Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top player?

Discussion in 'Business and Media' started by pc4th, Nov 17, 2005.

  1. pc4th

    pc4th New Member

    Jun 14, 2003
    North Poll
    Club:
    Los Angeles Galaxy
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Instead of having Henry salary increase from $8 million to $12 million because his star teammates will complain, how about signing Henry on $8 million a year and give him a $16 million upfront sign-on fees.

    Star teammates don't complain because their salary is comparable to Henry.
    Henry is happy because he is getting $8 million per year in salary + $16 million upfront sign-on fees.
     
  2. leg_breaker

    leg_breaker Member

    Dec 23, 2005
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    The fans benefit by having their clubs effectively shut down? Somehow I can't see an Everton fan going watching Liverpool because they're part of the new 'European Football League'.
     
  3. leg_breaker

    leg_breaker Member

    Dec 23, 2005
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Yet they have no problem with the draft system which is pretty much exactly the same, but for free?
     
  4. rangers00

    rangers00 Member

    Jun 1, 2000
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Who are you kidding here? "sign-on bonus"? do you think this is the NFL?

    And do you think Henry's new teammates are blind because they don't see those $16M in Henry's salary?
     
  5. pc4th

    pc4th New Member

    Jun 14, 2003
    North Poll
    Club:
    Los Angeles Galaxy
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    How? If the team and Henry and his agent keeps quiet, NOBODY will ever know. This is not NBA/NFL/NHL/MLB or MLS where the salary numbers has to be published to the public.

    His teams would probably think "hmm...maybe I could do a Ballack or a Henry too" and play out my contract and get the same sweet deal.

    Anyway, if Henry is worth $17 million in the transfer market and a team get him for $16 million in sign-on fees, that team is better off by $1 million.
     
  6. rangers00

    rangers00 Member

    Jun 1, 2000
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Ummm... under the table deal. Is this thing legal in European soccer?

    I'll believe it when I see it, i.e. all the big clubs are acquriing star players thru' under table deals...
     
  7. Prenn

    Prenn Member

    Apr 14, 2000
    Ireland
    Club:
    Bolton Wanderers FC
    Nat'l Team:
    England
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    But if everyone knows it's going on then well... everyone knows it's going on. There will be plenty of people who would know that Henry got a huge signing on bonus, his agent may even represent other players at the club who in turn would demand their fair share.

    You're not thinking this through. Put yourself in the shoes of everyone involved.
     
  8. JohnR

    JohnR Member+

    Jun 23, 2000
    Chicago, IL
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Strange and economically inefficient. No player on Arsenal is worth 80% of Thierry Henry's salary. Nor is anybody on Barcelona worth 80% of Ronaldinho. Not for getting results, not for selling tickets.

    I don't doubt what you write. However, I would expect this system to change. If the best players are underpaid -- as Henry and Ronaldinho certainly are relative to relatively ordinary players who make 80% of their wages -- then some rationalization is in order.
     
  9. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    but $8 million worse off than they'd be if they paid him the going rate.

    I really don't understand where you are coming from. It's as if you think clubs want to pay their top players exceptionally high salaries, but feel their hands are tied because of also having to pay transfer fees.


    It's been said time and time again on each of these threads you've started on this subject - even where American sports clubs and european sports clubs have comparibly similar salary budgets they still have hugely different ways of spreading those salaries. If it was only a lack of salary budget which stopped european clubs paying the same top salaries as american ones, that would not be happen. The conclusion from that leans more heavily than a fat man on a rapidly cornering bus towards the idea that clubs here just have a different view on salary distribution.


    And players talk. Many of them share the same agents. If an agent of one player knows that another of his players at the same club is comparibly underpaid, he'll get that player to demand a raise. After all, agents get a cut, so all they care about is where their next Porsche is coming from. They couldn't care less about team unity.

    As has also been pointed out, clubs there can get away with paying the supporting players comparitely peanuts because there is no competition for those players. Nowhere else for them to go. Maybe that's why pro leagues there have a minimum salary, yet one doesn't exist here.
     
  10. aloisius

    aloisius Member

    Jul 5, 2003
    Croatia
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    They happen in European football as well.

    And not just for players coming on as free players but also for players who sign a new contract at the same club.

    There is also nothing “under the table” about them.
     
  11. herewego

    herewego Member

    Jun 1, 2004
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    I don´t think the main influence for the lesser wages is the difference of the transfer systems.

    First of all pro-sport is a business and therefore the main rules of economy are working.

