Daniel Geey: “Done Deal – An Insider’s Guide to Football Contracts […]” | Talks at Google

Daniel Geey: “Done Deal – An Insider’s Guide to Football Contracts […]” | Talks at Google


[MUSIC PLAYING] DANIEL GEEY: I’m Daniel Geey. The boring part is I’m a lawyer
a law firm called Sheridan’s. The exciting part is I do
football for my living, which is actually quite cool. And going back very briefly
to, literally, all the times I used to go to Anfield– I was a Liverpool fan
with Hal back in the day. As all you guys are, I’m
sure, some football fans, the things that I always did
when I was a six-year-old and still as a 37-year-old do
is talk about football all day long, if it’s in the
office or if it’s actually after on WhatsApp chat. Because he gets
really annoying on WhatsApp as well actually, if
a results gone good or bad. But ultimately– and the truth
is, with a lot of the work that I’ve done, from a very
early age, what I actually wanted to do was
talk about football. And I’ve been lucky enough–
and you’ll hopefully see the career
journey to a degree about why and how I
managed to convert myself from a regulations lawyer,
which doesn’t sound as sexy, to a football lawyer,
which sounds a bit sexy. But all it is, is a
regulations lawyer in football. And what I wanted
to also talk about, firstly, is a little
bit about my journey but, as importantly,
the type of stuff that I do day-to-day
and the very nice impact that my book, which has
just come out recently, has had on that. Now, apart from my
mum being very excited about the book being
published, it’s thankfully been quite
well-received so far. And what I want to try and talk
about in a little bit of detail are some of the myths that I
try and dispel in the book. Usually, the first thing that
most of my friends and even my family still
ask me is actually, what do you do as
a football lawyer? So what is it that you do
that pays the bills that’s cool enough to say that
you’re a football lawyer and work in the
football industry doing? So very briefly,
it is as follows. On a day-to-day basis, I tend
to work with players and agents. So that is what I do. That tends, traditionally,
to be behind a computer, but very often is on
WhatsApp, is on my phone, is on voice messages that come
to me sometimes at 4 o’clock in the morning. So I’ll give you one
just brief example of what happened to me the
day before transfer deadline day– so Wednesday evening. I won’t, obviously,
disclose confidential stuff. But just to give you a flavor of
what tends to happen very often is a message will come to
me from a client that may be a club or a player or an agent. Usually, it’s an agent
or a club saying, right– this is happening. A deal’s happening on
this particular day. We need you to just
have a little quick look through the documents,
is always what they say. And that happened actually at
1:45 AM on Thursday morning. Dan, there’s a deal
that’s happening. You need to get on
a train somewhere. You need to get to the
meeting for lunch time, try and conclude the
deal in the afternoon, and then hopefully
everything will be done before deadline day concludes. And that type of stuff
happens very regularly. The other cool element that
happens quite regularly is when I tend to
know information that nobody else knows,
which obviously is very cool. But I need to be extremely
careful about telling anybody this, especially
because my family are the biggest blabbermouths
of all time as well. And it happens. Because I did a Liverpool
transfer over the summer. I knew a lot of cool
stuff that was going on and couldn’t tell anybody. And the brilliant
thing about it also was that he was asking me
about particular deals that were going on. And I couldn’t even deny the
existence of what was going on. So for about a week and a half,
I couldn’t even reply to him. So he thought I was just
being annoying, not replying to the general rumor mill
that was going on generally. But it was actually, because
one of the players that I was working with was going to be
signing a deal with Liverpool. And I couldn’t even
tell my dad, obviously, which is very important,
because he obviously wants to know the gossip and
what’s going on generally. But needless to say, as
soon as the deal happened, I could then tell my dad and
my rest of my family, who had no idea what was going on. But I still couldn’t tell them
anything interesting about what happened in the deal,
because obviously that was confidential too. So that the type of stuff
that I tend to do is, unfortunately– and the
glamorous side is great. You’re working with so
many fantastic players with great clubs. They’re spending lots of money. It is, without doubt, the
most terribly stressful hours of my life on a regular basis
when the window is cropping up or finishing or concluding. Because you’re managing risk. On one sense, you
want to make sure that the deal
completes, because you don’t want to be at blame if
it has anything to do with you. You are still trying to
communicate quite difficult legal concepts to your clients
to explain what the risk is of particular things happening. And at the same
time also, you’re trying to make sure that you
are being proactive– you’re thinking about solutions
and things generally are going to plan. And you want to look unruffled. And looking unruffled
and feeling unruffled are two quite different
things at times. So that’s just a very brief
way of a background as to what I actually do day-to-day. So about me– we’ve
had the intro. This is where it all
began is the truth. So my seat was just above the
directors’ box– about there. And as you can imagine,
there’s this big pole. That got in the way of the goal
basically, which is a problem. So me and my bro had
to alternate games– had to swap seats. So one of us could see the
main goal and one of us couldn’t for a particular
game, which worked out well. Now, this is the old stadium. So it’s now a
cantilever stadium. So it’s slightly better. How did I get
involved in football? So very briefly– what happened
in law school at university was that I asked my tutor,
literally off the cuff, can I write about
the Bosman ruling? And the Bosman ruling
was Jean-Marc Bosman, back in the day, in
1990, wasn’t allowed to transfer to a new club
after the end of his contract– after it even expired. And that started a
very big landmark case which, five years
