PDF Summary:Done Deal, by Daniel Geey

Football has grown into a massive global business and entertainment empire, fueled by complex dealings involving players, agents, clubs, and investors. In Done Deal, Daniel Geey pulls back the curtain on this intricate ecosystem, exploring the nuances that drive player transfers, contracts, broadcasting rights, and multi-million dollar investments.

From examining the lucrative revenue streams of sponsorships and media deals, to unpacking the financial regulations and governance structures that shape club operations, the book offers an in-depth look at football's sophisticated inner workings. It also addresses the industry's controversies and challenges, such as disciplinary issues, illegal streaming, and proposals like the European Super League.

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The author delves into the details, demonstrating how clubs incentivize players through signing-on fees, loyalty bonuses, and a variety of performance-related bonuses (appearances, wins, goals, assists, clean sheets). He explains how these variable figures can greatly enhance a player's base salary and how clubs strategically structure these payments to manage their financial liabilities, as seen with Dimitri Payet's loyalty bonus from West Ham.

Geey also examines specialized clauses like release, buyout, and buyback clauses, illustrating their impact on transfer negotiation dynamics. He cites examples like the contract provision triggered by Liverpool in their acquisition of Christian Benteke from Aston Villa and the infamous (and failed) attempt by Arsenal's attempt to invoke a similar clause for Luis Suárez.

Context

• Dimitri Payet joined West Ham United in 2015 and quickly became a key player. His performances were instrumental in the club's success during his time there.
• Liverpool's decision to trigger Benteke's release clause was part of their broader transfer strategy to strengthen their squad by acquiring proven Premier League talent, reflecting their willingness to invest heavily in key players.
• Suárez remained at Liverpool for the 2013-2014 season, during which he had an outstanding performance, nearly leading the team to a Premier League title.

Other Perspectives

• These types of incentives can also lead to disparities within the team, causing tension among players who may feel undervalued if they are not receiving similar bonuses, despite contributing to the team's overall performance.
• The emphasis on variable figures can lead to a culture of short-termism, where players prioritize individual performance metrics over team success or long-term development.
• Structuring complex payment agreements can lead to disputes over contract interpretations, potentially resulting in costly legal battles that negate any financial management benefits.
• The presence of these clauses does not always significantly impact negotiations, as they can sometimes be set at levels that are unlikely to be triggered or are not in line with the player's market value.

Contract Termination, Renegotiation, and Disputes About Player Transfers

Geey elaborates on how clubs and athletes can navigate contract terminations, using scenarios like player transfer requests and contract disputes. He explores the legal avenues available, including invoking FIFA's Article 17, which lets players break contracts under certain conditions. However, he cautions that this option often comes with major monetary penalties, as seen in Matuzalem's and Morgan De Sanctis's situations.

Context

• A player transfer request is a formal appeal by a player to be moved to another club. This can be a strategic move to facilitate a transfer, but it may not always be granted by the club.
• The Court of Arbitration for Sport (CAS) often becomes involved in disputes arising from Article 17 cases, providing a legal forum for resolving such conflicts.
• Players who terminate their contracts without just cause during the protected period may face sporting sanctions, such as a suspension from official matches.

Club Operations, Finances, and Governance

This section explores the operational and financial challenges faced by football clubs, detailing the strategies they employ to maximize revenue, regulate spending, and navigate the complex world of ownership changes and fair play financial regulations.

Clubs Must Balance Ambition With Sustainability Under Financial Fair Play Guidelines

Geey emphasizes the delicate balance clubs must strike between achieving success in competition and maintaining financial sustainability. He highlights how the allure of trophies and the pressure to meet fan expectations can lead to unsustainable spending on players and wages, ultimately jeopardizing a club's long-term health. He points to past examples like Portsmouth and Leeds.

Clubs Maximize Income From Media, Partnerships, Matchdays, and Trading Players

The author provides an in-depth analysis of how teams maximize revenue across various streams. Broadcasting rights, especially for Premier League teams, generate astronomical sums, as seen with the £8bn+ deal for the 2016-2017 and 2018-2019 seasons. Geey clarifies how this revenue is distributed among clubs, emphasizing the financial windfall associated with earning a spot in England's top tier. He also details the role of parachute payments, which offer financial support to clubs that drop down to the Championship.

