“We’re proud of everything that we’ve done…We’ve won 26 trophies in the past 28 years. Nobody are like us. Milan have been the best team over a 25-year period.” Galliani has repeated for weeks. Milan, as they always do, brought up their illustrious past as the talking point of choice. After the sales of Thiago Silva and Zlatan Ibrahimovic, the usual words require a little bit more than just lip service. Now, Adriano Galliani’s mention of the “fact” that no president has been as successful as Silvio Berlusconi requires more than the signing of Ronaldinho or Ibrobinho in order for those words to be uttered going forward.
The Curva is silent this time. There are no protests like when Kaka was sold in 2009. Arguably, from a personnel standpoint this is a greater loss than the great trequartista, coupled with an economic climate that is even more dire than in years past. Part of it is because Thiago and Ibrahimovic never grew into the squad. Thiago’s rise was meteoric, and his talent can’t be argued, however presented with the highest transfer fee ever for a defender, Milan let him go. The feeling of love was there, but perhaps there is a sense that these losses aren’t on the same emotional level as Kaka ever was. Kaka was a champion.
“Milan’s problem is the economy. Milan don’t have enough money to buy 5 players or even just the players that they need,” said Zlatan Ibrahimovic before he himself became the latest victim of the clear out. Reports have said Ibrahimovic was not happy that he was escorted out of Milan so quickly, having settled with his family (Milan have put back a smile on his face” in the words of Mino Raiola). “We’ll play together for a long time; the more that you play together, the better you become. Look at Chelsea. They won the Champions League, but they weren’t the best team.” Zlatan unwittingly summed up one of the reasons the Rossoneri project has shifted focus.
Silvio Berlusconi’s return to the presidential role of Milan was supposed to be his final presidential role – having left politics earlier in the year after being forced out by a worsening economic climate and the resulting political pressure. The passion Silvio had for Italy, and once had for Milan, would return and a few signings later, the Milan squad would be the best in the world. That’s the image Milan sell to the press.
Presumably this was to be the plan even continuing forward. It was the image given to the press in recent weeks. As of May 26th even Max Allegri seemed to believe in Il Presidente, “I’ve spoken with Berlusconi and he assured me that Ibra and Silva won’t leave. The next Milan will be built around Thiago Silva and Ibra.” Ibrahimovic himself seemed happy to stay on past his unspoken 2 year expiration, even offering to take a sip of the Milan kool-aid, “So far they have done everything that was promised and I am happy to stay here. The club, firstly president Silvio Berlusconi and Adriano Galliani, have given me confidence and responsibility. I am happy and I can only do my talking on the pitch. They have done a lot for this club over the last twenty years. They are the symbols of this club and continue to make history (April 17)”.
“The most successful club in the world” may be how some fans see the club’s place in history – however it does not reflect the current health of the organization behind the P.R. curtain. A look at the structure of Milan brings some alarming figures to light. The last period of success [as gauged by Milan fans, and the organization as well measured in European cups/international trophies] was the Milan side of the early to mid 2000s coached by Carlo Ancelotti. Carletto’s success was due to the players that Berlusconi funded and Galliani acquired. He was able to get the players he needed for his vision to succeed. In the four years leading up to 2003 (the building years of the backbone of the squad) Milan spent €237m. That side made 3 CL finals, winning two of them and becoming one of the best teams of the decade, as well as one of the most innovative, packing playmakers into the midfield.
As the squad experienced success, costs rose. Players came and left. Some players were bought presumably to give Silvio a political bump, such as Ronaldinho, that didn’t advance the club at all. These were able to be covered, because leading up to this time, Milan were among the top 5 earners in the world. They had as much revenue as Real Madrid did, as pointed out by Galliani. In the years since then, due to a variety of reasons (TV rights, tax structure, stadium ownership etc) Milan were left in the dust. Today, they make closer to half of what Madrid makes.
Milan appeal themselves as a club by likening their organization to be a family. It is all part of the (successful) notion that the club has of creating a brand that is more than a football team. Milan isn’t just a club for the players, it is a passion, a love. The players have it. This love is shared by the fans. At the head of the love-pyramid is Silvio Berlusconi, Milan being his primary extra-political financial indulgence, his main mistress.
