Have Arsenal failed to capitalize on Emirates move?
Building on Revenue
By Merlion
September 26 2011
As everyone knows Arsenal moved to a new stadium to maximize revenues, and this has been acclaimed a success. However, Merlion believes that the increase in revenue is not as good as it should be, especially when compared with the revenue growth at other top European clubs. He starts by comparing season on season growth in revenue at the Emirates with that at Highbury, before comparing growth with other top clubs.
Arsenal moved to Emirates for the 2006/07 season and I will compare Arsenal’s financial ranking from 2000/01 to 2004/05 season in Table 1. 2004/05 season marked the end of the French Spine, Arsene Wenger’s 2nd Arsenal team; and the rebuilding of Fabregas Era, Arsene Wenger’s 3rd Arsenal team.
Note that Premier League clubs started to overtake Italian and German football clubs, as money from the new TV contract came streaming in to boost their income. (NB From 2006/07 to 2007/08, Premier League revenues were boosted by the new TV rights contract.)
During the Highbury Era, Arsenal FC was just a 2nd tier club and could not compete against those Top-8 marquee clubs. This was simply due to Arsenal FC failing to expand their global appeal as in the case of Manchester United, Liverpool and Chelsea. Chelsea FC shot into the rank of “marquee club” due to Abramovich and Peter Kenyon in maximizing their global market appeal. This is most telling in table below:
Revenues increase from 2001 to 2005/06 in €-million
2005/06 2001/02 Increase
Man U 242.6 229.5 13.1 6%
Chelsea 221.0 143.4 77.6 54%
Arsenal 177.4 141.4 36.0 25%
Liverpool 176.0 154.6 21.4 14%
It also shows the decline of Liverpool FC, and that Arsenal increased its revenues mainly due to the successes of the French spine on the pitch. It was not from additional revenues and from global merchandise sales like Liverpool FC with its vast appeal in the Asian market, and of course, revenues generated during the summer overseas tours.
I believe that Arsene Wenger’s “euro-centric” policy during summer pre-season training (refusing to tour America or Asia) hampered Arsenal FC’s global appeal during the halcyon days of The French spine and is the “Smoking gun” in the failure to maximize revenue (Sure you don’t mean grassy knoll. Ed). This is illustrated by the mediocre 25% increase in revenues in contrast to the stupendous Chelsea FC 54% increase in revenues for the same period with their 1st League title in 2004/05 after 50 years.
It is notable that from 2000/01 to 2009/10, the Top-10 football clubs are virtually unchanged and presumably by the end of 2011/12 season, Manchester City will be ranked within the Top-10 football clubs in term of revenues.
During our last season at Highbury, the 2005/06 revenues were €177.4-million. And in our very first season at Emirates, the 2006/07 revenues were €263.9-million, an increase of €86.5-million or 49% over that 2006/07 revenues of €177.4-million. This clearly indicates the financial capability of The Emirates over Highbury in terms of ticket sales, shirt and stadium naming rights.
But as shown below, from 2006/07 season to 2009/10 season, the aggregate increase in revenues is 4% of 2006/07 season, Arsenal Holdings failed to grow the revenues, substantially, year-on-year as apparently merchandise sales, TV rights and lack of successes on the pitch contributed to this stagnation.
This was partly due to the narrow vision of Arsenal's Board of Directors indulging to Arsene Wenger’s insistence of pre-season training in Austria instead of touring America and Asia to boost Arsenal's global commercial interests as well as tapping into the lucrative summer tours market. It was also due to the decline in value of the front loaded stadium and shirts sponsorships.
A useful contrast amongst the Top-4 from 2006/07 to 2009/10 is tabulated below:
Revenues increase from 2006 to 2009/10 in €-million
2009/10 2006/07 Increase
Man U 349.8 315.2 34.6 11%
Arsenal 274.1 263.9 10.2 4%
Chelsea 255.9 283.0 - 27.1 - 10%
Liverpool 225.3 198.9 26.4 13%
That Ivan Gazidis, PHW & the Board failed to grow the revenues of Arsenal Holdings during the “Emirates Period from 2006/07 to 2009/10” by 25% from the same “Highbury Period” from 2000/01 to 2005/06 is a devastating verdict on their claimed financial success. (NB figures do not include 2010-2011)
Since we have been resident at the Emirates between 2006/07, our revenues grew only by 4% indicate Arsenal FC global appeal does not compare to those marquee clubs in Real Madrid, Barcelona and Manchester United.