    So the first law is that offer and inquire determinates the price.

    That means the market circumstances are the main factors to decide how much a team is willing to pay or has to pay to get players of the wished level of class. How much revenue is able to be maid by TV contracts, advertising, selling tickets etc.?

    The main factor in my opinion is: The number of pro teams and thereby the number of needed pro players related to the market they are able to participate from.

    I will focus on american football vs. european soccer, knowing that there are some other significant pro sports in US and even in europe and other parts of the world:

    On one hand 300 millions US citizens possible watching American Football,
    on the other hand between 40 and 80 million possible watchers of soccer in England, Spain, Italy, Germany, France, about 450 million europeans in whole.

    That means every single euopean soccer league has a much lesser market than NFL in US.

    And all together could not compete significant on the other big 4 european markets because they all have a league of their own.
    Then we have about 50 countries with 1. Level pro leagues in europe, much of the countries have 2., 3., and 4. level pro leagues either and most of the clubs of the biggest leagues have pro reserve teams either. That means thousands of pro teams competiting for the revenues of the 450 million possible soccer watchers in europe.

    So 450 millions of europeans are more than 300 million US citizens, but thousand of teams have to live from them instead of, I don´t know, about 100 or so of NFL and college football teams.
    So for sure, the average european pro soccer teams revenue is much much lesser than that of an average american pro football team. That may have it´s influence on the money the teams are able to spend for there players for shure.

    But that does not mean, that there are no big european teams that take benefits from the big world market, because soccer is the worlds game with supporters all over the world, but the real deal is not able to be made in foreign countries, because the economical strong countries have their own leagues that dominate the attraction of the most of the soccer supporters in their countries.

    On the other hand, because of the thousands and thousands of pro teams in the world, not even in europe, think especially on southamerica, there are hundred thousands of pro players available. That is a big difference to the NFL and has to decline the average wages payed for the average player.

    Nevertheless, lesser average wages must not mean, that the topstars must earn lesser than a topstar in NFL, but instead of american football, where maybe quaterbacks and wide receivers, are much more important to the game than other positions, and there are only two handful of top quarterbacks to sign, in soccer every position is more or less significant for the strength of the team. Normaly the strikers and midfielders get a bit more money in average than the defenders or goalies, but the difference is much much lesser than the difference between different positions in american football.

    Even or rather more is it to basketball, where only 5 players are on the pitch, or baseball where it belongs to the best hitters.

    So soccer is much more a teamsport and has much more players available for all the needed positions even the strikers and playmakers. So on one hand the average wage is lesser because of the many available players, on the other hand the money for the topstars mustn´t be too much higher for the teamspirit, because no striker is really worth for the teams success a few times than an average defender and is btw significantly depending of the work of the whole team.

    That are for me the main reasons why soccer topstars do not earn as much money as US proteam sporttstars and now one word to the freeagent cases and the tranfer fees.

    I read in this thread, that transferfees take money out of the business so that leeser wages could be payed.

    I don´t think that this is correct.

    One hand: the money that one team spends on a player goes to another team, so nothing is burned. That is a zero sum game.

    In deeper sight there could be a loss of money when you sign a player for a transfer fee and must let him go after 3 or so years for free. Then you have to write off the transfer fee.

    But first, this writing off is able to be activated in the bilance and thereby relevant for income tax, and second: there are not only clubs that loose money by letting go players on a bosman by free, but allthough clubs that get transfer fees for players that they bought for less or developed them from their youth teams.

    All in all, Bosman has it´s influence and you will see more Ballacks in the future, but to handle that is the main task for the clubs managers by dealing out the contracts. Not to forget, that it is risky to do it the Ballack or Henry way, because in case of an main injurie or a significant lose of class it could be much better to have a long term guaranteed contract than be free but nobody wanting to sign you. It´s a bit of gambling and I think, most young players like the secure contract and target the bosman way only if the have earned enough.
     
  12. JohnR

    JohnR Member+

    Jun 23, 2000
    Chicago, IL
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Zero sum, yes, but not directionless. Money flows from the giant clubs to the big clubs to the smaller clubs, all the way down to the minnows who only sell (and not for very much), never buy.

    So .. what would happen if these flows stopped, all other things remaining the same?

    1) Less money for the little clubs
    2) More money for the biggest clubs

    More like the U.S. system, I would guess -- more salary for the top players at the top level, less salary (or maybe none) for the players at the lower clubs.

