The battle has begun to wrestle Champions League cash away from Europe’s super-powers as smaller clubs, fans and leagues demand a change in how prize money is distributed.
The current system for sharing winnings is heavily weighted in favour of those teams that have a recent record of success in European tournaments, or in other words, the founding members of the aborted European Super League.
Currently, 30 per cent of the Champions League prize money is shared based on a coefficient using a club’s performance in European competition over the previous ten years.
But a fightback has begun to put pressure on UEFA to rethink how the money is handed out.
Real Madrid have a stunning record in Europe, which guarantees a bigger share of winnings
Talks held at the European Club Association board meeting in Istanbul on Thursday acknowledged there is ‘work to be done’ on distribution of the Champions League pot, when the tournament is expanded to 36 teams from 2024.
It may not sound like a big deal, but it marks a shift in the balance of power. After all, it is the ECA that forced through the coefficient-based cash distribution in 2016 and has driven the creation of the current system.
The body has been an effective lobby for the richest clubs, but following their disastrous attempt to launch a European Super League, the likes of Real Madrid, Juventus and Manchester United lost their seats on the organisation’s board.
Now, small and medium sized clubs are stepping up and demanding the funding model be changed.
At the same time the European Leagues organisation is pushing for reform, warning that ‘drastic changes are needed’ because the current arrangements just concentrate more power in fewer hands, destroying competition across the continent. It wants more money spread across the UEFA competitions and handed down to clubs that do not qualify.
And fan groups are also warning football will lose its appeal if the money is not shared more fairly.
But while a campaign for change is gathering pace, the continent’s most powerful sides have made clear they are not in favour of widespread reform.
Manchester United put their head above the parapet and set out their position in June, arguing it is right that big-brand clubs, which help to generate large TV revenue and have huge player budgets to manage, should receive a bigger share compared to potential rivals.
Speaking at a European Leagues meeting Cliff Baty, chief financial officer for United, said that significant changes to the funding formula would pose a problem to his club and the other super-powers.
Liverpool lost in the Champions League final to Real Madrid, but ongoing record of success, reaching later rounds, gives the Reds the opportunity to earn more money than smaller clubs
Bold reforms to the Champions League in 2024-25 have now been detailed by UEFA
Payment | Share |
---|---|
Sporting Fee | £431M (25%) |
Performance | £517M (30%) |
10-Year coefficient | £517M (30%) |
Market Pool | £258M (15%) |
Total | £1,723M (100%) |
Source: UEFA/European Leagues |
‘The reason the broadcasters are paying that much money is for the product, frankly, at the Champions League level,’ said Baty.
‘So, I think… if you are changing the distribution and wanting more money you have got to be careful what you are doing there, because we all know where the value is being created, let’s not kid ourselves.
‘I think we should put more money down I totally give it sentiment… but the value is created at the top.
‘If you start changing that and making it more difficult for the bigger clubs to perform, it’s hard.’
UEFA president Aleksander Ceferin is committed to overhauling Europe’s premier competition
It is uncomfortable that the current system benefits those clubs that supported the European Super League.
The latest figures for the 2020-21 Champions League distributions reveal that Barcelona pocketed £33.3M from the 10-year coefficient for reaching the last 16 of the competition, Juventus received £29.9M, but Atalanta received just £5.5M, even though all three clubs went out at the same stage.
More successful clubs also receive greater benefit from the ‘market pool’ segment of the competition’s prize money, which accounts for a further 15 per cent of the total pot. It is linked to how much a domestic broadcaster pays for the TV rights to the competition.
It is designed to reward clubs from countries that generate the value in the sale of the media rights, which means teams from Europe’s big five leagues have the potential to earn more.
At the European Leagues meeting, Baty responded to smaller clubs, who raised concern about the widening gulf between rich and poor.
The Manchester United executive added: ‘I understand some of the sentiment being said here, you mention changing the coefficient and the market pool in terms of giving too much guaranteed revenue [to clubs with a record of success]…
Manchester United’s chief financial officer, Cliff Baty (l), says the big clubs create the value in the Champions League and need a greater share of the revenue to maintain competitiveness
‘One thing I would say from our perspective is that it does give a degree of certainty that helps in terms of sustainability, in all the discussions we are having around sustainability and financial fair play in football.
‘If you take that away it is going to increase the volatility and be more difficult for us to manage.’
Baty’s position underlines the challenge faced by the majority of clubs to effect change.
‘There is a sense of entitlement,’ Liverpool University football finance expert Kieran Maguire told Sportsmail. ‘They already have substantial financial advantage.’
‘They have extracted huge commercial value from the Premier League and UEFA with the threat of the European Super League and they do not want to have to row back on those gains.’
Football Supporters Europe, an umbrella group for fan associations across the continent, believes the new cycle of the Champions League after 2024 should be used to bring about change.
‘The proceeds of UEFA club competitions are apportioned in an uneven manner, benefiting elite clubs, and adding to financial disparities within and between leagues,’ the FSE said in a statement. ‘To address this, we believe that the market pool and coefficient pillars should be eliminated.
‘Solidarity payments should be dramatically increased in the next broadcast cycle.’
The European Leagues agrees there is no option other than reform, if European football is to retain widespread competition.
Clubs like Atalanta without a long record of success in Europe miss out on prize money
‘If nothing changes differences will grow and more and more competitions and clubs will suffer the consequences,’ said Jacco Swart, managing director of the European Leagues at the June meeting.
‘To defend and protect the interests of all domestic competitions and all the clubs, further drastic changes in UEFA cup competition’s distribution systems are urgently needed and unavoidable.
‘The enlarged Champions League after 2024 will have an even larger prize pot, which is expected to increase from the current figure of £1.7BN to £2.45BN.
This may create the possibility for change, since the big clubs’ cut could be reduced, while still receiving more money in cash terms.
A figure involved in the ECA discussions told The Times: ‘It may be that the end result is one where everyone is a bit unhappy, but that might be the best outcome.
If the big clubs can still get more money because the TV income is going up, but agree to cut the amount of coefficient funding they get, then maybe a deal can be done.’
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