Why Are Premier League Clubs Richer Than Anyone Else Revenue Gap Explained

Every summer and winter, football fans’ news feeds are full of headlines about major transfers. European top clubs are lavish when they get the opportunity to sign a star player. However, quite often we can see how middle clubs and even obvious outsiders spend 15 million per player and even more. Why are the vast majority among these clubs the Premier League representatives? Why are English clubs richer? Let’s geek it out.

The incomes of any professional club serving in the European top leagues are dependent on three pillars: commercial, match day and TV broadcasting revenues. Sometimes a small club can profitably sell its player, but this profit source is not constant and should be considered separately.

However, despite the significant role of revenues generated from transfers, sponsors or tickets, it is the broadcasting sales that make the difference between the middle peasants of the Premier League and La Liga, not to mention other championships.

In the beginning of 2018, Sky and BT Sport agreed to pay 4.46 billion pounds for showing the Premier League matches in the period from 2019 to 2022. This is about 1.5 billion pounds per year. Given that the money is distributed almost equally, all clubs will receive about 70-80 million income only from the broadcasting rights and only within England. If we add the income from the sales of foreign broadcast packages, then each club that is not the member of the “big six” of England will get at least 100 million.

La Liga, which ranks second in terms of broadcast incomes, significantly lags behind the English championship. In the summer of 2018, La Liga entered into a new three-year contract worth of three billion pounds, that is, one billion a year. But the problem is that the revenues are distributed with a strong bias in favor of large clubs: teams from the bottom of the table receive 5 times less than Real and Barcelona. In other words, the relative Real Sociedad can expect no more than 40 million per season.

This explains why Premier League Fulham can buy twelve new players in one summer while spending 110 million pounds.

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