Saturday, 14 January 2012

An open reply to steve_mcfc's questions to me on 13th January 2012


This is an open reply to steve_mcfc, the Manchester City supporting Twitter sensation. I blocked Steve on Twitter months ago but in a rush of blood to the head I unblocked him yesterday.... Steve proceeded to tweet me around 30 times starting at 7.48pm yesterday. The Tweets were a combination of insults and questions and are reproduced in full below (in bold). You can check they are exactly as Steve tweeted on his timeline. I was out at the time.

Given that it is hard to reply to 30 tweets I thought I would give more detailed answer to each of Steve’s points on this blog. I apologise for not replying on Twitter but as Steve doesn't restrict his questions to 140 characters, I don't see why I should restrict my answers...

Before you blocked me, you said you were opposed to a cap on squad spending where the cap is the same for all clubs. How can you claim to be impartial when you refuse to support a cap that's fair and you will only support a cap that provides United with a huge long-term advantage? You're not impartial at all, are you?

I’m not impartial about which team (United) I want to win things and which teams (others, especially Liverpool, City) I don’t. That’s called “being a supporter”. I am impartial about wanting football organised in a fair and sensible way maintaining decent competition, preventing the exploitation of supporters and the endangering of clubs through excess debt and financial mismanagement.

I support FFP because I think excessive owner subsidy unbalances competition and injects unsustainable inflation into the system. The labour market in football has an almost vertical supply curve, that is to say the supply of footballers is almost completely price inelastic. Additional cash above a certain level just increases the price (wages) of footballers. The vast majority of clubs lose money because of the wages they are forced to pay. Controlling owner support through FFP should calm this systemic inflationary problem, helping the whole pyramid.

Why did you refuse to support a cap on spending where the cap is the same for all clubs, & you would only support either FFP as it currently stands, or a cap on spending where the cap is set to be a percentage of revenue?

Because a fixed cap would eliminate any incentive to grow and develop a club, surely a daft and unwelcome consequence? What is wrong with the “normal” equation of “play good, attractive football, attract higher gates and more sponsors, reinvest this money back in squad and create virtuous circle....”?

FFP doesn’t preclude massive investment in stadia, youth development, training facilities etc in any way. It just limits inflationary bursts of wage and transfer spending.

I would have preferred FFP to have specific debt restrictions in addition to its spending limits, debt is a cancer on the game. I would like to see any English licensing rules to include debt restrictions. See my submission to the CMS Select Committee, available here:

Do you still think that FFP will land City "back in the ditch", as you once charmingly said?

I hope City go back to the regular relegation/promotion comedy cycle of failure they have been on for most of my life yes! In other shocking news I hope Liverpool implode with King Kenny going mad, that Leeds never come back up and I have to tell you Steve, THE POPE IS CATHOLIC.

Before you blocked me, you said you were opposed to a cap on squad spending where the cap is the same for all clubs. How can you claim to be "impartial" when the reason you oppose that is because you want FFP to provide United with an unfair advantage?

I don’t support FFP because it helps United (under the current ownership all it would actually do is help the Glazers boost EBITDA and get a bigger price for any future IPO in any case).

I actually think there needs to be a financial rebalancing between the richest clubs like United and the less well off. I would advocate the reintroduction of league gate sharing and a redistribution of Champions League income across the PL to help this. I think the FFP exclusions on stadium development are great for aiding a rebalancing but bottom line, clubs like United should be “taxed” through gate sharing etc. If you don’t believe me, ask Dave Boyle, David Conn and Ian King (of TwoHundredPercent) with whom I’ve been discussing this for a while now.

Why did you assume that Etihad Airways would not grow at all over the 10-year period that the Etihad sponsorship deal of City covers? Etihad is a young airline that is looking to massively expand over the next decade, yet the figures you assumed for Etihad's growth over the next 10 years was 0%. Your assumption of 0% growth was dishonest wasn't it, Andy? Why would a young airline seeking to massively expand sign a £400m sponsorship contract and expect to grow by 0%?

