Is the bubble about to burst? (all doomsday scenario posts here please)

Red Katie said:
It won't burst although I assume that is what you hope? And who are these clubs if I may ask?
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The clubs that are shelling out huge sums for players into today's hyper-inflated market. We all know who these clubs are. It doesn't need spelling out.

I don't necessarily hope the bubble does burst - tho' I think it will. I have mixed feelings about it because the current situation suits Spurs pretty well in a strange way: the cost of our new stadium shrinks in comparison to what we can sell the occasional player for (e.g. £50m for Walker) and the inflated price of new, established players - coupled with the money being diverted into the new stadium - forces us to rely more on our academy/youth development just at a time when we are starting to reap the rewards of having invested a lot in that youth set-up.

Also, our first XI is pretty strong, and was mostly acquired before prices started to reach today's absurd levels, so our need to buy new, established players is not that great compared to many other clubs.
 
Ijazz17 said:
How is it you call the transfer of a future Ballon D'Or winner (Aka Neymar) as batshit crazy but can justify Mbappe's transfer as less crazy "only" because he is 18 years old and only played half a season. I find the post to be very odd.
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How can you say Neymar is a future Ballon D'Or? Not likely to happen if he signs for PSG. Also unlikely going to happen as long as he's playing in Messi's shadow. There is also a reported €80m difference in what Mbappe will go for compared to what Neymar is going for. Would Mbappe's reported fee be okay if he was 24 and had put in several years of great football? In today's market I think so. What has Neymar done to warrant him going for €200m or there about? Signing Neymar does not guarantee PSG a CL title. They'd win the league title but they already do that pretty much every year. These clubs are paying these fees based on potential and marketing hype. We all know RM want the latest hyped up player every season. This season it's Mbappe. I think the Neymar speculation is all bullshit but only time will tell. He seems to be linked with a move away from Barca every season.
 
thegregster said:
The football bubble is the TV Deals,Commercial revenue and match day revenue.

Not just transfer fees.
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Well, yes, but the point is that some clubs are spending hugely on new players on the back of all this (even the sugar-daddy clubs rely on this revenue expansion to some extent, albeit less so than other clubs), and some clubs aren't. So when the music stops, some of the clubs in the former category may be left without chairs to sit on.
 
Yes the bubble is absolutely going to burst.
Spurs won't be finishing top 2 again, for a long long long time.
 
Pogue Mahone said:


Re the chat about streams eating into TV revenues, looks like the PL is trying to fight back.
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They're going to be fighting a losing battle.
They need to readjust the service they offer or they'll continue bleeding customers.
Do a netflix / video rental style thing. A tenner a match or something.
 
bonusroller said:
I hear what you're saying. For example if you go back 20 years when Alan Shearer joined Newcastle for £15m, there wasn't a defender going for the £10-12m.

However think back to 2002 where we bought Rio for £30m, then a year later Ronney for a similar amount.

That said VVD is no where in the same class as Rio.
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Exactly, it's not just because he's a defender, it's because he's just a good premier league defender, no more than that, and with no obvious sign that he's going to suddenly become a worldbeater. And yet the quoted fee is similar to ours for Lukaku, one of the top three strikers in the league at only 24 and with clear room for improvement in his game too.
 
caid said:
They're going to be fighting a losing battle.
They need to readjust the service they offer or they'll continue bleeding customers.
Do a netflix / video rental style thing. A tenner a match or something.
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If they did a package where you could stream all of your team's games for 40-50 quid a season I'd pay that for sure.

Add in special deals for big games or derby matches for other teams and watch the money roll in.

Stupid three o'clock kick off laws and everything to do with broadcasting the games needs to be redefined and changed to meet current technology and demand.
 
caid said:
They're going to be fighting a losing battle.
They need to readjust the service they offer or they'll continue bleeding customers.
Do a netflix / video rental style thing. A tenner a match or something.
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£10 a match kind of a plan would be a very very poor business for the league.

The current arrangement they have is probably the best one to maximise the revenues. Also, the crackdown is not very difficult to put in effect. All it needs is a govt contracted agency like the bailiffs to hunt down the offending ips (granted it will take some lobbying but can happen).
 
