Manchester City’s penalty and the future of football as a business

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Friday 14th of February the UEFA announced a penalty to Manchester City Football Club banning them from all European competitions for the following 2 seasons, plus 30 million Euros for breaking the Financial Fair Play Regulations. This opens the question whether football can be a business or part of a bigger business that has a strategy that reaches beyond sports? And it should be added that the inclusion of an amount to this penalty resounds more like an opportunity for UEFA to make some cash. (This is not a defense to Manchester City FC that accepted to play by rules that they broke later on).    

All companies develop assets, resources or market positions and sometimes even do so knowing beforehand that they will lose financially, however looking at the bigger picture they envision potential earnings that will overcome by long the financial loses; with this strategy many mid-tier car-makers develop convertibles knowing they will lose on them, only to gain brand image. And on the other hand, in the world of business exists the word “Investment”, where “resources are input today, to have a bigger output tomorrow of the same or other kind of resources multiplied by a factor that depends generally on the level of risk”.

As in any other business in football one is able to invest in grown-up or young players for short-term, base football, data and analytics, infrastructure and many other ways hoping to have financial or trophies returns, and yes!, why not any investor should be able to use football to leverage the rest of its portfolio, even being aware that will lose on it; for example, a publicity agency could acquire a club that runs on loses and have a strategy to obtain to have free publicity. And there can be a point made on elite football that inputting financial resources will not lead into titles, nor prestige if it’s not accompanied with a sports strategy that beats the rivals and leads to titles.

Or if the case were to be that the team is being used for money laundry, they can be removed of their titles and should be punished as any other company would be; as in the case of sports betting.

Related link on the interest of other big teams in European football:

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