If you are talking about my benchmarking of the Etihad deal to the company’s current financial in my blog post of 13th July you have got the wrong end of the stick. I pointed out that the company’s current turnover was £2bn and that even at a 10% EBIT margin the deal would represent an unusually substantial proportion of profits. When did I say the company would never grow?

I think the deal is extraordinarily large compared to the size of the company and can find no equivalently large deal vs. company size out there (Bayern’s sponsor Deutsche Telekom for example have EBITDA of €3.9bn and pays Bayern €25m pa). Let me know if you can find another mismatch between deal size and company size...

No response to anything I've just said then? Does that mean you accept everything I've just said?

No, hence these replies!

As for verbal diarrhoea, I would say you being interviewed by the BBC talking about City's finances is the best example of verbal diarrhoea I've seen. Why on earth a supposedly unbiased broadcaster has a highly biased Utd fan on to slag off our finances I'm not entirely sure.

Why don’t you ask the BBC Steve.

You don’t like me or my views, but lots of other people take me seriously unfortunately.

One other thing. Do you not consider it extremely hypocritical to campaign against the Glazers because they limit United's spending while you also act as cheerleader for FFP, cos it will limit City's spending? Is that impartial?

The Glazers exploit United and its fans (like Hicks and Gillett exploited Liverpool and their supporters)  through an LBO. My main gripe is not spending restrictions, it is enforced ticket price hikes to make the LBO numbers stack up. The House of Commons Select Committee for Culture Media and Sport was scathing of LBOs in football, it is not an unusual view that they add no value.

I am not a cheerleader for FFP, I support it but think that the financial structure of UEFA’s CL is a major problem and would like specific debt limits in the rules too. Again, see my DCMS submission for details (and note that the committee quoted my submission on several occasions).

No response to any of that then? Guilty as charged then.....

Sorry, it took me a while...

You actually blocked me because I accused you of being a liar, Andy. I see you're lying about that too now.

Did I Steve? I knew there had to be a good reason.

Sorry, my mistake, you blocked me because I accused you of being a biased liar. That's the one.

OK, if you say so Steve.

Come on Andy. I think I explained the issues I have with your claim of being impartial. You used to stick up for yourself, so why not now? For example, this is a yes/no answer: Do you still think FFP will land City "back in the ditch"? Yes/no - wouldn't take you very long to clear that up, would it?

I actually think City may get around FFP sufficiently to remain quite competitive. As a United fan I would of course like to see you back down in the ditch!

Stop pretending to be impartial. We all know you've only started covering clubs other than Utd so that you can help to convince people of the supposed need for FFP so that Utd get their massive unfair long-term advantage. Unless you can convince people why it's "fair" for United to spend around 65% more than their PL rivals year in year out when on-field success has been shown to be highly correlated with total spending on wages & transfer fees

Are you saying nobody who supports any club can comment on the finances of any other club or on football wide regulation? That would rather restrict debate!

As I said above, I think the big clubs like United need reining in financially through new rules. The fact that clubs without rich owners like Everton can’t possibly compete and that clubs with quite rich owners like Sunderland can spend £100m of their owner’s money and not get anywhere suggests fundamental flaws with the system. The answer to that is surely not a billionaire owner for every club?

I started covering other clubs because the whole subject interests me and I believe fans are exploited all too often (see my work on QPR’s ticket price hikes for example). The Football Supporters Federation were kind enough to nominate me in their blogger of the year award. I’ve helped out various supporters trusts behind the scenes too, not that you appear to care about ownership issues Steve.

In fact Steve, you are like a stuck record, fixated by FFP and its relative impact on City and United.

You've provided a great defence of your impartiality, Andy. Well done son.

Thanks Steve.

29 comments:

Anonymous said...

Steve is mentally ill, and lives in a bedsit with an Uwe Rosler duvet on his single bed.

Gooner said...

Well done Andy. Steve_Mcfc is a massive bellend. Arsenal fan here and enjoy your financial analysis, keep it up mate.

Anonymous said...

