The inordinate fees that the transfer window continues to churn out, particularly in the Premier League, have been staggering. But first, a parable.
The European conquest of South America in the early 16th century led to huge quantities of bullion crossing the Atlantic, giving sudden, immense spending power to consumers in Spain, France, England and elsewhere. Much of that revenue was used to buy goods and produce from India, China and Southeast Asia. That in turn brought immense, previously inconceivable, wealth to Indian rulers.
“They spent their own new cash on buying the best that money could buy,” Peter Frankopan, the author of The Silk Roads and the Professor of Global History at Oxford University, told SI.com. Much of the money went on horses, and specifically “baehr,” horses from overseas, particularly Arabian stallions.
“Not surprisingly, the amounts spent on those dragged up the prices of rubbish horses–especially of horses that looked a bit like Arabian stallions, above all the Kathiawar breed," Frankopan continued. "Those involved in the horse trade could and did make huge profits.
“It all unravelled by around 1700: partly that was because the kinds of horses that were most valued changed: hardy, tough horses because more valuable especially because that was what the military wanted and needed. But it all tumbled down really because the money supplies could not and did not go on forever. The Brits were too greedy, stripped India dry, and the numbers of those who wanted, needed or could afford horses locally plummeted.”
Frankopan sees a similarity in the modern trade in footballers, as Premier League clubs made wealthy by a combination of fantastically rich owners and television rights deals have conducted transfers with increasingly extraordinary fees.
As the summer has gone on, the parade of figures has lost some of its shock value–but only some. £75 million for Romelu Lukaku, a player who hasn’t so much as played in the Champions League for six years? £71 million for Alvaro Morata, a 24-year-old who has never been the top striker at any club for which he has played? £52 million for Benjamin Mendy, who has won only four caps from France? £52 million for Alexandre Lacazette, who has scored just once for France and is regularly kept out of the side by Olivier Giroud–whom Arsenal already owns!? £50 million for Kyle Walker, a right back who has made just three Champions League appearances? £40 million for Nemanja Matic, a 30-year-old midfielder deemed surplus to requirements at Chelsea? £30 million for Jordan Pickford, an uncapped goalkeeper with only 31 appearances to his name?
They may all be very fine players. They may all go on to have fine seasons. It may be that in time, one or even most comes to be seen as money well spent. But they won’t all succeed. And even if they do, it’s not clear that’s even the point. How will we explain to the future that this was an age in which, seven years after the UK government began an austerity program that continues to cap public sector pay-rises at 1%, well below the rate of inflation, the equivalent of Kathiawar horses were changing hands in England for more than £50 million?
Like the 17th-century Indian horse market, this feels, as Daniel Levy, the Tottenham chairman, has said, “unsustainable.” Football, at the top level in England at least, has been largely immune from the economic storms of the past decade, the Premier League a story of endless expansion. But there have been recent indicators that we may be coming to the top of the market.
In the UK, Sky TV has reorganized its sports channels, ostensibly to give viewers more choice, but in reality making packages cheaper for those who want to watch football but aren’t bothered about cricket, golf or other sports. That is a response to falling viewing figures last season and worrying data that suggests illegal downloads are a major issue. That said, the Premier League expects the next broadcast deal, to begin in 2019-2020, to be even larger than the present one, with a small increase in UK rights from around £5 billion to around £6 billion, and a more significant increase in overseas rights from £3 billion to £5 billion.
Streaming, though, is not going away, and the Premier League’s other problem is Brexit. Despite claims during the referendum campaign, nobody now thinks that will come without economic cost. While the details of the UK’s exit from the European Union remain unclear, and a transitional agreement seems increasingly likely, some studies suggest that it could take 20 or 30 years for the UK economy to recover from leaving the Single Market. If there is a downturn of that magnitude, there will, fairly obviously, be a huge downturn in demand for football, whether consumed on television or at the stadium. Not surprisingly, even amid the spending frenzy, the message from some clubs is one of retrenchment while it becomes clear exactly what Brexit will mean.
If the projections for the next broadcast deal are correct, though, the bubble would appear to have at least three or four more years to run. After that, who knows? Football’s economy has proved surprisingly robust in the past, but there are reasons now for significant concern.