubs were already the richest in the world, but the latest TV rights developments have meant that now English clubs are even richer. It stands to reason that they’d have to pay more. That means paying more both within England – because other Premier League clubs can themselves afford to jack up prices – and abroad, too – because foreign clubs can compare their own players with the value of those sold within the Premier League.
Take City’s pursuit of Benjamin Mendy as an example. Monaco reportedly rejected a fee of £44.5m simply on the basis that they place their player’s value at around the same as Kyle Walker’s, and that means City will have to pay £50m.
It’s entirely reasonable for a club to look at their own asset and conclude that, given the market at a certain time, he should ne valued at a similar price to another club’s asset. So if City felt that they overpaid slightly for Walker – say, by £5m or so – but were happy to do so in order to get the deal over the line, that means that Monaco are now perfectly reasonably asking for the same concession.
The problems of this nature arising this summer, though, do seem to be greater and more numerous than in most transfer windows. That’s surely down to the fact that this is a new era of richer clubs that has suddenly spiked fees to a level which seems frankly absurd. It’s like going to Denmark and realising that the exchange rate to pounds sterling as at 1:10: in other words, your £2 cup of coffee now costs 20 Danish Kroner. But imagine paying £20 for a cup of coffee. It seems ludicrous, but the reality is, it’s just the rate of exchange.
That shows just how much of a bubble football lives in. In no other healthy industry does inflation happen so quickly, and in football, we’re also talking real money, but fairly notional values.
What makes Kyle Walker worth £50m as opposed to £25m, as it might have been two years ago, or £2.5m as it might have been in the late 1990s? What makes Romelu Lukaku worth £75m – or £90m overall – as opposed to even more? Why not £110m? That’s what’s so striking. You know why a cup of coffee costs £2 – the raw materials of the drink and the cup, the cost of packaging, manufacturing of the paper cup, the electricity needed to run the machine, plus the money to pay the barista to make it. All of that adds up to almost £2, and then there’s a little bit added on so the company makes a profit. In football, there’s no such reference point.
But that doesn’t mean the transfer market is completely mad this summer. It just means we haven’t yet settled on a combined agreement as to why the prices are as they are, nor have we yet come to terms with the amount of money being bandied around for players of arbitrary value.
The only thing that still doesn’t make sense – in fact, it’s the sickening part – is why a football player can cost more than a hospital or a library. But that’s a different argument.