Steve is an absolute Chump. Does he know there is more to life than Twitter?

Fair play to you for replying though Andy. Are you going to block him again now?

Anonymous said...

He is an idiot. Completely lost it since the derby.

Anonymous said...

Spot on Andy! That Steve needs a shovel to the face, proper div!

Anonymous said...

He's a prick and think he knows all there is to know about football in general.. He knows nothing! He blocked me because I tweeted him sayin 'Should be 2-0 down by now', poor, very poor!
@LouisGilkes Man Utd fan.

MattNW5 said...

Another Arsenal fan here - Andy is a great lesson in being passionate about your team without losing sight of the bigger picture of what we all actually have in common as fans. Great work mate.

Anonymous said...

The real challenge is to respond to Swiss Ramble's FFPR piece on City rather than some guy on Twitter. Swiss Ramble's took me nearly 3 hours to read and makes the best case for City passing FFPR yet. Incidentally the club looks set to make a net profit for the first time since the takeover, about £1.5million net so far with some youths sold off, £20million at least if Tevez goes, then there are Onuoha, Bridge, and a few other youth players like Ben Mee (£300,000ish) and Ryan McGivern (£600,000ish) who are close to being sold. I doubt all said that City are going to spend £28million+ in this window so there is an obvious attempt to combat FFPR at the club or else they wouldn't give a damn, ala Anzhi and PSG who seem to know something we don't as they are ignoring FFPR.

Frank said...

Anonymous 19.04, You say, with reference to Man City, that "Incidentally the club looks set to make a net profit for the first time since the takeover, about £1.5million net so far...".

There is no evidence whatsoever that City are going to make a profit any time soon!

Their likely losses for this present year are going to be somewhere around £150m + and this is likely to continue for some years to come.

True, this is a reduction on their loss last year of £197.5m but, hey, what's the difference, really!

Anonymous said...

Once a bitter always a bitter. Well done Andy!!!

erroneous said...

@Frank - I believe anonymous means "a net profit on transfer fees in this transfer window" which is a fairly limited and weak achievement, but might actually be true.

City's policy to meet FFP is to stockpile ~70 professionals before FFP kicks in and then to sell them off as soon as it does...

CeefaxTheCat said...

Does anyone really take that steve_mcfc character seriously though?

Anonymous said...

So Steve calls you out for being biased numerous times on an issue that affects all of football yet he only has interest on how affects his own team. Irony!

Anonymous said...

I commented on Steve's "6-1 exclamation" on his twitter profile, and pointed out that the trophy count is something like 60 v 11 in our (red) favour, and told him that Manchester is still red. He responded like this: "You're not even from this country, let alone this city, so don't tell me who has the most fans in Manchester or anything else. You fucking glory seeking cunt. *blocked*" Deluded fucking maniac

Anonymous said...

Not come across Steve before but he does seem like the traditional "Bitter". I do wonder how City and Chelsea will deal with FFP (which I think is a worthwhile attempt to get some sanity in football finance). City's Etihad deal does strike me as a ruse to get round it (Swiss Ramble has explained it better than I can).

Equally, I dislike the LBO approach where a corporate raider can use future club earnings to pay for his takeover, while adding little. That's the converse of the "Sugardaddy" owner, like Mansour. UEFA should look at this too (although I think this is primrily an English problem). Is Stan Kroenke planning to asset strip Arsenal?

I should say that I'm a Spurs fan, so don't have either issue to contend with.

As an aside, do you know what's likely to happen with Rangers? Seems every chance of their going bust.

Anonymous said...

Twitter = full of boring trolls who have no life.

Just ignore them Andy, or delete your account. No point wasting your valuable time with these kind of people.

Regards,

Greville.

Kanonier said...
This comment has been removed by the author.
Kanonier said...

Well, at least they have a lot of fans with tattoos (according to our ex Player Nasri) although sometimes with players they never signed or trophies they never won.

@boundary_bob said...

@steveMcfc is comedy gold. Please keep him arguing. I bet he even types his replies in full match kit.

