FOOTBALL
A new ball game
THE ENGLISH PREMIER LEAGUE COMPLETED ITS 30TH SEASON IN LATE MAY 2022, MAKING IT THE SAME AGE AS THE CISI. HERE, NEIL JENSEN TRACES SOME DEVELOPMENTAL PARALLELS BETWEEN THE FINANCE SECTOR AND THE PREMIER LEAGUE OVER THE PAST THREE DECADES
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n 1992, when the Premier League kicked off, the world was a very different place. The UK was a member of the European Union, pound sterling was still part of the European Exchange Rate
Mechanism – at least until 16 September (Black Wednesday) when it was withdrawn by the government – and the concept of minimum wage was introduced in the Labour Party’s manifesto. Finance, much like football, had to navigate this changing landscape. Technology was advancing, with the invention of the first smartphone, and the rate of inflation was at 3.74%. Football was emerging from tragedy:
the 1980s had seen disasters at Hillsborough, Heysel Stadium in Brussels, and in Bradford, and the popularity of the sport was declining. The Premier League’s inauguration was a response to this diminishing appeal and a bid to leverage untapped opportunities.
A new structure Author and consultant Alex Fynn, who has been called ‘the spiritual godfather of the Premier League’ because of his involvement in early discussions around its creation, championed a structure comprising slimmed-down leagues and regionalisation. “We had the idea that fewer games and more emphasis on a showcase division at the top would reap benefits for the England national team and also prestigious competitions like the FA Cup. But this was not intended to be the creation of a breakaway.” At that stage, nobody could have foreseen that the Premier League, which became the
CISI.ORG/REVIEW
epitome of a globalised, cosmopolitan product, employing players, coaches, and managers from abroad, would come under threat from the UK’s own breakaway from the European Union. Initially, however, the Premier League
merely resembled the same product with a different label. “In reality, little changed in those early years and broadcasting revenues were not as substantial as history tries to tell us,” says Alex. The first cycle (1992–97) amounted to less than £40m per season for domestic rights and the most recent deal for the 2022–25 cycle is £1.5bn per season.
Impact of technology To some extent, the rise of broadcasting rights as a source of valuable income was a reflection not just of football’s resurgence but of the technological revolution taking place across all aspects of business. This was reflected in the dot-com boom, which gathered pace between 1995 and 2000. The US index, Nasdaq, climbed by 400% during this period, only to spectacularly collapse in late 2002. New technology made broadcasting
more dynamic and enhanced the product. People clamoured for football on TV and broadcasters benefited from subscription channels. Club revenues grew dramatically. For example, Arsenal’s financial statement 1991/2 shows a turnover of nearly £14m in 1992, growing to £325m by 2021.
Dropping the ball on gender representation Women’s football was also gaining popularity in the 90s. According to
// THE PREMIER LEAGUE’S INAUGURATION WAS A
RESPONSE TO THIS DIMINISHING APPEAL AND A BID TO LEVERAGE UNTAPPED OPPORTUNITIES //
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