Record fees paid to agents

[hellava_tough]

Ok say we transfer player a from club b to club c.
After the transfer fee, the signing on fee etc... the agent then hands a bill to the player of £xxx. Don't you think that the player might rethink about why he is his agent? Another agent might do it for less? He could hire a lawyer?

The clubs will probably be prepared to spend that amount of money but more of it would probably stay in football.

Not especially, because the agent and player would have already had the conversation about fees, etc, before the transfer; the player wouldn't be surprised at the amount he's paying to the agent, because it's already been agreed

Agent: I can (i) get you a move to your favourite club and (ii) get you a huge salary increase. It's going to cost you 'X' amount. If you don't like it, you can go to another agent, but I'm the best in the business and I'll get the deal done.

Player: Okay, if you can get me those things I'm happy to pay you; money well spent in my estimation.

OR

Player: I've considered your offer, but I think I can do this myself. No deal...unless you bring your fee down by 'X' amount

etc, etc

I just don't think you get a situation where you've got a high value asset (player) and a multi-national corporation (club), and a pointless individual turns up demanding to be paid for nothing (agent).

The agent is going to have to do something for their fee. Obviously players and clubs are quite happy to allow this situation because they're all making money from the situation. If they weren't, then they'd tell the agent to 'do one'.

 

[hellava_tough]

Btw guys, I'm not necessarily a massive fan of the system

I'm just trying to highlight the economic realities of the situation...if that doesn't make me sound too pretentious

 

[Lilbaz]

Not especially, because the agent and player would have already had the conversation about fees, etc, before the transfer; the player wouldn't be surprised at the amount he's paying to the agent, because it's already been agreed

Agent: I can (i) get you a move to your favourite club and (ii) get you a huge salary increase. It's going to cost you 'X' amount. If you don't like it, you can go to another agent, but I'm the best in the business and I'll get the deal done.

Player: Okay, if you can get me those things I'm happy to pay you; money well spent in my estimation.

OR

Player: I've considered your offer, but I think I can do this myself. No deal...unless you bring your fee down by 'X' amount

etc, etc

I just don't think you get a situation where you've got a high value asset (player) and a multi-national corporation (club), and a pointless individual turns up demanding to be paid for nothing (agent).

The agent is going to have to do something for their fee. Obviously players and clubs are quite happy to allow this situation because they're all making money from the situation. If they weren't, then they'd tell the agent to 'do one'.

That is for the player to decide though if it is a good deal. It's his money he can spend it however he wants.
The system as is the player might not know how much of the deal the agent gets. This leaves it open for abuse.

 

[NinjaTuna]

**Googles "How to become a football agent"**

 

[glacierSpurs]

Somehow always in the name of 'agent', the true hard-working ones are really taking the bad rep from the ones spoiling the industry and market rate. Insurance and property industry are the same.

 

[hellava_tough]

That is for the player to decide though if it is a good deal. It's his money he can spend it however he wants.
The system as is the player might not know how much of the deal the agent gets. This leaves it open for abuse.

Firstly, the player doesn't need to use said agent. He could use a different agent, who is contractually obliged to be more transparent.

Secondly, who's getting abused in the situation? The player gets his pay-day, the agent gets his fee and the club get the player and all the marketing revenue that goes with signing the player.

You could argue that the fans get short-changed, because their hard-earned money goes to a third-party which they don't think is deserving of it. I'd accept that. But then it's down to the fans as consumers, to vote with their wallets and stop buying one or more of the following; season tickets, merchandise, BT or Sky football subscriptions, or the products that are advertised in the grounds or on the TV ad breaks.

I think this is actually the problem and always has been; the fans, as consumers, potentially have a hell of a lot of power, but they're not organised enough to wield it. That's not necessarily a direct criticism of them, because there are practical considerations to take into account, but it's still the reality in the 'market-place' of football.

 

[Lilbaz]

Firstly, the player doesn't need to use said agent. He could use a different agent, who is contractually obliged to be more transparent.

Secondly, who's getting abused in the situation? The player gets his pay-day, the agent gets his fee and the club get the player and all the marketing revenue that goes with signing the player.

You could argue that the fans get short-changed, because their hard-earned money goes to a third-party which they don't think is deserving of it. I'd accept that. But then it's down to the fans as consumers, to vote with their wallets and stop buying one or more of the following; season tickets, merchandise, BT or Sky football subscriptions, or the products that are advertised in the grounds or on the TV ad breaks.

I think this is actually the problem and always has been; the fans, as consumers, potentially have a hell of a lot of power, but they're not organised enough to wield it. That's not necessarily a direct criticism of them, because there are practical considerations to take into account, but it's still the reality in the 'market-place' of football.

So do you not think that when a transfer of £80m goes ahead and the agent takes £40m of that there isn't something seriously wrong? The agent getting much more money than the player? That money has gone out of the game.