later, actually resulted in what’s called the
free movement of players across Europe. Which meant that, after a
player’s contract had finished, they could move on
a free transfer. And the selling club
didn’t have to demand and couldn’t demand
a transfer fee. So I thought, what
a brilliant thing to possibly, in third
year uni, write about, which was the Bosman ruling,
the transfer system changing, and how things would work. And they let me write about
it, which was even better. After that, I
actually just tried to persuade my dad for me to
spend an extra year at uni, which he was happy for me to do
if I did something interesting. I did a masters in football
broadcasting rights. It didn’t sound as
interesting because, actually, underpinning it was competition
law, which obviously is not quite as sexy
as football law, but at the same time meant
that I could spend the best part of about nine or 10 months
writing about how broadcasting rights are sold across
Europe, which is cool. And it meant that
I could get out of the real world for
one more year before I had to start working. As a result of that
masters degree, I had a little bit of
spare time at the end of the year, which
actually meant that my tutor said
to me, instead of actually just
slacking off, why did you write in a couple of law
journals about the things that you’ve written about. Great– OK, I could do
that– didn’t think anything would happen. But in a fantastic
way, they were happy to publish something about
the football industry, which was broadcasting rights
and about club ownership. “The Entertainment Law
Review,” at the time, published those two articles
in a few months spells. But what I actually
realized afterwards that, as well is it was
great for my ego– fantastic getting in “The
Entertainment Sports Journal,” great to have the publicity,
fantastic to show a few people and have it on my CV– the truth was– I don’t mean
to say it badly against “The Entertainment Law Review”–
maybe only about eight people read it. It’s the truth. And you’ll soon find out
from a little bit of the talk that I give in a
little bit of time is, what I actually realized,
as much as it was really good for the ego, because
no one was reading it, I actually needed to increase
my profile to a degree. And the way that I
actually did that– I’d met my wife Holly in 2007. And quite quickly, we
talked about all the stuff that I could do in my job
and wanted to do in my job. She actually then said to
me, well, hold on a second. Why are you writing
5,000 or 6,000 words for an entertainment
law journal when you could be writing 500
words on your own blog, free, that everybody could
be able to then access and read accordingly. And I actually
thought, you know what? It’s actually a
pretty good idea. And so what I ended
up doing was not necessary not writing
in law journals overall but,
ultimately, deciding to start my own website,
which is DanielGeey.com, and then effectively
start writing small pieces about trying to demystify the
football industry to a degree, even though actually,
at the time, I wasn’t doing a huge
amount of work in football. I was doing small bits. It was hopefully increasing in
the type of work I was doing. But I wasn’t doing huge
amounts at that time. And it came,
actually, at a very– fruitful is the wrong word–
but a really interesting time in the football industry. There was financial
fair play, which I’ll talk about in some detail. There was third-party
ownership, which was a big thing at the time. Luis Suarez came to the country. And obviously, he
had a lot of issues with racism, with
biting, with suspensions. John Terry matter
came up as well. And Nicolas Anelka
happened at the same time. So what was actually happening–
which is quite cool– is that there were lots of
cases and lots of issues that the public– the wide fans– really
wanted to know about. And what I had– a little
bit more time before kids and marriage– was to be
able to read these cases, try and explain what they
meant for the average fan, and try and get beyond the– Luis Suarez is a racist
or it’s a three match ban for fouling
somebody or, actually, if you look at the detail of a
particular case, it means that or it means this. And what I developed– which was great– was quite a
strong follower base on Twitter as well, which was a great
amplifier of my blogs, to be able to then put
forward easily-accessible, easily-digestible 500,
600, 700-word blogs that people were interested in. And then what happened
as a result of that was that journalists– Sky Sports– all the
types of broadcast media– were then interested in having
me on their shows really, which was great. And that in itself
then drove the profile that I was able to drive
for myself and my firm. I was able then to refine
my message that I wanted to get across to people– and in turn, led
me then to that, which was from blog to book. So I used to give a lot
of comments and commentary to people in the
football industry. Someone– a
journalist– said, why don’t you think about
writing a book on the topic? And I said, oh, great idea. I don’t think
anyone will actually think and be interested in it. He introduced me to an
agent, David Luxton, who is bizarrely my agent,
which is quite strange to say, but nice as well. And he is, in effect,
the miracle worker that got my proposal that I
put to him out to five or six different publishers. There was quite a long process
in that to actually get the all-clear to actually
then get the deal and to write the book. And then, more or less,
three years later– from starting to
get the proposal to finishing the book– we
are there with “Done Deal.” So that is the book that came
out a few weeks ago that, so far, has done really well. I don’t know how many
copies, actually, Mum has bought in order to
actually skew the Amazon algorithm accordingly. But in any event, everyone’s
happy at the moment in the Geey household, which is
nice to the extent that, when I told my
daughters actually that I had a book being
published– my oldest one, Izzy is 6 and my youngest
one, Livy, is 3 and 1/2. I told her was writing a book. And the teacher then, at
the next teacher’s meeting, then came in and said, oh,
it’s fantastic that you’re involved in the book industry. I didn’t realize that
you were a librarian. Because Izzy had told
her that I’d become a librarian, because
I’d written a book. So that’s my new
