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Transfer prices are rising. Why? And is that a problem?
SunFlash 8 years ago
USA 19 3260

Michy Batshuayi (£33m, Marseille)
Sadio Mane (£30m, Southampton)
Henrikh Mkhitaryan (£30m, Borussia Dortmund)
Miralem Pjanic (€38m, AS Roma)
Renato Sanches (€35m, Benfica)
Mats Hummels (€38m, Borussia Dortmund)
Grzegorz Krychowiak (€26m, Sevilla)

These are large figures, paid by Chelsea, Liverpool, United, Juventus, Bayern, and PSG respectively. What kind of world do we live in where a 19-year Renato Sanches is worth 35m, or if you listen to Bayern, even more? Like it or not, big clubs will spend big. Manchester United have bid more than 100m on Paul Pogba, and irrelevant of if the transfer actually goes through, the fact remains that they can. Is this a problem?

Personally, I would argue that it is not. Money has always been spent by the richest clubs in the world. To be real, Sanches for 35m is not that different from Ronaldo for 17m. Pogba for 100m is not that different from Zidane (46m) in 2001. What has effectively happened is that the top players have seen their value double. This is natural. Big clubs have always outpsent small clubs, and new TV deals combined with rich owners creating a larger bidding market have caused this naturally. This can be seen as quite logical. In 2001, when Real Madrid bought Zidane for 46m, they were quite literally the only club that could have done so. Juventus could have asked for 60m and it would not have made a difference. Real would not have increased their offer because there would be no reason to aside from lining Juventus' pockets.

However, today it is different. Take Pogba. At most, in terms of ability, Pogba is worth 70m, and that is being generous. In 2001, only one club would have been able to afford that, and it would have been Real Madrid. However, if the top clubs in the world are sold on the fact that Pogba is the next great midfielder and will be for the next decade (my opinion may differ, but whatever) how many of those clubs could realistically spend 70m? I would put out a list that includes United, both Madrids, Barca, Bayern, Juventus, PSG, City, Chelsea, and half of China. All the player's agent has to do is kindle interest in more than one of these clubs and the player's value will skyrocket as a big dick contest ensues between the clubs. Eventually, as we saw with Pogba, only one club is left, and by the time United becomes the only challenger, suddenly Pogba is worth 100m.

Of course, this doesn't just happen with players like Pogba. When I first saw that Chelsea had spent 33m on Batshuayi to presumably be a second striker, if that, I was stunned. It turned out over the following days that Chelsea had to beat Crystal Palace of all people, who had tried to get the former Marseille man for 30m, and Chelsea had to outbid them. In previous years before the BPL TV deal, a club like Crystal Palace would NEVER have had 30m to spend on a player, and therefore Chelsea would have been able to comfortably buy Batshuayi for 20m or less if none of the other world powers were interested, which in this case, they weren't.

Let's look at some different numbers:

Pierre-Emile Hojbjerg (£12.8m, Southampton)
Kevin Volland (€20m, Bayer Leverkusen)
Marten de Roon (£12m, Middlesbrough)
Fernando (€14m, Spartak Moscow)
Ruben Rochina (€11m, Rubin Kazan)
Matt Ritchie (£12m, Newcastle United)
Dwight Gayle (£9m, Newcastle United)
Jordon Ibe (£15m, Bournemouth)
James Tomkins (£10m, Crystal Palace)

From a price inflation standpoint, it is these numbers that show me great concern. In what realm of possibility can Newcastle United, a team in the Championship afford to spend more than 20m on below-average BPL players? How is James Tomkins, who doesn't even start for West Ham, worth 10m to Crystal Palace? Times are changing, but why?

Much like the bidding war I explained earlier, the same holds true for these players. Premier League teams from the regulation spots up have significant amounts of money to spend, which makes them competition. As any idiot can tell you about economics, if demand does not equal supply, prices will increase. There is more demand from more teams that ever before, and they now have the fiscal ability to pull it off. Which brings me to Leicester City.