Otherwise, how to explain that with a brand-new 60,000-seater stadium and the world highest ticket prices, that aggregated revenues only grew by 4% between the 2006/07 and 2009/10 seasons?
Below are my compilations of the stats for those readers who love to crunch numbers.
A few definitions as indicated below:
Data for “Deloitte Football Money League” were obtained by using “Google Search”. The ranking in brackets is for that respective season. E.g. Manchester United was ranked No. 1 from 2000/01 to 2003/04 season.
“Year-on-Year” increase is to compare previous season revenues with current. E.g. Arsenal’s 2005/06 and 2006/07 season are €177.4-million and €263.9-million. FY2006/07 “Year-on-Year” (Y-o-Y) increase is €86.5-million or 49% from FY2005/06 (FY = Financial Year).
Table 1 – 2001/02 to 2005/06 revenues (€ million)
2005/06 2004/05 2003/04 2002/03 2001/02
Real Madrid 292.2 275.7 236.2 193.7 152.2
Y-o-Y Increase 6% 17% 22% 27% 10%
Ranking (1) (1) (2) (4) (6)
Barcelona 259.1 207.9 169.9 - 139.8
Y-o-Y Increase 25% 22% - - -
Ranking (2) (6) (7) - (9)
Juventus 251.2 229.4 215.3 218.8 177.9
Y-o-Y Increase 10% 7% - 2% 23% 3%
Ranking (3) (4) (5) (2) (2)
Man United 242.6 246.4 259.4 251.2 229.5
Y-o-Y Increase - 2% - 5% 3% 9% 6%
Ranking (4) (2) (1) (1) (1)
AC Milan 238.7 234.0 222.1 200.4 159.1
Y-o-Y Increase 2% 5% 11% 26% - 3%
Ranking (5) (3) (3) (3) (4)
Chelsea 221.0 220.8 217.5 134.1 143.4
Y-o-Y Increase 0% 2% 62% - 6% 21%
Ranking (6) (5) (4) (10) (7)
Inter Milan 206.6 177.2 167.1 162.5 -
Y-o-Y Increase 17% 6% 3% - -
Ranking (7) (9) (8) (6) -
B Munich 204.7 189.5 166.4 163.9 176.8
Y-o-Y Increase 8% 14% 2% - 7% 2%
Ranking (8) (7) (9) (5) (3)
Arsenal 177.4 171.3 174.1 150.1 141.4
Y-o-Y Increase 5.3% - 2% 16% 6% -
Ranking (9) (10) (6) (7) (8)
Liverpool 176.0 181.2 140.2 149.3 154.6
Y-o-Y Increase - 3% 29% - 6% - 3% 12%
Ranking (10) (8) (10) (8) (5)
Table 2 – 2006/07 to 2009/10 revenues (€ million)
2009/10 2008/09 2007/08 2006/07
Real Madrid 438.6 401.4 365.8 351.0
Y-o-Y Increase 9% 10% 4% 20%
Ranking (1) (1) (1) (1)
Barcelona 398.1 365.9 308.8 290.1
Y-o-Y Increase 9% 18% 6% 12%
Ranking (2) (2) (3) (3)
Man United 349.8 327.0 324.8 315.2
Y-o-Y Increase 7% 1% 3% 30%
Ranking (3) (3) (2) (2)
B Munich 323.0 289.5 295.3 223.3
Y-o-Y Increase 12% - 2% 32% 9%
Ranking (4) (4) (4) (7)
Arsenal 274.1 263.0 264.0 263.9
Y-o-Y Increase 4% 0% 0% 49%
Ranking (5) (5) (6) (5)
Chelsea 255.9 242.3 268.9 283.0
Y-o-Y Increase 6% - 10% - 5% 28%
Ranking (6) (6) (5) (4)
AC Milan 235.8 196.5 209.5 227.2
Y-o-Y Increase 20% - 6% - 8% - 5 %
Ranking (7) (10) (8) (6)
Liverpool 225.3 237.0 210.9 198.9
Y-o-Y Increase - 4% 12% 6% 13%
Ranking (8) (7) (7) (8)
Inter Milan 224.8 196.5 172.9 195.0
Y-o-Y Increase 16% 14% - 11% - 6%
Ranking (9) (9) (10) (9)
Juventus 205.0 203.2 167.5 145.2
Y-o-Y Increase 6% 17% 22% 27%
Ranking (10) (8) (11) (12)
Manc City 152.8 101.2 104.0 -
Y-o-Y Increase 51% - 3% - -
Ranking (11) (19) (20) -
Table 3 - Revenues Increase form 2000/01 to 2009/10 in € million
Increase 2000 to 2010 2006/07 to 2010
€-million % €-million %
R Madrid 300.4 217% 87.6 25%
Barca 285.5 253% 108.0 37%
Manc U 132.6 61% 34.6 11%
B Munich 149.8 86% 99.7 45%
Arsenal 161.3 143% 10.2 4%
Chelsea 137.5 116% - 27.1 - 22%
AC Milan 71.2 43% 8.6 4%