pastime, as well as being an author and a lawyer. So book out– and what I
wanted to share with everybody for the next 15, 20
minutes, hopefully, if this works all right, is just
a few insights into the world of football, which I see on a
daily basis and what is covered and uncovered in the book– but just talking about
particular things. So you’ll see at the top–
transfer fees, shirt sales, agents, boots deals,
appearances, and image rights– some of the more interesting
elements that I think and hope will be of value. And please feel free
to ask questions and to delve into some
of the things I say. I think we’re going to keep
the questions, if possible, to the end. But just hold your questions,
because I’m always very keen on audience participation. So the most you’re able to ask– the better. I’m looking at Tom. Please, be careful
about the questions. Because you probably know as
much as me about some football stuff. So don’t show me up
too much, please. OK– number 1– a 35 million pound transfer
actually isn’t a 35 million pound transfer. Now, I know it sounds
slightly counterintuitive. But I promise, I’ll
try and explain myself. So when you look at the
back page of a story and the back page of a
newspaper, you’ll see, player moves for
35 million pounds. And that’s a fee,
basically, that the club has paid for that player. Yes, that is the case. But what I want to drill down
to is actually the liability that the clubs–
the buying club– has to incur for that player. Now, if we talk about just
the transfer fee for a second, the transfer fee
is, effectively, the amount that the buying
club pays to the selling club. The buying club pays– obvious. But what isn’t
usually as obvious is actually how
that is structured. So in most deals that I
see and have come across, what actually happens
is there’s what’s called a fixed and a contingent
element to a transfer fee– the fixed bit being paid
regardless of anything over a particular period of time–
usually, the first, second, and third anniversaries
of the transfer– and the contingent being
if certain bonuses are met. Certain conditions are met,
which mean bonuses are paid. So if I give the 35
million pounds example, it may be, for example– I’ll try and do the math right– that 15 million
pounds is paid upfront at the time of the transfer. And then, maybe on
the first anniversary, 5 million pounds is paid. Maybe on the second
anniversary of the transfer, another 5 million
pounds is paid. So that takes it to
25 million pounds. It may be that for
the next 10 million, in order to be paid,
the buying club has to win the Champions
League or the buying club has to win the Premier
League, for example. And if those performance
measures aren’t hit, then that extra 10 million
will never be paid. It actually gets a little bit
more complicated than that. Because usually what
has to happen is, as well as the club
winning those trophies, the player has to appear in a
certain amount of those games– i.e. he has to contribute to
that season’s worth of success. Now, that’s the first element. So 35 million pounds doesn’t
usually mean 35 million pounds. It actually might only
mean 25 million pounds and certain contingencies
as a result. The other element, which is
not factored into any of that, is the player’s wages. Now obviously,
the player’s wages are usually the
biggest liability over the length of the deal. If a player signs
a five-year deal, let’s say, for
200,000 pounds a week. That could add,
over five years– I was trying to do
the calculations– possibly 50 million
pounds worth of liability over and above the transfer fee
that might only be 25 million. So the point is, when
you see that headline at the back page
of the newspaper, saying, 35 million
pound transfer, think, actually, the first thing is,
it might not be a 35 million pound transfer. But actually, the main liability
is actually the player’s wages. So a 35 million pound
transfer may actually be, if everything is included,
over 100 million pounds worth of liability that’s
taken into account. And the other thing that
needs to be take into account is the agent’s fee. But we’ll talk about that
in just a second as well. So myth number one– 35 million pound transfer
isn’t usually a 35 million pound transfer. It’s a lot less,
but also a lot more. Number 2– I see this
quite a lot as well– I feel I’m spending more time
on this side of the room than on this side of the room–
sorry, I’ll try and do this– is as follows. Without fail, Pogba, Zlatan,
Mane at Liverpool, Salah– whoever else it may be. Every time a big transfer
happens, the first thing that you’ll always see– Beckham, back in
the day– is– ah– the clubs will recoup
most of the transfer fee from the shirt sales
that they will then make as a result of the transfer. I can’t say, categorically,
that this absolutely never ever happens. But I absolutely doubt
that it ever happens, for the following reason. So try and give an example. And this is only from
public information. Because Manchester United, for
example, are floated in the US. So they have to provide certain
information to investors, on a quarterly basis anyway. It’s reported that
Ed Woodward states, in some of those
quarterly reports and what is published, that
Manchester United makes 75 million pounds a year from
their Adidas apparel deal. They make 75 million
pounds a year. That decreases if they
don’t get into the Champions League over a particular
period of seasons. But on the whole– 75 million a year. And I think it’s a 10-year deal. So almost coming up to 1 billion
pounds for a 10-year deal– 750 million pounds
over 10 years. Now, what usually happens in
these very, very big shirt deals is, effectively,
those apparel companies are paying a very big
advance for the right to be able to then
exploit the brand and to be able to
sell those shirts. This isn’t the Q&A part. But just very quickly– how many shirts do you
think Manchester United sell on a yearly basis?– just very quickly. Shout out a figure. AUDIENCE: 100,000. DANIEL GEEY: 100,000– higher. I’m doing a Bruce
Forsyth thing here– AUDIENCE: 15 million. DANIEL GEEY: 15 million shirts– that’s quite a difference. AUDIENCE: Basically. DANIEL GEEY: Yeah. AUDIENCE: Yeah– not
the ones in Bangkok. DANIEL GEEY: Pardon? [INTERPOSING VOICES] It is. AUDIENCE: Do they
sell real shirts? DANIEL GEEY: Well, that’s
another big question, fake or real shirts, is