Leicester City are being called one of the biggest success stories of all time. How could a club that was so close to utter failure, turn it around and beat all the "big-spending" clubs? Most of us have deducted that it was a combination of bad form on the part of the British powers (Chelsea, United, City, Arsenal) and the smashing success of Leicester's summer signings, which included Kante, Okazaki, Huth, and Gray for a combined 20m, as well as a number of frees (Fuchs, Dyer) and the great success of Mahrez and Vardy. However, if one looks at the stats, Leicester had the best defence in the league and that allowed Ranieri to use his high-flying counter system based off of Kante's workrate, Drinkwater's passing, and further up the pitch, Mahrez and Vardy. That 20m in transfer fees (and over 200k in weekly wages just from the players Leicester brought in equaling over 10m for the entire year) was the foundation on which Leicester won the league.

The team that barely escaped relegation spent 30m, and nailed every single signing. It was enough to win them the title. As recently as three of four years ago, a team at Leicester's status would never have had 30m to spend in a single window. And if they did, there was no possibility they would win the league, so many owners simply sat on the majority of money that they had. (See: Mike Ashley).

But with Leicester, everything has changed. Nailing all your signings can win you a league. Nailing even one, such as West Ham and Payet, can get you into Europe. Every team in the BPL is trying to be Leicester, and spending up, hoping to find that one player, or group of players. Owners and executives have turned into the happy-go-lucky fans who run up and down the streets yelling "we're going to be AMAZING" whenever their team makes a signing. Hope has found its way into every BPL team.

Which of course means that everyone else is taking advantage of it, and with good reason. It was commented by an agent that clubs have one price for BPL clubs and one price for non-BPL clubs. It all has to do with what a club can spend, and as far as every club is concerned, once a British team is involved, no one else can match them. That's why it seems that BPL teams are overpaying for players, because they are. British players are even worse. Thanks to BPL rules that require 8 out of the 25 squad players to be from a part of the UK, a player such as Raheem Sterling or John Stones becomes incredibly overvalued. Instead of having a smashing foreign starting 11 (cough City cough) with English bench players, any chance at grabbing an English player that is starting 11 capable becomes priority because it frees up squad space.

However, this doesn't just affect the average teams of Europe, it affects the elite ones too. Bayern spent 35m on Sanches because they had to, due to United's interest. If United is not interested, Bayern could have probably gotten him for 25m or less. Bayern then loses out. Juventus is having the same issue, expect they are refusing to play. Selling off players for high amounts of money and buying within their league (see: Pjanic) and accepting older frees (Pirlo/Evra/Dani Alves/Marcheso etc) basically has shown that Juventus only makes a move when no other large clubs are involved, usually when accepting rejects like Morata and Pogba. PSG are playing the game, and playing it hard, but still have yet to take a major player off of the hands of a power that the power wanted to keep - and no, going full retard for David Luiz seems to be an exception, not the rule, and that's if Chelsea even wanted to keep him.

There are a couple things to take from this.

-Prices for elite players will only continue to rise as more clubs acquire big time spending power (ex; China)
-Prices for British players will become obnoxious to the point where clubs outside of England will literally not be able to afford them...some would argue that we are at that point already.
-The BPL will become much more competitive. Squad strength across the entire league has strengthened significantly since there is no competition for players from teams outside the BPL (aside for elite players).
-If no BPL team is interested in a player, that player will be sold for what amounts to potentially half of what that BPL club would've spent.
-European giants will suffer from increased competition especially if they don't hold major TV deals themselves, Bayern not as much, but Juventus and PSG mainly.

So what's your opinion on rising transfer fees? Is it bad for the BPL, Europe, smaller clubs, larger clubs? Good for the balance of the game? I'm curious to know what you guys think.

1
Comments
tiki_taka 8 years ago Edited
Barcelona, France 367 9768

Have to admit didnt read everything written above, And concerning some leagues ligue 1 for instance, kind of players who costed 10 mil 5 years ago are costing 10-12 mil just like any product outside Football buisness. I Fully agree with your last post but I dont see à huge rise on " normal " talents unless its a big gun who enter the négociation.
If you offer a service to a poor person for 5 dollar, you can offer the same service to a Rich guy 25 dollar depending on who is going to buy And How he Will negotiate. If Michy went to Dortmund the transfer would have costed 25 mil, if Pjanic went to City Roma would have sold him at 60 mil.

