Rob Minto

Sport, data, ideas

Month: March 2007

Premiership footballers: overpaid, under-motivated, salary-capped?

Football wages are an eternal source of fascination and disgust in equal measure. I have no idea why they are always quoted as a weekly wage rather than per year, as is the case with almost every other profession. But aside from that anomaly, last Sunday it was interesting to compare the lead story of the sports sections of the Sunday Times and the Observer. Depending which you read, you would come away with very different impressions of football salaries. Here’s the <b>Sunday Times</b>:<br />
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<a href=”http://www.timesonline.co.uk/tol/sport/football/premiership/chelsea/article1496727.ece”>Terry demands �60m deal</a><br />
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<i>JOHN TERRY�S contract negotiations with Chelsea have broken down over the England captain�s demand to be the best-paid player at the club for the next nine years. At current rates, the deal would be worth a minimum of �58.2m, making it the richest in British sporting history, but with new signings at the world�s biggest-spending club it would inevitably rise.</i><br />
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The “limitless parity” clause would guarantee that Terry was the highest-paid player at the club until beyond his 35th birthday. While Chelsea were prepared to increase his wages to the club�s current ceiling of �121,000 a week, which is paid to Michael Ballack and Andriy Shevchenko, they could not accept the liability of promising the defender equivalence with the club�s best-remunerated player for the best part of the next decade. <br />
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Any way you cut it, there’s a big deal going down. If Chelsea’s offer of �30m+ over 5 years is too small, Terry may well walk, but this is the reality of the sums involved. Lest we forget, Beckham is getting up to �25m a year with bonus, and about �5m of that is salary. <br />
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And then I picked up another Sunday paper. In the <b>Observer</b>, it’s a different story:<br />
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<a href=”http://football.guardian.co.uk/News_Story/0,,2031162,00.html”>Premiership’s top clubs set �100,000 limit on wages</a><br />
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Frank Lampard and Cristiano Ronaldo have ‘no chance’ of receiving the massive pay increases they are demanding from Chelsea and Manchester United. That is what they will be told this week by the chief executives of their clubs… the decisions signal a sea change in attitudes to players’ wages, which, in some cases, have spiralled to more than �100,000 a week.</i><br />
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What is really going on? Football wages have exceeded inflation for years, and it’s not due to the usual factors that you would expect in an industry. There is no lack of people able to do the jobs. There is an increase in labour liquidity, given the Bosman ruling and the EU transfer laws. Plus, players are more willing than ever to work abroad. These factors should if anything, depress wages or keep them in line with inflation.<br />
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But, as the <a href=”http://sport.independent.co.uk/football/news/article357006.ece”>Premiership wage study in the Independent</a> shows, this is not the case.<br />
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Wages are up 65% from 2000. There is also an interesting disparity between what forwards earn and other positions, with defenders on �653k to the forwards on �806k. John Terry’s demands seem even more outrageous given his defender peers get on average nearly 20% less than their striker counterparts.<br />
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But these sportsmen are not being incentivised correctly. What other group of high earners gets similar coverage? Finance professionals in the City. And how do they get paid? With low salaries and huge bonuses. Bonuses are measured in performance – great in a bull market like the one of the last few years, but measurable all the same.<br />
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Why football should follow suit. Players should have their salaries cut to a basic level, and then big bonuses for performance and results. There is no shortage of stats from Opta on how players perform, which could allow outstanding players in poor teams benefit. And win bonuses could easily be used, with levels going up for league position and rounds-progressed in tournaments. Win bonuses exist now, it’s just that they are paltry compared to salary.<br />
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The current structure encourages players to play well only when their contract is up for renewal. Once signed, they can cruise, knowing that getting dropped is the only big damage that they can suffer to their reputation – and many club’s rotation policy negates that effect anyway.<br />
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So are they going to be salary capped? In reality, no. The problem is that it’s too late. Any club that tries to impose a new wage structure could easily see their players walk out or get bought out. It would only work if all clubs were to impose it uniformly – unlikely given the current situation. Changing wage structures in any industry is hard enough, but in football, where the structures to impose industry-wide changes are even weaker than usual, it would be nigh-on impossible.

Equal prize money, equal dues?

