Saturday, January 14, 2012

An open reply to steve_mcfc's questions to me on 13th January 2012


This is an open reply to steve_mcfc, the Manchester City supporting Twitter sensation. I blocked Steve on Twitter months ago but in a rush of blood to the head I unblocked him yesterday.... Steve proceeded to tweet me around 30 times starting at 7.48pm yesterday. The Tweets were a combination of insults and questions and are reproduced in full below (in bold). You can check they are exactly as Steve tweeted on his timeline. I was out at the time.

Given that it is hard to reply to 30 tweets I thought I would give more detailed answer to each of Steve’s points on this blog. I apologise for not replying on Twitter but as Steve doesn't restrict his questions to 140 characters, I don't see why I should restrict my answers...

Before you blocked me, you said you were opposed to a cap on squad spending where the cap is the same for all clubs. How can you claim to be impartial when you refuse to support a cap that's fair and you will only support a cap that provides United with a huge long-term advantage? You're not impartial at all, are you?

I’m not impartial about which team (United) I want to win things and which teams (others, especially Liverpool, City) I don’t. That’s called “being a supporter”. I am impartial about wanting football organised in a fair and sensible way maintaining decent competition, preventing the exploitation of supporters and the endangering of clubs through excess debt and financial mismanagement.

I support FFP because I think excessive owner subsidy unbalances competition and injects unsustainable inflation into the system. The labour market in football has an almost vertical supply curve, that is to say the supply of footballers is almost completely price inelastic. Additional cash above a certain level just increases the price (wages) of footballers. The vast majority of clubs lose money because of the wages they are forced to pay. Controlling owner support through FFP should calm this systemic inflationary problem, helping the whole pyramid.

Why did you refuse to support a cap on spending where the cap is the same for all clubs, & you would only support either FFP as it currently stands, or a cap on spending where the cap is set to be a percentage of revenue?

Because a fixed cap would eliminate any incentive to grow and develop a club, surely a daft and unwelcome consequence? What is wrong with the “normal” equation of “play good, attractive football, attract higher gates and more sponsors, reinvest this money back in squad and create virtuous circle....”?

FFP doesn’t preclude massive investment in stadia, youth development, training facilities etc in any way. It just limits inflationary bursts of wage and transfer spending.

I would have preferred FFP to have specific debt restrictions in addition to its spending limits, debt is a cancer on the game. I would like to see any English licensing rules to include debt restrictions. See my submission to the CMS Select Committee, available here:

Do you still think that FFP will land City "back in the ditch", as you once charmingly said?

I hope City go back to the regular relegation/promotion comedy cycle of failure they have been on for most of my life yes! In other shocking news I hope Liverpool implode with King Kenny going mad, that Leeds never come back up and I have to tell you Steve, THE POPE IS CATHOLIC.

Before you blocked me, you said you were opposed to a cap on squad spending where the cap is the same for all clubs. How can you claim to be "impartial" when the reason you oppose that is because you want FFP to provide United with an unfair advantage?

I don’t support FFP because it helps United (under the current ownership all it would actually do is help the Glazers boost EBITDA and get a bigger price for any future IPO in any case).

I actually think there needs to be a financial rebalancing between the richest clubs like United and the less well off. I would advocate the reintroduction of league gate sharing and a redistribution of Champions League income across the PL to help this. I think the FFP exclusions on stadium development are great for aiding a rebalancing but bottom line, clubs like United should be “taxed” through gate sharing etc. If you don’t believe me, ask Dave Boyle, David Conn and Ian King (of TwoHundredPercent) with whom I’ve been discussing this for a while now.

Why did you assume that Etihad Airways would not grow at all over the 10-year period that the Etihad sponsorship deal of City covers? Etihad is a young airline that is looking to massively expand over the next decade, yet the figures you assumed for Etihad's growth over the next 10 years was 0%. Your assumption of 0% growth was dishonest wasn't it, Andy? Why would a young airline seeking to massively expand sign a £400m sponsorship contract and expect to grow by 0%?

If you are talking about my benchmarking of the Etihad deal to the company’s current financial in my blog post of 13th July you have got the wrong end of the stick. I pointed out that the company’s current turnover was £2bn and that even at a 10% EBIT margin the deal would represent an unusually substantial proportion of profits. When did I say the company would never grow?

I think the deal is extraordinarily large compared to the size of the company and can find no equivalently large deal vs. company size out there (Bayern’s sponsor Deutsche Telekom for example have EBITDA of €3.9bn and pays Bayern €25m pa). Let me know if you can find another mismatch between deal size and company size...

No response to anything I've just said then? Does that mean you accept everything I've just said?

No, hence these replies!

As for verbal diarrhoea, I would say you being interviewed by the BBC talking about City's finances is the best example of verbal diarrhoea I've seen. Why on earth a supposedly unbiased broadcaster has a highly biased Utd fan on to slag off our finances I'm not entirely sure.

Why don’t you ask the BBC Steve.

You don’t like me or my views, but lots of other people take me seriously unfortunately.

One other thing. Do you not consider it extremely hypocritical to campaign against the Glazers because they limit United's spending while you also act as cheerleader for FFP, cos it will limit City's spending? Is that impartial?

The Glazers exploit United and its fans (like Hicks and Gillett exploited Liverpool and their supporters)  through an LBO. My main gripe is not spending restrictions, it is enforced ticket price hikes to make the LBO numbers stack up. The House of Commons Select Committee for Culture Media and Sport was scathing of LBOs in football, it is not an unusual view that they add no value.

I am not a cheerleader for FFP, I support it but think that the financial structure of UEFA’s CL is a major problem and would like specific debt limits in the rules too. Again, see my DCMS submission for details (and note that the committee quoted my submission on several occasions).

No response to any of that then? Guilty as charged then.....

Sorry, it took me a while...

You actually blocked me because I accused you of being a liar, Andy. I see you're lying about that too now.

Did I Steve? I knew there had to be a good reason.

Sorry, my mistake, you blocked me because I accused you of being a biased liar. That's the one.

OK, if you say so Steve.

Come on Andy. I think I explained the issues I have with your claim of being impartial. You used to stick up for yourself, so why not now? For example, this is a yes/no answer: Do you still think FFP will land City "back in the ditch"? Yes/no - wouldn't take you very long to clear that up, would it?

I actually think City may get around FFP sufficiently to remain quite competitive. As a United fan I would of course like to see you back down in the ditch!

Stop pretending to be impartial. We all know you've only started covering clubs other than Utd so that you can help to convince people of the supposed need for FFP so that Utd get their massive unfair long-term advantage. Unless you can convince people why it's "fair" for United to spend around 65% more than their PL rivals year in year out when on-field success has been shown to be highly correlated with total spending on wages & transfer fees

Are you saying nobody who supports any club can comment on the finances of any other club or on football wide regulation? That would rather restrict debate!

As I said above, I think the big clubs like United need reining in financially through new rules. The fact that clubs without rich owners like Everton can’t possibly compete and that clubs with quite rich owners like Sunderland can spend £100m of their owner’s money and not get anywhere suggests fundamental flaws with the system. The answer to that is surely not a billionaire owner for every club?

I started covering other clubs because the whole subject interests me and I believe fans are exploited all too often (see my work on QPR’s ticket price hikes for example). The Football Supporters Federation were kind enough to nominate me in their blogger of the year award. I’ve helped out various supporters trusts behind the scenes too, not that you appear to care about ownership issues Steve.

In fact Steve, you are like a stuck record, fixated by FFP and its relative impact on City and United.

You've provided a great defence of your impartiality, Andy. Well done son.

Thanks Steve.