R.Vinello

The DFL also sold international rights to bwin for €20m a season. This money is only spread out among the 18 teams from the first Bundesliga. In addition the distribution key is very top heavy and uses the final table position of the last season as a ranking. The top five receive the majority of the money (€4m, €3m, €2m, €1m, €1m).

The current deal is valid for this and next season.

Maybe even English-speakers could understand the explanation or derive it from the presented numbers, calulcations and examples, it is the second post in the thread. If there is interest I could explain the essence of the distribution system here in English.

Sorry, but I dont know too many English soccer sites, especially ones who would report in detail about the antitrust problems of the Bundesliga.
As far as I know the antitrust authority sent an enquiry about the current TV deal, decentralised TV deals and their financial impact to all Bundesliga clubs, who had to send back the answer at the 19th of March. Obviously it is to short to survey all the answers and publish any information or conclusions.

Their main beef is the distribution of the money and the new publishing company, owned by Kirch and the DFL. The company would (only) give the pay tv broadcasters a prefabricated product which they would have to distribute via their channels. The idea is to lower the entrance barriers for new pay tv broadcasters, who would no longer need to build up a whole sport section from scratch.

The journalistic independence would obviously be compromised as the host (the DFL) would also do all the press work surrounding the games.

could you tell me a little more about what’s going on at the moment with the german cartel investigation inot kirch? what’s the latest? how is the tv money currently split? can you recommend a good website for this info? many thanks

some interesting stuff, but a point that should be mentioned is that the german population is 82.5m (and declining) and the uk is 60m with england’s at 50m. therefore, assuming shirts cost the same – £45, then the gap would be about £1.5bn . but point taken about sales.

The size of the home market isnt the deciding factor in the merchandising income. Real, ManU, Liverpool, Barca, Bayern etc aren’t makein so much more money than everbody else because the plaster everyone in they home countries with their products. They have a global market and teams like Schalke, Hamburg or Bremen simply can’t compete there, no extravagant marketing will help there, only long sustained success at the international and national level does. Even then they will have a hard time closing the gap.

Similar things are true for the gate receipts. Most clubs, especially the bigger ones, make the most money from business seats and luxury boxes not from the 10€ stand tickets they are only some kind of additional pocket money. I pretty much doubt that the high prices there differ that much from the English one. It even is a reasonable policy to sell a bunch of tickets at cheap prices to guarantee the appropriate athmosphere the high price spectators expect of a football match.

The biggest problem in terms of revenue for the German teams is the TV market. There is no viable competition between paytv channels to drive up the prize into crazy regions like in the PL. On top of that come home made issues f.e. repeated absolutely amateurish negotiations nd contracts by the league officials, the fans don’t wanting a split up game day, because of various reasons, competition for amateur clubs, overmarketing, away games can only planned on short notice, myth “Sportschau”, high marketing income because of the high range in public TV etc. Frankly as long as the officials are botching the TV deals as much as they constantly have for the last 7-8 years, there is no reason for the fans to step down.

The next biggest challenge will be the decision of the German cartel bureau concerning the central TV marketing. They are extremely unsatisfied with the revenue distribution (best teams get ca 25m /y, worst in 1. Bundesliga around 12m/y, teams in the 2. Bundesliga somewhere between 4-5m to 8-10m). If the central TV market goes all the mid level teams like Hannover can forget about getting good investors, because their TV deals will be too small.

Even if the Bundesliga opens itself up to investors, it wouldn’t change much in terms of internal competitiveness, as the rich clubs would get more potent investors than the smaller clubs. It would only tighten the grip of the richest clubs on the top denying the small teams the much needed income and marketing boost of the CL.

ANY model is vulnerable. There is no 100% safe business venture. The question is: ‘do you want to get the biggest bang for the buck or not?’
The semi-pro model that Euro leagues had up until the 70’s was safer but as a fan of those leagues would you want to see that? NASL was on the verge of becoming the world’s top league back in the day because they actually paid people top dollar. That was in the early 80’s. As you can see, Europe is still kinda new to making the game a self sustaining prospect.
It will be interesting to see what happens with the marketing case, but I don’t see it being as much of a target as 50+1 which violates free trade laws (see Jan’s excellent point re: Bayer & VW) that the EU seems so intent on upholding (in theory anyway) Your point on possible implications is a very valid one though.

Daniel”I don`t see any need for a sugar daddy in the Bundesliga. The financial situation is excellent. The Bundesliga grew 15% within a year and although it is not a global brand like the PL, its revenues from merchandising and sponsorship deals are much higher than in the PL. The Bundesliga might look non-commercial from the outside, but reality is different.”

Of course Bundesliga makes a great deal of money. Not including Russia, it’s nearly twice the size of any other country in Europe and the football pyramid is much shorter than any other country of ‘large’ size in Europe which means people have fewer choices of clubs to support (that’s to say nothing of the fact that Germany is the richest nation in Europe). The Bundesliga should be killing the rest of Europe in revenue. Built in competitive imbalances stifle what should be much greater growth.
Sponsorship money will always be greater in Germany because of said massive population and wealth. Germans are also more consumer oriented than most countries in Europe which makes them even more attractive to Sponsors. The same holds true for merchandising. Germany has 90 million potential people buying shirts, England has 60 million. At $100 per shirt it’s nearly a $9 BILLION potential revenue difference.

Sure there is commercialism in Bundesliga, there is in every league in Europe that is big. But the utilization of it is simplistic to say the least. I mean, 2 years ago Bundesliga formed an agreement with MLS to learn business practices in terms of marketing and liscensing in exchange for information on how to produce a match for TV. If Bundesliga seeking the advice of a league that is less than 15 years old for how to maximize revenues isn’t telling enough of how far Bundesliga needs to go despite how far it has come, I don’t know what is.
I’ve been a Bundesliga fan my whole life and just wish it would reassert itself and make the strides it could.

To answer the Serie A question, yes, the model here has always been for the owner to absorb and fund the club’s losses (when they can’t be forgiven by legislative action or absorbed by municipal authorities); Moratti has just been the most benevolent in recent years (but then, he has significantly more money than any of the others except Sivio). It fits nicely into the highly paternalistic structure of Italian football (and much of Italian society). The “Anglo-Saxon” idea that clubs can actually be run as profit-making enterprises hasn’t really caught on here (though the new group at Juve is trying, and Berlusconi has made noises about wanting Milan to break even), which may be one reason why there hasn’t been as much interest on the part of foreign investors. It will be interesting to see if the latest rumours of serious interest by the Gap/Banana Republic heir in Roma turn into something tangible, as I would imagine that he and his group have other ideas about a club should be run.