Kiss That Pay Rise Goodbye! - How Italy is Becoming Money Conscious

A rich man's league. That's how Italian football has always been seen by the rest of Europe. The willingness to spend whatever necessary to sign the most talented players has always drawn a strange mixture of criticism, envy and admiration: everyone reviles teams that try to buy their way to success yet deep down everyone would like to be in a similar position. 
 
Whilst the Serie A was never the most spectacular of leagues, it has always been the most competitive. But lately, it is being overtaken on all counts. As Italian teams stutter to make any sort of impact in European competitions, their English, German and Spanish counterparts have been dominating the latter stages of both Champions League and UEFA Cup. And the Spanish - led by the prosperous Real Madrid - are proving to be a more than adequate match when it comes to spending money.
 
Nevertheless, the Italian league can still boast the various talents of Gabriel Battistuta, Lilian Thuram, Hernan Crespo, Rui Costa and Christian Vieri. Thanks to the benevolence of the men at the top, there is still a lot of money in the game. That's how Italian football has always been: the Agnelli family (who own the Fiat group) have bankrolled Juventus since the early part of the twentieth century, Inter's success during the sixties was financed by the Moratti family, while Milan's dominance in the early nineties was paid for by politician and media baron Silvio Berlusoni.
 
But, that situation is changing. In an ever-worsening financial climate, football is becoming a hobby most businessmen can barely afford. For season 2001-2, in fact, the clubs in Serie A returned a staggering combined loss of around $650 million. As a result, many of the businessmen currently involved in Italian football are looking for a way out, especially since the financial collapse of Fiorentina.
 
Facing Bankruptcy
 
Like most other clubs, Fiorentina were run like a personal fiefdom by the club president, Vittorio Cecci Gori. He put in the money, bought the players and hired (and fired) the managers. The supporters tolerated his egotistic behaviour as long as he financed their dream of competing for the league title.
 
Little were they aware that Cecci Gori had bitten off far more than he could chew. The shock departures of Francesco Toldo and Rui Costa came as unexpected body blows, but were inevitable in order to temporarily save the club. The situation was so bad that Fiorentina recently had to pull out of the transfer of Sinisa Mihajlovic even though Lazio had agreed to release him for a cut price £300,000. Now, however, things have gone from bad to worse for Fiorentina. As a result of their financial problems, in 2002-3 Fiorentina are competing in Italy's Serie C2 (the Italian fourth division) under the name of 1926 Florentia Viola!
 
Fiorentina aren't the first to run into such problems. When Corrado Ferrlaino led Napoli to their first ever title in 1987, he spent more than the club could afford to build a team containing Diego Maradona, Alemao and Careca. Despite a second title three years later, Ferrlaino's unhealthy policy was eventually exposed. Today, Napoli play in Serie B, struggling to emerge from under the legacy of debts accumulated during the mid-eighties.
 
A Sudden Demise
 
Whilst Napoli's decline has been a gradual one, Fiorentina's fortunes have changed virtually overnight.
 
Their descent has alerted a string of similarly-placed other Italian clubs. Most are in a similar plight. Thanks to their aggressive transfer policy and the cost of having forty-two players on the payroll, Inter are faced with a deficit in excess of £90 million, the highest in the league after Fiorentina. Sixty two percent of all the revenue generated by the league ends up in the players' pockets who, on average, earn around £1 million per season. To rectify this unsustainable money-drain into the pockets of the big stars, three Inter stars (Ronaldo, Vieri and Recoba) offered to voluntarily take a pay-cut of 10%. While obviously a step in the right direction, even if this gesture was copied by every star in Serie A, it would still not be sufficient to balance the books for the majority of Serie A clubs.
 
Salary Caps on the Horizon
 
Unsurprisingly, many are alarmed by this situation. So much that Italian bosses are toying with the idea of introducing a salary cap. Indeed, some have already declared their intention of doing so. If Juan Sebastian Veron is really thinking of a move back to Italy, he should brace himself for a decrease in his weekly income, as Lazio's Sergio Cragnotti is one of those favouring a cut in the wage bill.
 
From season 2002-3, Lazio will limit the total amount spent on salaries to £75 million, forty percent less than their current expenditure of £105 million. The number of registered players will also be reduced to twenty-five.
 
Their plans have been echoed by city rivals Roma, who have also announced a salary cap of £72 million. Parma's Sergio Tanzi, currently vying to be the next Serie A President, has openly talked of imposing a universal salary cap on all teams. In reality, such an imposition would primarily effect the big teams seeing that the smaller outfits spend significantly less. Tanzi's rival for the senior post in Italian football, Roma's Franco Sensi has hinted at a similar solution, but one that would also take into consideration the individual situation of each team.
 
Even the mighty Juventus are preparing to adopt a more business-like approach. Beppe Giraudo, the club's chief executive has openly stated his admiration for the way English clubs are run, in particular Manchester United. Yet, achieving that goal will not be easy, not even for the most popular side in Italy.
 
No Merchandising
 
One reason for this is merchandising - a huge source of revenue in England - is virtually non-existent in Italy. This is due to a cultural difference between the two countries: your average Italian male is far more fashion-conscious than his British counterpart. Whereas in England sporting your club's latest replica kit is considered trendy, in Italy it is unheard of. There is also a problem of piracy, which is rampant in Italy. On each match day, stalls can be found outside the stadiums, each one selling clubs shirts at a fraction of the official price.
 
Which explains why the leading Italian clubs depend heavily on television income and, increasingly so, on the revenue generated by the Champions League. For the first time since Silvio Berlusconi took over Milan, the club have announced that players will be sold unless they finish among the top four, which automatically guarantees a place on the gravy train that is the Champions League. Among those who could be sold is striker Andrei Schevchenko. Naturally, Milan are also in favour of a salary cap.
 
It's no wonder then that, after being linked with a host of Italian clubs, David Beckham recently decided to sign a new contract with Manchester United.
 
Adapted and reproduced courtesy of www.footie51.co.uk.

By Paul Grech