Season after season, Arsenal owner Stan Kroenke has been able to bank on Champions League income boosting the club's bottom line thanks to manager Arsene Wenger reliably delivering top four finishes.
Yet with speculation surrounding the Frenchman’s position reaching fever pitch since a 10-2 aggregate hammering to Bayern Munich in the last 16 of this year's competition, the possibility of a less-predictable future at the Emirates is coming into sharper focus.
Should Wenger step down when his contract expires at the end of this season, there would be few guarantees that the club would seamlessly adapt to his successor or vice versa.
Fans frustrated with a lack of trophies and a repetitive surrender to Europe’s best sides have have grown weary of being asked to heed the warning of Manchester United’s disastrous metamorphosis from reigning champions to seventh place after Sir Alex Ferguson stepped down to be replace by David Moyes in 2013.
But with at least six Premier League clubs now considered consistent competitors for a coveted top four place — as well as the increased spending power and profitability of the rest — the room for failure is narrower than ever before for a new Arsenal manager.
It would undoubtedly feel like uncharted waters, but would dropping out of the Champions League really be so devastating for Arsenal?
After all, Chelsea are appear to be cantering to the Premier League title after finishing 10th last season, Manchester United are showing shoots of recovery under Jose Mourinho and both Tottenham and Liverpool have returned to the top four in recent seasons after prolonged absences.
What’s the worst that could happen? The Gunners are one of the world’s wealthiest teams, are owned by a multi-billionaire, play in one of the most profitable stadiums in Europe, sit on one of the league’s largest cash reserves and are one of the best-supported clubs in burgeoning football markets such as China. There is a high floor on how far they could fall should disaster strike.
Furthermore, by virtue of the Premier League’s current £8bn cycle of TV rights, clubs in the English top flight are automatically promised a place amongst football’s super-rich, regardless of performance. This season’s basement team in the English top tier will make just short of £100m while the Champions League winner is unlikely to make more than £80m.
Yet it’s not just at home where Arsenal and other Premier League clubs enjoy a broadcasting boon that gives them the edge over their European rivals. English clubs are disproportionately better remunerated than any of their European counterparts despite relative under-performance in recent years after BT Sport paid £897m — double the amount paid by any other European broadcaster — for the 2015/18 rights.
Arsenal received €53.4m from Uefa last season, €31.9m of which represented their share of the TV market pool. In comparison, winners Real Madrid received just €26m in TV income, runners-up Atletico Madrid made €21.7m and semi-finalists Bayern Munich €25.9m.
Only Manchester City, Chelsea, Paris Saint-Germain, Juventus, and Roma made more than Arsenal in TV money last season. The French and Italian clubs both benefitted from the fact their country’s relatively large TV deals — worth €75m and €112m a season respectively.
Yet while a lack of Champions League money would weaken the club’s financial position compared to Europe’s biggest clubs, it would also see the club lose a financial advantage over their domestic rivals.
Over the last decade only the two English teams who have earned more from European competition than Arsenal, who have generated €343m are the two who have won the Champions League in that time — Manchester United and Chelsea who have earned €383m and €456m respectively.
More pertinently, in the last three years seasons a consistent place in the Champions League has meant Arsenal have pocketed €31m more than Manchester United, €43m more than Liverpool and €84m more than Tottenham.
Post-Brexit, playing in Europe has only increased in its value to Premier League clubs as the Pound’s value has plummeted against the Euro since the UK voted to leave the EU.
The value of the pound has fallen 12 per cent from £1/€1.32 last June to £1/€1.16, meaning Arsenal’s European loot of €53.4m would now be worth £46.1m in sterling terms as opposed to £40m last season.
Arsenal are currently negotiating contract extensions with Mesut Ozil and Alexis Sanchez, and a lack of income from European football would further weaken their hand in future attempts to sign stars to new deals.
Under the current Premier League short term cost control rules clubs are not permitted to increase their wage bill by either £7m on the previous year or by more than £19m compared to their 2012/13 levels — that increases to £26m next year and £33m in 2018/19.
Clubs can exceed the limit — as Arsenal have in recent years — if they can demonstrate a profit made through their “own revenue”, defined as player sales, commercial income, ticket sales and money from European competitions. Profit made from TV does not count.
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Without income from playing in the Europe, Arsenal would be left with few options beyond player sales to circumvent that limit. The club are currently locked into a £30m-a-year kit manufacturing deal with Puma until 2019 and a £150m combined shirt and stadium sponsorship deal with Fly Emirates.
Matchday income would suffer due to a lack of games and could not be increased without upping the price of what are already the most expensive tickets in the country, a move that would risk a backlash from supporters.
Arsenal were ranked as the world’s seventh richest team in this year’s Deloitte Football Money League, ahead of domestic rivals Chelsea and Liverpool.
Without European football however, Arsenal would have been surpassed by the Premier League pair based on their latest financial figures.
Both clubs currently enjoy superior commercial income and Chelsea’s is set to swell even further this year when they swap a £30m-a-year kit deal with Adidas for a £60m-a-year partnership with Nike. Arsenal’s commercial income of £107m last season was already £10m smaller than Chelsea’s £117m, £9m smaller than Liverpool’s £116m and is dwarfed by Manchester United’s massive £268m.
The Gunners could follow the lead of Chelsea, who terminated their contract with Adidas early in order to negotiate a better deal, although that move cost the Blues a hefty £67m in compensation.
Arsenal have an opportunity to make up ground when their deal with Puma expires in two years. Being in the Champions League will only increase their bargaining power - Manchester United's £75m-a-year deal with Adidas reduces by 30 per cent if they fail to qualify for the competition for a second successive season this year.
Rivals gaining ground(s)?
Further ahead, Arsenal’s Emirates Stadium advantage is in danger of dwindling as rivals build new state-of-the-art arenas for themselves.
Read more: Chelsea's new stadium in pictures
Liverpool expect to see a £25m increase to turnover this season after the opening of an expanded main stand — a rise that would still leave them short of Arsenal’s £99.9m — while Tottenham and Chelsea are both on their way to building new grounds to roughly match the Emirates’ 60,432 capacity.
However, with Spurs required to fork out £750m for their new home and Chelsea £500m for their Stamford Bridge redevelopment, they would at least be restricted in their spending power.
Of course, there is no guarantee that Wenger will continue to keep producing the same results ad infinitum, nor that his successor won't propel the club forward rather than struggle with the transition.
Yet while the Champions League is a key differentiator between the richest six Premier League clubs and the rest in the Premier League, the impact of dropping out of the competition would affect Arsenal's status among the richest but not relegate them to the rest.
Just like Arsene Wenger leaving the club, dropping out of the Champions League will hurt Arsenal. But as Manchester United and Liverpool have demonstrated in recent seasons, the wounds won't be permanent.