Premier League clubs could face action over ticket prices if fans are no longer valued

Premier League clubs have been left angered by the latest TV deal, which has seen broadcasters ask for a small refund after the competition failed to meet expectations

Football, for generations, was the domain of the working class. Stadiums across the nation were filled to capacity every week, a sea of flat caps and cigarette smoke as thousands flocked to see their heroes bring some joy to their weekend after a gruelling work week.

The flat caps and cigarettes may have disappeared, the latter for the better, but the joy that football brings to the communities it serves remains. Thousands continue to attend, in search of the euphoria that only football can truly provide. However, as times have evolved, so has football. It had to; nothing lasts forever.

Some pinpoint the creation of the Premier League in 1992 as the moment the sport embarked on a transformative journey. In truth, time, technology, attitudes, and a host of other factors progress, meaning stagnation is never an option.

Tickets are no longer as affordable as they might have been 40, 50, or 60 years ago. There are now varying levels of support, from watching the game on a terrace with a limited view to enjoying it in a hospitality box complete with a personal chef and a bottle of Margaux.

All these aspects carry a cost, but as clubs increasingly depend on revenue generation to cover the escalating costs of payroll, transfer fees, agents, and club infrastructure to maximise other business opportunities, the cost is often passed onto the consumer. However, in this case, the consumer is actually the fan, and fans are not customers.

The collapse of the European Super League should have been a lesson for clubs. Fans, understandably, become irate when clubs attempt to offset increased costs through higher ticket prices. Clubs often argue that they feel they have no alternative. Whether you agree with one side or the other depends on your personal view of the modern game and how football clubs now operate in a multi-billion pound global industry with numerous stakeholders.

To provide some context, Premier League season ticket prices have largely remained static for some time. In a period of low inflation and soaring Premier League broadcast revenues both domestically and internationally, there was less strain on clubs as businesses. Increasing ticket prices for fans would have been a bad move during a time when they were receiving more money than ever.

However, the economic landscape has significantly changed, and signs of domestic TV rights plateauing have been evident for some time, which will inevitably lead to a decline in the coming years. The most recent Premier League broadcast deal was hailed as a success, with an apparent rise from £5bn to £6.7bn.

However, this deal now spans over four years instead of three, and the Premier League has offered an additional 70 games per season, up to 270, to broadcasters. In reality, the actual value of each game has decreased, while the 'rise' is merely the Premier League maintaining its position.

The Premier League still holds hope that the ongoing international popularity of English football's top-flight will generate larger revenues in the next cycle, particularly with the United States emerging as a significant growth market.

The chair of a key parliamentary committee has issued a warning that English football authorities are "firmly in added time" to negotiate a new deal on financial distribution. It's expected that these revenues will see a significant increase, but it may not be the cure-all for the issues plaguing Premier League clubs.

Over the past decade or so, frozen ticket prices have been the norm, but with external pressures and rising costs, only Crystal Palace out of the 12 teams that have announced their season ticket prices for the upcoming season, has maintained a freeze. Liverpool has seen its first rise in seven years at 2%, Manchester United's prices have gone up by 5%, Arsenal and Tottenham Hotspur by 6%, and Brighton and Hove Albion by 8%.

Brentford, Burnley, Everton, Manchester City, Sheffield United, and West Ham United have also hiked prices for the next season. For Nottingham Forest supporters, this season's ticket price increase was harsh, with the club raising its season ticket prices by an average of 24% for the 2024/25 season, even if they are relegated back into the Championship next season.

Aston Villa also faced backlash from fans earlier this year when they were perceived to be capitalising on the long-awaited return of Champions League football and a seat at the top table of European football by increasing prices for games at Villa Park.

The Aston Villa Supporters Trust and the wider football community have expressed disappointment over the club's decision to charge up to £97 per ticket for home Champions League matches this season. The move has led to the club being labelled as "out of touch".

Adult tickets for their four home games in the new 36-team league format will cost between £85 and £97, while season-ticket holders are offered discounted rates of £70, £79 and £82. In response to the backlash, Villa defended their decision, stating that they had to make "difficult decisions" to remain competitive. However, any anger was quickly overshadowed by a thrilling European night at a packed Villa Park, where Jhon Duran scored a late winner against Bayern Munich. Despite the victory, the issue of price increases was largely forgotten amidst the excitement.

This allowed the club's management to avoid addressing the issue, a pattern often seen across the country. It is difficult to persuade owners to make significant changes, as it usually means fans must boycott games in protest. However, in the highly commercialised world of the Premier League, there is always someone ready to fill the void, ensuring demand continues to outstrip supply. This remains a key advantage for club owners.

