Italian football Stadiums - The elephant in the room
Why an issue with stadium funding means Italian teams lag behind other leagues in Europe.
Why football clubs in Italy are behind the rest of Europe.
Between 1980 and 2000 14 of the 20 Ballon D’or winners played for clubs in Italy, the league was considered the pinnacle of European football between 1980 and 2005.
After a few lean years there might be a resurgence coming. At the end of the 22/23 season a Serie A team was in the final of all three major European trophies. Perfect, let the resurgence begin.
But, if you scratch below the surface you’ll find a league in turmoil, where owners have to take huge gambles to stay competitive and clubs can’t afford to stay afloat. How is that possible? I hear you ask. Well, it’s all to do with the stadiums.
Serie A – Public investment
First, some context. In four of Europe’s five major leagues if a team builds a stadium it owns it, if it wants to build a new one or make changes it can, as long as it abides by relevant laws.
The exception? Italy. In Italy, city councils use government funding to build stadiums, teams then rent them. This is the case for all but 3 teams: Juventus, Sassuolo and Udinese.
Per PWC, because government is involved if a team in Italy wants to build a new stadium it can take 8-10 years, in the other four major leagues it takes between 2 and 3.
So why is this bad for the league?
Stadiums
This model causes three main problems for teams: Stadium condition, infrastructure and commercial revenue.
Condition
Stadiums in Italy are old. Because government is focused on other things, like making sure people stay alive, renovating/building stadiums is a fairly low priority. As a result, the average Serie A stadium is 74 years old and the combined age of Serie A’s 18 stadiums is 1,200.
Sadly for the teams, the government doesn’t do a very good job of renovating stadiums either, the last time most Stadiums had any serious renovations was Italia 90, more than 30 years ago.
Speaking of Italia 90, this has caused its own problems. A lot of the funding for these stadiums came from the Olympics committee who demanded athletics tracks be installed in every stadium to ensure they got the best value for money.
As a result of this incongruous feature match day atmosphere, for both players and fans, suffers since games takes place what feels like miles away from the stands.
Commercial revenue
For this one we’ll use an example. Let’s say Taylor Swift performs in turn (a man can dream) since Juventus own their stadium and the adjacent land (which includes a shopping mall) the club gets the money from tickets and a cut of the money everyone spends on the stadium complex.
On the other hand, if she performs in Milan, all the money the concert makes goes to the city council, as does the money people spend in the grounds of the stadium.
This shows itself in the balance sheet. Between 2018-2023, Juventus made an average of £44m a year more in commercial revenue than both Milan clubs. In total, that’s equivalent to £220m, nearly as much as AC Milan has made in player sales since 2018.
Infrastructure
Have you ever been to a football match in Italy? If so skip this next bit because you’ll know.
For most stadiums in Italy, public transport links are generally quite poor. This is due to a number of factors such as: Stadium age and location, fan habits, Italian cities being quite old (who knew) and good old government incompetence. This makes the matchday experience much more complicated than a lot of other European countries.
That’s rubbish, so what?
While infrastructure isn’t ideal, it’s not as bad as the other two issues. Riddle me this, if you could watch a game in an old, falling apart stadium that’s miles away or your own home, which would you choose?
Analysis of attendance figures shows Italians are choosing the latter. IN the 21/22 season average Serie A attendance was 50%-60% compared, in the Premier League it’s 80%+.
While factor three isn’t ideal, it’s not as much of an issue as one and two because they impact attendance. If you had a choice between an old stadium that’s falling apart and the action is miles away or your own home, which would you pick?
The San Siro, one of the biggest Stadiums in Italy, seats 75,817 spectators at full capacity. Between 2018-2023 the two Milan clubs average matchday revenue was £32m, equivalent to £422 per seat.
By comparison, Old Trafford seats 74,310 but Manchester United’s average commercial revenue over the same period was £95m, equivalent to £1,278 per seat.
Doesn’t this just make tickets cheaper?
Well, yeah. But it has serious implications because of its impact on…
The Serie A TV Deal
The stadiums are old, falling down and half full. On the field, the atmosphere isn’t very good and top talent doesn’t want to play in the league miles away from fans. Not very marketable, is it?
No, it’s not. In an age where the biggest source of revenue for clubs in any league is TV money, the league fails to market itself effectively.
The new Serie A TV Deal for 2024-2029 is worth £4.5bn. Not only is this around half the value of the TV deal for Europe’s other major leagues, its actually £27.5m per year less than the previous deal.
So, because of a whole list of issues stemming from stadiums, the league struggles to market itself and doesn’t have any money. But hasn’t this always been an issue?
Mismanagement
Before we get started let’s call a spade a spade, football leagues are judged on their best performing sides.
Based on Serie A wins & revenue the three biggest teams in Italy are Juventus, AC & Inter Milan. For the purposes of this section, we’ll look at those three clubs.
So, in summary. Clubs are poor because of a list of issues stemming from their stadiums (less of an issue for Juventus but they’re historically behind clubs from other leagues in Europe).
Well, that’s where the Padre Padron (Italian for father figure comes in) comes in. The stadium issues have never been a problem because Italian clubs have traditionally been bankrolled by generous local billionaires.
The two most famous of these were Massimo Moratti and Silvio Berlusconi for the two Milan clubs. During their respective reigns both men spent more than 1 billion funding their respective teams.
Sadly, this business model wasn’t sustainable. Because of wider economic pressures lots of owners were forced to tighten their belts and/or sell up between 2010 and 2020, something Moratti acknowledged upon the sale of Inter in 2013, “An extraordinarily gifted, beautiful girl. You will do everything you can to make her happy. But there comes a time when you have to send her to college[1]1.”
Since then, the situation hasn’t bee great. Famous historic clubs like Parma and Palermo went bankrupt, the big teams had to sell the top talent to tighten their belts and 10 of the 18 teams in Serie A have changed owner since 2010.As a result, the leagues been forced to adopt a ‘sign and develop strategy’ to keep up with other teams in Europe. In January 2023, total transfer spend for the league was £31m, the lowest in 20 years.
Wow, any reasons to be hopeful?
Well, it depends on how you look at the situation. On the one hand, sign and develop seems to be working well, all three European finals featured an Italian side this year.
On the flip side, a lot of Italian clubs are in massive amounts of debt. Per Bloomberg, the league lost $1.5 billion by the end of the 21/22 season. Most of this debt is owned by the biggest teams in the league and is one of the main reasons they were so keen to start the European Super League.
So, if stadiums can be modernised and the league made more marketable, then a resurgence to a new golden age of Serie A is on the cards.
On the other hand, if laws aren’t changed and clubs gamble on short term success rather than short term stability (the model for the last 20 years) then a temporary blip might turn into a nuclear winter. Serie A might become the Serie B of Europe.
Only time will tell which it is.
[1] Serie A: How Massimo Moratti's Sale of Inter Milan Will Impact Walter Mazza Team | News, Scores, Highlights, Stats, and Rumors | Bleacher Report