Liverpool 87.7 64% 26.4 13%
Inter 112.0 99% 29.8 15%
Juventus 31.5 18% 59.8 41%
Manc City - - * 55.5 57%
(* Note that Manchester City was out of Top-20 in 2006/07 season and their 2006/07 revenue is assumed to be matching to that of No. 20 (Werder Bremen) with €97.3-million revenues.)
Table 4 - Revenues Increase from 2000/01 to 2006/07 in € million
Increase 2001 to 2006 2005 to 2006/07
€-million % €-million %
R Madrid 140.0 92% 58.5 20%
Barca 119.3 85% 31.0 12%
Juventus 73.3 41% - 106 - 42%
Manc U 13.1 6% 72.6 30%
AC Milan 79.6 50% - 11.5 - 5%
Chelsea 77.6 54% 62.0 28%
Inter 65.2 46% - 11.6 - 6%
B Munich 27.9 16% 18.6 9%
Arsenal 36.0 25% 86.5 49%
Liverpool 21.4 14% 22.9 13%
(* It is interesting to note that Arsenal FC revenues jumped by 49%, an increase of €86.5-million revenues in the 1st year at Emirates, i.e. from 2005/06 to 2006/07 season.
Presumably the decline in those Italian clubs during 2006/07 are due to that match-fixing scandal with clubs being relegated, point deductions and overall impact in tehri earnings at UEFA club tournaments in CL Cup and Euro Cup. )
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Edited 1 time(s). Last edit at 2011:09:28:23:03:23 by Padre Pio.
Theodore roosevelt - In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.
all i look at is the actual growth in terms of revenue, and wat i hv learnt from this forum as well as the other arsenal articles on the internet, below are some of the points i feel which hv hampered our growth in revenues since the move to Emirates. Please do correct me if the stats n facts are not accurate enuff
1) 2 mortgages that we had, one for the stadium and the other for property development, hampered us. we hv been debt free frm property based mortgage only in the last year or so
2) First year of Emirates shows a big jump as pointed out by Merl due to enhanced gate revenues, majority of sponsorship payments for shirt and stadium naming rights being made upfront. Due to this revenues fell frm sponsorship income in the next few years
3) Due to economic recession, property market fell considerably thus hampering revenue generation frm the highbury square not in terms of the overall value but the time it took to recover the money.
4) Move to Emirates happened a couple of months after our Cl final appearance, thus adding revenue in the first year. In subsequent years we have hardly lit the CL on fire, if i may say so, adding to our inability to generate revenues.
5) No trophies since 2005 and low finish in the PL table(3rd or 4th is a low finish for a top 10 team in the world) adding to our incapability to generate extra revenues vis-a-vis previous years.
6) Gate revenues have increased since the move, perhaps the only decent earning method for the board right now.
7) Wage expenses have increased, partly due to billionaire clubs literally offering blank cheques to players for their signature and partly due to the increase in taxation structure in uk for big earners.
Now the overseas tour neva happened till this pre-season and AW was forced to go for it only because its the only left option to increase revenues apart from rise in ticket prices in the immediate future since the sponsorship revenues are frozen and they have exercised both their options.