Anonymous said...

A question or two for Andy or anyone who knows, City lost £196m last year right? Am I right in thinking that in that year they spent about £135m-£145m on players and cleared up £35m of player Amortisation before FFP come in? In total that comes to around let say £170m meaning if they have a similar year to last and they don’t spend they will lose around £30m. But last years accounts don't include the Etihad deal £30m-£40m depending on who you listen to, also so I hear £25m minimum Champs league money and possibly more TV, attendance via more games etc so say about £8m (I have also read they are making a big deal with kit makers Umbro £15m-£25m pa). I do not really claim to know the ins and outs but that if right then it kinda looks like profit as long as they don’t spend as they have been. Maybe somebody could tell me if that would be the case as simple math makes it look that way or maybe I‘m missing somthing. Cheers.

Frank said...

Anonymous 00.06, you must distinguish between cash flow and yearly accounts.

Yes, City spent spent some £450m on players. That means that in the years these purchases took place, the cash flow suffered a big hit.

However, most of these players were signed on four or five year contracts.

This means that, in the accounts, the annual cost is about £100m as an expense, similar to the depreciation in the value of a car.

If you buy a car, the cash flow is affected in the year you buy the car but the value of the car, in the accounts, is depreciated over a period of years.

Therefore, City's accounts for years to come will show this depreciation as an expense. This is known as player amortisation.

On top of this annual expense in the accounts, City will also have to show the wages of these players and in the most recent set of accounts, those for the season 2010-2011, wages came to £174m.

This means that these two expenses alone will come to some £270m+ each year for the next several years.

Obviously, there are other expenses involved in running a football club, expenses such as travel and, in the case of City, rent of the ground, about £4m a year.

It is very likely that City's losses in coming years will be in the region of £150m a year, based on present knowledge.

If they buy any more big names, their losses will be bigger accordingly.

Once again, remember that the cash flow is different to the profit and loss account.

If they buy some big names for big money, the cash flow will suffer immediately, but will be made good by the owner (although this is subject to FFP rules which allow only a loss made good by the owner of no more than €45m over this season and next combined).

Anonymous said...

Most City fans seem to be in denial about the implications of the FFP in the future.
This season is the first of three in which a clubs accounts will be scrutinised.
Following on from the huge loss of last year it would be fair to say that another huge loss awaits City.

This huge loss has more to do with excessive wages than big transfer fees. The fact that City are unable to get Tevez and Adabayor off there wages bill merely compounds the situation.

City will have to off-load some of their high wage earning players in the summer. With this deterioration in the quality of the manager's playing staff, I expect Mancini to leave City as they would have no hope of ever winning the CL, surely Mancini's greatest hope.

Without Mancini,and perhaps the re-appearance of Hughes or Allardice as club manager, mid table mediocrity awaits the City faithful.

The disappearance of Mansour will surely follow, leaving City with a HUGE debt.

Hopefully good will come out of all this. The FA and PL people will bring in a FFP to govern the financial regulations of PL clubs.

Manuel said...

talking to Steve is like talking to a horse...utterly pointless.

Good work fella

Ed said...

I genuinely worry for Steve's mental health. He has obsessive-compulsive issues, evidenced in the sheer volume of tweets, posts, emails, and letters he produces, not only on MCFC but, apparently, digital radio too. This would also seem to place Steve on the autistic spectrum - narrow focus, inability to relate, frequency with which he is ostracised by others. I hope he gets some help.

Ian King said...

Ho hum. I'd kind of heard of this guy before, and commented merely on Twitter yesterday that I could confirm the conversation that Dave, Andy and I had last month. Cue a barrage of messages over the course of the next twenty minutes or so, one of which accused me of having a pathological hatred of Manchester City, or some such - possibly on account of the fact that my nominal Premier League club of choice is Spurs.

I had to block him because I was at work, my mobile phone was going off every five seconds and I wasn't just going to switch it off because he had decided to drag me into whatever argument he was having. This evening, a charming message arrived from somebody that I presume follows him calling us "miserable cunts" because, presumably, he had returned to this subject again.

