transfer window looks likely to be snibbed

You might not have read it on the back pages, but Publicis, Les Echos and la Tribune have all reported that they see no advertising market recovery before at least end of this year. Now, in case you're wondering whether you've accidentally slipped through a worm hole in time and are currently holding a shrunken version of Not The Financial Times, the fanzine for men in braces and stripey shirts, please bear with it (pardon the pun).

There is a reason why we should all take notice of this. Publicis is among the five largest advertising firms in the world, with a bias in its sales toward Europe. Their comments echo similar opinions expressed by the head of WPP, the world's second largest agency.

So what? Well, advertising growth is the main determinant of how much media companies spend on content such as football rights. Although the US is seeing a small pick-up in advertising, it still looks like a recovery in revenues for football clubs is a long way off. Given the financially weak situation of most clubs, this means that more of them will be looking to sell players rather than buy, leading inevitably to further pressure on player wages and prices.

Apart from this, the Sky deal is coming to an end in the UK. The broadcasters will be in a position to renegotiate it next year with no competitors and in a weak environment. You don't have to be John Maynard Keynes to work out that Rupert Murdoch is in quite a comfortable bargaining position, thank you very much.

What is equally clear is that, in the short term at least, one of the big buyers (English Premiership clubs) will be spending less money. Conclusion: revenues and prices within the game will go down, so Celtic should not be spending more on players, but conserving cash.

For anyone clamouring for the board to spend money on players this is bad news. The joint sponsorship deal between the Old Firm and Coors which was announced in January actually represents a fall in revenues from this source of around 11-12%. There may be more cash to come in the form of bonuses for doing well in Europe (this was not revealed at the press conference) but the basic figures would seem to bear this out. To sum up, Celtic's level of debt is highly uncomfortable, and we need to pay it down. (For a full run down on last year's figures see ntv 103)

Spending large sums of cash on players is not an economically justified option at this point in time. Unless, that is, we are all happy to subscribe to another share issue. I am, personally, but my experience is that many people will say, 'The club should spend more,' and in the same breath, 'I'm not subscribing to another share issue, just look what happened to the price of the last one'. This isn't even taking into consideration the damaging publicity surrounding the board's non-delivery of an 'Academy' in the wake of the last share issue which many supporters understood they were helping to create through taking up their options to buy into the club.

Faced with further worries about the future of their own jobs and financial security, it would be understandable if the board were reluctant to take such a course of action.

However, the PlC would appear to be facing something of a dilemma this winter break. It was clear towards the end of the year that the team could do with a couple of fresh faces. A big push could see the Hoops progress into the latter stages of a European competition for the first time in a generation. The bold philosophy would be one of carpe diem. Go for broke and see if it's enough to get to the semi-finals.

Going by previous form the board are unlikely to charge out into the transfer market with nostrils flaring and blank cheques in hand, so it looks as though the best we can hope for is if we can get a good player on loan. This would be ideal as we can just give him back if we don't make it through to the next round of the UEFA Cup.

The other alternative is unearthing a bargain on the Larsson/Moravcik/Agathe (in that order) level, although it's a bit optimistic to believe that we at Celtic will be any more successful at uncovering these hidden gems than all the other clubs all looking for the same kind of player, especially when most of them are able to offer the player the inducement of playing in a more interesting league.

No doubt many among us were disappointed when it became clear that Celtic were not going to be able to secure the services of Kleberson. But consider the financial implications if we had signed him. His wages would be about £20k per week, or £1m per annum. That's almost the sum total of what we would make from TV rights to the next round of this year's UEFA Cup should he have helped us to qualify. And we pay that next year whether we qualify for anything or not.

Call me old fashioned, but I think that all the money made at Celtic should go on players. The only problem is we've already been spending more than we've been bringing in for the last five years. And the amount of future revenue is about to collapse. Therefore, even with the current squad of (unevenly) talented players, we are basically living beyond our means.

It's all a question of timing. The advocates of spending in the transfer market in order to possibly achieve some success in the new year would be correct if we were sitting on a cash surplus. Then the idea of a Kleberson's wages being financed by the money we get from getting through to the next round would be acceptable. But I think that currently, even if we get through without signing any more players, we will still be in a tight position. Remember, the costs of the current lot of players goes up every year automatically, whatever happens to our revenues. But if we make it through to the next round, some of the extra cash goes to them in bonuses.

All the odds are stacked in favour of the players as a result of structures inherited from the boom years. We need to get rid of those structures before we start expanding again.

Another word of caution. There were rumours that Desmond and his mates were hoping to de-list Man Utd. Behind all the politically correct chit chat re turning Man U into a not for profit association, the plan disguised a structure whereby Desmond and his pals had their shares bought back with money financed by debt. In other words, it was an exit strategy. The relevance for us is that Desmond may be looking to exit the football market. If that's the case, then he's unlikely to want to subsidise any great spending on players.

That leaves the only people who will as you, me and the rest of the fans.

Ideally, we continue to pull rabbits out of the hat in Europe with our current squad, cut costs, pay down debt, and when prices are collapsing and everyone is looking to sell their players, we step up to the plate and build a really impressive squad at three-quarters of today's prices. That will give us a head start over the rest.

I may be wrong, but that's why the debate is such a crucial one.

Barrow Bhoy

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