Unfettered Free Agency

[Dirrrty South]

I stand corrected.



But if you have a look at NBA history, and I'm not complaining being a Lakers supporter, the Lakers & Celtics have won 30+ championships from a possible 60 odd. Not what the AFL is looking for.

True, however a majority of the Celtics titles came long before the free agency period. Small market teams like San Antonio have been very succesful too in since the salary cap came into play (4 championships) yet teams that are rich and in marquee cities like the New York Knicks haven't won anything since the 70's. In the end, the Lakers and Spurs just list manage better IMO. To put this into an AFL perspective, Sydney, Geelong, Adelaide etc have all been very good this past decade with good list management skills, despite in Sydney and Geelongs case, not being two of the more traditionally financially powerful teams.

 

[DeanoT]

Unfortunately the AFL is an organistion that doesn't know the meaning of the term 'sporting integrity', so even the application of rules is subjective based on their expressed goal of maximising revenue.

Until that issue is address, we'll never have a cap or any other rule that does what it's intended to do.

A properly enforced salary cap is the real issue. If it is monitored and enforced properly, and no dodgy "Visy ambassador" roles are allowed to occur, then free agency, in any form, can't do a damn thing to help rich clubs prosper at the expense of poor clubs.

Even now without free agency, we have seen salary cap breaches, dodgy deals, brown paper bags. The integrity of the competition is already under question with or without free agency. The salary cap is the key to equalisation, free agency won't have anywhere near the impact that the fearmongers like to think it will.

 

[JeffDunne]

No doubt Dean, a properly enforced salary cap is the real issue.

If you can achieve that then there is nothing to fear with free agency. However, we know how the AFL operate. They have form.

I'm all for free agency but only if it's done to further rather than dilute equalisation measures.

 

[seanoff]

Baseball which is the loosest of the US sports also have a salary cap and draft.


as with Basketball you can choose to blow the cap if you want but the tax is penal.

read this from Jayson Stark on the MLB wages.
http://sports.espn.go.com/mlb/columns/story?columnist=stark_jayson&page=rumblings091119

the Yankees paid $215M in wages this yr and Miami paid $36M. However the Yankees also paid $150M in taxes and revenue sharing. keep in mind minimum income (without playing a game is $80M), so miami are making a choice not to spend money.

with a cap in place free agency will not lead to a free for all. esp with a number of yrs restriction. average career is 4 yrs now so, the average player would never get the opportunity to access free agency.

my belief is 6 yrs before you are a free agent. atm the clubs have too much power, but you also don't want to give the players too much power.

 

[Southerntakeover]

West Coast and Adelaide would become Chelsea and Man U,

Theres probably a downside somewhere?

 

[stickman11]

Those who think the competition would end up like english football are having a laugh. AFL is centred around Australia, english football is world wide. Most of the powerful clubs you have mention are owned by Arabs. Do you really think that any Arabs would be interested in our game. Last of all, teams like Manchester United have debts totaling near 100 million.

Interestingly, Chelsea which has one of the smallest supporters bases is also one of the richest clubs thanks to an Arab.

 

[ArachniX]

Those who think the competition would end up like english football are having a laugh. AFL is centred around Australia, english football is world wide. Most of the powerful clubs you have mention are owned by Arabs. Do you really think that any Arabs would be interested in our game. Last of all, teams like Manchester United have debts totaling near 100 million.

Interestingly, Chelsea which has one of the smallest supporters bases is also one of the richest clubs thanks to an Arab.

Chelsea is not owned by an Arab. He is Russian.
Liverpool and Man U are owned by Americans.
Arsenal also not owned by Arabs!

 

[stickman11]

They are still owned by someone and all are in debt.

 

[Rob]

Would be WCE, Crows, Pies..... then after that it drops off.

Dons certainly wouldn't be "one of the big boys" - only had $35m in rev with about a $2m profit last year compared to Hawthorns $40m & $2m profit this year. Not anywhere close to WCE/Crows/Pies $50-60m revenue.

Far too simplistic because of the presence of non football related revenue.
You open a hotel that turns over $10m a year but has $10m in expenses - how does that have any effect whatsoever on the football club?

The 2 important figures are football revenue and non football related profit - i.e the amount that can be injected into the football department. Non football related revenue on it's own means precisely dick.

 

[DeanoT]

And Man U has a net worth of over $2 billion AUD.

