The Spanish government has struck a blow for parity in the country’s top football league.
Granted, the measures announced Monday will only slightly pare back the television earnings of Real Madrid and Barcelona, but as the Primera Division giants have seen their TV revenues balloon to about 6.5 times as much as some of their rivals, according to Alex Duff of Bloomberg, even a modest indent in their financial might is a step in the right direction.
Breaking: Real Madrid, Barcelona can't earn more than 4 times TV money of smallest La Liga team under new law @BloombergNews learns— Alex Duff (@DuffofBrentford) February 10, 2014
As reported by Bloomberg, a new piece of legislation known as the “Sports Law” will limit the broadcast income of Madrid and Barcelona to no more than four times the amount brought in by La Liga’s last-place finisher.
At present, the 20 clubs in Spain’s top flight sell their television rights independently—an arrangement that delivered more than €140 million into Madrid’s coffers last season while Granada made a mere €12 million.
“Real Madrid and Barcelona are running away with all the television money in Spain and that is not healthy,” remarked La Liga chief executive Francisco Roca last April, as per The Guardian.
He added: “We need to conquer the issue of individual television rights. It is not advantageous for the Spanish league to sell its rights individually and something we aim to solve over the next two or three years is to sell them collectively.”
The current rights agreement, negotiated by each of the clubs with Barcelona-based Mediapro, expires after the current season. But as the contents of the Sports Law do not, and perhaps cannot, encourage a collective sale, the upcoming settlements will once again be done individually—the difference being more equitably distributed fees.
Of course, another (and indeed negative) fallout from the legislation could be less money pumped into Spanish football altogether.
(Negative, that is, for La Liga’s biggest clubs and their continental stature.)
Real Madrid, FC Barcelona and Bayern Munich lead the Deloitte football club money league. http-//econ.st/1jWihY7 pic.twitter.com/zjXqNRpgES— Jorgen Sundberg (@JorgenSundberg) January 28, 2014
In light of an unemployment rate of more than 26 per cent, according to January numbers from Reuters, the Spanish authorities seem to be clamping down on what they see as excesses in football, going so far as to fine Real Madrid, Barcelona and Mediapro for exceeding the typical three-year contract term while coming down hard on Lionel Messi, whom they accused of tax fraud.
As Mike Ozanian recently wrote in Forbes, the country’s Council of the National Commission on Financial Markets and Competition (CNMC) has essentially told La Liga and its partners that it intends to “comb through the fine print of your contract and look for any technicality to grab some of your loot.”
Deloitte Money League 2012/13 List: 1. Real Madrid (£444.7m), 2. Barcelona (£413.6m), 3. Bayern Munich (£369.6m) #SSFootball— SuperSport Blitz (@SuperSportBlitz) January 23, 2014
Conversely, Roca could well point out the example of Racing Santander, whose players refused to contest a January Copa del Rey match after going without pay for several months.
Speaking to reporters after the incident, as per Eurosport, club captain Javi Soria remarked that he and his teammates had “done this for the good of football, for the good a city and the whole of Spain, because there are lots of similar cases and we wanted to set an example.”
Move has been made that prevents Real Madrid and Barcelona from earning more than four times the TV money of La Liga's smallest team. Good.— Dan Brett (@DanBrett90) February 10, 2014
It’s the “similar cases” that the Sports Law intends to aid.
And while it’s hardly perfect—even a half-measure—the legislation still addresses one of the fundamental issues of competitiveness: that prestigious clubs are nothing without opponents to play.