that you could [INAUDIBLE].. Let’s just say, authentic
shirts, retailing for over 50 pounds a shirt. AUDIENCE: 5 mil. DANIEL GEEY: 5 million– OK, so the last figures were,
from a season and a 1/2 ago, that Manchester United,
on a yearly basis, sold 2.9 million shirts. Or rather Adidas or whoever
the manufacturer was– 2.9 million shirts. I’m not sure that’s more
than a lot of people think or less lots
of people think. I get varying degrees
of surprise either way. The point being
that, usually, what will happen in those
type of agreements is there will be this advance. This is paid every year. But after that, there may not be
anything more paid as a result to the club by way of amounts. Usually, there will be
performance-related amounts. But that only kicks in after a
certain amount of shirt sales are made on a yearly basis. So it may well be–
and I don’t know– that Adidas don’t pay
anything more to Manchester United per year over the
75 million pounds mark that they do. And when I say pay, what I
mean is share in the revenue. But let’s say, for example, that
Manchester United and Adidas share some revenue after
they hit 2 million shirt sales a year. And usually, that share– that royalty– whatever
you want to call it– is actually probably
only 10% or 20% of the overall
additional amount. So let’s just, without
wanting to confuse anyone in too much detail,
say that, actually, Manchester United,
for every shirt sold over 2 million shirts, maybe
gets 10 pounds per shirt. So you don’t need me to do
the math very quickly for you to work out that one of the
biggest clubs in the world are not making huge amounts
of money from shirts sales over and above the
amounts that they’re getting from their apparel
manufacturer straight away. Now, the other question
to also add into the mix as well on that is– and it’s something that
no one’s really done too much empirical evidence in. Would a marginal fan
by an additional shirt with the new player’s name on? Or were they already going to
buy that shirt with an existing player’s name on? Which also fits
into the narrative, which is, it doesn’t mean
that an absolutely new fan is going to be buying an
absolutely new player’s shirt. It may be that they’ll
buy that shirt, but were going to buy it anyway,
regardless of which the player was going to be. So second myth hopefully
dispelled in a little bit of detail– which
is, very rarely, whenever you read the headline
of, “Shirt sales will make fortunes for the club,”
usually, they won’t. Sorry– it’s a
little bit smaller. But you’re going to have to
strain to be able to read it. I know that the
question of agents is always quite a
topical issue generally. The narrative of
agents is that they don’t do a great job
for players or clubs, that they take
too much money out of the game in terms
of commissions, and that their approach is
wheeler-dealer, at best. I have a slightly
vested interest, in that I work with a lot of agents. But the book– hopefully,
you’ll see as well, if you’re able to read it– gives a slightly
different narrative to the usual
narrative, which is, agents are just bad guys
doing bad things all the time. And nobody likes them at all. The difference with a lot
of the very good agents is, they’re extremely
well-networked, very diligent in what they
do, work incredibly hard in a very, very
insecure industry. And when I mean insecure
industry, I mean, they’ve worked very hard
to get very good players on their books. And probably, at
every other window, another agent is trying to
poach their player to say, I can get you a better deal
or I can get that for you. I can do this for you better. I’m not saying, all of a
sudden, poor agents doing a terrible job on the breadline. But the vast majority
of agents are not earning the huge sums that
are reported in the media. And the point of what
I’m trying to get to here is that there is an
interesting narrative which works in the media, which is,
look how much agents take out of the game. And look how much
clubs pay agents. And this is the thing that I
think a lot of people maybe don’t quite grasp in the same
amount of detail that I’ve been able– to be able to work in
the industry for some time is– players don’t pay their agents. So I just want that to
sink in for a second. Because before I
started in the industry, it seemed quite a
strange concept to me. It’s like, if I’m a player
and Hal is my agent. And Hal does a move
for me to a new club, I thought that I would pay
him, because my contract is with him. I’ll pay you a percentage
of my earnings. And that’s the way that
things work generally. But the way that
things tend to work, at least in the UK
and other countries, is, in order to incentivize the
player to move to their club, the club pays the players agent. Does that make sense? OK. And that has caused
controversy because, on the whole, that
means that fans see their club paying agents. And they see the
amounts that they pay agents and don’t like the
amounts that they pay agents. And where It can get a little
bit tricky for the player– and I don’t want to go
into too much tax detail, because this is
certainly not a tax talk. And I don’t want to get involved
in that type of stuff as well. But the one thing that
actually then becomes quite– I already heard someone who’s
heard too much about taxes as well. The one thing that’s important
just to stress about that is that is seen as what’s
called a “taxable benefit.” The club paying
the player’s agent is what’s called a P11D benefit. It’s like what medical insurance
or a company car would be. So even though the player
isn’t paying his agent, he has to pay tax on the
club paying his agent. And if that is one of
the most important things that I actually see when
a transfer happens– is that there’s
been so many times when the player, 18
months on from a transfer, will get a big tax
bill from HMRC. And the player will say,
well, hold on a second. Why have I got a tax bill? The club has paid my
agent on my behalf. And then, if the agent
hasn’t done a great job, unfortunately, the
agent says, ah– yeah. But there was still a tax
bill to be paid on that. And what usually happens
for very savvy agents, when a transfer is happening–
and we see this more and more– and I’m sure you guys will have
heard of a similar equivalent– in the employment
contract, an agent will negotiate what’s
called a gross-up clause. And a gross-up clause