GlastonSpur said:
The clubs that are shelling out huge sums for players into today's hyper-inflated market. We all know who these clubs are. It doesn't need spelling out.
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GlastonSpur said:
Well, yes, but the point is that some clubs are spending hugely on new players on the back of all this (even the sugar-daddy clubs rely on this revenue expansion to some extent, albeit less so than other clubs), and some clubs aren't. So when the music stops, some of the clubs in the former category may be left without chairs to sit on.
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You've spent over a decade on here having the piss mercilessly taken out of you so you can constantly try (and usually fail) to big up Spurs and grasp at any faint opportunity to WUM United fans. Why be subtle? Might as well name these clubs. Fill yer boots.
 
The growth in club revenue, largely driven by TV contracts, is not sustainable.

Not that the NFL is the proverbial canary in a coal mine, especially for a different sport that counts most of its viewers in different countries, but after paying out record fees for TV contracts, ESPN has seen a very significant dip in viewership and has since laid off a large number of their employees, including popular on-air talent (
https://www.nytimes.com/2017/04/26/sports/espn-layoffs.html)

http://thebiglead.com/2017/03/10/the-sports-bubble-has-already-burst/
 
GlastonSpur said:
Well, yes, but the point is that some clubs are spending hugely on new players on the back of all this (even the sugar-daddy clubs rely on this revenue expansion to some extent, albeit less so than other clubs), and some clubs aren't. So when the music stops, some of the clubs in the former category may be left without chairs to sit on.
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I dont know,
Real Madrid and PSG are spending a fortune too. They dont have the TV deal that premier league clubs do.
In Reals case you assume they can afford it on money they generate.
What horrible disaster is going to occur with their finances that causes their player wages to bury them?

Player transfer fees aren't that meaningful. They're a once off cost, either you have the money or you dont.
Not every club needs to make a profit or break even on player sales to pay the bills. We've been giving players away for nothing for years.
 
They had this discussion in 1898 when the first player was transferred for £100 and 11 years later when the first 4 figure transfer went through. This has continued throughout the last century and into this one despite assurances from our fathers than the game wasn't about money in thier day. Transfers will continue to rise and this discussion will continue to bubble under the surface.
 
AshfordLad said:
£10 a match kind of a plan would be a very very poor business for the league.

The current arrangement they have is probably the best one to maximise the revenues. Also, the crackdown is not very difficult to put in effect. All it needs is a govt contracted agency like the bailiffs to hunt down the offending ips (granted it will take some lobbying but can happen).
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The offending ip's will be vpn's. Or they'll reside in russia or china. Or both.
And that would be a spectacularly unpopular decision by any government.
 
It's not speculative, is it? Prices & wages are increasing in line with income.

If costs exceeded the players intrinsic value we'd be in a bubble, but they don't. The players make the clubs a shit tonne of money and the price has spiked as a result.
 
caid said:
I dont know,
Real Madrid and PSG are spending a fortune too. They dont have the TV deal that premier league clubs do.
In Reals case you assume they can afford it on money they generate.
What horrible disaster is going to occur with their finances that causes their player wages to bury them?

Player transfer fees aren't that meaningful. They're a once off cost, either you have the money or you dont.
Not every club needs to make a profit or break even on player sales to pay the bills. We've been giving players away for nothing for years.
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Real haven't spent a fortune at all in recent years, to be fair.
 
caid said:
The offending ip's will be vpn's. Or they'll reside in russia or china. Or both.
And that would be a spectacularly unpopular decision by any government.
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By offending IP I mean the viewer not the host (hence it would require lobbying). That too only in countries where people can pay up eg. UK, US, Europe etc. Dont think anyone would go after poor countries like indonisia, india or nigeria or even russia for that matter.
The decision would be only be unpopular if the govt does a bad PR job on it. But with all the money the PL have they could put a very good spin on it. Afterall they would be stopping something illegal.
 
It is impossible for domestic broadcasting rights to continue like this. It is starting to hit a breaking point now where people won't/can't pay the price anymore - simple economics.

