A big aspect of modern football is the change in the way players move between clubs. Players have always moved between clubs so this is not something new, however, the frequency and the amounts for which they are transferred has changed significantly. As I pointed out in part one, the Bosman ruling was a huge contributory factor to the way transfers are now conducted, and the millions in television revenue, as described in part two, also fuel the current transfer system. But these are not the only factors.
The Bosman Ruling
In 1995, the European Court of Justice ruled in favour of Jean-Marc Bosman in his case against RFC Liège, The Belgian FA and UEFA. This ruling meant that any EU footballer had freedom of movement, within the EU, to transfer between clubs for no fee. This had a huge impact on the balance of power between clubs and players. Players could now demand higher contracts when renegotiating with clubs, as the clubs would not want to lose them for nothing if their contracts expired. Players could also demand more from clubs if they were arriving on a “Bosman Transfer”, as the club they were moving to had not had to invest a transfer fee to acquire that player.
Early players to take advantage of this were Edgar Davids and Patrick Kluivert who both moved from Ajax to AC Milan on Bosman Transfers in 1996 and 1997 respectively; Steve McManaman moved from Liverpool to Real Madrid in 2000 and Sol Campbell made the controversial move across north London from Tottenham Hotspur to Arsenal in 2001. This saw clubs take a different stance over players with expiring contracts, with many offloading them before they reach the end of their contracts if new ones can’t be agreed.
Television’s Millions
With the influx of money from Sky, transfer fees increasing quickly and many teams willing to pay more, the British transfer record was broken three times in 1995 alone, with Manchester United buying Andrew Cole, Arsenal Dennis Bergkamp and Liverpool Stan Collymore. As TV deals have increased so have transfer fees and the additional revenue from the UEFA Champions League has had teams spending beyond their means to reach this pot of gold. Most notably, Leeds spent money on players based on the business model that they would continue to qualify for the Champions League, and then endured the financial disaster that followed their failure to qualify.
Galácticos
A different strategy exercised mostly in Spain was the Galácticos, personified by the spending habits of Real Madrid. Already having won the 2000 UEFA Champions League with star players such as Raúl, Roberto Carlos and Steve McManaman, Real undertook a policy of signing one world star each summer, starting with Luís Figo from Barcelona in 2000, Zinedine Zidane from Juventus in 2001, Ronaldo from Inter in 2002 and David Beckham from Manchester United in 2003. This policy netted them another Champions League in 2002 but did not get them the sustained dominance that President Florentino Pérez had hoped for and the club went in a different direction under new president Ramón Calderón. In his second term, Pérez has gone back to the Galacticos formula breaking the world record transfer fee again and again to sign Kaka, Cristiano Ronaldo and Gareth Bale. This has led to an increase in world transfer fees with other clubs having to spend over £50 million on players such as David Luiz, Fernando Torres, Falcao, Edinson Cavani, Ángel Di María, Luis Suárez, Neymar and Zlatan Ibrahimović to compete.
Billionaire Owners
Another aspect of modern football that has affected transfer values is billionaire owners of clubs such as Roman Abramovich at Chelsea and Sheikh Mansour at Manchester City. These owners have bought teams and demanded instant success spending hundreds of £millions bringing in some of the best players from around the world, sometimes overspending on a player to lure him away from more traditional powerhouse clubs. This leads to other clubs spending more to keep up.
The transfer system has fluctuated in the last 20 years with some players going for astronomical fees and other top players moving for nothing. UEFA is trying to steady the ship with financial fair play, whereby a team cannot spend more than it earns, but with the millions that teams are earning through TV deals, they will continue to spend big on the best players in the chase for success.
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