FFP isn't my specialist chosen subject and my support for Spurs falls plainly into the "nominal" category , so I have no great opinion on whether City will pass it, fail it or whatever. It'll all come out in the wash. What I find perplexing is that somebody will be so damn abusive for no particular reason whatsoever, other than that, well, I had a conversation with somebody that he doesn't like.

I have always been relatively sympathetic towards City for two primary reasons: firstly, they were underdogs for years and years, and, secondly, because I do happen to know a lot of their supporters who are decent, funny people that I like. I even went to an away match at Portsmouth with them about four years ago. The likes of him and his chum make it pretty difficult to maintain that affection, and I dare say that the same goes for everybody else that he has abused for however long he has been doing it.

Anonymous said...

Hi, I asked the question on 18 January 2012 00:06. Thanks for the replies but it doesn’t seem to be answered my question. City have said they paid all the outstanding player money off before the first year of FFP last year with the £196m losses. That year new player cost say £135m paid off old players £35m =£170m. Last year = £195m losses so surely it doesn’t matter if the players they have value drops to nothing it? As it has nothing to do with income and outgoing? If they don't buy any players (unlikely I know) then that £170m wouldn’t exist and they would have lost around £30m but if Etihad pay them £40m surely the are £10m up? If you include the Champs league money that’s a further £25m and other higher incomes that were not there last year. So I can’t see were they fail. The only problem I see is if the owner already put a large sum of money in their accounts last year which I don't know if he did but what I have read here Andy seems to think they will make FFP. I think that FFP will not be fully regulated as Club after Club would try suing UEFA as there are many other besides City are in trouble I don't think it will last long or just be used to keep so called lesser club under control hence stopping more City's tipping up. Still confused!

Anonymous said...

LFC-fan here. You're the only Man Utd blogger I follow but your post are mandatory reading, regardless of which team you're writing about.

Keep up the good work and don't let narrow minded people get to you!

Glen said...

Is this the same steve who would have been whole heartedly in support of the FFP to stop the United bandwagon had citeh not struck lucky with the petro dollar sugar daddy?

The good thing about the emergence of twitter and similar media platforms is that everyone can now see the true colours of 95% of citeh fans. Maybe now the myth of the 'family club' will be well and truly smashed. United fans have been putting up with the 'steve's'of this world for years.

As for the FFP, the release of the financial state of european clubs and the fact that club debt has gone up quite sharply, despite the previous UEFA warnings, has made interesting reading. UEFA seem even more determined to bring the problem under control with their severe warning regarding the lavish spending of certain clubs trying to buy into the history club.

Anonymous said...

Why did you assume that Etihad Airways would not grow at all over the 10-year period that the Etihad sponsorship deal of City covers? Etihad is a young airline that is looking to massively expand over the next decade, yet the figures you assumed for Etihad's growth over the next 10 years was 0%. Your assumption of 0% growth was dishonest wasn't it, Andy? Why would a young airline seeking to massively expand sign a £400m sponsorship contract and expect to grow by 0%?

If you are talking about my benchmarking of the Etihad deal to the company’s current financial in my blog post of 13th July you have got the wrong end of the stick. I pointed out that the company’s current turnover was £2bn and that even at a 10% EBIT margin the deal would represent an unusually substantial proportion of profits. When did I say the company would never grow?

I think the deal is extraordinarily large compared to the size of the company and can find no equivalently large deal vs. company size out there (Bayern’s sponsor Deutsche Telekom for example have EBITDA of €3.9bn and pays Bayern €25m pa). Let me know if you can find another mismatch between deal size and company size... I cannot believe you think this is an good enough repsonse to his question you admit that you think ETIHAD will grow and so the sponsership as an amount of out goings and revenue and profit will fall thus making it normal not to mention you probably undertesmate the value of sponsoring city and ETIHDS growth also most companies dont have finciall backers on the scale of etihad hency why advertising is more closly linked to income