You might have a period where domestic rights drop but global rights pick up the slack to some degree. This might result in very modest or even negative growth for a few years.

In five and ten years the PL will still crush any other league in terms of broadcast revenue that is 100% certain.
 
AshfordLad said:
By offending IP I mean the viewer not the host (hence it would require lobbying). That too only in countries where people can pay up eg. UK, US, Europe etc. Dont think anyone would go after poor countries like indonisia, india or nigeria or even russia for that matter.
The decision would be only be unpopular if the govt does a bad PR job on it. But with all the money the PL have they could put a very good spin on it. Afterall they would be stopping something illegal.
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The host can change his ip, so the ip you blocked is no longer relevant.
The viewer can connect to a vpn, so the provider will only see them connected to that network, what they connect to from that network wont be available to the provider.

They're competing against a free, mediocre quality alternative. No amount of lobbying will end that.
 
caid said:
The host can change his ip, so the ip you blocked is no longer relevant.
The viewer can connect to a vpn, so the provider will only see them connected to that network, what they connect to from that network wont be available to the provider.

They're competing against a free, mediocre quality alternative. No amount of lobbying will end that.
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As said earlier, they do not need to care for the host as it can be in any country.

All they need to do is declare streaming illegal in for example UK. Now sure, some will use VPN and wont be caught but a good VPN would cost about £10 a month anyway so it would defeat the purpose of streaming illegally (think it costs about £20 to get PL games).

But most ppl who stream illegally dont pay for VPN, I am willing to speculate. The govt could just contract some agency to give them a substantial fine or a criminal record. Obviously this would require first getting offending IPs from the ISPs but with the amount of state control prevalent in western Europe, this would be not too difficult.
 
caid said:
They're going to be fighting a losing battle.
They need to readjust the service they offer or they'll continue bleeding customers.
Do a netflix / video rental style thing. A tenner a match or something.
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Exactly, this is an unwinnable war. As soon as they plug one dam, another will open up.
 
Tarrou said:
It's not speculative, is it? Prices & wages are increasing in line with income.

If costs exceeded the players intrinsic value we'd be in a bubble, but they don't. The players make the clubs a shit tonne of money and the price has spiked as a result.
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Exactly. I think some people like the OP don't quite understand what a bubble really is.

The wages and transfer fees as a percentage of overall turnover has been roughly the same for 20-30 years so there is no bubble. There is increased money coming into the sport. The growth of new money is obviously going to slow down, but then transfer fees and wages will just plateau.

Some clubs might go bust chasing an unrealistic dream like Leeds or find their sugar daddy abandons them like Malaga.

The OP just incorrect frames things - its not that the 'bubble will never burst' , there simply is no overall bubble here at all.
 
MikeSmalling said:
Not that the NFL is the proverbial canary in a coal mine, especially for a different sport that counts most of its viewers in different countries, but after paying out record fees for TV contracts, ESPN has seen a very significant dip in viewership and has since laid off a large number of their employees, including popular on-air talent (
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The NFL is starting to contract because that sport reached its natural growth limit. Due to its inherent cost and dangers, it simply never caught on in any other country except the US and now even in the US its popularity has plateau'd and has only been saved by the gambling industry (fantasy NFL)

Now that modern medicine is revealing the relationship between the NFL game and concussions which is very serious, even participation in the USA for NFL football has been declining among youths. The NFL tried very hard to ignore that Academy Award nominee movie about concussions and their sport but parents are paying it more and more attention every year.

http://www.vocativ.com/298019/youth-football-participation-is-plummeting/

https://www.forbes.com/sites/bobcoo...-ratings-slip-will-be-long-term/#38dca4ce2da2
 
The bubble has a long way to go. We turnover 500m which is actually quite small compared with other entertainment businesses which is ultimately what we are. Just wait until Facebook and Twitter start bidding for tv rights when they have 2 billion subscribers on the books. That's a huge global business model yet to be explored. I think we will turnover a billion within 5-7 years but salaries and transfer fees will have to stabilise as shareholders invest in other areas of the business.
 
caid said:
I dont know,
Real Madrid and PSG are spending a fortune too. They dont have the TV deal that premier league clubs do.
In Reals case you assume they can afford it on money they generate.
What horrible disaster is going to occur with their finances that causes their player wages to bury them?