DO you notice that for 2001/02 season, Arsenal, Chelski and Barca have more or less the same amount of revenues?
...........2001/02............2009/10
Arsenal - 141.4-million.....274.1-million
Chelski - 143.4-million.....255.9-million
Barca --- 139.8-million.....398.1-million
You can see that Chelski with their ramshackle shed is doing as well as Arsenal even without property development, without a 60,000-seater stadium.
Barca really exploded out of the starting block due to them winning all honors as well as a global merchandise sales and image...not forgetting all their mega-stars which help to push up Barca commercial values and sales.
FInancially, that is how far we slipped from 2001/02 to 2009/10 under Economist Wenger's "astute financial management".
While we have had conservative owners/board not willing to take too many risks with investing in the team. I read on another thread AW spent almost 14M on 2 players in early 2000s, says he wasnt averse to spend huge amounts but with the new stadium plans it was probably a collective decision on part of AW n board not to spend on high wages and not to add more on the debt apart frm the Grove. So instead of paying for mediocre players in their mid 20s(read lower salaries) AW prolly went for talented young kids thus paving a path for his so called youth policy. But they cld hv done with a graded pay structure of say less than 40k, between 40k-80k and more than 80k instead of a communalist approach of spreading the wages across the squad n paying almost equal wages between 40k to 80k to all irrespective of the performances
*Signing Ozil is a signing Bergkamp type moment for Arsenal. It changes things utterly.*
So the table are objective as they compare like with like.
Gate Money, Merchandise, Sponsorship and TV money.
Of course Man City will become devious and hide this kind of money as sponsorship so it will show as revenue and not debt
"When we had to suffer the team is a lion because they suffer together." 4 July 2020 at Wolverhampton Wanderers
Arteta on his team's first away victory at a club above them in the Premiership since September 2015 at Leicester.
Quote:eduardo
merl you know the reasons why the club has not capitalized on the Emirates move, and its very sad to see you try to make a sensational story out of it.
ED, as a layperson,I was udner the impression that "happy days" are here again witht eh move to Emirates that will improve our financial msucles to compete with the "big boys".
I am not a trained economist nor a banker nor an accountant and hence like any business, I was deluded to believe that with icnreased gate collections (and world highest ticket prices) we should be achieving a decent year-on-year icnrease of 4% to 6% revenues growth everys eason, regardless of successes ont eh pitch.
Who was it that said that Emirates revenues are independnet of CL Cup successes or even non-participation in CL Cup for say 4 seasons? That is, the commercial successes of Emirates are sufficient to enable Arsenal FC to be financially-sustainable.
I was curious as ot why Stan made a move to acquire Arsenal FC last seasona dn started to look at the numbers, starting with that FY2009/10 Report at www.arsenal.com.
My take is that Arsenal FC is "overwhelming undervalued" when run by those Etonian foggies with their "old boys" network"; and like ManLeeds, needs a corporate predator like Glazer Family to unlock Arsenal FC full potential values to compete with the "big boys".
Both Stan and Usmanov are corporate predators and a polite term is "capital investors" out to fatten Arsenal FC for the kill like a goose being "force-feed" to produce fois gras.
Stan and Usmanov are the equivalent of "Gillett & Hicks" but with a deep pocket and can finance their investments to grow Arsenal FC.
I will say that once Stan adn Usmanov get rid of those old foggies plus Arsene Wenger, you will nto see the tradiitonal Arsenal FC no more, but more liek a professionally-run NFL club with vats commercial appeal, building on the existing "captive customers" in Arsenal homegrown fans plus expanding the global fan bases.
We had been deluded by Arsene Wenegr and PHW & Board as if Arsenal FC is a well-run club.
I don't as Arsenal FC had lost that "window of opportunity" from 2006/07 to 2009/10 to grow Arsenal FC into a marquee club to compete financially with the likes of Real, Barca, ManLeeds and Bayern Munich.
it is not sensational but let moi said:
How many Arsenal fans knew that after than 49% growth in revenues from 2005/06 to 2006/07, how many Arsenal fans knew that our revenues actually "stagnant", hardly grown at all, with those fantastic reports that our reveneus are increasing..thru' property development and player tradings, insetad of football businesses?
How many average Arsenal fans knew that our revenues hardly grew at all, but stagnant?