 

[hellava_tough]

Somehow always in the name of 'agent', the true hard-working ones are really taking the bad rep from the ones spoiling the industry and market rate. Insurance and property industry are the same.

I'm not sure it is the same, since the products/services sold in these two areas tend to be either required by law or required by necessity (i.e. the State says you have to have car insurance and the realities of living says you need shelter/a home; there's not really much choice in the matter).

Secondly, 99% of the time the people who have to use insurance and property agents have little to no bargaining power in the market-place. Unlike footballers, they're not high-value assets who are needed by the agent or football club. They're just 'Joe Public' who are forced into doing a deal with an agent who doesn't really need them as a customer. Sure, if enough customers refuse to do business with an individual agent or company, then they would have a problem. But because the service and prices are about the same across the industry/sector, the agents know that they don't have to bend over backwards to attract custom.

 

[Rocksuperstar]

The problem with the "market-place of football" is that just one person can completely screw the perceived standard - there's not one industry on earth like it, where one person can come in with abnormal demands for their wage and that be enough to change the entire landscape so that others now have to compete.

Most industries would regulate that, the majority would find a way to ride out the bump it creates or flat our refuse to be baited into the increase in costs, yet with football it becomes the new standard and all of those who also charge for the same service declare it's the new standard and start making the same demands.

That's ridiculous, but only until you realise that the clubs have encouraged this by bowing to these impractical and unrealistic demands, instead of standing up and saying no, we're not prepared to be held over a barrel by agents - the clamour to get the best* players had had all the club owners lose their minds and desperately throw fistfuls of cash at whoever demanded it. Now precedence has been set and despite the fact it's still only maybe 7 or 8 clubs out of hundreds across the continent that can afford this, ALL other clubs are expected to keep up.

It's retarded and is surely going to be a huge factor when it comes to the inevitable slump in the game's investors.

 

[hellava_tough]

So do you not think that when a transfer of £80m goes ahead and the agent takes £40m of that there isn't something seriously wrong? The agent getting much more money than the player? That money has gone out of the game.

I understand your point Lilbaz and I'm not trying to be awkward, but it depends if you agree with the capitalist and/or free-market economic system or not.

The principle or theory of the situation is capitalistic; essentially anyone is allowed to pay as much as they think worth it, for a good or service and this is what is happening, and further still, is what has always happened.

The only difference now, is that because the game is becoming so popular and so lucrative, the fees have grown exponentially. The principle remains the same though.

As far as 'money going out of the game', well that's debatable, but if we assume that that is the case, then all money ultimately 'goes out of the game'. The clubs, players, coaches, agents, will spend their wages on something non-football related eventually.

I think people are having a hard time realising that the nostalgic game they used to watch or play when they were younger has mutated into a multi-billion dollar entertainment industry. And that is going to develop economic systems that previously were unfathomable to the average fan.

PS Apologies if that last paragraph sounded a little patronising - it wasn't meant to be

 

[Lilbaz]

I understand your point Lilbaz and I'm not trying to be awkward, but it depends if you agree with the capitalist and/or free-market economic system or not.

The principle or theory of the situation is capitalistic; essentially anyone is allowed to pay as much as they think worth it, for a good or service and this is what is happening, and further still, is what has always happened.

The only difference now, is that because the game is becoming so popular and so lucrative, the fees have grown exponentially. The principle remains the same though.

As far as 'money going out of the game', well that's debatable, but if we assume that that is the case, then all money ultimately 'goes out of the game'. The clubs, players, coaches, agents, will spend their wages on something non-football related eventually.

I think people are having a hard time realising that the nostalgic game they used to watch or play when they were younger has mutated into a multi-billion dollar entertainment industry. And that is going to develop economic systems that previously were unfathomable to the average fan.

PS Apologies if that last paragraph sounded a little patronising - it wasn't meant to be

All i'm suggesting is that the players be responsible for paying their agents not the club. The club pays the transfer fee, agrees wages then pays the player say a £10m signing on fee. Then it should be between the agent and the player how much of that fee goes to the agent.
The agents might get the same as now (maybe more, maybe less) but there would be better clarity (especially from the players point of view) of where the money has gone.

 

[hellava_tough]

The problem with the "market-place of football" is that just one person can completely screw the perceived standard - there's not one industry on earth like it, where one person can come in with abnormal demands for their wage and that be enough to change the entire landscape so that others now have to compete.

Most industries would regulate that, the majority would find a way to ride out the bump it creates or flat our refuse to be baited into the increase in costs, yet with football it becomes the new standard and all of those who also charge for the same service declare it's the new standard and start making the same demands.

That's ridiculous, but only until you realise that the clubs have encouraged this by bowing to these impractical and unrealistic demands, instead of standing up and saying no, we're not prepared to be held over a barrel by agents - the clamour to get the best* players had had all the club owners lose their minds and desperately throw fistfuls of cash at whoever demanded it. Now precedence has been set and despite the fact it's still only maybe 7 or 8 clubs out of hundreds across the continent that can afford this, ALL other clubs are expected to keep up.

