Twelve elite European soccer clubs announced Sunday that they are forming an exclusive $6 billion Super League, backed by JPMorgan Chase financing. The announcement of the league has led to a firestorm of negative reactions, not just from those not invited to the party but also from fans and (former) players of the clubs that were included.
British Prime Minister Boris Johnson tweeted that the plan is “very damaging,” and French President Emmanuel Macron said the initiative “threatens the principle of solidarity and sporting merit.”
What is all of this about?
The short, simple and largely accurate answer is money. The Super League threatens Europe’s existing top club level competition, the Champions League, which is run by the European Football Association (UEFA). Teams need to qualify for the Champions League by doing well in their domestic leagues. The 12 founding members prefer not to suffer the inconvenience of having to earn the right to play in Europe’s most prestigious and lucrative competition. At least four of them are not in a position to qualify for next year’s Champions League. One, Arsenal, has not qualified since 2016.
Moreover, broadcasting rights are a huge source of revenue. If UEFA negotiates broadcasting contracts, then it keeps some of that money. UEFA also distributes revenue to less successful (and less wealthy) teams. The elite clubs, which are already among the 16 wealthiest clubs, want to keep the money for themselves and hope more matches between very popular teams will increase the amount of broadcasting revenue.
The idea of a European Super League isn’t new. So far, clubs have mostly used it to create a credible exit option that enhances their bargaining position with UEFA. UEFA has every incentive to keep these powerful clubs in the Champions League, and they just announced a new format for the Champions League. Yet Europe’s wealthiest clubs were not satisfied with what they got.
Sunday’s announcement is an escalation in this ongoing bargaining process. UEFA has countered sharply by announcing it will seek sanctions not just against the clubs but also their players, most notably banning them from international tournaments such as the World Cup. These actions may well run afoul of European competition law, and the Super League has already filed motions in several jurisdictions to block such sanctions.
National soccer associations could ban Super League clubs from their domestic leagues. National associations desperately want to keep these clubs. Yet viewers’ interest in domestic leagues is partly driven by their desire to see which teams will qualify for the coveted Champions League places. Thus, the Super League also threatens domestic competitions.
National associations could demand teams commit to partake in the Champions League rather than the Super League if they qualify. Such rules already exist, and it is less likely Super League teams have a legal recourse against sanctions for violations. By far, the most amusing punishment would be relegating these teams to a lower league.
It isn’t clear who will prevail in this power struggle — but here are two factors to keep an eye on. First, European cooperation typically does not work without the French and the Germans. The Super League invited French and German teams to participate but they declined. Especially notable is the absence of last year’s Champions League finalists Bayern Munich and Paris Saint Germain. These clubs are now power brokers. They could hold out and help negotiate a compromise with UEFA, or they could jump ship once it becomes clear the Super League will move ahead.
The second factor is public opinion. Fans often have little patience for the wealthy owners of their own clubs. Fans already deride the role of American owners, and many portray the Super League power grab as an attempt to copy U.S. professional sports leagues where relegation and qualification are foreign concepts. Public anger may also spur politicians to try to block the new Super League.
Of course, it’s also easy to overestimate the impact of fan anger. Instagram videos of fans emotionally tearing apart their season tickets don’t tell us much, since they can’t really use these tickets thanks to coronavirus bans on stadium sports. Fans are deeply attached to their own teams, and probably want to see the superstars, who will play for the wealthiest clubs whatever they are now saying on social media. The owners are betting fans will ultimately come around. They may well be right.