is a miraculous payment which comes one week before
HMRC’s tax bill comes along. Which means that then the player
doesn’t feel the money going out of his account, because
it’s more or less going straight to HMRC. Which actually is
a very clever thing for the agent to do really. Because otherwise, they will–
and I’ve seen it time and time again– get into an awful lot of
trouble with the player when the player has
to basically pay 1/2 of the agent’s fee in
tax to the tax authorities at the right time. So they’re the type
of things that– yeah– you see day-to-day. But the point
generally being is– even though it feels
counterintuitive, almost always, the player
will never pay his agent. And we’ll talk about
what the thing is in the future that’s going on. I think, there’s a
possibility that that may change with the new
FIFA regulations that are being implemented. Next– boot deals
are complicated. OK– so just very briefly– and I’m always
interested in doing– and actually, I do use
the Google Analytics tool for my website, to be
able to understand, actually, which are people’s favorite
blog posts, more or less, and what have I had
the most views from. The blog that I did on boot
deals is, by far and away, the blog that I’ve had my most
views on in my entire history of writing any blogs. And the reason why I
think, hopefully, it’s hit an interesting point is– most people think that
a boots deal– i.e. when a player signs a deal– and it may be for goalkeepers
with their goalie gloves as well– for their shin
pads and their boots– that all they are paying for is
the ability of the player, when they go on the pitch, to use
their boots and shin pads and, maybe, have a
couple of appearances and some promotional stuff. So you’ve seen Messi
last week for Pepsi– but he used his Adidas shoes
for the promotional videos, et cetera. So it more or less means this. Whenever I see a boots deal, if
it’s with Puma, Adidas, Nike, New Balance, Under Armor–
whoever else it may be– in almost every situation,
it doesn’t cover just boots. So just a quick straw poll– who thinks a boots deal
should cover headphones? Anybody? Yeah– 2. Thank you. You got a head start there. The scope of a
boots deal is vast. And there’s two particular
caveats and carve-outs that I see quite a lot. One is, with most
manufacturers, they will try and carve out as much
as possible into their scope that they can then exploit for
the player to be able to use. So headphones is a big one. Shampoo and skin care
is another big one. Any types of electrical
goods is another one. Does anyone think Armani
is a competitor of Puma? Apparently, in some
boot deals, it is. not giving Puma as example– but the general point
is that, if possible, what a brand is
looking to try and do is to create the biggest
scope as possible for a player not to be able to
endorse anything else– is the truth. Because it gives them,
ultimately, a bigger window to be able to put and dress
the player up in all of their gear all the time. And also, the point worth
mentioning as well is– just, if you’ve signed a
Nike deal, for example– it obviously goes without saying
that you shouldn’t be going out wearing Adidas trainers. But ultimately, the
practical reality is that, if you are signing
a long-term Nike deal, you’re probably not going
to be able to wear Adidas for the next five years at all. And if you do– bear in mind, if you do
wear any competitor– and especially a
direct competitor– it’s pretty likely
your deal is over– almost very likely
your deal is over. So that’s the one thing on
the brand alignment and scope points. The other bit that’s quite
interesting, I think, also, on boot deals is the amounts. So the agent may say to
the player, OK, fantastic. You’re going to earn 500,000
euros a year for your deal. And the player says, great. Great news– great to hear. There’s one annex at the
back of most boots deal contracts, which always
scares me whenever I see it. And the reason why it
scares me to a degree is because it is a
direct table, which relates to the
amount of appearances that the player has to make
on a yearly or seasonal basis. So what usually
happens is the table– if he’s an international
player, which the big players
are, obviously, who are getting the bigger money. It will say, you have
to perform or appear in 80% of your
club team matches. And you have to appear in 70%
of your international club matches. And if you don’t, the retainer–
which is the overall amount– reduces by 40% and
sometimes bigger, depending. And it depends on how you
want to negotiate that. So one of the important
elements is for two things. We want to try and negotiate
hard on those points. But secondly– to make sure the
player’s aware of that point. Now, there’s another question
to all of that, which is– and I’ll talk about it in
the next slide to a second. But I want to just
briefly mentioned it here. And this is obviously
where lawyers get involved a lot more. What do you think the
definition of an appearance is? [INTERPOSING VOICES] Exactly– all of that
is exactly right. Is it appearing in
the matchday squad? Is it being on the pitch? Is it starting on the pitch? Is it ending on the pitch? Is it 5 minutes? Is it 10 minutes? Is it 20? That is one of the
most important– I’m going to talk– I think it might be
the next slide, which we’ll go onto quite nicely. Perfect– I’m seamless. That is one of the most
important definitions in a contract that I
will tend to deal with. Because ultimately,
for a boots deal, if an appearance can simply
be 10 minutes in a game, you can obviously
imagine that it’s very much easier to be able
to get to that 70%, 80%, 90%– whatever percent
threshold in order to maintain your retainer
amount in your boot deal. But most importantly, in an
employment contract setting, this is very, very,
very strategically important for an agent and
a player to know about, as you can imagine– but
usually for two reasons. The first is, when an agent
is negotiating his player’s employment contract, there is
much more consideration given to variable pay, rather
than fixed pay, as there has been in previous years. And what I mean is, fixed is,
you will get 50,000 pounds, regardless if you play 1
minute, whether you’re not even in the squads,
and it doesn’t matter whether you play or not. That’s the fixed amount. The player always knows that
he will get that amount, regardless of how he
