In the summer of 2008, Manchester City sealed the transfer of Brazilian superstar, Robinho for a British transfer record of £32.5 million. At the time, even Chelsea were unable to pay that kind of money for the player. If we fast forward just eight years to 2016, the total transfer figure in this window is expected to break the billion pound mark and players are regularly moving for £30 million plus. Manchester United are currently in the process of attempting to sign Paul Pogba for a fee in excess of £120 million, a player they once let go for no fee at all.
Lets look at what has caused the hike in player prices in the Premier League and why players like John Stones and Romelu Lukaku of Everton have asking prices of over 40 million and 70 million respectively. Obviously inflation has a small part to play in relation to the rise in prices, however one of the main reasons is the increase in TV revenue. In February 2016 clubs were told that they would be sharing £8.3 billion in TV revenue between the 2016-2019 Premier League season, with just over £5 billion coming from Sky and BT sport. This season even Aston Villa, who finished dead last in an embarrassing league campaign received around £66 million.
It isn’t just Premier League clubs who are wildly spending on players.
During the winter transfer window last season, Chinese teams began to try and lure stars from all over the world to the Chinese Super League. Over £200 million was spent on players, including a reported 25 million pound deal for Chelsea midfielder Ramires. That sum was higher than the total spent by Premier League clubs during the January transfer window. More recently Italian striker Graziano Pelle signed for Shandong Luneng for around about 13 million. Now this may not seem a huge amount of money, but the 31 year old will be earring £260,000 a week, the same kind of money that the world’s best players will be on.
The reason for this sudden surge in spending from Chinese clubs is different than that of English sides. China’s president Xi Jinping has announced that he has a goal of developing a domestic sport economy of $850 billion by the year 2025. He believes that sport can be used to show China’s world status and football is the perfect way to kickstart this project. Clubs are partially state funded. However, companies must spend in order to show appreciation of the government’s goals and as a result clubs are sending more and more money on big name players.
In my opinion, prices for players are inevitably going to keep rising unless a cap is put on transfer fees. Premier League clubs are probably going to tap into the Chinese market and further develop their brand, creating more revenue. This is extremely unfortunate for clubs in leagues where TV revenue is minuscule in comparison to the Premier League. Here in Scotland clubs are fighting for their lives every season and even our best and most successful clubs have no way of competing against our English neighbours.