Ronaldo’s wage too much?

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By Towser, 19 May 2009 The Crowd is a Roar Pro

Tagged:: EPL, football, International Football, Ronaldo

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This story appeared last week about Ronaldo’s muted transfer to Real Madrid.

Let’s try and put this into perspective by reading this article about Footballers’ wages.

I take this quote from it:

“The maximum wage was increased to £14 (1951), £15 (1953), £17 (1957) and £20 (1958). The union argued that in 1939 the footballers’ £8 was approximately double the average industrial wage, by 1960 the gap had narrowed to £5 with these figures standing at £20 and £15 respectively.”

Now, as one of the many fans who stood amongst the 50,000 crowds of the day at both Sheffield Wednesday and United matches, to see a £5 difference between the average industrial wage and a footballer’s wage, given their entertainment pulling power and skill, seemed somewhat askew.

But I remember my grandad astonished when picking up his Sunday paper and reading that Johnny Haynes was getting £100 a week. I looked at his plaque on the wall that said he had worked for 50 odd years till the age of 70 in a steelworks to receive the princely sum of £2 a week pension, and was inclined to agree with him.

What of Ronaldos wage of $480,000 per week then (let alone $143 million transfer fee)? I don’t know what the average industrial wage is in England now, but I guarantee its only a fraction of $240,000 per leg Ronaldo.

Here is another article judging the current state the 1961 decision had on football.

My own thoughts are that, although the maximum £20 wage was, in my book, exploitation by the clubs, perhaps Johnny Haynes’ £100 was a more realistic wage, based in reality on what is the only real indication of a club’s drawing power: punters through the gate.

I guarantee that clubs like mine, Sheffield Wednesday, would still be a big club if wages and transfer fees were kept at a realistic distance from the average industrial wage.

The killer in my book, TV rights, has put footballers’ wages way out of proportion to the actual pulling power of the market they operate in.

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The Crowd Says (33) | Page 1 of Comments

Brett McKay said | May 19th 2009 @ 8:50am | Report comment

Towser, it’s all relative. If Man Utd or Real Madrid or the Central Coast Mariners decide to put that sort of money on the table for Ronaldo, and they can afford it, then they’ll argue he’s worth every cent. It’s just thet same as a competitor to your current employer offering you well over what you’re currently being paid to jump ship.

In my opinion, these comparisons of sportspeople’s wages to that of Joe the Plumber are exercises in futility becuase as we all know, top level sporting organisations, and European football clubs in particular, operate in completely different economies to we common folk. How many “Towser” items or ideas could your employer sell in comparison to how many Ronaldo shirts Man Utd or Madrid could flog. It was widely reported that LA Galaxy covered Beckham’s wage in shirt sales alone.

I don’t know what Man Utd’s turnover is each year, but I’d reckon there would be plenty of countries (let alone plumbers) that would struggle to match them.

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whiskeymac said | May 19th 2009 @ 9:09am | Report comment

good article. the amount of money is immoral, but on the one hand, aren’t TV rights essentially the new market. it’s no longer just who comes through the turnstiles, it’s the people at home with Sky or Fox or Setanta or ESPN etc.. and they just don’t live in Sheffield, but China, USA and every other corner of the globe. The market is now global not local. IF Ronaldo (or a Beckham, Messi, Kaka) ensure success for the club, and their marketing power increases, then this should be reflected in greater wages. Success is now the sale of shirts, sponsorships, computer games… and then there’s football success. Almost analogous to movies now – they make more money in spin offs and merchandising with maccas etc than with tickets sold. A great movie could be considered a failure if it doesn’t sell cuddly toys (as was suggested recently for a critically acclaimed pixar movie that had no marketable (ie cuddly) star). The movie market has changed as have the reference points for what is termed successful. From a lay opinion it seems the similar changes have affected the sports one. The point (sorry a bit laboured) is that in these new markets for “entertainment” the returns are much larger than they ever have been before.

It might be less expensive for a big club to pay more for these superstars than risk losing them to a rival – the cost of failure in football is enormous, with the champions league failures and relegation proving catastrophic for some. Look at Leeds.

Football is a truly multinational billion dollar industry and these guys are the “product”.

On the other hand, and in saying the above, I still agree with the sentiment the amount of money is still obscene. How can a sportsman be worth so much more than a team of nurses and doctors for example (if we measure wages). but if the industry is so big, and the stars being the “show”, then what would be fair? is it not free market powers at work? (credit crunch adjustments to follow). do you know how it compares to US sports stars?

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Ryan Steele said | May 19th 2009 @ 9:48am | Report comment

Nothing draws a crowd – both to stadiums and on televisions – better than big names. It also helps to bring in the silverware.

As the competition gets more competitive, the transfer markets get more competitive. How are you going to entice a player to move clubs, when they are content? Money. A player’s cost doesn’t rise, based on Workplace Agreements. It is based on their value to the club – as a name becomes better-known, so will his salary, as will the desire for other clubs to try to snatch them up, and for smaller clubs to find a fortune to get large drawcard players. Beckham is a much better example than Cristiano Ronaldo, earning an estimated $1m per week with LA Galaxy. Transfer fees work exactly the same way (even if they are sometimes ridiculous).

whiskeymac is right; these players are the product of the club, and the products sell merchandise, seats, television rights, and possibly silverware. We’ve even heard players be called ‘bargains’ in the past – look at Kaka with AC Milan.