Geey points out how teams have become adept at monetizing commercial partnerships, securing lucrative deals with shirt sponsors, kit manufacturers, and a wide range of brand partners. Manchester United, with its numerous international and local collaborators, exemplifies the scope and potential of this strategy. He explores the evolving landscape of earnings from game days, highlighting how clubs, particularly those with large, modern stadiums, bring in significant revenue from ticket sales, corporate hospitality, and merchandise.

Practical Tips

• You can diversify your income sources by mirroring the club strategy in your personal finances. Just as clubs have multiple revenue streams, consider creating your own mix by investing in stocks, starting a side hustle, and monetizing a hobby or skill. For example, if you're good at graphic design, you could sell your services on freelance platforms while also investing in dividend-paying stocks.
• Create a game with friends where you simulate the negotiation of broadcasting rights. Assign roles like sports league representatives, TV network executives, and sponsors. This role-playing exercise will give you a deeper appreciation of the complexities involved in these negotiations and the strategies used by different stakeholders to maximize their gains.
• Engage in online simulations or games that involve managing a sports team, paying close attention to how revenue is generated and distributed within the game. This practical experience can provide insights into the financial dynamics of sports teams and the importance of revenue sharing for maintaining competitive balance.
• Create a personal rewards system where you set aside a small amount of money for each personal goal achieved, akin to a club earning a spot in the Premier League. This could be for fitness milestones, learning new skills, or professional achievements. Over time, you'll see a 'financial windfall' from your cumulative successes, reinforcing the concept that achievement can lead to financial benefits.
• You can create a personal safety net fund by setting aside a small percentage of your income each month. Similar to parachute payments for relegated clubs, this fund would act as a financial cushion if you experience a sudden loss of income or an unexpected life event. Start by determining a fixed percentage of your monthly income to save, and automate the transfer to a separate savings account to ensure consistency.
• Use social media to run a virtual sponsorship campaign for a personal project or cause you're passionate about. Create engaging content that showcases the value of your project and reach out to brands for micro-sponsorships. In exchange for funding, offer to feature their products or services in your content, providing them with exposure to your audience.
• Leverage social media to connect with potential international partners by showcasing your unique value proposition. If you own a craft store, use Instagram to display your handmade products and reach out to similar businesses abroad for cross-promotion opportunities.
• Organize a neighborhood sports tournament for kids or adults, where participants pay a registration fee. Offer personalized merchandise like t-shirts or caps for the event, and set up a small concession stand selling snacks and drinks. This encourages community engagement and gives you hands-on experience in event management, sales, and marketing.
• Explore virtual stadium tours to experience the ambiance of large, modern stadiums from home. Many clubs offer online virtual tours, allowing fans to immerse themselves in the stadium atmosphere without being there on game day. This can give you a sense of the scale and revenue potential these venues have.

Ownership Changes Affect Clubs' Strategies and Finances

Geey delves into the motivations and mechanisms behind club ownership changes, explaining how billionaire investors worldwide are drawn to the prestige, influence, and potential financial rewards of owning a football team. He outlines the steps necessary for a typical takeover, highlighting the importance of due diligence, legal agreements, and regulatory approval. Geey also details examples of both successful and unsuccessful takeovers.

Context

• Ownership can include opportunities to develop or enhance stadiums and surrounding areas, potentially increasing property values and generating additional income.
• New owners may have different expectations regarding on-field performance, which can increase pressure on players and management to deliver immediate results.
• New owners must consider the club's cultural significance and its role in the local community, as fan support and local engagement are crucial for long-term success.
• Governing bodies like the Premier League or UEFA have specific criteria and tests, such as the Owners' and Directors' Test, to ensure that new owners meet financial and ethical standards.

Clubs Invest in Developing Young Talent Under the EPPP System

Geey examines the strategic importance of youth development, highlighting how clubs invest heavily in academies to produce talented players who can contribute to the first team or be sold for significant profits. He cites Southampton’s success in producing star players like Gareth Bale and Alex Oxlade-Chamberlain, generating substantial sums from their transfers to reinvest in the club.

Compensation Mechanisms Like Fees and Payments Incentivize Clubs For Developing Talent

The author explains how the 2012 Elite Player Performance Plan provides a structured framework for youth development, categorizing clubs and establishing compensation mechanisms to incentivize investment in young talent. He, however, notes concerns that the fixed compensation amounts can hinder player movement, potentially discouraging clubs from developing players who may be too expensive to acquire.

