One Transfer to Inflate it all!

Transfer | Inflate | 07th July 2022 | Virtual Wire

 

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It’s very rare to see a single event change a sport forever, Yet that’s exactly what happened in football.

Neymar Jr’s $263 million transfer from FC Barcelona to Paris Saint-Germain (PSG) back in 2017 was the cause of it. Not only did it absolutely blow up everyone’s mind but also caused an inflation in player transfer fees. As of 2022 Neymar’s move still remains the costliest ever in football by a large margin. In 2nd place we have another transfer to PSG, French superstar Kylian Mbappe arriving from Monaco in 2018 for a cost of $198 million. A gap of over $50 million dollars separating the two. Before Neymar’s transfer to PSG there was only the 2 transfers that crossed the $100 million mark.

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The first one ever being Gareth Bale’s transfer for $110 Million from Tottenham Hotspurs to Real Madrid back in 2013. It had pretty much the same reaction as the Neymar’s transfer but to a lesser degree. The other being Paul Pogba’s return to Manchester United from Juventus in 2016 for $115 million, which held the record for the most expensive transfer for a year until Neymar broke it. Let’s go back and see how PSG was even able to afford Neymar and then Mbappe the following year.


The current owners of the club are Qatar Sports Investments (QSI) its namesake nations sovereign wealth fund who bought the club way back in 2011. The clubs’ President and CEO since this sale has been Nasser Al-Khelaifi, a former tennis professional who also happens to be the Chairman of QSI, beIN media group & DIGITURK. Under whose supervision PSG saw a hike in revenue. Their main source of income came from television rights, they alone accounted for 40% of their total income. Not only that, with time the club brand become extremely desirable by bringing in some notable players like David Beckham and Zlatan Ibrahimovic.

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PSG were also sponsored by Nike who is a common connection between them and future partner the Jordan brand. This partnership PSG X Jordan allowed PSG to enter more into the fashion industry, especially street fashion. Jordan is the personal brand of Basket ball legend Michael Jordan. Regardless of this income Neymar’s release clause was set at approximately $230 Million. But due to UEFA’s Financial Fair Play (FFP) regulations which essentially regulates football transfers so that clubs do not spend more than they can earn. PSG had some barriers to this transfer. What both PSG and Neymar did to solve this is they sent Neymar the amount for his release clause to his personal bank account from the club CEO Nasser Al-Khelaifi’s own funds. Neymar paid his own release clause. Essentially making him a free agent and now able to join PSG.


It was also reported in the media that Neymar agreed to be a brand ambassador for the Qatar World Cup that will commence this November, although there has been no solid confirmation on these reports. With Neymar’s addition to PSG, Neymar brought PSG more income from their shirt sales, ticket sales and TV revenue. It was the first time a single player brought in so much wealth to both a French club and Ligue 1 France’s top football league itself. Thus, bringing in more money into a club with very rich owners. As mentioned earlier PSG were able to afford another $100 million+ signing the following summer with the purchase of Kylian Mbappe. This purchase was certainly helped due to the money they gained with having the Brazilian in their team for a full season.

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After this historic signing. The football world saw several big money signings all over Europe within a short amount of time. A few names being Ousmane Dembele who was Neymar’s replacement for Barcelona, Joao Felix, Antoine Griezmann & Harry Maguire to name a few. There were many public reactions and opinions by those involved in the football industry, club owners, players, managers, fans all included. But one manager’s thoughts on this stands out.


Jose Mourinho then manager at Manchester United who made the previous record-breaking signing of Paul Pogba. Mourinho said “I don’t think he’s expensive for 200 million. I don’t think he is expensive. I think he is expensive the fact that now you are going to have more players of 100 million and you are going to have more players of 80 million and more players of 60 million”. With time what he said turned out to be true. Many players who sold for 80 million and above wouldn’t have their price tag anywhere near if not for that 1 transfer. Let’s take the case of Joao Felix.


Atletico Madrid splurged $141 Million for the young Portuguese forward from Portuguese club SL Benfica in 2019. At the time he was only 19. As for his stats at Benfica he scored 20 times in 43 appearance and made 11 assists. Those are some remarkable statistics. But if such a transfer were to happen even 3 years prior. It would have been complete madness and no club or organization would have even entertained the idea. A greater issue now is many of these big money transfers that happened post 2017 have been flops. From Felix’s mediocre impact to Harry Maguire being among the biggest football meme in the internet for a while.

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All these highly valued players are just making other average players look better. This just allows inflation and increase in a player’s valuation that much more probable and dynamic. Soon it may just happen that player prices are inflated to such a level that only the top clubs of a nation with massive cash reserves will be able to buy players, leaving other mediocre and smaller clubs in the dust.

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