Soccer: Players flaunt wealth while fans drift away

Scottish comedian Billy Connolly had this joke. "I used to support Partick Thistle," he would tell audiences. "That's Partick Thistle, FC. I say FC, in fact because for a long time I thought it was Partick Thistle, nil."

The same cruel jibes may soon befall another beleaguered Scottish soccer club that once boasted Thistle in its title - Ferranti Thistle, a works team from West Lothian, formed during World War II. Over the subsequent decades Ferranti flexed its muscles and metamorphosed into Livingston FC, which in 2004 completed its coruscating arc of success by winning the Scottish League Cup. It was all downhill from there.

Last month, as what some believe is the worst economic crisis since the Great Depression sweeps the country, debt-laden Livingston breached insolvency rules, a transgression that under Scottish Football League rules triggered its demotion to the Third Division.

Incensed by its punishment, Livingston refused to play its first fixture of the season, triggering chaos in the Scottish soccer calendar that has come to symbolise a wider malaise in the game.

For these appear to be difficult times for soccer clubs. With big-name sponsors including behemoths such as Manchester United's former backer, the insurer AIG, pulling out of lucrative deals, and bombed-out television companies such as Setanta unable to pay to screen matches, a chill wind is blowing across Britain's terraces.

Fans are also feeling the pinch. As unemployment queues lengthen and uncertainty about when the economy will bounce back continues, many are being forced, reluctantly, to turn their back on the beautiful game.

Research suggests that 30 per cent of regular matchgoers have resolved to go to fewer live games this season, scared off by soaring costs compared with 26 per cent last year. Significantly, this shift in sentiment applies to top soccer clubs.

Virgin Money's Football Fans' Inflation Index indicates that, this season, prices for diligently following a team have risen 15.1 per cent year-on-year. The index, which factors in rail fares, drink, food, shirt and ticket prices and pay-per-view costs, suggests "soccer inflation" has increased by 29.6 per cent since October 2006, when it was launched. "It is very worrying that 'soccer inflation' continues at a level way above standard inflation," said Malcolm Clarke, chairman of the Football Supporters Federation.

"Fans are you, me and the bloke next door, not a different race, and with people losing their jobs and being worried about the future it's not surprising that going to the match - a leisure activity - might suffer."

Part of the shift is as much cultural as it is socio-economic. Last week it was reported that the Chelsea players spent £120,000 ($297,887) on a surprise 24th birthday party for their teammate Salomon Kalou at the Whisky Mist nightclub in Mayfair, London.

It was a sign that, while the fans might be feeling it in the pocket, their heroes suffer no such problems. "In the middle of all this, fans see huge sums of money being paid in transfer fees and even a club talking of paying a player a million pounds a month, which many regard as obscene," Clarke said.

"A little bit of prudence - and a little bit of humility - from those at the top of our game would not come amiss in the current climate."

At first glance the clubs seemed to have anticipated this. The annual review of soccer finances produced by consultancy firm Deloitte reveals many Premier League clubs froze ticket prices a couple of years back, aware there was a danger the game was about to eat itself alive. But Deloitte found the Premier League produced record operating profits of £204 million in 2007-08, allowing it to wrestle its claim to be the world's most profitable league back from the Bundesliga. Deloitte estimates that Premier League clubs' revenues in 2008-09 will be shown to have exceeded £2 billion, with modest growth to come this season.

And even the 72 League clubs, football's Cinderellas, seem to be in relatively robust health. Deloitte found in 2007-08, as the economic downturn started to bite, their combined revenues managed to exceed £500 million for the first time.

True, net debt of clubs has soared - in the case of the Premier League from £2.7 billion to £3.1 billion in 2007-08 - but as Deloitte notes, "the fundamentals underpinning the development of the football business in England remain strong".

Indeed, counter to popular perception, the industry is largely resistant to economic doom and gloom, and this has profound implications for its fans.

As Stefan Szymanski, professor of economics at Cass Business School and a world authority on the finances of the game, has found, "football capitalism" is an "incredibly stable economic system".

He points out that in 1923 there were 88 teams in four divisions of the English football league. Today 85 of them still exist and 48 are still in the same division. Compare that with a study of the top 100 companies conducted in 1912. Today 80 per cent no longer exist; some have merged, some have been broken up, some have disappeared. "You had the Great Depression, the Second World War, economic crises, two oil shocks, a succession of housing boom and busts, and football clubs have remained largely intact," Szymanski said.

This is not to say clubs exist in an economic vacuum - experts suggest that as many as a dozen will follow Livingston into insolvency this season - but they are astonishingly adept at surviving, even in lean times. In fact until the mid-1980s, football was what economists termed an "inferior good" - the wealthier the nation became, the less people went to matches.

But clubs should not assume their fans will remain blindly loyal.

Angered by the game's increasing "embourgeoisment", the perception that it is becoming a leisure pursuit open only to the middle class, some are walking away while others transfer their loyalties to rugby and league. Another segment of the fanbase is lowering its sights. The Virgin Money survey found one in five disaffected fans intends to turn to lower league football for a less expensive fix of live soccer.

More subversive is the trend among supporters to turn the clock back to a time when clubs were owned by their local community. The model here is Ferranti Thistle, not Livingston.

FC United of Manchester, a one-member, one-vote club, formed by disillusioned Old Trafford fans in the wake of their club's controversial takeover by the American Glazer family, is developing a loyal, fanatical following. This season it asked supporters to decide how much they wanted to pay for their season ticket, based on what they can afford.

The club has already hit its target to raise £125,000, exceeding last season's sales.

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