Context

• The categorization affects the level of funding and support clubs receive, as well as the level of competition their youth teams participate in.
• The EPPP aims to create a sustainable model for nurturing talent, ensuring that clubs have a vested interest in the long-term development of players, rather than focusing solely on short-term gains.
• Fixed fees can create a financial barrier for smaller clubs that wish to acquire talented young players from higher-category academies, as the costs may be prohibitive.

Tensions Among Clubs, Players, and Associations Regarding Young Talent Recruitment

Geey highlights the tensions arising from clubs' competitive recruitment of young players, evidenced by sanctions imposed on clubs like Liverpool, Manchester City, and Barcelona for breaching regulations. He explains how clubs seek to secure the future of promising teenagers through scholarship agreements and professional contracts, ensuring they receive appropriate transfer fees if players move.

Context

• For UK clubs, Brexit has affected the recruitment of young players from Europe due to changes in work permit regulations, influencing how clubs approach international scouting.
• The recruitment of young talent involves ethical considerations, such as ensuring the player's education and welfare are prioritized alongside their athletic development.
• Once a player turns 17, they can sign a professional contract, which formalizes their status and often includes clauses about transfer fees and buyout options.

Problems and Scandals Outside Football

This section explores the challenges and controversies faced by football, from regulating player behavior both on and off the pitch to grappling with evolving broadcasting models, online piracy, and the impact of social media.

Discipline: On-field Incidents, Social Media Misconduct, Gambling, Doping

Geey emphasizes the importance of upholding the sport's integrity and standing through disciplinary measures. Recognizing that player behavior, both on and off the pitch, is subject to intense scrutiny, he details the rules, sanctions, and debates surrounding issues like diving, spitting, dangerous tackles, and abusive language.

Governing Bodies Impose Sanctions Like Fines and Bans to Manage Behavior

The author provides numerous examples, including the multiple biting incidents involving Luis Suárez and the racist abuse case of John Terry, to illustrate how governing bodies like FIFA, the FA, and UEFA impose sanctions, such as fines and bans, to regulate player conduct and uphold the standards of the game.

Other Perspectives

• There is a risk that fines and bans might disproportionately affect players from less affluent backgrounds, who may feel the financial impact more significantly than wealthier players, potentially creating a disparity in the enforcement of conduct regulations.
• Over-reliance on punitive measures might overshadow the potential benefits of positive reinforcement strategies in promoting good conduct.

Football Broadcasting's Evolution: Digital Platforms Rise, Piracy Issues Persist

Geey examines the transformative impact of broadcasting on football, highlighting the symbiotic relationship between pay TV and the sport's global growth. He details how the exclusive deal between Sky and the league revolutionized the UK market that year, sparking a dramatic increase in revenue and transforming clubs into lucrative businesses.

TV Rights Fuel Football Industry Growth

The author breaks down how the EPL monetizes its broadcasting rights, outlining the auction process and the escalating sums paid by broadcasters like BT and Sky, who see live football as a crucial driver for attracting subscribers and generating advertising revenue. Geey explores the evolving landscape, noting the emergence of digital platforms like Amazon Prime, which secured a package of matches for the 2019-2020 and 2021-2022 seasons, signifying a potential shift in how fans access and consume live football.

Practical Tips

• Use the auction model to organize a charity event where local businesses bid for advertising opportunities. This could be for a community sports event or a local festival, where businesses compete to sponsor different aspects of the event, thereby increasing the funds raised for the cause.
• You can explore alternative sports content by subscribing to less mainstream sports channels or streaming services that offer lower fees. By doing this, you're not only potentially saving money but also supporting smaller organizations that may not be involved in the high-cost bidding wars for broadcasting rights. For example, instead of paying premium prices for big-name sports channels, look for niche sports networks or online platforms that broadcast less popular sports or leagues at a more affordable rate.
• Create a fantasy football league with a unique twist, such as incorporating player performance predictions or charitable donations for points scored. This can engage a community of football enthusiasts who are looking for a new way to enjoy the sport, and it can also attract sponsors who want to be associated with innovative and socially responsible initiatives.
• Consider creating a comparison chart of different digital platforms' offerings, focusing on their exclusive content and broadcasting rights. This can help you and others make informed decisions about which services to subscribe to based on the content they value most. For instance, if you're a fan of a specific genre or type of show, you could track which platform has the most comprehensive selection and share your findings with others who have similar interests.
• Develop a blog or vlog that provides analysis and commentary on games available through subscription services. By focusing on the games that are part of these services, you can attract viewers who are looking for a deeper understanding of the matches they've watched or are planning to watch.
• Organize a virtual watch party with friends or fellow fans using a video conferencing tool. Coordinate with your friends to start watching the game at the same time and share the experience through video chat. This can create a sense of community and shared excitement, similar to being in the stands, but from the comfort of your own homes.

