How Bayern Munich Destroyed German Football: The Kirch Group Deal

The big picture in this series cannot be complete without each part of it explored. This is why I encourage people to check out previous posts before getting to this one.

Part 1: Introduction
Part 2: The Ugly Side Of Financial Fair Play
Part 3: Before The Berlin Wall Fell
part 4: Before The Berlin Wall Fell Part 2
Part 5: After The Berlin Wall Fell

Mulan

This whole story started in 2000 when Leo Kirch, the founder and president of Kirch Group, a media company, wanted to buy the rights to the Bundesliga and broadcast it around the world. The closest example this resembles is BeIn Sport. Leo Kirch had a problem anyone would when it comes to acquiring league broadcasting rights.

It is the same problem that led Liverpool and Manchester United present project big picture. Also, the same problem led to the Super League suggestion to be considered every now and then. The problem is that bigger clubs want to sell their broadcasting rights individually. They don't want to sell their rights as part of wholesale because individually they'd make more money.

Before we get into the details of the deal, we must understand how those deals are made. There are plenty of ways to go about it. But, if the broadcaster bought the rights to the most popular clubs, it would be effectively killing the other teams. Think about what would happen if it was only the top 6 teams getting the broadcasting money. Another way would be to sell the rights altogether and distribute the money equally.

Smaller clubs are the biggest benefactors of those wholesale deals as without them they wouldn't make half the money they would if they sold separately. Simply put, Southampton would be making 100 million by the end of the season regardless of being bottom of the league while Arsenal or Manchester City would be making around the same while ending at the top of the league, if deals were done separately, Arsenal and Manchester City would make more while Southampton would make much less.

There's also the La Liga approach, where the deal is also done wholesale but with the popular clubs making more money. That style is only an appearance because it basically means that each side is negotiating its own deal but it just looks like a wholesale.

Bayern Is Germany's Biggest Club

Everyone was expecting Bayern to object to the Kirch Media deal as Bayern could make more if their deal was done individually. But, surprisingly, Bayern were the biggest supporter of the deal. They cited fairness and competitiveness as reasons, in fact, Bayern actually embarrassed Burossia Dortmund and other top clubs for attempting to get more money from the deal, money that would reflect their position and popularity in the league more.

So, what's the problem? Bayern is coming off as a good-hearted team, very humble, very gracious, and very generous, right? Bayern was basically giving away its own money to keep the league competitive and fair, right? Well, no. I wouldn't be writing this series if that were the case.

It turned out that Bayern had a secret agreement with the Kirch Group that they would help make the sale of the league in the form of a wholesale. As mentioned above, Bayern embarrassed all the top clubs that wanted to negotiate their own deals, creating a fit of local anger directed at them for their "greed". "Greed" and "selfishness" were actually the terms Bayern used to describe the other top clubs. After all, Bayern was the club most damaged by the deal, so the rest don't have the right to talk.

However, that was all bullshit. Bayern Munich and Leo Kirch made a secret agreement that would ensure Bayern would make 20 extra million annually for signing that deal and for their help to get it signed by the rest. It is as if Bayern negotiated and sold their rights separately making Bayern the biggest benefactor of the deal.

The issue isn't that Bayern negotiated their own deal or made more money. Real Madrid, Barcelona, and Atletico Madrid do that whenever there's a deal with the Spanish FA. It's the fact that Bayern conspired to not only be paid much more but also to make all the rest get paid much less than they could have. The "rest" are the other 6 clubs that managed to win 6 league titles from underneath Bayern just a few years before.

To put the extra money Bayern made in context, you'd just need to put how much Bayern paid to sign Claudio Pizarro from SV Werder Bremen, Robert Kovac from Bayer Leverkusen, and Niko Kovac Hamburger SV. All deals are done with direct competitors who had to sell because they weren't making enough money to keep the clubs running because guess what? They couldn't negotiate their own deals with Kirch Group due to media and public pressure created by Bayern Munich.

The extra 20 million is also what Bayern paid to sign Sebastian Deisler from Hertha BSC. Along with Zé Roberto and Michael Ballack from Bayer Leverkusen, who along with Kovac were the reason Leverkusen was within inches from winning a treble in the 2000-2001 season. 27.5 million is literally what Bayern needed to take Leverkusen's best three players within 2 seasons in Zé Roberto, Michael Ballack, and Lúcio.

So, Leverkusen went from almost winning a treble to 15th place in the Bundesliga because of the limiting broadcasting deal they were pressured because of Bayern. Then Bayern used the extra money made from that deal to buy Leverkusen's best players.

The Full Picture

Lots of people love believing the saying "If x kept their stars, they'd be a top club". The reason they say that is because they don't know how much maintenance goes into running a club in Germany, including paying rent for the stadium, which is another thing Bayern cheated, lied about, and blackmailed to avoid. The Bayer Leverkusen example was more direct but the fact is other top clubs had to sell their top stars to maintain the club.

Now, Borussia Dortmund don't get much sympathy from me because it was their own doing that they fell in a hole during that time, more on that in a later post. But, clubs like Werder Bremen, Hamburger SV, Koln, Munich 1860, and many more clubs suffered directly due to Bayern Munich's actions, losing players to many clubs just to stay afloat. Munich 1860 was literally scammed and bullied by Bayern Munich and had their share in the stadium stolen from them in the ugliest way.

To put all of that in perspective. Imagine playing Call of Duty, but ahead of a new match, I take your best weapons for myself. You might respond, "I don't have to sell them to you", but that doesn't matter to you because you have to sell them nonetheless, whether to me or someone else, you still can't have them.

You might be wondering, if Bayern Muncih are so guilty, then how come they weren't punished? Well, the answer is bullying, lying, and dirty blackmailing as we will come to see soon.

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