Football: Financial Fair Play Paradox

With the 2012-13 season already half way down and approaching its business end, clubs have more than one thing in mind. The first thing, everyone can guess, is finishing at the best possible spot; but the other point being the implementation of Financial Fair Play (FFP) from 2013-14. FFP, according to wide spread discussion, would affect transfer policy of clubs as well as put a huge pressure on marketing and revenue generation. FFP will make clubs grasp every last denomination out of their revenue source, even more important when they need to cope with ever rising wages and mind boggling transfer fees.

The recent melee created by Man City fans regarding high away ticket prices charged by Arsenal FC fizzled out relatively quickly, given the fact that Arsenal was able to reallocate all of the unsold tickets and secure a capacity crowd of 60,017. Contrary to reports where Richard Scudamore (Premier League chief executive) supported Man City fans and urged them to show their feelings through market mechanism, it could be argued that it is the market mechanism which forces clubs to charge high ticket prices for match days. With high wage bills and pressure to bring world class players to clubs, it can be safely said that financial fair play regulation will not help in this matter of ticket prices. In addition to this, Arsene Wenger defended his club’s decision, quoting, “Ideally you want ticket prices to be as low as possible, but on the other hand the only way we can pay the wages and compete without any external help is through the ticket prices because it is our main income” shows the gravity of the situation.

FFP principally will limit the number of losses a club can sustain, and the penalties for FFP non-conformity understandably will include a ‘limit on squad size in UEFA competitions, fines and withholding of prize money and, ultimately, exclusion’. With UEFA’s stand regarding FFP and its promise of closing all loopholes in the proposed system, it would be interesting to follow the big spenders across European football in their approach towards running their respective clubs.