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Towser said | May 19th 2009 @ 10:12am | Report comment

Brett,Whiskeymac

Good posts re merchandise TV rights etc.Let me just add that the speed which this has occurred since the days of Johnny Haynes is astounding. Lets though then concede(as much as I find it whiskeymac obscene money to real value of the skill involved ie how much do micro surgeons earn?) that this is the reality of modern day football.
Reality being that the mega rich clubs rule & dominate in the major Leagues of the world. Call it sour grapes(being an Owls fan) if you like ,but why is it that only a few are favoured in this brave new football world? When the 20 quid minimum wage existed leagues were much more even. As I said 100 quid was realistic in my book given the gates of the time. Clubs could have paid these wages on their gates. Funny thing about football spreading globally as a sport is that from the financial angle its power influence is concentrated in a few clubs & Leagues in Europe. OK the USA is not a traditional football nation we know that ,but as far as professional sport goes from the financial angle its a powerhouse,yet the reality is that its league the MLS is small fry in the football global village. Their fans still pay homage as the rest of us do to the great football gods,the EPL,Serie -A La LIga. Even then as in this country & the rest of the world the glamour clubs the most succesful get the support like Manu,Liverpool,Real Madrid,AC Milan,Barca. Never seen an Aussie in a Bolton shirt yet.
Sure you can argue that “Joe the Plumber comparisons are futile” & on the surface given the way the Football market operates that appears a sound premise. But I argue that if wages(& I mean wages not the merchandising TV rights etc) had been kept at a realistic/value skill level in comparison with JTH then we would not have had clubs like Leeds on the brink & great clubs like Wolves & Sheff Wednesday/United continuous also rans.

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Towser said | May 19th 2009 @ 10:15am | Report comment

Last post should read JTP not JTH. Although could be Joe the Hod carrier.

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Brian said | May 19th 2009 @ 10:59am | Report comment

Actually I think Ronaldo is underpaid. Desipte being the best player in the world most popular sport he earns less than the top stars in Baseball or Golf. The truth is not only does Ronaldo’s skill cover his own wage but he helps cover the expensive wages of others who (unlike him) could probably be replaced by the Joe the plumber – Sepp Blatter, Brian Robson, Gary Linekar (commentator), Darren Fletcher etc.

I dont think its possible to contain wages any more than has been done. Ronaldo may earn $20m a year but the truth is he is probably worth $100m. Were his wages further constrained it would only have been a matter of time before a Murodch type had come along and setup a new European league outside the FIFA parameters. The clubs did setup a G15.

In developing countries like ours wages are also are good promotion for the sport as no AFL player can match the wages of Kewell or Cahill. I think there are a lot of things football authorities can do better (technology!!!) but on player wages I think they have done realtively well

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James Mortimer said | May 19th 2009 @ 11:10am | Report comment

I agree on the prospect of inflated wages.

This goes around everywhere in the world, even beyond sport.

I found out the other day that Oprah Winfrey (I can’t watch 10 seconds of her show) earns between 385 and 410 million per year.

But it is all relative to what a star can do.

Allegedly, when LA Galaxy signed Beckham for I think 300 million – half of that was recouped in two year with jersey sales alone. Mind blowing stuff.

Equally, when Carter signed for Perpignan, they sold 30,000 Carter 10 jerseys in one month.

Still, I remember when I was a venue manager for a catering company, and I managed a $6 Million budget for the princely wage of just under 40K……….

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whiskeymac said | May 19th 2009 @ 12:25pm | Report comment

towser the way things are changing generally are astounding compared to back in the day. from satellite tv rights to internet podcasts the truth is we aren’t in Kansas any more. Even back in the 60s and 70s weren’t traditional powerhouse teams like Preston North End struggling in the UK once clubs paid more… it could be said that what is happening has been going on for decades, but its more evident now as those at the top are fewer and fewer.

Do you think that the ultra wages are a sign of things to come and that such costs will ultimately bring about even more consolidation in the future. I personally don’t want to see Galactico clubs operating. all the main leagues are already won by only a few. what place then for the Owls? or Spurs or Lazio or Shalke*? as someone suggested an attempt to prevent the growth of these clubs could possibly bring about the much UEFA feared g14 superleague but who but a superclub can realistically pay such enormous fee’s? What bank would be able to underwrite Perez’s next round over inflated poachings?
I also wonder what disharmony in a dressing room such wages would create. Last year there were grumblings from Real players as to Ronaldo’s expected costs on that issue.

* in answering my question about what would happen to owls, spurs, lazio etc.. i think, .one good thing about the world game is that because it is global and there are so many players and set ups to prosper in, for every ronaldo and messi there’s a Totti, Podolski, Djite, Fabregas etc. Even if there were 20 big clubs there will always be plenty of talent to go around – ronaldo is not 10 times better than say Flamini. He is ten times more marketable. even in a superleague the crowds will come to watch their teams, and am sure that some TV will pay for it. English lower division players still make good money – they may not have Bugatti’s but they can afford to hire a plumber to fix the inside latrine.

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whiskeymac said | May 19th 2009 @ 12:32pm | Report comment

oh and re: USA and soccer…. Man Utd, Liverpool and Villa, plus a healthy dose of Arsenal is owned by yanks!

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jimbo said | May 19th 2009 @ 12:40pm | Report comment

FIFA should bring in a global salary cap the same as the A-League and the same amount all round the world.

Clubs would make more money and re-invest it in the sport, ticket prices and Pay TV subs will be a lot more affordable and all competitions around the world could afford to keep their best players in their own true domestic league.

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