And if you factor in inflation, hwo much our revenues had decline in terms of real money?
EXCLUSIVE
ARSENAL will today post a small pre-tax profit when the club announces its financial results for the year ending May 2011.
The figure will be dramatically lower than the record £56m pre-tax profit for the previous 12 months, City A.M. has learned. However, that 2009-10 sum was boosted by a one-off property windfall and significant transfer proceeds, far lower in 2010-11. The club is understood to be happy with what it views as a sound off-field performance. A profit will be seen as proof the Gunners can survive solely on income from their football-related activities.
Next year’s figures are also likely to be healthier still, as the cost of summer signings, such as Gervinho, was far outweighed by sales.
Shareholders will discuss the results at the AGM on 27 October. Majority shareholder Stan Kroenke will attend and, the club hope, speak.
.
[www.cityam.com]
_________________________________________________________
Most interesting to note our revenues.
But one thing to note, Arsenal FC is just a "footballer trading" club no better than West Ham United or Saints, i.e. selling their best players to survive as a money-making corporation.
1 Property
2 Player sales
Ist has dried up,
Without selling players there wil be no profit unless comericial revenue rises
"When we had to suffer the team is a lion because they suffer together." 4 July 2020 at Wolverhampton Wanderers
Arteta on his team's first away victory at a club above them in the Premiership since September 2015 at Leicester.
These are all due to lack of successes on the pitch.
Celine Dion is correct.
Arsene Wenger will be the death of Arsenal FC financially. You think Stan will remind silent and non-action after another trophyless season with a demoralised squad and disgusted fans?
Quote:nhoj14
So what is our debt overall debt now? And do we actually make a healthy profit, without the sale of property and players? Also when do the naming rights on the stadium run out and when can we renegotiate our shirt sponsorship deals with Nike and Emirates?
Not too sure about the run-out date for Emirates naming rights, but the shirt deal with Nike expires in 2014.
Our Emirates debt runs till 2031 paying an annual interest of about 5.5% per annum over this "bond".
If you go to www.arsenal.com and look at our FY2009/10 Accoutns, you will notice that Adebayor-Kolo trasnfer fee of 38-mil was added to our "profit" column...plus property development profits were also added to our profit column.
And all our "financial charges" were about 18-mil quid as well.
As for FY2010/11, take away player trasnfer profits and property devleopment profits (maybe about 5-mil), it will make interesting readings as I suspect it will gloss over the declining earnings from football side of the business due to lack of successes on the itch...and of course, that obscenity of paying top-wages for a bunch of mediocre players..with even ALmunia was rumored to earn 50,000pw.
of coruse, FY2011/12 will be a bumper year due to:
- extra income due to Asian tours
- 70-mil from the sales of Clichy, Cesc, Nasri, Traore, JET, et al (I think about 10 players??) and many more perhaps in Jan Transfer Window as well.
So if you ask the obvious question that like any other normal business in the world why the numbers from the turnover wasn't capitalized for further growth of the business, the answer is simple the focus is on the working capital thing..the risk free business model and everything points to here I disagree with you Merl only to one person Stanley Kroenke and no one else. I will rationally distance Usmanov from this. Although this business model doesn't hurt Usmanov so far but Kroenke is probably using Arsenal FC as a hedge to his more risky sports investment in US.
But the question is, is this risk free business model is actually risk free?
Look at the components of this turnover number:
The numbers are significantly heavily weighted towards the following in order:
1) Gate sale
2) Participation money from PL and CL
2) Property sale
3) Player sale
4) TV rights
5) Naming rights and shirt sales etc
What I see in Stan's business model, his prime importance is to reduce the risk involved due to substantial reduction of revenue from any of the above components.
I don't see a foreseeable reduction of more than 10 to 15% of gate sale due to any eventuality.
Participation money could have a significant impact of around 25 million which could lead to a 10% impact on overall revenue.
He has intelligently capitalized from the property sale without reinvesting into the club, which already adds up to the working capital and equity value.
The business model has a sustainable source of revenue from the player sale and isn't any immediate concern for him.
I'm not totally sure that the entire income from TV rights revenue adds up to clubs revenue or not but in any case there isn't immediate threat of revenue reduction here.
