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 Posted by ESPN Staff
Sep 4, 2007

English transfer spending breaks £500m barrier

Television money has fuelled a rise in transfer spending by English clubs from £300million last summer to more than £500million.

The figures, which include all Premier League and Football League clubs, come from business advisory firm Deloitte, who attribute the 60% rise in spending to the huge increase in broadcasting revenue from the start of the 2007-08 season and new owners buying into Premier League clubs.

Paul Rawnsley, a director in Deloitte's Sports Business Group, said: 'This summer's transfer spending by English clubs has beaten all previous records but, as Premier League clubs will receive around £300million of extra broadcast payments during the 2007-08 season, the increase in transfer spending is not a surprise.

'On a net transfer basis, Premier League clubs spent around £140million more in 2007 than 2006, well below the increase in broadcast payments they will receive this season.

'We expect total player wages to also increase but by a much lower proportion than the 80% rise in gross transfer spending this summer.'

Despite winning the Premier League last season, Manchester United were the biggest spenders during 2007, shelling out £51million on players.

They were closely followed by Liverpool (£50million), while Tottenham spent £40million in their quest for Champions League qualification and newly-promoted Sunderland spent £35million.

Twelve clubs spent more than £20million on players, up from three in 2006.

Overseas clubs did well out of English sides, receiving £250million for players which accounts for half of all spending by Premier League teams.

Real Madrid were 2007's biggest spenders in Europe, with an outlay of around £80million, while Thierry Henry's transfer from Arsenal to Barcelona pushed the Catalan team's spending up to around the £50million mark.

Both the Spanish giants benefit from being able to negotiate their own broadcast deals, while Premier League clubs operate collectively.

Alan Switzer, director in the Sports Business Group at Deloitte, added: 'Looking further afield, it comes as no surprise to see Real Madrid and Barcelona spending at least as much as their English rivals on transfers, given that they have the highest revenues in world football in 2005-06.

'Broadcast revenues are again the key to explaining the high transfer spending by the two giants of Spanish football who, unlike their Premier League counterparts, can sell their own broadcast rights.

'Both clubs have signed new deals which will generate significant increases in broadcast revenues for each club, to around £100million per season from 2008-09 - around twice the highest amount that a Premier League club is likely to receive.'

Closer to home, Football League clubs received around £110million in transfer fees from top-flight sides, almost three times more than the 2003 figure of £40million, demonstrating an increased willingness among Premier League clubs to spend on lower league talent.