Another Soccer (Football) Question - Transfer Fees

In US based sports, a player’s value is usually determined by the salary that a team is willing to pay him or her. And adjusting for the timing of contract renewals and incentives, the better player is paid more than an inferior colleague. But any time I read about a specific soccer player, it is usually accompanied by a “transfer fee” figure, which seems to indicate the player’s value. Rarely does a salary even get mentioned. Can someone explain this to me?

http://en.wikipedia.org/wiki/Transfer_fees

Essentially, the transfer fee is for the transferal of a player’s contract of employment from one team to another. Salaries are comparitely small - this from last year lists Lampard as the highest salary in the world, at £5m.

Whenever I look at the standings in the various European leagues, it seems that there are usually 3-4 teams in each league that populate the top of the standings. Examples are Bayern Munich in Germany, Man U and Arsenal in England, Real Madrid and Barcelona in Spain, and Juventus and AC Milan in Italy. I always wondered why many of the other teams bothered to exist, especially when they will never have the financial capital to consistently compete with the top clubs. When the heck will Aston Villa ever win the Premier League? I’m now thinking that the potential transfer fee is the financial reason for the existence of these smaller clubs. 1: Develop a player to the point when a bigger team will want to buy him for a huge price. 2: Put money in pocket. 3: Go to step 1.

Is that about right?

Many of the other teams in the top league, and indeed in other leagues, are viable financial concerns (although there’s plenty that are distinctly unviable, too!) You’re absolutely right that the transfer market is a big source of income for some teams, who’ve invested in a big youth scheme. As an Ipswich fan, it’s painful to look at how many current Premiership players came through Portman Road. And in fact, the club had become too reliant on this as a source of income, to the point where we couldn’t retain a decent team from one year to the next. Since then, there’s been deals with mortgate-lenders and other debtors, to ensure we can actually build a squad with a chance of getting back into the top flight.

The ‘super team’ scenario is relatively recent. Man Utd took the marketing of a team as a brand to a whole new level, and reaped the financial rewards. Most teams still rely on the core support, i.e. ticket sales and traditional merchandising, plus TV income.

It’s worth noting, however, that the FA Cup has had eight different teams win it within the past twenty years. And take a look at the list of former Premiership teams - fairly substantial for an elite group which has only existed in its current form for 14 years.

Oh, and one more thing - winning the Premiership isn’t the only thing teams aim for. The objective for many is to finish in the top quarter of the table, which is where the qualification places for the Champions League and the Uefa Cup lie.