There isn't any risk involved of significant drop in naming rights or shirt sales etc which infact is very lightly weighted in the overall revenue structure.
So all this point to one thing, the risk free business model of Stan Kroenke with the Wenger factor has already taken care of risk of devaluation of his equity valuation.
This model is by no means sustainable but involves minimum risk of any kind of lose due poor performance in actual business that is club's result.
Everything, points to one thing that Stan Kroenke's prime agenda is safe guarding his investment and walking away at anytime with a handsome profit irrespective of any eventuality of club's actual result on the football field.
Stan is a corporate predator whose sole interest is to double his investment wihtin 5 years like Glazer Family.
To grow his investment, he needs successes on the pitch..like ManLeeds where by 2014, Gazidis can get a better shirt deals plus more revenues from annual overseas tours, which equate to greater global merchandise sales and commercial rights in "Gunner" brand-name.
He will follow the same route as Glazer Family in IPO listing in the booming Asian bourses to get his basic investments of 750-mil quid into hsi pockets with the rest of 'em just pure profits.
Taht is, the inital 2 or 3 years is a period of consolidation for STan and Gazidis to ensure a steady revenues stream to safe-guard his capital and to aviod asset depreciaiton as you rightly poinetd out.
But by 2013/14 at the latest, he expects this udnervalued Arsenal FC to grow form its basic base of 255-mil quids to break through that 300-mil quid barrier.
To do that, he needs successes on the pitch.
GUess how long will STan tolerates failures on the pitch which will not grow revenues for the next 3 seasons?
Glazers are having a problem selling of Asian exchanges as buyers do not like reduced voting rights. Meanwhile markerts everywhere are plummeting.
Man U will not get tehir asking price, and Arsenal will ask even less
"When we had to suffer the team is a lion because they suffer together." 4 July 2020 at Wolverhampton Wanderers
Arteta on his team's first away victory at a club above them in the Premiership since September 2015 at Leicester.
I think, stakes will be too high for Stan Kroenke to take the IPO road and as Padre said that investors are now a days very clever and holding their hands on their chest due to financial uncertainty and will look at the track record of the business before investing, same saying is for any future sponsors and naming rights sale etc. So what I see, Stan will continue with his risk free model and don't see him further revenue addition is his major priority at the moment.
Quote:Padre Pio
you live in a dream world Merlion, why people would invest heavily in a team that is winning nothing I dont know.
Glazers are having a problem selling of Asian exchanges as buyers do not like reduced voting rights. Meanwhile markerts everywhere are plummeting.
Man U will not get tehir asking price, and Arsenal will ask even less
That is my point as Stan is just another 'Gillett & Hicks" without the deep pocket of ABu Dhabi or Abramovich to invest in Arsenal FC.
There is only two routes for Stan:
1 - Goes the way of Glazer Family, starting to load up Arsenal FC with debts and buy up 20+ to 30+ mil players in January transfer window jsut to retain Top-4 status.
2 - Goes the way of "Gilett & Hicks" with no investment in Arsenal FC; and with Arsenal FC on teh slide, fans turning against Wenger and owner, declining share values such that to cut hsi losses, like "Gillett & Hicks", Stan is forced to sell-out to Usmanov...who is actually waiting to pounce if Dein is sitll within his camp.
Both corporate predators knew that Arsenal FC is grossly undervalued due to lack of development in the global amrket. which predator is more likely to pour funds into Arsenal FC to unlock this "goldmine" of global market?
I tend towards Usmanov who knew the RUssian, Central Asian and Asian market mroe that an insular American who knew f**k-all out of USA sporting market.
Indeed, those bunchs of c.unts had sold out Arsenal FC liek the Moore Family ahd sold out Liverpool FC or the Edwards Family ahd sold out ManLeeds to American corporate predators.
Give me a Russki robber baron or an oil sheikh anytime as at least they are honest in tehri approach as to invest in a football club as an alter ego to burnish their image...in de facto, they are obsessed with successes on the pitch to boost their ego...not a f**kign snake-oil salesamn who promised "a trophy within 2 years", "this is mys trongest squad", "we can win the Quadruple", "we can finish Top-2" and "Being Top-4 is like winning a trophy".