Might want to check your facts next time stickman.

 

[DeanoT]

They are still owned by someone and all are in debt.

Absolute garbage.

 

[legend166]

The Swans will do better than some expect. We couldn't compete with West Coast or Collingwood, but I think our revenue is pretty similar to Essendon. The best I can find is that we had $33 million in revenue in 2007.

 

[Furn]

And Man U has a net worth of over $2 billion AUD.

Might want to check your facts next time stickman.

MANCHESTER UNITED

Net assets: £36.08m

Net debt: £649.43m

Pre-tax loss, 2008: £44.78m

Annual wage bill: £121.08m

Top earners: Rio Ferdinand, Wayne Rooney both £5.5m

Chairmen: Joel and Avram Glazer (USA)

Owner: Malcolm Glazer (USA)

Worth: £1.5bn

Made their money: Everywhere. Jewellery, food, broadcasting, property, gas, oil

WHERE THE POWER LIES: Malcolm Glazer.

http://www.newsoftheworld.co.uk/spo...E-News-of-the-World-Premier-League-money.html

 

[DeanoT]

MANCHESTER UNITED

Net assets: £36.08m

Net debt: £649.43m

Pre-tax loss, 2008: £44.78m

Annual wage bill: £121.08m

Top earners: Rio Ferdinand, Wayne Rooney both £5.5m

Chairmen: Joel and Avram Glazer (USA)

Owner: Malcolm Glazer (USA)

Worth: £1.5bn

Made their money: Everywhere. Jewellery, food, broadcasting, property, gas, oil

WHERE THE POWER LIES: Malcolm Glazer.

http://www.newsoftheworld.co.uk/spo...E-News-of-the-World-Premier-League-money.html

I'll take Forbes financial info over News of the World thanks.

http://en.wikipedia.org/wiki/Richest_football_clubs

Man U 2008 figures:

Net worth $1.8bn (approx $2bn AUD)
Revenue $512m USD
Income (Profit) $160m USD

http://www.forbes.com/lists/2009/34/soccer-values-09_Soccer-Team-Valuations_Rank.html

http://www.forbes.com/lists/2009/34/soccer-values-09_Manchester-United_340001.html

 

[WatWouldCyrilDo]

Far too simplistic because of the presence of non football related revenue.
You open a hotel that turns over $10m a year but has $10m in expenses - how does that have any effect whatsoever on the football club?

The 2 important figures are football revenue and non football related profit - i.e the amount that can be injected into the football department. Non football related revenue on it's own means precisely dick.

Was just using them as a rough guide - barring Collingwood, all the others i mentioned are generally in the same boat with non-football income - mainly pokie machines and social club type stuff. Hawks gaming rev - $5m, Cheaters - $2.8m, Dons $4m.

Maybe you could go through the financials and determine the figures? Cbf myself. While your at it, work out total current football spend + profit. That would probably be a better measure, as you can use football revenue on non-football related expenses.

 

[db swannie]

Stuff free agency, our competition is strong, crowds are great, etc. Free agency would be great for the top end, elite players, but not so good for the bottom end, and bad in general for the competition as a whole. Like Edmund Burke said, if it ain't broke, don't fix it.

p.s. I agree with others, in that I don't want to see AFL end up like premier league soccer, with two or three teams with the big bucks dominating.

 

[DeanoT]

Stuff free agency, our competition is strong, crowds are great, etc. Free agency would be great for the top end, elite players, but not so good for the bottom end, and bad in general for the competition as a whole. Like Edmund Burke said, if it ain't broke, don't fix it.

p.s. I agree with others, in that I don't want to see AFL end up like premier league soccer, with two or three teams with the big bucks dominating.

Actually free agency won't do much for elite players, it will do more for fringe players who can't get the game time or earning power at their existing club.

The AFL won't end up like EPL because we don't have European employment law or private ownership of clubs. Free agency has nothing to do with it.

 

[Rob]

Was just using them as a rough guide - barring Collingwood, all the others i mentioned are generally in the same boat with non-football income - mainly pokie machines and social club type stuff. Hawks gaming rev - $5m, Cheaters - $2.8m, Dons $4m.

Maybe you could go through the financials and determine the figures? Cbf myself. While your at it, work out total current football spend + profit. That would probably be a better measure, as you can use football revenue on non-football related expenses.