For normal transactions between normal clubs, the inflation isnt different for me. But yeah the economical analysis part debate was interesting to read from both of you.

PL is an exception, because of the budgets And the marketing arround, even average players from midtable teams are considered stars there just like in NBA. In other leagues 90% of transfers prices look fair, Villareal sell to Sociedad is different than Villareal sell to United, for the same player you can witness a big gap between the 2 negotiations.

0
  • History
Showing previous versions of this text.

Have to admit didnt read everything written above, And concerning some leagues ligue 1 for instance, kind of players who costed 10 mil 5 years ago are costing 10-12 mil just like any product outside Football buisness. I Fully agree with your last post but I dont see à huge rise on " normal " talents unless its a big gun who enter the négociation.
If you offer a service to a poor person for 5 dollar, you can offer the same service to a Rich guy dependind who is going to buy And How he Will negotiate. If Michy went to Dortmund the transfer would have costed 25 mil, if Pjanic went to City Roma would have sold him at 60 mil.

For normal transactions between normal clubs, the inflation isnt different for me. But yeah the economical analysis part debate was interesting to read from both of you.

PL is an exception, because of the budgets And the marketing arround, even average players from midtable teams are considered stars there just like in NBA. In other leagues 90% of transfers prices look fair, Villareal sell to Sociedad is different than Villareal sell to United, for the same player you can witness a big gap between the 2 negotiations.

SunFlash 8 years ago Edited
USA 19 3260

I respect your points and research, but the amount of money we see in the game today is not a natural increase incurred with the rate of inflation. Otherwise, much like the most expensive player in the world, the price of a doughnut would have increased by more than half, when clearly it has not.

Much of the world's economy is run by debt (I should know I have student loans), but just because there is more money involved doesn't mean that value itself changes.

Example A:
Newspaper in 1900: 5 cents
Newspaper in 2000: 99 cents

Just because the newspaper increased in price to over twice its old price does not mean the VALUE of the newspaper itself changed. A newspaper is just as affordable now, if not more so, even if the price increased that much.

If we apply this to football, it is probably safe to assume that the average European club (not PL club) has far more money to spend then they did 10 years ago. This is normal, and is consistent with inflation.

What has happened in the BPL is that mid and lower level teams can now spend 30m on a single player, like Palace attempted to do recently. If we go back five years, Palace could not have dreamed of an eighth of that amount of money, and clearly inflation did not make the price of everything else increase by eight times as well, or else I would be in a spectacular amount of debt, since my newspaper would now cost 8 dollars on a daily basis.

The price of players is increasing, but unlike what sustainable inflation does, the VALUE of players is increasing as well.

So, again, I understand what you're saying, and it is a factor, but it is ignoring the sheer ridiculous amount of money that is in the BPL now.

0
  • History
Showing previous versions of this text.

I respect your points and research, but the amount of money we see in the game today is not a natural increase incurred with the rate of inflation. Otherwise, much like the most expensive player in the world, the price of a doughnut would have increased by more than half, when clearly it has not.

Much of the world's economy is run by debt (I should know I have student loans), but just because there is more money involved doesn't mean that value itself changes.

Example A:
Newspaper in 1900: 5 cents
Newspaper in 2000: 99 cents

Just because the newspaper increased in price to over twice its old price does not mean the VALUE of the newspaper itself changed. A newspaper is just as affordable now, if not more so, even if the price increased that much.

If we apply this to football, it is probably safe to assume that the average European club (not PL club) has far more money to spend then they did 10 years ago. This is normal, and is consistent with inflation.

What has happened in the BPL is that mid and lower level teams can now spend 30m on a single player, like Palace attempted to do recently. If we go back five years, Palace could not have dreamed of an eighth of that amount of money, and clearly inflation did not make the price of everything else increase by eight times as well, or else I would be in a spectacular amount of debt, since my newspaper would now cost 8 dollars on a daily basis.

So, again, I understand what you're saying, and it is a factor, but it is ignoring the sheer ridiculous amount of money that is in the BPL now.