plays or what he does. What a lot of the elite
clubs are doing now is trying to reduce
the fixed amount and increase the variable
amount, which is– if you play and
if you win, you’ll get more than if
you would have just had your 50,000 amount every
week and a little bit extra. So the incentive,
effectively, is that, if you think
you’re good enough to play on our first
team, you should take a lower fixed amount
and a higher variable amount. Because we’re good enough, which
means you’re going to appear and you’re going to win. And therefore, you’ll be
remunerated better than you otherwise would have done. But you can see,
obviously, the point that I’m trying to get at here,
which then becomes the point– appearance becomes very, very
important as a definition. Because the bonus element for
the employment contract is, appearance fee will
give you a bonus. Now as you can imagine then,
it’s exactly all the points that you said. Does an appearance mean–
and it usually does, in a lot of instances– starting a Premier League match? That’s what it can sometimes be. And there could be
caveats throughout. There was a different bonus
for starting a Premier League match to an FA Cup match
to a Champions League match to a League Cup match
to a friendly match. That’s how varied it can be. And they can be
different win amounts for all of those competitions. And sometimes, they
can be merged together. So it’s an appearance
and win bonus, in order to get the bonus. So obviously, as you can
get to now, an appearance and how that is defined
is crucial, as to whether a player may
get the bonus or not. For an agent, he’ll want
to try and make sure that 1 minute on that pitch
classifies as an appearance. Whereas, the club
will want to make sure that it’s a start
in the first team squad for a particular
game, which means it’s harder, obviously,
for the player to do that, if he’s injured, out the
form– whatever else it may be. The other element of when
an appearance becomes very important is– because
sometimes, in a contract, there’ll be a ratchet effect. And what that will
be is, after you’ve played in 20 games, 40
games, 60 games, 80 games, your salary will go up
accordingly as well. So you may be 50,000 pounds
that you get as fixed. If you play 20 games for
us and appear in 20 games, you will then go up to
60,000 pounds a week and then 70,000 pounds a week
if you get to 40, 60, 80. And again, that’s very important
for how you define appearance. I’ve talked about
appearance for way too long. But hopefully, you can
see why that actually becomes quite an important
element for players and agents and clubs to understand. Last bit about dispelling
myths a little bit as well– so I’ve just put the
phrase out there, which is, image rights deals are
just another way to avoid tax. I just want to briefly spend– are we OK for time?– a few minutes talking
about what an image rights deal is for players
and then talking about why it’s important
in the current environment. So if I just try and
explain very briefly– traditionally, a
player will only have one contract with his club. It will be an employment
contract that will say, you are employed by this
club to play football. It’s straightforward,
with all of those clauses and all the things we
talked about previously. Nowadays, for a lot of the elite
clubs, for their elite players, they have a huge raft of
partners and partnership agreements and endorsement
deals that they can activate across
the globe, which are very lucrative contracts. And what clubs are realizing
is, they are happy to– well, not realizing. What they want to do is control
the activities of their players to a degree, so that they
can activate those players for the club to be able to then
activate its own partnership arrangements over
a long-term basis. So do Spurs want Harry Kane
to be able to activate a Nike campaign for the Spurs? Yes, they do. Do Liverpool want Mo Salah
to be able to activate a particular campaign
for Standard Chartered? Obviously, they do. Within the standard
contract, there are default positions
where players have to have x amount
of appearances. But what is happening more
and more with elite clubs is they are entering now
into two separate deals with their players. One is the employment contract. But the second is the image
rights contract– usually, with a player’s company. And what happens in this
deal is the player’s company, more or less, promises
to do two things, which is of real significant
value to the club. One is, it says, for the
provision of x amount of money, we, the club, want to make sure
that you, the player’s image rights company, make sure that
the player appears in x amount of endorsement opportunities
and partnership opportunities for the club’s partners. Does that make sense? Guaranteed numbers–
so that means that then the club’s
commercial teams can go out and sell
quite a lot of inventory, on the basis of knowing that,
maybe, their top 15 stars will be available
and are contractually available to help endorse
the club in a club context. And that’s a very
important element. The other element, which is very
useful to the club in paying a player’s image
rights company, is that there are hell of a lot of
restrictions that then the club can impose on the player. So just to give you
a brief example– so I don’t know how many
partners Manchester United have throughout the world– global partners. AUDIENCE: It’s 150? DANIEL GEEY: There’s a lot. I’m not sure it’s quite 150. At last count, I think
there was upwards of 90. So for example– and just, by
way of– if it’s Manchester United, if it’s Chelsea, if it’s
Liverpool, if it’s Arsenal– a lot of these clubs have a big
roster of commercial partners. And what those clubs would
ideally want from their players is to ensure that those
players cannot contract with a competitor of the club brands. Which means that
they are effectively clean from any club competitors,
which then puts them in a strong position
to make sure that their players are never
going to endorse competitors of the club’s brands. And that’s quite a
valuable commodity to be able to
actually use as well. The flip side, which is why
we talked about tax, is– the reason I’ve said all of
that commercial explanation– is because, still,
there are always big headlines about the fact
that image rights deals are just a way to avoid tax. Because obviously, player’s
