Celtic Skywalker
By James Dailey
I have a 13-year old son and he is in that awkward period as he ascends out of childhood into adolescence and young adulthood. I joke with him that it is time to put his “big boy pants” on when he does not like the reality of increased responsibility as he grows up. For us to have a serious “conversation” about what the future of Celtic and playing within a Scottish league may entail, we need to put on our big boy pants. While the supposed “dossier” has predictably emerged as little to do about nothing, and The Rangers’ may have been acting in bad faith, it is time to get back to the business of SPFL survival, and whether or not Celtic will have a league to play within once the pandemic lifts.
The point of this piece is to try and provide an objective analysis of financial reality. I do not like the reality of pandemic, global economic depression, or The Rangers’ economic value to Celtic, but they exist, nonetheless. I started writing this piece with the intent of focusing upon on-field implications (that is still in the works) but decided that such an analysis would not be effective without first addressing the “elephant in the room.”
Good vs Evil
Without Darth Vader and the Dark Side of the Force, would our lives have been complete without all the 4th of May memes? Star Wars has thrived for over four decades based upon the age-old drama of good versus evil. From a commercial perspective, I can see no viable emergence from the pandemic period for Scottish Football without a “Rangers” taking part. Whether any of we supporters like this idea or not, it is most assuredly going to be something which is front and center for the SPFL and Celtic board. I can envision many people reading this, considering the idea that Celtic will need Rangers in the league, and screaming like Luke did when Vader tells him he’s his father. NOOOOOOOOO!!!
Here are Celtic’s revenue and average home league game attendance and season ticket sales over a sampling of seasons since the year 2000:
This data provides some framework for assessing what I will call the two “shocks” to Celtic’s business over the past twenty years. First was the global financial crisis (GFC) of 2008-2009, where we saw an initial hit of around 3,000-4,000 in tickets sold per game. The 2002-2003 season is reflective of pre-GFC attendance from 2000-2010. Recessions typically have lasting and residual effects, and that is reflected in the 2011-2012 season, which was the last with Rangers in the league while still feeling the effects of the GFC. We can then see the continued decline in attendance as the new Rangers played their way through the lower leagues.
The decline of about 8,000 tickets per game from 57,000 to 49,000 (the economic shock) and the 7,000 difference between that 2011-2012 figure and 2015-2016 (Rangers shock) combine for an impact of 15,000 seats per game, about a 26% hit to attendance. Throw in a loss in media revenues with the loss of the derby centerpiece, and the financial implications are massive.
Unfortunately, I believe there is legitimate concern that the economic shock to Celtic supporters may be worse in the coming months and next few years.
Really Bad vs Worse
This comparison offers some perspective as to the economic impact to Celtic from whether a Rangers are in the league – it is comparable to the worst UK recession from the period between WWII and the current pandemic. Initial GDP reports from just the last 3 weeks of March suggest that the current economic contraction is likely to be at least 25%, which compares to the 5.2% of the GFC recession. In fact, to place this into perspective, the last time the UK economy contracted at such a rate was from 1919-2021, when unemployment reached 17%. We may be looking at a similar contraction, or worse, over a period of months rather than years.
Would that climate be a good time for an entertainment product facing an existential crisis to eliminate its most compelling villain?
Closed Doors
With total media-related revenues in 2018-2019 of about £22 million for Celtic and £11 million for The Rangers, and just about £4.5 million of that due to domestic TV rights, the idea of playing in empty stadiums is likely unrealistic without massive subsidies from fans paying for “virtual” tickets. The Rangers’ first team wage bill is about £23 million, and I estimate Celtic’s to be somewhere around £26-£27 million. It is possible, if not likely, that every Premiership team ex-Celtic will have to enter administration or be liquidated and reconstituted in advance of games returning.
Conclusion
Our collective disgust with “Them” may be reaching a new level with the SPFL charade, and they may very well be in the midst of building a campaign to try and “normalize” liquidation and a Third Rangers. The path back to games is likely to be riddled with more theatrics and nauseating drama, but we will need our Darth Vader to have a viable league. In a reconstituted Scottish Premiership, concessions such as eliminating points deductions for administration or allowing liquidated clubs to reenter the Premiership immediately may be a necessary evil.
Or perhaps we can join a new European Super League and leave The Rangers to be the Joe Exotic of whatever domestic league is left.