In the recently concluded European football championship, even the diehard fans would have missed the Beckhams and the Zidanes, but none missed the Roteiro—the only ball to appear throughout the competition. The result was simply amazing. Within a few weeks time Adidas, the maker of Roteiro, sold 6 million balls. And that is the commercial value of football. No wonder why the big European clubs make huge money. For the 2003-04 season, European football clubs earned a revenue of $12 bn, and the revenues of British, German, French and Italian football clubs have increased three times since the mid-1990s. Manchester United (Man U), the richest in the business, has increased its turnover from £17.8 mn in 1990 to £129 mn in 2001 and to $351 mn in 2003. The expenditure of the clubs has also increased in leaps and bounds. For example, the spending of the British clubs alone doubled from £213 mn in 1995 to £423 mn in 2001. The two major reasons cited for the sudden surge in the revenue and expenditure of the clubs are the introduction of Pay-TV channels, which escalated the broadcasting rights, and the 1995 EU ruling (famously known as Bosman Ruling), which eased the movement of players between clubs on completion of their contracts by banning the transfer fee. This led to a competition among the clubs to rope in the star players, who not only drew the paying public, but also bought in additional revenue through merchandising and sponsorships along with television rights. Sports analysts say that the 1995 ruling has changed the way football is marketed by clubs in Europe through major tournament.

At the club level, the most prestigious competition is the ‘Champions League’, which started in 1955-56 as the ‘European Champion Clubs Cup’. The Champions League consists of three qualifying rounds and one stage of group competition, where teams play each other in the ‘home-and-away’ format (i.e., every team plays one match on its home ground), and then four rounds of knockout finals. All qualifying rounds and the knockout ties are two-legged except for the final, which is a single match played at a predetermined venue. All the football clubs dream to qualify and play in the knockout ties because of the whooping sums from the sponsorships and television rights. Traditionally,
ticket sales have formed the major part of the clubs’ earnings. But the advent of new telecommunication technologies
in the mid-1990s have paved the way for the pay channels and the scenario changed. In the initial days of pay-TV, it
was thought that football rights were seriously undervalued so the cost of broadcasting rights shot up, making them too expensive in many markets. In 1994, the television rights to telecast the domestic and European football were sold to various media houses for $300 mn and by 1998 the broadcasting rights were valued at around $2 bn a year. These revenues coupled with the Bosman Ruling have changed the football business beyond recognition.