The German model: the Bundesliga
The debate about the respective merits of the Premier League and the Bundesliga is more than one about football. It is also part of a large clash between rival models of capitalism: the free market or 'Anglo-Saxon' model and the coordinated capitalism or 'Rhineland' model. Britain is seen as a classic case of the former model, Germany as an exemplar of the latter.
Critics of what they see as the rapacious capitalism of the free market model say that it creates gaps that are too big in the distribution of wealth and income and ultimately doesn't work as exemplified by the global financial crisis. Capitalism needs to be tightly regulated and controlled to save it from itself.
Defenders of the free market respond that if you do that you risk destroying the very incentives and spirit of competition which have allowed capitalism to generate greater prosperity.
In football the Bundesliga has often been held up as a dignified and fan-friendly counterpart to the greed of the Premier League. Attention is drawn to subsidised season tickets for loyal supporters, free rail travel to away games and safe standing areas in modern stadiums. Above all, clubs are majority owned by their ultimate stakeholders, the fans.
However, there is quite a lot of mythology in circulation. To read some accounts you would think the Bundesliga is largely made up of teams from the gritty industrial heartlands of Germany with the supporters having just finished a shift making high quality cars or machine tools. Moreover, the Bundesliga is a lot more commercial than its advocates allow and becoming more so.
Last year the 18 clubs in the Bundesliga posted record revenues for the seventh season in a row. They generated almost €2 billion in ticket, merchandise and rights sales. It is already the second league in terms of revenues behind the Premier League.
It is also the best attended league in the world with 94 per cent of games sold out. Only the NFL outstrips the Bundesliga when all sports are considered. An average of 42,401 fans paid to see games last season at a price of about €20 for a top flight match.
However, the Bundesliga recognises the importance of television revenues. That is why the recent deal with Sky Deustchland which we discussed in an earlier post provides income at one-and-half times the rate of the current deal.