Footballers wages will be kicked up

England captain John Terry is close to signing a GBP 125,000-a-week contract with English Chelsea and football business analysts are expecting that the new television deals will lead to an increase in pay for the best players.

The biggest stars in the Premier League may break through the GBP 200,000-a-week pay barrier, due to the League's new GBP 2.7 billion television windfall.

The Daily Telegraph reported that clubs would benefit from a 60 percent increase in media revenue following the completion of a GBP 625 million deal with overseas broadcasters.

The extra cash means a few of the elite players will earn more than GBP10 million a year, double the annual salary of Dr. Jean-Pierre Garnier, chief executive of one of the country's largest companies, Glaxo SmithKline.

Dan Jones, a partner in Deloitte's Sports Business Group, said approximately 60 percent of an increase in TV money is directly passed on to players' wages.

The Premier League clubs are set to share an extra GBP 1 billion from the start of next season, which gives the clubs an extra GBP 600 million to spend on salaries.

"A player earning GBP 200,000 a week could well happen during the course of this deal," Jones said. "We are already nudging towards the GBP125,000-a-week mark."

According to Deloitte's recent analysis, total salaries in the Premier League increased from GBP 168 million in 1995 to GBP 763 million in 2005. Over the same period, total earnings for Premier League clubs increased from GBP 346 million to GBP1.3 billion.

Though wages had been on the rise since the League began in 1992, salaries actually dropped by two percent in 2004-05 due to a flattening out in TV income.

"Although history has shown that there is a direct correlation between income and wages going up, we did see wages dip for the first time at the end of the 2004-2005 season," said Jones. "Everyone was asking at that point whether the bubble had burst, but clearly the answer is no."

The players' agents will see their fees increase, too.

There is a growing demand to limit the amount being paid to middlemen after it was revealed that Israeli agent, Pini Zahavi, made a GBP 3 million deal for completing Yakubu's transfer to Middlesbrough from Portsmouth.

Sam Rush, chief operating officer of Wasserman Media Group, an American entertainment and sports company, who represents England midfielder Steven Gerrard, said players would fight to get their share of the windfall.

"Players are aware of their market value and I am sure this will ultimately be reflected," Rush said. "It's not implausible that we will see a player being paid GBP 200,000 a week before the end of the next TV deal."

However, Jon Smith, chief executive of stock market-listed agency First Artist, said he was confident that players and agents would not get carried away.

"The lessons have been learnt from previous years and there's a lot more prudence in the business of football," said Smith.

"The football industry is now a much better run industry and even among the smaller agents there is a realisation that you need to behave more sensibly."

Source: euFootball.BIZ © Copyright 2006 - All rights reserved.