Can't be arsed either, but then again i'm not naming clubs who would and would not be competitive in a free market.

All i'm saying is that revenue alone isn't much of an indicator of anything. Otherwise Southport would dominate every club in the country.

 

[Crow-mo]

West Coast and Adelaide would become Chelsea and Man U, Collingwood would become Everton, Essendon would become West Ham, Carlton, Fremantle and possibly Hawthorn would become Bromich West Albion, Middlesborough and Sunderland.

The game would lose millions of supporters and the competition would become a joke.

so what you are saying is our code would come to resemble the most successful, popular, and wealthiest league in the world?

are you sure that your conclusion makes sense? the EPL is enormously popular, it hardly seems a big insult.

 

[Crow-mo]

No doubt Dean, a properly enforced salary cap is the real issue.

If you can achieve that then there is nothing to fear with free agency. However, we know how the AFL operate. They have form.

I'm all for free agency but only if it's done to further rather than dilute equalisation measures.

the key to a properly enforced salary cap is easy. publish salaries, but this removes one of the major information asymmetries that the clubs rely on to manage their cap.

if the AFLPA had any sense, or vision, they would insist on FA with publication of salaries.

 

[Crow-mo]

Baseball which is the loosest of the US sports also have a salary cap and draft.

MLB does not have a salary cap. they have revenue sharing but not a cap.

incidentally you'd do well to read this:
http://online.wsj.com/article/SB10001424052748703683804574534021373434110.html?mod=googlenews_wsj

and I quote:

"It's a little surprising, but the statistical relationship between a team's winning percentage and its payroll is not very high. When I plot payroll and win percentage on the same graph, the two variables don't always move together. In other words, knowing a team's payroll does not enable one to know a team's win percentage."

 

[Crow-mo]

They are still owned by someone and all are in debt.

an efficiently run private organisation should always have debt; it is a cheaper form of financing than equity.

 

[Crow-mo]

Absolute garbage.

of course its not garbage, he's absolutely right they are all in debt. ManU enormously so. Ambramovich's investment in Chelsea is all via loans.

what isn't true, is that this is necessarily a bad thing.

 

[Crow-mo]

I'll take Forbes financial info over News of the World thanks.

http://en.wikipedia.org/wiki/Richest_football_clubs

Man U 2008 figures:

Net worth $1.8bn (approx $2bn AUD)
Revenue $512m USD
Income (Profit) $160m USD

http://www.forbes.com/lists/2009/34/soccer-values-09_Soccer-Team-Valuations_Rank.html

http://www.forbes.com/lists/2009/34/soccer-values-09_Manchester-United_340001.html

net worth is a meaningless financial term, it has no basis. even less so particularly for a private company. you shouldn't rely on either.

the Glazers bought the club for approximately £1.1Bn largely funded by debt from the capital markets, secured against their own assets - namely their tampa bay NFL team.

what the equity happens to be worth now, is anyone's guess.

 

[DeanoT]

of course its not garbage, he's absolutely right they are all in debt. ManU enormously so. Ambramovich's investment in Chelsea is all via loans.

what isn't true, is that this is necessarily a bad thing.

net worth is a meaningless financial term, it has no basis. even less so particularly for a private company. you shouldn't rely on either.

the Glazers bought the club for approximately £1.1Bn largely funded by debt from the capital markets, secured against their own assets - namely their tampa bay NFL team.

what the equity happens to be worth now, is anyone's guess.

The clear implication of Stickman's use of the term "in debt" was that they are struggling financially, or have debts exceeding their assets, not that they have liabilities in their balance sheet, which as you correctly point out, every private sector organisation has.

The point is that Man U made an operating profit of $160m on revenues of $512m during 2008. It also has a current estimated valuation of $1.8m USD (excess of assets over liabilities). This is a very relevant figure. How you can say net equity is a worthless term is beyond me, especially for a private company.

The issue of how the Glazers funded the purchase of Man U is only relevant to Man U if this funding is currently on Man U's books. While I don't know for sure, my guess would be that it is not. Happy to be proven wrong, if that is not the case, but it would be unusual for the funding source to be on the club's books as opposed to the owner's investement company.

If the Glazers have to sell to met their obligations, any future valuation of the club will be based upon the profitability of the Man U business model, not how much debt the Glazers have accumulated.