image rights companies are paying corporation tax
rather than pay-as-you-go, pay-as-you-earn, and National
Insurance Contributions. The point being is that, even
though that money is coming in, and the player’s image
rights company is only paying corporation tax,
that money is still in that club’s accounts. If the player wants
to remove that money, he’s either got to pay
it through dividends, he’s got to pay it through
salary to other people through the company– however it is. There still needs to be tax
paid for onshore companies that are using an image
rights structure. So my point is, I’m not the
guy that will always say, image rights structures are
always totally inadequate. It’s just another
way to avoid tax. Usually, there are
very good reasons why clubs will want to enter
into image rights agreements with their players. One– because it guarantees
them appearances. And two– it means they
can restrict the players in promoting competitor
club brands, which can be very important. OK– almost there. I promise. What’s next? I just wanted to talk– we talked, actually,
about agents already. And get your questions
ready, if you have any questions, as we go. I’m more than happy
to answer anything. But a lot of people actually,
since I’ve released the book, have actually said,
well, what do you think is next for the industry? And there’s a chapter right
at the beginning of the book called, “The
football ecosystem,” where I talk about
how everything is overlaid together. So where do players fit
in with their clubs? Where do clubs fit
in with the league? Where do the leagues fit
in with broadcasters? Where do broadcasters
fit in with the fans for subscriptions? Where are our
international games? What about FIFA and UEFA and
all of these different ways that the football world works? And people have said to
me for quite some time– and continue to ask me– is the football
model sustainable? I think that’s one of the
things that lots of people say. Football players are
being paid huge amounts of sums to be able
to play football and for their image
to be able to be used. Is that model sustainable
in the longer term? Where we have Sky,
for example, and BT paying over 5 billion
pounds for UK rights and a whole raft of broadcasters
paying upwards of 4 billion for the overseas rights for
live Premier League matches. The query is, well,
how can clubs still afford to pay all of
these wages and pay these exorbitant transfer fees? Is the bottom going to come out
of the market at some point? That’s the type of question
I get asked quite a lot. And the answer– at least
for the time being– and that’s why I just put the
broadcasting points up there– is that, so long as there is
an appetite for broadcasters to spend large sums of money– because they think
they can recoup that money by way
of subscriptions and different models– then at the moment,
the answer is yes. But I saw some interesting
stats a few weeks ago explaining that Sky, in the purchasing
of the rights for Premier League matches,
seem to be straining a little bit in removing
some of their other content, because they’ve had to spend
so much money on Premier League matches and live
Premier League matches. And in the same way,
whilst Sky has always been the incumbent for live
Premier League matches, BT came into the market
two auctions ago, effectively, because they
saw quite significant churn. They saw churn away from
their broadband offering into Sky broadband,
because people were already taking Pay TV Sky
Sports and thought that they should bundle Sky
broadband with their Sky Sports offering. So in some ways– what a lot of
commentators said at the time was that BT came into
the market to protect their broadband
offering and then in order to be able to get
Champions League rights and Premier League rights. And then you can see what’s
happened subsequently. BT by EE. Sky have their own
mobile offering as well. And you have what’s called
a quad play offering. So you have two
quad play players playing out in the UK market,
for a whole range of consumer goods. Pay TV and the Premier
League being a very big part of that overall picture. So the question
is, at some point– who knows what will happen– is whether subscriptions
start dropping off, because of the
cord-cutting generation– because people aren’t
willing to pay 60, 70 pounds a month for their Sky
or BT pay TV subscriptions– the question asked a week ago– Simon Jordan was
on “Talk Sport.” And he said, why don’t the
Premier League just go it alone? Why don’t they just
go straight to market and offer an OTT
offering globally and ask people to
pay 8 to 10 pounds a month to watch every
Premier League match they want and take away the broadcasters? I wrote a blog 10 years
ago about that exact point. Major League Baseball do it
really well in the States. And there’s a real
interesting offering now that could possibly
come to fruition. But the truth is, it
would take a very brave– whoever the next chief
executive of the Premier League to come in and decide not to
take the 9 billion pounds check that is usually on the table
for the global distribution of its rights. So if I just end on that note,
which is, are things changing? There’s cool things happening
in the market right now. There’s lots of different
broadcasters doing cool things. But ultimately, so long
as that money funnel continues, because fans and
subscribers are subscribing to those channels, then
that money flow will continue throughout the game. And players will probably
paid significant amounts, because they are that good
and because the clubs can afford it. So on that note, I
think I’ll probably say, thank you for listening. And– happy to
answer any questions. [APPLAUSE] AUDIENCE: Great talk– what’s
the strangest thing that you’ve seen in a player’s
employment contracts with a club?– like a clause or some sort. DANIEL GEEY: I haven’t seen any,
like, totally bizarre things that I’m thinking, oh, my gosh. That’s just really weird. But there’s lots of publicized
ones that I’ve put in the book really. So if I talk about
a few of them– and this is just what’s been
reported in the press really. So Neil Ruddock, who was an
ex-Liverpool player and Spurs player back in the
day– who I think could have only really
played center back, because he was quite a big guy. But he scored a great
goal, I remember, in the Monday night
Liverpool-Man U game. When he went, towards
