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English tradition meets American ownership


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English tradition meets American ownership

By Ridge Mahoney, Special for USA TODAY


Over the next week, the two most famous English soccer clubs will vie for two of the sport's most cherished trophies. But even if Manchester United wins England's FA Cup or Liverpool wins the European Champions League, anxiety will linger among many of their fans.

That's because of widespread suspicions about whether the clubs' new American owners are beginning to undermine some of the traditions of English soccer — from affordable tickets to intimate, century-old stadiums — that have fostered incredibly passionate fan bases in the United Kingdom and beyond.

In newspaper columns, over the airwaves and on the Internet, fans are fretting over whether England's most beloved clubs will become the focus of U.S.-style sports business practices: debt-laden club financing and a relentless pursuit of revenue through pricey game tickets and expensive stadiums with luxury suites and club seats.

U.S. sports fans take such things for granted. But in England, soccer fans have been accustomed to their clubs being almost community organizations, with management using revenue mainly to acquire players and hold ticket prices steady. Many see the American owners of Manchester United, Liverpool and two other English Premier League clubs as nothing less than threats to a treasured part of English culture.

European soccer "has never been a pure business. It's always been about the glory on the field," says Sean Hamil, a lecturer at the University of London's Birkbeck Sports Business Centre and a board member of Supporters Direct, a publicly funded body that helps groups of fans buy ownership shares of teams.

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Fans "are unhappy not because (new owners) are American," Hamil says, "but because of an instinctive distrust of big business people" being in soccer.

But more big American business people may be buying European teams. Tuesday, William H.C. Chang, who owns part of the San Francisco Giants and the operating rights to Major League Soccer's D.C. United, told Bloomberg News he is in talks with two European teams he declined to identify.

Wednesday, San Datta, a director of a London-based sports financial and capital services company, told USA TODAY "other U.S. investors are looking at English and European teams." He declined to name them.

"We are in touch with some these investors," added Datta, whose Hermes Sports Partners announced Monday it is teaming with a unit of GE Commercial Finance.

Much of the angst over American ownership has focused on Malcolm Glazer, who took over Manchester United in a $1.49 billion deal in 2005 and owns the NFL's Tampa Bay Buccaneers. After the takeover, some fans of the 129-year-old soccer club burned Glazer in effigy; others picketed games with signs that said, "Yankee Go Home."

Such tension appeared to have eased somewhat this year, in part because Manchester United was en route to a Premier League championship and the Champions League semifinals. But when the club announced this spring that ticket prices would rise 12% next year, even with its television revenue about to jump significantly, the criticism of Glazer began again.

Liverpool was bought this year by Tom Hicks — who also owns the Texas Rangers and the NHL's Dallas Stars — and Canadian George Gillett, owner of the Montreal Canadiens. Hicks and Gillett initially caused alarm among Liverpool fans by saying plans for a new stadium to replace Anfield — the club's home since its founding in 1892 — might include selling naming rights.

Since then, Hicks and Gillett have made public efforts to show their appreciation of the club's roots.

"They seem to have a good grasp of what the history of Liverpool football is all about," says Mark Longden, chair of the Independent Manchester United Supporters Association. "And their financial position will be greatly enhanced by respecting that tradition. That doesn't seem to be the case with the Glazers." Glazer could not be reached for comment.

For all the angst in English soccer over U.S. marketing tactics, few sports leagues in the world have been more effective at popularizing or commercializing their product than the Premier League. Revenue, especially from TV, is soaring.

Corporate sponsors' logos dominate the fronts of team jerseys. Most clubs have prominent partnerships with online sports betting and gaming companies. And a bank's name now is part of the league's name (it's officially called the Barclays Premiership).

Rich owners producing winners

The worldwide passion for soccer and the expanding marketing opportunities that surround it have made the sport's top leagues overseas increasingly attractive to super-wealthy U.S. investors. Cleveland Browns owner Randy Lerner bought Aston Villa, a 133-year-old team in England's Premier League, for $118 million in August 2006.

In April, Stan Kroenke bought a 12% stake in Arsenal, another bedrock English club that was founded in 1886. Kroenke also owns the Colorado Avalanche, the Denver Nuggets and the operating rights to MLS' Colorado Rapids.

The American investors see their type of aggressive marketing as a way to extract untapped revenue in European soccer strongholds and they see a range of marketing opportunities in the USA and Asia.