The north Londoners posted another set of impressive financial results eight days ago, headlined by a £14.8 million pre-tax profit.
But indicative of the club’s flat revenue growth during the year ending May 2011 were commercial earnings that crept up to £46.3m. Over the same period Manchester United’s commercial revenue was £103.4m.
However, The Sweeper understands that Arsenal are confident they can start bridging the gap with United before the London club’s shirt sponsorship agreement with Emirates expires in 2014.
The club have not yet opened talks with potential sponsors but the feedback officials have received from informal discussions is that Arsenal’s global brand would enable them to surpass the most lucrative shirt sponsorship deals in the Premier League - the £20m-a-year, four-year contracts negotiated by Liverpool with Standard Chartered and United with Aon, both in 2009.
Arsenal believe the market for shirt sponsor deals is still buoyant because of the continued growth of the Premier League overseas, and one senior official has claimed that the club could even negotiate a deal worth £25m a year, which is nearly five times more than the current eight-year deal with Emirates. That is worth a relatively meagre £5.5m per year, principally because it was front-loaded to pay for Emirates Stadium.
Arsenal had been reluctant to prematurely terminate the agreement with Emirates and pay the airline a multi-million pound compensation fee, much like Chelsea did when they paid former kit supplier Umbro £24.5m to end their deal five years early and sign a more lucrative contract with Adidas.
However, it is understood that there is a growing appetite within the club to negotiate an early end to the agreement with Emirates because of the long-term benefits of agreeing a more profitable contract with another sponsor.
There has been a shift to a more aggressive commercial strategy under Tom Fox, who was hired from the NBA in 2009 to head Arsenal’s commercial team.
Arsene Wenger was persuaded by the benefits of allowing the team to go on a pre-season tour to Malaysia and China in July, the first outside of western Europe to be undertaken by the club in over a decade. The trip was viewed by the club as a great success in building the club’s fan base in such an important region and illustrated how much appeal Arsenal have among the crucial Far East youth market.
[www.goal.com]
Arsenal believe the market for shirt sponsor deals is still buoyant because of the continued growth of the Premier League overseas, and one senior official has claimed that the club could even negotiate a deal worth £25m a year, which is nearly five times more than the current eight-year deal with Emirates. That is worth a relatively meagre £5.5m per year, principally because it was front-loaded to pay for Emirates Stadium.
Then, like Chelski, time to break that meagre £5.5m per annum shirt deal with Emirates (expiring in 2014) and negotiate for a lucrative £25m per annum shirt deal.
No wonder Gazidis said that Arsenal FC cna do without CL Cup as this new shirt deal will compensate for whatever revenues lost without CL Cup or Europa Cup for the next 5 years for the new shirt deal.
COmpensation to Emirates will be lessen too without CL Cup exposure.
But there again, without CL CUp, will any "shirt naming party" is willing to pay £25m per annum to put thier name on the shirt of a mediocre mid-table team?
Quote:SandyB
The problem with your above theory from goal.com is no sponsor will sign a 25 million deal with a club 10 years trophy less by 2014 and who knows where they will be on league by then without CL money..as even with CL money they don't spend more than they sell and without CL money it's as simple as that the player sell will be the only source of their profit on the balance sheet.
Sandy, Arsenal FC is the last of the Top-10 Football Club that does not maximise their "shirt naming rights", barring Barca who refused to sell "Naming rights" on their except "UNICEF".
You can be assured that there are plenty of firms willing to takeover from EMirates and pay more than that piffy 5.5-mil per annum.
I am sure that Gazidis and COmpnay are calculaitng the "pro & con" of breaking Emirates' contract right now.
There were an incredible 4.7billion global viewers watching the top-flight on the box last season.
There is no denying huge numbers of fans around the planet are tuning in each week to watch the likes of Steven Gerrard and Luis Suarez in action.
Star attraction: Luis Suarez is a popular figure for global Liverpool fans
Around 70 per cent of all football fans worldwide are now watching the English game.
A new report from the Germany's Sport+Markt group reveal that Premier League reached 643million homes last season. From just a year on, that represents an increase of 11 per cent.
The audience watching at home is up to a record 3.9bn, while 777m are heading to pubs and bars in every corner of the globe to watch.