Wimbledon have announced that this year, the men and women will get equal prize money. The predictable responses covered the usual arguments about equality, entertainment and fairness. As <a href=”http://www.timesonline.co.uk/tol/sport/tennis/wimbledon/article1434294.ece”>Pat Cash noted in the Sunday Times</a>: <br />
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<i>”Men need to be far fitter, work harder in their preparation, compete with much more intensity once they get out on the match court, show greater powers of endurance and play many more tough matches… Here�s the deal in everyday terms. What would a man think if he worked in an office next to a woman and she did 40% less work than he did and left a good hour earlier every day, but went home at the end of each week with the same amount of money in her pay packet?” </i><br />
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An interesting viewpoint. But then again, the 2005 Wimbledon finals don’t bear this out. The women’s match lasted longer, had more games and points, and was far more entertaining.<br />
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Roger Federer beat Andy Roddick 6-2 7-6 6-4 – 1hr, 41min<br />
Venus Williams beat Lindsay Davenport 4-6 7-6 9-7 – 2hr, 45min<br />
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Even Pat Cash would be hard pushed to deny that Venus Williams deserved an equal paycheck that day.<br />
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<a href=”http://sportsillustrated.cnn.com/2007/writers/jon_wertheim/02/27/mailbag/index.html?eref=writers”>Jon Wertheim notes in his excellent column</a>: <br />
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While on balance, I applaud this decision, I find the WTA’s gloating a bit disingenuous. Check out the prize money from last year and you’ll see that the year-end ATP Masters Cup pays nearly 50 percent more than the analogous WTA Championship. The typical Masters Series event pays nearly double the WTA Tier 1. If I’m a WTA exec, I’m not sure how I respond to the question, “How can you clamour for equal prize money when the market consistently suggests your product is worth less?”</i><br />
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Well, the market may not be an even playing field. The WTA may have a far less energetic marketing department than the ATP. The men’s tour may be in bigger stadiums and attract better sponsors due to other factors other than the quality of the tennis – poor management, or sexism, for instance. This is hard to measure, although I suspect Wertheim’s analysis is correct.<br />
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Given that the men’s and women’s tours are separate, we need to find tournaments where they play together for a better comparison – the Grand Slams. The marketing, stadiums and other factors are effectively the same for men and women. We can then look at the attendance. If Women’s tennis is so poor, the crowds will stay away.<br />
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Some commentators have pointed to TV viewing figures to show that men get up to 20% more viewers. Again, although this is an interesting indicator, it doesn’t allow for external factors – e.g. what else was on TV at the time, such as football, and doesn’t allow for average higher viewing figures on different days of the week. Why should Saturday and Sunday TV figures be level?<br />
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In theory, the ground attendance figures should tell us nothing. Demand for tennis tickets exceeds supply, so the stadiums should be full for both finals. However, fans will go to the ground on the chance of a return ticket or to watch on the big screen, and to watch the doubles and juniors.<br />
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The French, US and Australian events stagger the draw, so that men and women play on the same day except for the finals. This makes a comparison difficult, as there are no figures for specific matches on one day, just overall ground entrance. You can’t tell if the stadium empties for the women OR the men.<br />
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The data for the finals of the Australian Open over the last 18 years is available, and the men have a much bigger attendance: on average, 1,278 more bums on seats. The highest was 2005, with 3,973 more spectators. This doesn’t look good for the women.<br />
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But Wimbledon does something different, which allows for an interesting comparison. It alternates the draw from the Tuesday of the second week onwards. The Quarters, Semis and Finals for the women are on Tuesday, Thursday and Saturday. The men play their equivalent rounds on Wednesday, Friday, Sunday. If we look at the attendance figures we should in theory see a surge in numbers for the days the men play. And helpfully, Wimbledon’s daily attendance figures for the last 6 years are online, including days affected by rain.<br />
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The only other factor is that over time, there are fewer matches such as doubles and the juniors on the outside courts, which should show a gradual tail-off in crowds during the 2 weeks.<br />
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If women’s tennis is such a poor product, the data for the quarters and semis doesn’t add up. There are on average <b>758 MORE</b> people for the women’s quarters, and <b>1,370 MORE for the women’s semis</b>. But the finals show a 1,000+ advantage to the men. (Luckily, the number of rain affected days was evenly spread over the days.)<br />
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<pre> 2001 2002 2003 2004 2005 2006 Total average<br />
Wednesday – Tuesday -1,406 -2,081 1,215 -338 643 -2,583 -758<br />
Friday – Thursday -1,307 -5,544 -365 -1,150 956 -858 -1,378<br />
Sunday – Saturday 1,545 1,905 2,276 1,172 1,669 -1,594 1,162</pre><br />
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What does this mean? Crowds are just as keen to watch a combination of women’s matches on a given day, but if there is just one – the final – they are less enthused. Why might this be? <br />
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Perhaps one women’s match is too high a risk of being over in quick time; or with two matches there is more chance of seeing an entertaining match, whereas the men are a safer bet? If so, then women’s tennis is indeed a poorer product, but only in isolation – more matches means more chance of good play.<br />
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Interestingly, the attendance figures and prize money gender differential for the final have been incredibly close for the last few years – both at around 5%. The women should, if anything, get more than the men for the earlier rounds but less for the final. This contradicts the perceived wisdom that the men’s tour has greater depth than the women.<br />
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In which case, perhaps the women should play a five-set final. Then the attendance on the last 2 days would be a better comparison, and we could leave the equal pay dispute alone for ever.<br />
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