Afternoon all. So, we've signed a midget Russian for £15m who played quite well in the Russian league and put in a couple of good performances in Euro 2008.
Now, whilst I suspect Arshavin is going to turn out to be a good signing, and not the new John Jensen, we must not expect too much him this season. If he hits the ground running, then great. But lets not wobble like Rafa's belly if he takes some time to adjust.
Speaking of Rafa the Kebab-King, Robbie Keane's transfers to-and-from Liverpool within 6 months has got to be one of the weirdest episodes of all time. I wonder how much Liverpool's dire financial situation has to do with this?
Anyway, whilst we bask in the glory of Arsene actually dusting down the cheque book and signing a player, its sneaked out in the press that the first round of negotiations for the Premier League's TV contract have concluded, apparently with Sky paying £1bn for a 92 game per season deal. Sounds good doesn't it? Lots of lovely new money for the clubs to spend. Well I am not so sure.
Football finance is a popular hobby horse on this blog, and whilst we know virtually nothing about it, lets not let any minor details like that get in the way. So here is what we know so far. The Premier League TV rights deal is apparently split into 6 "packages" of coverage rights for live games, which are each sold to the highest bidder, so long as no single company has more than 5 packages in order to comply with EU competition law prohibitions.
Sky have apparently secured 4 "packages" in the first round of bidding, leaving another 2 up for grabs, with Setanta and ESPN rumoured to be interested. Now, the point is that the Premier League trousered £1.7 bn for the six packages during the last round of negotiations in 2006. Sky paid £1.3bn for their 4 packages in 2006.
Therefore, on a simplistic view, Sky's contribution to the pot is already down by over 23%, and unless a bidding war starts between Setanta and ESPN, the overall figure will be much worse.
Again, "who cares" I hear you cry, "its tons of money". Well, the point is that for those few clubs who actually run themselves as a genuine business, such as Arsenal, there will be at least 20% less income next year compared to this year in relation to the money feeding down from the Premier league deal. If that is reflective of what will happen elsewhere in terms of clubs' projected income, then on a current turnover of £250m that means there will be £50m less going through the books next year.
For me, that is a scary thought and this says two things loud and clear:
1. Those clubs that do not run themselves as a business need to really watch out. That is most of the league.
2. This is why we didn't just pay the £20m that Zenit wanted for Arshavin on 1 January. People who do not regulate their spending will go bust.
Lets hope Spurs are the first against the wall. I wonder if Ladbrokes offer odds on this sort of thing....