Evolving Habits: Challenges and Opportunities For Content Providers and Rights Holders

Geey highlights how traditional TV has fewer viewers of live matches, arguing that evolving fan habits and the rise of online platforms present both challenges and opportunities for those broadcasting and holding rights. He acknowledges the growing threat of online piracy, fueled by readily available illegal streams, and details the Premier League's efforts to combat this trend. He discusses the potential of direct-to-fan subscriptions, exemplified by the Football League's iFollow platform, and explores emerging technologies like augmented reality (AR), which could revolutionize the way fans experience live matches.

Context

• Many viewers find online subscriptions more cost-effective than cable packages, which can be expensive and include channels or content they do not watch.
• The shift to online broadcasting involves navigating complex international regulations regarding digital content distribution, intellectual property rights, and data privacy.
• The financial losses from piracy can affect the entire sports ecosystem, including player salaries, team investments, and grassroots development, as less revenue flows back into the sport.
• They run campaigns to educate fans about the legal and ethical implications of using illegal streams, emphasizing the impact on the sport's revenue and quality.
• Implementing these platforms requires significant investment in technology and infrastructure, as well as strategies to combat piracy and ensure content security.
• AR can provide features like real-time subtitles or sign language interpretation for fans with hearing impairments, making matches more accessible.

Controversies: Managerial Sackings, Owner-Manager Conflicts, Super League Proposals

Geey delves into several of the more contentious issues surrounding football management, ownership, and the potential for a European league of top clubs. He highlights the pressure managers face to deliver results, explaining how a run of poor performances can quickly lead to dismissal, often with significant payouts for their remaining contract value, as seen with Chelsea's numerous managerial changes.

Incidents Highlight Tensions and Interests in Modern Football

Geey also examines potential conflicts between owners and managers, citing Kevin Keegan's resignation from his role at Newcastle United to show how disagreements over transfer policy and control can lead to costly legal disputes. He considers the recurring proposals for a European Super League, detailing the debate surrounding a breakaway competition involving Europe's elite clubs.

Practical Tips

• You can analyze decision-making in your workplace by mapping out the different interests of stakeholders and their potential conflicts. Start by identifying key stakeholders in your organization, such as managers, employees, and shareholders. Then, list their primary interests and objectives. Look for areas where these interests might clash, similar to how owners and managers in football might have differing goals. This exercise can help you understand the dynamics at play in your organization and anticipate potential conflicts before they arise.
• Create a "decision diary" to track the outcomes of your choices, especially those related to disagreements or conflicts. Note the situation, the decision made, the reasoning behind it, and the eventual outcome. Review this diary periodically to identify patterns in your decision-making process and adjust your approach to prevent repeating mistakes or to reinforce successful strategies.
• Draft a clear transfer policy for any assets you own, such as property or a business, detailing the conditions under which transfers occur and who has authority in these decisions. By doing this, you preemptively set the rules and expectations, which can be referenced to avoid disputes. For example, if you own a small business, create a document that outlines how ownership can be transferred, under what circumstances, and who needs to be involved in the decision-making process.
• Participate in fan forums and social media discussions about the European Super League. By contributing your thoughts and reading others', you'll gain a broader perspective on the topic. This interaction can help you understand the various stakeholder viewpoints, from fans to club owners, and the potential implications of such a league on the sport.
• Explore the dynamics of exclusivity by starting a niche club within your existing social or professional networks. This could be a book club, a fitness group, or a professional development circle that's invitation-only, mirroring the exclusivity of the European Super League. By managing this group, you'll understand the challenges and benefits of creating an elite community, such as maintaining high standards, dealing with the perception of others, and ensuring the group's sustainability without widespread support.