It's retarded and is surely going to be a huge factor when it comes to the inevitable slump in the game's investors.

There are a number of points you make RSS, but this is the one I want to focus on

I completely disagree with this; providing there is no government intervention, the economic system regulates the market-place. This might involve cartels or monopolies in some areas, but ultimately it's going to be a case of supply, demand and profit.

If I go down to the City this afternoon and tell a brokerage that I can bring a deal together which will make them a substantial amount of money, but I want a 25% cut, then they're probably still going to do business with me. If that 25% equates to £250 million, then in theory they're not going to care. However, in practice, they might think they could spend a good chunk of that £250m commission to get the deal done another way. But if they found that they couldn't, that I was the only 'supplier' for the deal, and they had the 'demand' to make the deal, then they'd happily sign the contract.

And this is the crux of the issue; supply and demand.

The fact that good quality footballers are in such demand, means that this is reflected accordingly within the economic system of the multi-billion dollar entertainment industry that is football.

 

[hellava_tough]

All i'm suggesting is that the players be responsible for paying their agents not the club. The club pays the transfer fee, agrees wages then pays the player say a £10m signing on fee. Then it should be between the agent and the player how much of that fee goes to the agent.
The agents might get the same as now (maybe more, maybe less) but there would be better clarity (especially from the players point of view) of where the money has gone.

But whichever way you do it, the outcome is going to be the same; the player, agent and club all get what they want, which is essentially to be paid a large amount of money.

Incidentally, I'd advocate a system whereby the finacials of all transfers are public knowledge, although I'm sure that would be against the law (right to privacy in business transactions, etc). Still, would be interesting to know.

Whichever way you spin it Lilbaz, the current system is here to stay unless supply or demand changes.

It's unlikely the supply (good footballers) will increase, so it's all down to the fans' demand of the entertainment product. If they feel it's distasteful that agents get paid a lot of money, good for them; but they have to vote by closing their wallets, otherwise nothing will change.

 

[hellava_tough]

Oh man, I can't believe I'm defending football agents on here

 

[Lilbaz]

But whichever way you do it, the outcome is going to be the same; the player, agent and club all get what they want, which is essentially to be paid a large amount of money.

Incidentally, I'd advocate a system whereby the finacials of all transfers are public knowledge, although I'm sure that would be against the law (right to privacy in business transactions, etc). Still, would be interesting to know.

Whichever way you spin it Lilbaz, the current system is here to stay unless supply or demand changes.

It's unlikely the supply (good footballers) will increase, so it's all down to the fans' demand of the entertainment product. If they feel it's distasteful that agents get paid a lot of money, good for them; but they have to vote by closing their wallets, otherwise nothing will change.

It gets rid of possible conflicts of interest (agent being paid by club and player) and will clarify to the player what they are paying the agent. This then gives the player a chance to decide if his agent is value for money.
Say tobys agent takes 20% of a transfer fee but he then speaks to jan who says his agent only takes 10%. Maybe toby will decide to change agents? You cannot have competition among the agents if the players themselves don't know how much of a deal the agents get or who is paying him.
Yes it is more complicated than that but it will give more clarity.

From a clubs point of view it makes it a lot simpler in negotiations. Agree fee with other club. Agree wages and signing on fee. None of this negotiating agents fee or paying the agent a loyalty bonus if the player doesn't move etc...

 

[hellava_tough]

It gets rid of possible conflicts of interest (agent being paid by club and player) and will clarify to the player what they are paying the agent. This then gives the player a chance to decide if his agent is value for money.
Say tobys agent takes 20% of a transfer fee but he then speaks to jan who says his agent only takes 10%. Maybe toby will decide to change agents? You cannot have competition among the agents if the players themselves don't know how much of a deal the agents get or who is paying him.
Yes it is more complicated than that but it will give more clarity.

From a clubs point of view it makes it a lot simpler in negotiations. Agree fee with other club. Agree wages and signing on fee. None of this negotiating agents fee or paying the agent a loyalty bonus if the player doesn't move etc...

As far as the player choosing an agent is concerned, it's pretty clear already because it's all outcomes focused; either you end up with the salary you want or you don't.

In terms of competition, this can (and does!) still exist without 100% clarity, because every player will have their own perceived value, and then it's up to the agent to 'supply' that value (or salary) for them. And if the agent can do that, then their reputation grows and he attracts more clients. At this point, it's up to other agents to follow suit. Perhaps they're willing to take a cut out of their own commission and pass it on to the players in order to drum up business, perhaps they've got other skills that they can leverage. Whatever the situation, a competitive market-place is still created.

I agree with your assessment about the clubs; it would certainly make it easier for them.

But then again, the players and agents would say, "Why should we make it easier for them?"

But no one party can be too awkward or too stubborn, otherwise a deal doesn't get done. So a happy compromise is created, whereby a proportion of football-money is dished out to all 3 parties.