    Perhaps all other things would not remain the same, however.
     
  13. Eliezar

    Eliezar Member+

    Jan 27, 2002
    Houston
    Club:
    12 de Octubre
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Good post, but I think you are losing sight of something.

    Who are the teams that are going to be the highest paying? The teams that are in big leagues and go deep into the CL year after year. (or that have Billionaire owners that throw away money, anyway)

    This is how the transfer thing hurts the wages.

    Real, Barcelona, Milan, Man U, Chelsea etc are some of these 'big' clubs. Now look at their transfer +/- over the last 5 years. These clubs are going to have lost a lot of money on transfers.

    Then look at some of the good clubs in smaller leagues like Ajax, PSV, Boca, or Porto. I bet these teams are break even or better in the transfer game.

    So what the transfers are doing in my mind are holding down the wages of most of the rich clubs and potentially increasing the wages of the 2nd tier (financially) clubs.

    If the same system was used in say MLB and the MLB teams were paying huge sums to buy players from AAA, AA, or A teams (instead of paying to run those teams or even profitting from it) then baseball salaries would likely come down in MLB, but potentially salaries would go up in the minor leagues as the wealth is distributed.
     
  14. herewego

    herewego Member

    Jun 1, 2004
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe


    I would not say it hurts the wages, it levels the wages. As you said: topplayers get less, average players get more.

    In the end that is good for teamspirit and reflecting the kind of teamsport that soccer is.

    But: if there would be only one unified european top league, maybe of 20 teams, than I bet, the average player would earn as much as a topplayer today and the topplayes even or more than the US topstars, becaue of the 450 million uropeans market. So I wouldn´t say that the transfer system makes the difference, but the rules of economy.

    What I left out was the difference between a system in which you can be relegated and a cartel with secure membership to the league.

    We know, there are two kinds of competition between pro sport teams: one about the economical succes, one about the sport success.
    One about the money, one about the silverware.

    This competitions go hand in hand normaly, but of course there are exclusions.

    You find economical successful teams that haven´t won anything since decades, you have teams which try to buy success and invest, you have teams that not realy try to win the championships by collecting a big team over years, but selling their best players year for year to make money out of it. But generaly in pro sport, economical success comes with winning the games.

    It´s a kind of hen or egg question, do you first need the money to build a big team, or do you need a good team to get the money.

    In a league without relegation you can take more risk to step forward and invest in a future team. In a league with the possibility to been kicked out every year, you have to deal with that. Maybe that´s another reason to be more careful with giving top contracts for longyear terms.
     
  15. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    I agree with that. I just don't agree with the idea that the money would come off (just) the top MLB players' salaries and go onto (just) the top minor league players. I believe MLB salaries would still be in proportion to now, but just 20% (or whatever) less across the board.
     
  16. rangers00

    rangers00 Member

    Jun 1, 2000
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    So PC's wacky idea of "give Henry a $16M sign-on bonus but don't let everyone else on the team know" is afterall, wacky...
     
  17. rangers00

    rangers00 Member

    Jun 1, 2000
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    There is no "if" here. MLB teams don't pay hugh sums to buy players from AAA, AA or A teams. These are MLB's ***FARM*** teams, i.e. the MLB teams OWN the AAA/AA/A teams.

    Does the Liverpool 1st team spend money to buy players from the Liverpool reserve team?

    Ridiculous, isn't it?
     
  18. pc4th

    pc4th New Member

    Jun 14, 2003
    North Poll
    Club:
    Los Angeles Galaxy
    Nat'l Team:
    United States
    Try to pick apart this claim:

    FACT:

    https://www.bigsoccer.com/forum/showthread.php?t=268786


    assumption/hypothetical world

    If there is no transfer fees and a big club like Man U would get players through free agency. It would have $36 million extra in profit each year [over the past 5 years].

    Manchester United buying the top free agents like Rio, Ruud, C. Ronaldo, Rooney, Giggs, Van der Sar, and Park using the extra $36 million.

    Edwin Van der Sar: $1 million extra
    Rio Ferdinand: $4 million extra
    Ryan Giggs: $2 million extra
    Cristiano Ronaldo: $2 million extra
    Wayne Rooney: probably get $3 million extra
    Ruud van Nistelrooy: probably get $4 million extra a year

    Total: $16 million in extra paid.
    Other: $12.8 million for the rest of the players in extra paid.
    Team: $7 million in profit left-over.
     
