gordondaviesmoustache
Well-Known Member
Re: City & FFP (continued)
I have occasional spells where I need to remind everyone just how clever I am ;-)Ducado said:gordondaviesmoustache said:There is a further aspect to FFP, which adds another layer to it being an anthema to the philosophy that underpins the EU, namely the freedom of the market to move goods, people and capital freely.
To allow this to happen businesses must fail. Companies if they are run poorly, make strategic errors or have products that are no longer relevant must be made to pay. If other companies, more hungry, nimble and innovative are providing a better product then it is in the public interest for them to flourish, or at the very least for the conditions to be in place that do not militate against that possibility.
I say this because united, on current evidence, are a poorly run business. They have made a series of poor decisions in terms of recruitment, have had to completely revise their putative corporate strategy, have a product which is looking tired and are, by their own admission, looking at significantly lower profits in the foreseeable future.
If there was a system in place which protected Phones4U, for example, that did not punish them for the mistakes they made as a business, which unfairly prevented others entering the fray and challenging their market dominance, this would most likely be acted upon by the EU. If, however, that situation was allowed to prevail indefinitely meaning that Phones4U were allowed to continue to make poor decisions in the knowledge that they were protected from the consequences that flowed from that, it's even more difficult to see how that would be tolerated by the EU.
We usually think about FFP as a means of keeping people out of a particular group, but even when reflecting upon those it seeks to protect we often assume they will continue to operate as efficient, well oiled commercial enterprises. Commercial history teaches us otherwise. It is littered with many examples such as IBM, Nokia and currently Tesco who once enjoyed dominance over a particular market, who became lazy and complacent and ultimately lost their power and relevance. FFP gives those clubs at the top protection against making difficult, but correct commercial decisions.
FFP protects and rewards bad business practice (aka "doing things the wrong way"). Football may, to some extent, be different from other businesses in terms of how it is addressed by the EU legal system, but how can anyone seek to justify that state of affairs?
Although I'm sure they will.
Now and again you really do post some excellent posts and that was one! (only now and again mind you ;-) )