Unsurprisingly, the most lucrative market for the Premier League is the Asia and Oceania region. A whopping 1.3bn viewers tuned in to watch popular clubs such as Manchester United, Arsenal, Liverpool and Chelsea.
The Premier League took up 185,000 hours of global TV coverage last season, which easily makes it the most popular competition in the world - in any sport.
Sport+Markt's head of international affairs Andrew Walsh said: 'The explanation for these remarkable figures lies largely in the redistribution of international rights for the start of the new three-year broadcast term last year.
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'One main driver of the rise was the switch of the League's broadcast rights in China from pay TV over to terrestrial coverage.
'That has burst open the floodgates in terms of the Premier League's popularity in the world's biggest and fastest-growing market.'
A Premier League spokesman added: 'Our international fan base and success is helping develop English football at all levels, something we should all be pleased about.
'Whether they are at the ground in person or watching all around the world on TV, fans know what they will get from a Premier League game. They'll see some of the world's best talent in thrilling matches played at packed stadiums.'
HOW THE MONEY IS DIVIDEDThe table below shows how the TV money was split between the 20 clubs who competed in the Premier League last season...
............ Equal share Facility fees Merit payment Overseas Total
Man United..£13.8m..... £13.5m..... £15.1m.......... £17.9m £60.4m
Chelsea.......£13.8m..... £11.6m..... £14.4m.......... £17.9m £57.7m
Arsenal....... £13.8m..... £11.6m..... £12.9m.......... £17.9m £56.2m
Man City......£13.8m..... £10.2m..... £13.6m.......... £17.9m £55.5m
Liverpool.....£13.8m..... £12.1m..... £11.4m.......... £17.9m £55.2m
Tottenham..£13.8m..... £9.2m....... £12.1m.......... £17.9m £53.1m
Everton.......£13.8m..... £7.3m....... £10.6m.......... £17.9m £49.6m
Aston Villa...£13.8m..... £8.2m......... £9.1m.......... £17.9m £49.1m
Fulham........£13.8m..... £5.8m......... £9.8m.......... £17.9m £47.4m
Newcastle...£13.8m..... £8.7m......... £6.8m.......... £17.9m £47.3m
Sunderland £13.8m..... £6.3m......... £8.3m.......... £17.9m £47.4m
West Brom..£13.8m..... £5.8m......... £7.6m.......... £17.9m £45.1m
Stoke City...£13.8m..... £5.8m......... £6.1m.......... £17.9m £43.6m
Bolton.........£13.8m..... £5.8m......... £5.3m.......... £17.9m £42.9m
Blackburn....£13.8m..... £5.8m......... £4.5m.......... £17.9m £42.1m
Wigan.........£13.8m..... £5.8m......... £3.8m.......... £17.9m £41.4m
Wolves........£13.8m..... £5.8m......... £3.0m.......... £17.9m £40.6m
West Ham...£13.8m..... £5.8m......... £0.8m.......... £17.9m £40.3m
Birmingham £13.8m..... £7.8m......... £2.3m.......... £17.9m £39.8m
Blackpool.....£13.8m..... £5.8m......... £1.5m.......... £17.9m £39.1m
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WOnder whether Arsenal TV will attain the same commercail success as Real MAdrid TV, Barca TV, Chelski TV. Kop TV and MUFC TV?
SImilarly, Red Devils garnered in £100-million from commercial right and marketing and sponsorships.
Whereas Arsenal FC is only about £44-million, and perhaps by 2014/15 when we signed a new shirt deals plus more corporate sponsorships from Asia may double our present £44-million to at least £80-million.
That is why Usmanov is prepared to offer £14,500 per shares to buy over Arsenal Holdings plc.
"When we had to suffer the team is a lion because they suffer together." 4 July 2020 at Wolverhampton Wanderers
Arteta on his team's first away victory at a club above them in the Premiership since September 2015 at Leicester.
We will only lose out on "Merit Payment" which depends on your league table position.
Our "Facilities fee" should remain the same as Arsenal matches are more widely televised than that of Stoke City to global audience.
But if Arsenal FC slipped into mediocrity without "star values" sans van Persie, Walcott, Arshavin, Vermaelen......then our "Facilities fee" may reach the level of Stoek City due to falling global audience which refuse to watch a loser playing Crab Football.