  19. pc4th

    pc4th New Member

    Jun 14, 2003
    North Poll
    Club:
    Los Angeles Galaxy
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Big clubs lost money on transfers. That's a fact. I did the calculation and this is how much they lost each year.

    Chelsea: $83.7 million a year
    Real Madrid: $41.67 million a year
    Manchester United: $36 million a year
    Barcelona: $25 million a year
    AC Milan: $22 million a year


    My argument is that if they lost $0 instead of the $30-35 million, they would be able to pay players more. It's simple as that. How much more? I don't know. Probably $3-4 million to the #1 star player on the team and maybe nothing for the #8 best player on the team.

    They make profits. If I have time, I will calculate those. However, I ignore these clubs because they are not the one who will pay the star players the most.

    You do know that MLB do pay huge sums to get players from AAA, AA or A teams right?

    MLB pays for the entire salary of their farms teams (AAA, AA, A).
     
  20. Rommul

    Rommul Member

    Aug 26, 2003
    NYC
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Um isn't that his point?

    Instead of paying a fee to the team that money is spent on salaries for the player.

    Which is his overall point, that the disparity in salaries is down to the absence of transfer fees.

    I don't agree with him necesarrily but you seem to be agreeing while at the same time saying he is wrong.
     
  21. Rommul

    Rommul Member

    Aug 26, 2003
    NYC
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Supply of what, talent?

    I think you mean the supply will stay the same.
     
  22. Rommul

    Rommul Member

    Aug 26, 2003
    NYC
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Actually no they are not. When soccer teams transfer players they are not forced to take players on they might not want (ie players they don't value). Selling players allows teams to get rid of liabilities without assuming new ones. Few trades allow that. Futhermore transfer fees allow teams to leverage their expertise in player training thereby giving them access to NEW capital that can be channeled into other avenues. Trades do not do this at all

    I think his point is much simpler than that. every dollar spent on transfers is one less dollar to spend on salaries. No matter how the accountants view it.

    Whether I agree or not he has a point.
     
  23. superdave

    superdave Member+

    Jul 14, 1999
    VB, VA
    Club:
    DC United
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Not exactly.

    What happens in baseball is that rich teams pick up the contracts of overpaid players in exchange for prospects. That's NOT the same thing as getting a highly-but-equitably paid player. The Randy Johnson and A-Rod trades included a form of a transfer fee, in that the Yankees relieved the D-Backs and Rangers of exhorbitant contractual obligations. When you compare the production and the salaries of those players, you realize that the Yankees, by picking up the contracts, "paid" the D-Backs and Rangers millions.

    In soccer, contracts for old players are much shorter than in baseball, so you see this less often. Whether that has any relationship to the transfer fee system, I dunno. You could make an argument either way. You could say it's because soccer requires so much running, signing a 30 year old for 5 years is a bad deal. (And with the new rules, after 2 years he's free to leave anyway.) Or you could say that there's no need for a team to take the risk of signing an oldster to a long term contract, since player acquisition is easier under the transfer fee system.
     
  24. Eliezar

    Eliezar Member+

    Jan 27, 2002
    Houston
    Club:
    12 de Octubre
    Nat'l Team:
    United States
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    What is the net for a AAA team? I have a feeling that a lot of them are doing decent financially. Also, those salaries for the young players are typically very small. In Houston one year we had Oswalt, Berkman, and another young player that all were combining for less than 1 million and yet they were arguably our best hitter and pitcher. So those salaries are really nothing. That Oswalt or Berkman would have been sold for 30 years worth of wages in the European market (350k * 30 = 10.5 million). And you better believe that teams would have been lined up to buy either of those guys (Oswalt was big in the Olympics as a minor leaguer).

    Anyway, soccer teams also develop players through academies and pay them. Ajax, Arsenal, ManU, Real, or Chelsea or whoever you want to talk about have players that they are supporting that are not at the senior club.
     
  25. JohnR

    JohnR Member+

    Jun 23, 2000
    Chicago, IL
    Re: Why is the top soccer player getting paid a lot less than NBA, NFL, MLB top playe

    Yep.

    Because transfer fees flow from big to small, the big clubs have fewer dollars to spend on salaries than they otherwise would, and the smaller clubs have more. Thus, the soccer salary curve is flattened, such that the elite players receive less than they otherwise would and the huddled masses receive more.

    I think that's pretty clear and correct. Transfer fees do not alter the overall level of salaries paid in the European professional game, but they alter the shape of the salary graph.
     

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