The love affair with the club has been on display by the homegrown bandiere, Baresi, Costacurta and Maldini to even short-lived departing players – Thiago Silva and Mark Van Bommel. While it’s beneficial for the club to portray itself as a family, in truth, it is only a family until it gets in the way of good business in bad times. Milan is at the end of the day a company that is responsible to the people that pay the bills.
Looking past the rhetoric of the importance to keep Silva and Ibrahimovic (which many fans took as a betrayal – the false extension of the contract certainly left an extra sour taste), the fact that the club is facing a more pressing (FFP) debt problem as the years go by was always going to rule over the temporary chase for success. Make no mistake – if Milan were to keep Silva and Ibrahimovic this would be a short-sighted decision with much more severe consequences going forward.
The transition to sustainability has been a long-time coming. As revenues dropped, expectations continued to be sky high. Two CL wins last decade isn’t enough for “il club piú titolato mondo”. Everyone wants to have their cake and eat it too, but Berlusconi and Galliani have found a way to make the fans think they’ve got both. Realistically, the Milan squad needed rejuvenation – a full rejuvenation, not just a new piece. The attempt of a repeat of Kaka’s investment after lifting the trophy in 2003 with Ronaldinho simply wasn’t going to happen again. In 2003 the team was young and fit enough to give more, they were not 4 years later. Ronaldinho was a band-aid on a larger problem.
Perhaps there is the belief that this Allegribra squad could get more done if they had more time. That they had one more big outing, one more shot at the big title. The problem is that they were not good enough over the past two years, both in the Champions League and in the league. They fell short against the best teams in Europe and Italy last year in particular. The ceiling was hit with the squad. Again, though, the financial problems underlying the squad came to rear their heads, this time, the €60m debt that seemed to become a mainstay of the Milan budget sheet. Berlusconi’s holding company, Fininvest has covered the €60m losses so that each season Milan may start the season with no debt.
The world changed around Berlusconi. He went from being the champion of the sugar daddies to just another face in the crowd. His spending has been dwarfed by first by Roman Abramovich, and now by the Sheikhs of Manchester City and Paris Saint Germain among others. The old “spend and get the best” idea may or may not work (it seems necessary to have a certain amount of money but it cannot be the only factor), but one thing is for certain – Milan are unable to compete with the top sides in Europe in this way.
Galliani has tried to build the squad with a different type of spending. Over the last half-decade, Milan have primarily relied on the Bosman transfer as well as low-cost deals to fill their squad. The problem with building a squad like this is that it takes the cost and puts it on the back end. What you don’t pay in transfer fee you pay in extra wages to the player (as you must win the bid for his signature). This has driven up wages, as has the rising cost of the aging champions. Milan were ranked #5 of all football clubs of the highest average salary per player. Also, it’s worth noting that player bonuses weren’t factored into that. You can’t spend the amount of money they spent, not win trophies, and expect that to continue.
As noted by SwissRamble, “Even though most of this increase was due to higher bonuses for winning the scudetto in 2011, the fact remains that this is the highest wage bill in Milan’s history and the second highest ever for Serie A, only surpassed by the €234 million paid out by Inter in their 2009/10 treble winning season.” It begs the question – if this is the most expensive Milan squad to maintain ever, are these results good enough to sustain it? Two disappointing Champions League exits, a Scudetto, and a SuperCoppa later, it seems the chance for the squad is over.
While the problems have been building for years, this year has been the year Milan have dedicated to redefining themselves as a club. This means first of all slashing the wage bill. By the end of the cuts and additions, which are still forthcoming – Milan will save an estimated 25-30% on their wage bill. The trick is to finance the revolution without losing sight of the short-term minimum – qualification for the Champions League.
The Champions League is more important than ever to Milan as they struggle to gain the revenue needed to sustain. Milan made fourth most in last year’s Champions League, adding €39.8 to the Rossoneri’s funds. Simply put – this money cannot afford to be lost. For comparison, when Milan played in the Europa League (granted with minimal effort) they made less than €1m Euros. The gap is so large that qualifying for the Europa League would be seen as the ultimate failure of Max Allegri, one that would cost him his job were it to happen. He will have to do it without Ibrahimovic and Silva.