the end of his career, to a particular
club, the report was that they put a weight
clause in his contract, so that if he went
over a certain weight, he would be fined
or his wages would be reduced by a certain limit. Another clause,
which I read about, which was Stefan Schwarz– he was a Swedish
international player. He moved to Sunderland. And apparently, there
was a clause which said– Sunderland had read
somewhere that one of the things he always
wanted to do was go to space. So Sunderland
apparently put a clause in saying, during
your time at our club, you are prohibited
from going into space. And there was another one which
is from a Liverpool player– next level player– Stig Inge Bjornebye, who was
a Norwegian international. His father was, I
think, an Olympic skier. And Liverpool ensured
that there was a clause in which said he
couldn’t ski during the time that he was a Liverpool player,
for obvious reasons really. And that is quite
a standard clause, that you can’t do anything
hazardous, for obvious reasons that you would
probably hurt yourself. AUDIENCE: Just a quick
question about the boot stuff that you put up as well– I’ve got a good
friend actually who works for one of the big two. And he was saying– about one of
the biggest challenges he cites with working with
some of the players– he looks after five Premier
League clubs, I think– is their egos and
their personalities. And they all want
things for free, even though they
earn mega money. So I suppose, my question
is around expectations. How do you deal with
expectations with players and with big egos? Well, not everyone’s
got big egos– and brushing everybody. But yeah– how do you deal
with those expectations of players and big players? DANIEL GEEY: Are
you talking about– in terms of boot deals?–
or just generally? AUDIENCE: Just generally– yeah. I suppose, it’s quite
difficult to manage– yeah. DANIEL GEEY: Simple
truth is that, of the players that I have
close relationships with– and literally, it’s hilarious. I’m cool. As a football fan, they’ll just
WhatsApp you and say, hello. And literally, I’m giving
book recommendations to one player, who’s
interested in just expanding his repertoire of
reading at the moment, because they have
loads of away trips. And he’s got lots of
time on his hands. But the majority of
players that I end up having good relationships
with are the guys that want to know the detail– is the truth. And usually, in my
experience, the players that want to know the detail
are the most switched on to understand the
way things work. The players that maybe
don’t are the ones that I’ll be like,
just leave it. And let the lawyer do it. Let the accountant do it. Let the agent do
it– however it is. That’s absolutely fine too. But usually– I don’t like
to call it prima dona status actually, because maybe they’re
not as educated as they need– as the team around them need
to give them to make sure they understand what they need to be
doing on a daily basis to get by– is the truth. And what I try and do
a lot of the time– just to flip it onto
the positive– is that, every time a new player– even if it’s a young
player– especially– comes into the office
to say, hello– or helping them with the deal– my idea is, like, look. Just give me 1/2 an hour with
the agents and the player. I just want to talk you
through particular things that I think are going to be
important for the next deal, for the next endorsement
deal you’re signing. Think about what you’re
doing on Twitter, or Insta, or Snap or Tinder– literally. Because everybody has a phone. Everybody has a video. Everybody wants to catch
someone out doing something they shouldn’t do who’s famous. That’s the truth,
unfortunately, that we’re living in at the moment. Players 20 years ago were
in, in a way, a much more privileged position. They could probably get
away with a lot more stuff that players can’t do now. So that’s almost
the point, which is, I’m trying just
to flip and pivot the narrative, which is,
get players better educated as to what they
need to be doing, so they can make more
informed decisions. Always, players will
do things wrong. They’re as fallible as us. I think people just like
a bit of schadenfreude, where a famous person who’s
earning a lot of money does something stupid. AUDIENCE: Just
wondering how you manage your clients’ expectations when
you’re dealing with someone who– so for example, a
player that is injury prone– and you’re going to see that
in their boot sponsorship deals and in their appearances. A lot of that is tied to
their appearances and– how you deal with that. DANIEL GEEY: It’s
a really good one. It depends how you classify
injury-prone– is the truth. Now, either you do
one of two things. As an agent, you can strategize
beforehand to say, right. We’ve got three boot deal
offerings on the table. The retainer amount
is this amount for this particular
manufacturer. We think an estimate that–
because over last three seasons, the players
played 25 games per season, because either injuries
or form– whatever it is. We need to try and get to
this number with this amount of appearances that we think
we can get for the player every season. So in a way, it’s a
reverse engineering of the contractual
matrix, in order to make sure that you can
get the player over the line, saying, this is the
amount that you may earn. But you’re probably going
to earn this amount, because of the amount of
games you’re going to play. And ultimately, what
can sometimes happen– which can help– is on
the appearance side, which I didn’t quite touch on. If you’re savvy enough,
what you can actually say to the boot
manufacturer is, we’re only going to
classify appearance as particular competitions. Because if you’re
an elite athlete– elite footballer–
you’re probably less likely to play in
FA Cup and League Cup and more likely to play in
Champions League and Premier League. So what you would try and do,
if you’re the agent acting for elite player– you’d try and exclude the cup
competitions to try and ensure that, if appearance is
defined as 80% of those games, you’re more likely to about
to hit those benchmarks. [APPLAUSE]

About the Author: Garret Beatty

3 Comments

  1. Funny the comments for this video are open, but the one you guys just uploaded with the black American woman are disabled.
    Nice try google….

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