The Liverpool brand is "very underdeveloped," Hicks says. "(Gillett) and I view the growing globalization of sports differently" than previous majority shareholder, Doug Ellis. "We very much want to build a brand, particularly in Asia, but also in North America and South America, as well as Europe."

Russian billionaire Roman Abramovich sparked this wave of foreign investment in the Premier League by paying $223 million for Chelsea in August 2003. He has poured hundreds of millions of dollars into player salaries and acquisitions. In 2005, Chelsea won its first Premier League title since 1955; the club won it again last year.

Before Abramovich's deal, Glazer had begun acquiring shares of Manchester United, which then was a publicly traded company. When he finally took over the club, he made it a private entity.

Manchester United's decision to raise ticket prices — which next season will range from about $50 to about $88 — has taken some of the glow from the team's first Premier League title in four seasons. It also has reached Saturday's final of the FA Cup, a 135-year-old tournament open to all English clubs, from the pros to the amateurs; United will play Chelsea for the title.

At Liverpool — which will play AC Milan on Wednesday in the final of the European Champions League, a tournament for which only the continent's top clubs qualify — Hicks and Gillett are in the final stages of stadium design.

They have stirred controversy in Liverpool by raising the idea of selling naming rights to the stadium. The practice, still rare in Europe, is creeping into England, where half the 20 Premier League stadiums this season dated from the late 1800s and traditionally have been named for geographical locations.

In October 2004, Arsenal made a 15-year, $178 million deal with Emirates, the international airline of the United Arab Emirates, that puts the Emirates name on the team's jerseys as well as on the stadium that opened in July 2006.

With such backing, Manchester United, Chelsea, Liverpool and Arsenal have been the top four teams in the Premier League three of the last four seasons. That situation may persuade fans to see competitive merit in their teams being bought by mega-rich outsiders.

Premier League officials take concern about foreign investment in stride. "There are some very, very dyed-in-the-wool traditionalists who think it's anathema to have foreign owners of our football clubs," league CEO Richard Scudamore says. "But there's also a lot of hypocrisy around it.

"I was speaking to a Sunderland fan the other day, and he was talking about how bad all this foreign ownership is, and I said, 'But your club is owned by the Irish.' In the European context, the Irish are no different than the Icelandic.' " (Icelandic investors now own the Premier League's West Ham United.)

So while many English fans are edgy, Scudamore welcomes his league's American investors. "They do bring some freshness to it in terms of marketing," he says. "The presentation and the materials, yes, but also the raw, brash enthusiasm of it. Your marketing is much more direct than ours in many ways."

New amenities vs. familiarity

It's not as if the Premier League is lagging on the business side.

League figures indicate that each week of its regular season, which runs from late August to mid-May, its matches are watched by 76 million fans in nearly 200 countries. During the last five years its annual revenue has doubled to $2.73 billion, according to a report by the accounting firm Deloitte & Touche.

The figure will rise when a three-year, worldwide TV deal worth nearly $5.5 billion begins next season. At an average of $1.83 billion a year, the money from the deal won't match the NFL's annual average of $3.7 billion. But the Premier League's deal tops the national deal of any other U.S. pro sports league.

Hicks says before buying the Liverpool club he knew a little about it — "I mean everybody had heard of Liverpool" — but the more he learned about its history, including its more than 30 domestic or European titles, the more intrigued he became. He says trips to Anfield got him excited about owning the club.

"The night I went to my first game … wow," Hicks says. "I've never heard any fan group of any team of any sport anywhere that could compare with that. Singing and chanting and screaming non-stop for the full 90 minutes."

Leaving Anfield will end the era of the Kop, a huge section of the old stadium from which tens of thousands of fans, who do not sit, emit a howl known as the "Kop roar." The new stadium will have a new Kop, Hicks says, adding he wants to keep as much tradition as possible while breaking new ground in marketing and merchandising.

"Their most sacred tradition is the Kop, and we're already in the process of redesigning the stadium to improve it," he says. "One of the things we're going to do is make the Kop the true, central focus of the stadium. We'll also have fan comforts that they haven't had before: high-definition video screens, some bunker suites to go along with the other boxes. It's going to be a great stadium, the finest soccer stadium that's ever been built.

"We've got 28 million registered fans. I find Liverpool fans everywhere, particularly in Asia, and even in the U.S. The press was concerned when we were introduced, but … the fans have warmly embraced us. … I think they sense that we want to win."

Contributing: Steve Berkowitz

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