Mino Raiola’s comments from the end of May speak to perhaps the misconceptions that Zlatan had about his time with the Rossoneri, “There is a global crisis and Ibra knows that Milan are doing what’s best for Milan.” Granted when these comments were made, Raiola believed that Ibrahimovic would be staying with the Rossoneri, and that would be in their best interest. Ibrahimovic (and perhaps Raiola, but likely not), like many others, fell victim to Berlusconi and Galliani’s main trick, and that is to make the future seem like it is here now. The perfect team that is “complete”. That’s Milan, right? The squad that is competing at the highest levels at all times. That would be the Milan project Zlatan Ibrahimovic thought he was joining. He referenced often that Berlusconi and Galliani pitched him a “great Milan project”. It seems they didn’t tell him what his part was.
The reality was that Milan were a squad spending a significant portion of it’s overstretched wage bill to satisfy a player who while capable of making the difference at any given moment, requires the entire team to be built around him. Thiago’s sale was good business (as was Zlatan’s), but Zlatan’s sale was just as tactical as it was financial. Zlatan Ibrahimovic was merely rented for Milan. It may not have been what he had in mind when he came, but based on his record he surely can’t be surprised with how it ended.
The Rossoneri have a freedom now, and it will be interesting to see the direction they take that freedom in. Zlatan Ibrahimovic was the player that was here to ensure the Rossoneri project could go forward as planned, he was never to be the man for which the team was to be built for. He wanted it all: the attention, the wins, the trophies, the money. His agent Mino Raiola alluded to the coming problem months before the Scudetto was even decided, “His agreement expires in 2014, even if expiry dates count for little. Whether Zlatan stays or one day goes will have nothing to do with the time left on his contract.” The fact that they were only guaranteed to have him for one year after this was the final nail in the coffin. Zlatan had to go for the squad, Pato in particular who never meshed with him, to advance.
Further shifts are necessary. Milan’s youth development academy has stuttered in recent years. “When your football club hasn’t developed a world class player since Maldini with a half empty stadium, you best rebuild/rethink – @RossoAnto” Galliani spoke recently on the youth, “But the thing that makes this club proud is everything that we’ve done for the youngsters. Football is education.” He continued, “I’m looking for those who advised us to sign Ignazio Abate and Luca Antonini. I’m going back to those people who brought us these youngsters back then..” The sentiment is not lost. However, to praise a factory that produces a Kia when it used to produce a Lamborghini is exactly the sort of cognitive dissonance that Galliani and Berlusconi rely on to get through this period. This is the same academy that has produced these world class talents before, and with our new re-focusing of our efforts, we can produce them again. If Luca Antonini represents the best educated of the Milan youth – there needs to be some renovations.
Another piece in the puzzle for the future Rossoneri is the stadium issue. According to SwissRamble, the contract with the municipality of Milano ran until 2030. “It’s not possible for Milan to do what Juventus, because of the Milano municipality,” Galliani has said, “We tried to buy San Siro, but the Milano municipality wanted an absurd amount of money. We’ll continue to play at San Siro.” The issue with the San Siro (now that the pitch has hopefully been fixed) is two fold. One, since Milan don’t own it, they do not make as much of the match day revenue that the other clubs of Europe do, and two, it’s painfully outdated in some aspects (eg. the restroom facilities are atrocious and there are no luxury boxes).
AC Milan attempted to buy the stadium, however, upon realizing that they were unable to do so at any point in the coming future, seem to be moving towards other options. Milan have apparently laid the ground work to do something about this. As reported by @Milanello, “The contract with the municipality expires on the 31st of December 2016.” Milan renegotiated the contract during the past season, signing a deal that was a not reported by the media.
The fact that the contract was shortened from ending in 2030 to 2017 indicates that there is no intent to renew in 2017. If there were, what would Milan seek to gain? There would be little incentive to cut the deal just to re-sign another deal in 2017? Thus, it seems that there will sometime in the future be plans for another stadium. Given the change to the financial policy, as well as the FFP loophole for stadium spending, a change of locale would benefit Milan in more than one way – as well as signifying a new era.
The image Galliani has crafted around Milan is of a Milan that can exist in the future, but not one that is here now. The great champion squad is not coming this year, it can only exist soon if the right sorts of moves are made. The sales of Thiago Silva and Ibrahimovic were necessary cogs in a machine that started its transition when they ushered out an entire generation of past Milan champions. Galliani’s rhetoric will need to be more than just lip service, and if the moves up until now haven’t made abundantly clear, Milan are all-in on their transition.