Thu, March 26, 2009
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Top soccer coping with credit crunch

2009-03-26 03:42:11 GMT2009-03-26 11:42:11 (Beijing Time)  Reuters

Old Trafford on match-night. Die-hard fans like these have helped Manchester United become the world's second richest soccer club.

The credit crunch has seen businesses collapse, pension funds decimated, and left hundreds of thousands without a job.

But soccer seems to have been little affected.

Soccer business analyst Professor Chris Brady.

SOUNDBITE (English) PROFESSOR CHRIS BRADY, SOCCER FINANCE EXPERT, SAYING:

"Nothing's immune from the credit crunch, but if anything were to be immune then it would be football. Football has strength of loyalties, of customers, so on, that other businesses don't have, so they've got a chance of getting through this."

Stars like Cristiano Ronaldo and Lionel Messi earn millions of pounds a year on long-term contracts.

But Europe's biggest clubs show no sign of being unable to afford such extravagance, despite the economic black clouds.

They've maintained an impressive variety of revenue streams.

SOUNDBITE (English) PROFESSOR CHRIS BRADY, SOCCER FINANCE EXPERT, SAYING:

"Champions League clubs I don't think the credit crunch affects at all. Maybe to a certain extent in their commercial activities, buying shirts and so on and so forth, but everything else is already in place, so prize money is already in place, television money is already in place. Now it might bite two or three years down the line but at the moment it's not going to bite."

Yet for many, less glamorous, clubs in Europe the recession has made life an ongoing struggle.

Television income is far less generous for clubs like Barnet of England's League Two.

Outside of Europe's top leagues sponsorship deals have dried up and gate revenues are down.

The big clubs have been accused of feathering their own nests while ignoring the plight of less glamorous rivals.

Richard Scudamore is chief executive of the English Premier League.

Speaking recently, he rejected that charge.

SOUNDBITE (English) ENGLISH PREMIER LEAGUE CHIEF EXECUTIVE RICHARD SCUDAMORE SAYS:

"We provide centrally somewhere between 75 percent of the smallest clubs' revenues and 25 percent of the largest clubs' revenues, so their cash flows to actually keep them in business, keep them playing football, keep them in business is good."

There are fears that some smaller clubs are in danger of going out of business, particularly in England, which hosts the richest league in the world.

But for the most wealthy clubs, soccer's 15-year economic boom shows no sign of turning to bust.

Jim Drury, Reuters

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