Like all sectors, football is grappling with escalating costs, while fans are also feeling the financial squeeze in their daily lives. Factors driven by market forces and surging inflation have affected major cost lines including wage costs, labour-based contracts, utilities, and rates at clubs, most of which are businesses operating at a loss.

Drawing inspiration from the brilliant 2011 financial drama, 'Margin Call', many clubs believe that the Premier League's broadcast revenue is beginning to dwindle amidst macroeconomic pressures forcing everyday costs to rise. Despite these external factors, player wages and transfer fees continue to soar.

This necessitates cost-bearing measures such as hiking ticket prices and merchandise. Clubs will be deeply worried about the moment when they can no longer hear the music.

Although it's a highly unpopular move for clubs to resort to such measures, in an industry where most clubs sell out their allocations and demand is expected to persist despite price increases, clubs now have the numerical strength to make such a move. Once one club broke rank, the others followed suit.

Season tickets also play a crucial role in maintaining cash flow within the business. The summer months can be lean with no games being played, yet the need for new signings and spending in the market remains.

Season ticket sales provide a vital cash flow for clubs during this period, and any increase in revenue ahead of the season is a welcome boost. Clubs also face the challenge of remaining compliant with the Premier League's current profit and sustainability rules, as well as the upcoming squad cost ratio regulations. Both carry sporting sanctions through points deductions, which can have a significant impact on business. A breach could cost £20m or even just £2m, but it will still be penalised, as Forest has discovered this season.

In these challenging times, when clubs are striving to raise more funds to cover costs and stay compliant, ticket prices present an opportunity for some extra assistance. From a business standpoint, increasing ticket prices would be a standard response, particularly considering that the Consumer Price Index inflation has surged 33% since May 2014. This means costs have risen while ticket prices have remained stagnant. Clubs are now beginning to bridge this gap.

However, from a fan's perspective, football clubs are community assets, not businesses, and fans are not customers. If a company raises its prices for a service, you can look elsewhere for a cheaper deal, but fans cannot simply change their loyalty and watch football somewhere else. Football clubs must find a balance, and not all are succeeding in doing so. However, it's difficult to feel too much sympathy for large businesses where the owners and stars earn millions.

For fans, the cost of living has significantly increased in recent years following the pandemic. Budgets are tighter than ever, and people are having to prioritise more. While some consider football non-negotiable when budgeting, for others, it's an unaffordable expense. The Premier League is the wealthiest domestic football competition globally.

A competition that spends tens of millions taking its own clubs to court; a competition where increasing spending on wages and transfer fees is not only expected but encouraged by some fans, driven by social media; a competition that generates billions in revenue each year, one would think more could be done to ensure football is affordable for fans. The same applies to UEFA and the clubs participating in its competitions.

Matchday revenue hasn't been the most crucial aspect of a club's balance sheet for a long time, but it's often the first lever pulled when cash needs to be found. Broadcast revenues continue to be the main source of income for clubs, followed by commercial revenues, and then matchday revenues. Clubs have begun to reduce their dependence on broadcast revenue due to the potential decrease in the value of broadcast rights in the coming years, as broadcasters may not be able to continually increase their payments each cycle.

As a result, clubs are exploring other avenues, such as maximising the potential of global fans who can't attend live games but want the same experience. There is no indication that increased revenue from these fans would be used to offset ticket prices for those attending matches. Matchday revenue remains crucial for clubs, particularly during lean periods. During the summer months, when there is no income, the money from season tickets comes in.

Throughout the season, fresh cash flows into the club every few weeks, amounting to millions. While the value on the balance sheet may not be as large, the importance in terms of cash flow is significant. The further down the pyramid you go, the more important matchday revenue becomes.

There are always two sides to every story, and as big business, which it undeniably is now, and which we played an active role in creating, these clubs see matchday revenue as a revenue stream to be relied upon, one where supply and demand dictates pricing. Clubs are always going to need to be competitive, but that is a hard line to sell fans at every price hike.

There is only so far supporters can go before they say no. We're not at the point where we are facing mass walkouts and non-attendance at games as, as mentioned before, there is so much demand. But it will come at some stage in the future if the fans continue to be squeezed out. It is cliche, but football is nothing without fans.

Watching empty stadiums and fake crowd noise during the pandemic was proof of that. The passion is of value as it is what makes the Premier League stand out, it is a major part of what broadcasters pay so much money to screen games around the world. The value of fans and what they bring to the table should never be diminished, and that starts with addressing the attitude of many clubs, not all, to hiking ticket prices.