Player transfer fees aren't that meaningful. They're a once off cost, either you have the money or you dont.
Not every club needs to make a profit or break even on player sales to pay the bills. We've been giving players away for nothing for years.
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Aren't they mostly paid in instalments over several years? So if a club makes several expensive signings each summer, the cumulative annual instalments bill builds up rapidly for years into the future.
 
It's not going to burst but I think buying clubs will look back at this window and think "Jesus, we can't go through that again".

We're in a big state of flux where Qatar are up against the wall and PSG have just lost the title to Monaco, where Barcelona have a new manager, where Italian clubs are looking to make a statement, where most of the Premier League's top clubs are only one season in to new management (and the managers are in a very strong position), and it's creating the perfect storm.

I'd expect a quieter window next year - possibly with the exception of the Milans if they qualify for the Champions League - and with this decreased demand selling clubs will have to reduce their prices also.

You'd predict a stronger Champions League showing by the likes of the English elite which will soothe their desperation to spend also.
 
I don't get why people are happy for this spending to carry on, this really isn't good for football. Over £100 million quoted for a player who has had one full season for Monaco (I think) and won three caps for France, no goals. This is not good.
 
Acole9 said:
I don't get why people are happy for this spending to carry on, this really isn't good for football. Over £100 million quoted for a player who has had one full season for Monaco (I think) and won three caps for France, no goals. This is not good.
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Why? Real Madrid could definitely afford it.
 
Bit of a pointless thread really since most people don't seem to know what a bubble is or what causes one.

Don't mean to go all 'holier than thou' on people but I have a degree in Economics and this isn't a bubble - it's basic supply and demand

Bubbles occur when people lose sight of the real value of something and can only ever imagine a world where prices go up. What eventually happens is people/organisations are so certain of this that they borrow money or put their assets up to purchase as many of these "sure things" as they can - tulips, tech. stocks, mortgage bonds.....when the value of the "good" stops rising or goes down, the bubble bursts and the debts are unsustainable.

I can understand why people have got confused because it sounds similar - but the crucial point is City aren't borrowing money to buy players, neither are Utd, neither are Real, neither are PSG etc....if the value of the entire market for players plummets for whatever reason clubs won't be left to pick up the pieces. Prices are going up because top players are in short supply, the clubs competing for them are richer than ever and so are the selling clubs. Its like art. A painting might not have any "real" value but if every rich bloke in the world wants to own a Picasso the price becomes insane
 
Lentwood said:
Bit of a pointless thread really since most people don't seem to know what a bubble is or what causes one.

Don't mean to go all 'holier than thou' on people but I have a degree in Economics and this isn't a bubble - it's basic supply and demand

Bubbles occur when people lose sight of the real value of something and can only ever imagine a world where prices go up. What eventually happens is people/organisations are so certain of this that they borrow money or put their assets up to purchase as many of these "sure things" as they can - tulips, tech. stocks, mortgage bonds.....when the value of the "good" stops rising or goes down, the bubble bursts and the debts are unsustainable.

I can understand why people have got confused because it sounds similar - but the crucial point is City aren't borrowing money to buy players, neither are Utd, neither are Real, neither are PSG etc....if the value of the entire market for players plummets for whatever reason clubs won't be left to pick up the pieces. Prices are going up because top players are in short supply, the clubs competing for them are richer than ever and so are the selling clubs. Its like art. A painting might not have any "real" value but if every rich bloke in the world wants to own a Picasso the price becomes insane
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While the whole premise of yout post here is correct, your assuming transfer fees are paid up front.

Aren't they paid in instalments over many years? If they whole thing went tits up and you owe 3 or 4 instalments on 3 or 4 £80 or £90 mil players it could turn into a situation where a club couldn't afford that player.

Especially someone like city or psg if their owner decided to jump ship because tv revenue bust or he simply got board.
 
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